Court Opinion

ID: 9521740
Source: CourtListenerOpinion
Date Created: 2023-08-07 02:10:56.327838+00
Date Added: 2024-06-11T12:50:34.119905
License: Public Domain

JUSTICE CLARK, dissenting: Because a document entrusted to an accountant by his client for preparation of a tax return is the quintessential example of “information or evidence obtained by [the accountant] in his confidential capacity as a public accountant,” I respectfully dissent. The majority opinion, like the appellate court opinion below; goes astray because it answers questions that no one has asked, and does not ask those questions which truly need to be answered. We do not need to know, for example, whether tax-preparation materials enjoy a privilege under Federal law. Why? Because the statutes of the United States, unlike those of Illinois, do not include an accountant-client privilege. (See Couch v. United States (1973), 409 U.S. 322, 34 L. Ed. 2d 548, 93 S. Ct. 611.) Therefore, the majority’s citation of such cases as Couch, Fisher v. United States (1976), 425 U.S. 391, 48 L. Ed. 2d 39, 96 S. Ct. 1569, and United States v. Lawless (7th Cir. 1983), 709 F.2d 485, is beside the point. Cases originating in a jurisdiction which does not recognize an accountant-client privilege have no bearing on the scope of the privilege in a jurisdiction where the privilege has been enacted into law by the People’s elected representatives. We also do not need to know whether the accountant-client privilege meets the four conditions proposed by Dean Wigmore as necessary for the establishment or recognition of a new privilege. This is because the privilege has already been established by the legislature; further inquiry into its wisdom or desirability is not within our province. We thus come to the question really posed by this' case: whether information given to an accountant for the preparation of a tax return falls within the scope of a privilege which, by definition, includes information or evidence given to an accountant in his “confidential capacity as a public accountant.” The interpretation of the scope of information obtained in a “confidential capacity as a public accountant” must depend, in turn, upon the legislature’s purpose. While the legislative history of this 43-year-old statute is admittedly sparse, the actual wording of the statute indicates that it was intended to be broadly and generously construed. Unlike the accountant privileges of other States (see, e.g., Dixon v. Bennett (1987), 72 Md. App. 620, 531 A.2d 1318), the privilege applies to any “court,” and does not contain any exception for criminal or bankruptcy matters. As the appellate court below acknowledged, the privilege is so worded as to confer the privilege upon the accountant, as well as the client. (See Baylor v. Mading-Dugan Drug Co. (N.D. Ill. 1972), 57 F.R.D. 509.) The breadth of the privilege indicates that it was intended not only to encourage “full and honest disclosure” (154 Ill. App. 3d at 294) by the client, but also nondisclosure of the client’s confidences by the accountant. (See 1 AICPA Professional Standards (CCH) §52 (1984) (American Institute of Certified Public Accountant’s Code of Professional Ethics).) And while we need not reexamine the policy basis of the privilege in order to carry out the legislative intent, it is worth noting the empirical evidence that business executives generally expect communications with their accountants will be kept in confidence, and their belief that the lack of a privilege hampers full and frank disclosure. See Smith, Do Executives Believe They Have a Right to Privileged Communications with Their CPAs, 19 Mid-Atlantic J. of Bus. 15, 19 (1981). If society has an interest in protecting accountant-client relationships in general, and in encouraging people to make use of professional accounting services, I see no reason why this interest does not extend to the use of professional accountants to prepare tax returns. Indeed, the vast majority of people only use the services of an accountant in this connection. In the absence of clear statutory language which excepts tax information from the privilege, I cannot agree that we can write such language in. Such an interpretation smacks of judicial legislation. I can agree with the majority that the accountant-client privilege, like other professional privileges, only protects “confidential” information. Where a client or patient volunteers information in the presence of a third party, or gives information which he knows that a professional is bound to disclose, a privilege is waived. And I agree that some of the information given the clients in this case, to the extent that it was actually disclosed upon their return, was not confidential. But I cannot also agree that all information, or, more pertinently, all the documents which contain such information, can similarly be considered waived. Finally, I do not consider the attempted passage of a subsequent amendment to the statute to have any bearing on the question before us. I have often repeated the arguments against use of subsequent legislative action or inaction as a guide to the intent of an earlier legislature, and will not rehearse them once again. (See People v. Hicks (1987), 119 Ill. 2d 29, 35 (Clark, C.J., dissenting).) Here the legislature acted in direct response to the appellate court opinion below, the validity of which is at issue. Had the legislature not acted, the majority would no doubt have argued that the lack of action indicated the legislature’s approval. On the other hand, successful passage of the amendment could have been interpreted as a substantive prospective change in the law supporting the interpretation of the prior statute adopted by the appellate court. In other words, an amendment, an unsuccessful amendment, and no amendment would all have the same effect. Each would be taken as ratifying the appellate court decision. The principle seems to be: heads, I win; tails, you lose. If we were to apply such reasoning consistently, the appellate court’s statutory interpretations would be final, and we would have abdicated our role as the ultimate arbiter of Illinois law. Subsequent legislative action, whatever its outcome, should not affect our decision. I must therefore respectfully dissent.