investigation of the law offices of Hall and Associates, the lawyer for the Attorney General's Chambers claimed yesterday.

Day two of the appeal against two Supreme Court rulings in January and March -- which struck down as illegal the search warrants issued by Magistrate the Wor. John Judge on October 21 and 22 -- focused largely on arguments ofwhether Mr. Judge considered the question of "legal privilege'' pertaining to confidential files before issuing warrants to search the law office.

Mr. Michael Tugendhat, QC, argued for a second day on behalf of the Attorney General's Chambers that Mr. Judge went beyond what was necessary in satisfying the conditions of the legislation governing the issuance of the warrants.

Police officers serving out the October 21 search warrant at the offices of local lawyer and former MP Mr. Julian Hall discovered other materials relevant to their investigation and went back for a second search warrant only "out of an abundance of caution'', Mr. Tugendhat said yesterday.

"It's my submission that they had no need to come back for another warrant at all,'' he said.

He told the three-judge Court of Appeal that Mr. Judge would have been justified in issuing the first warrant based solely on the sworn testimony of Police Superintendent George Franklin Rose taken with supporting evidence that "there were reasonable grounds for suspecting that the Applicant had assisted others to retain benefits from drug trafficking contrary to Section 28 of the Drug Trafficking Suppression Act 1988 and that the Applicant herein has benefited from drug trafficking contrary to Section 5'' of the same Act. In fact, Mr. Judge went further in considering the question of privilege and how it applied within the context of various sections of the Act, Mr. Tugendhat said.

"He actually says that there were not only reasonable grounds to suspect, but that there were reasonable grounds to believe,'' Mr. Tugendhat told the court.

According to the Act, privilege applies only to professional legal advice given for lawful purposes, and Mr. Tugendhat argued during the first day of the hearing that much of what might have been protected by privilege was cancelled out by the fact that it was lawyers themselves who were under suspicion of profiting from an illegal drugs trade. Most of the other documents outlined in the search warrant, including appointment diaries and financial records, would not have been protected by privilege anyway. Mr.

Tugendhat's third point was that it would have been difficult for a magistrate issuing a warrant to determine in advance what might have been protected by privilege, given the nature of the investigation and the suspicion of lawyers being involved in an illegal activity.

Hall and Associates lawyer Mr. Robin McMillan, representing Mr. Hall, disagreed with Mr. Tugendhat's assessment of Mr. Judge's consideration of privilege. In an afternoon cross-appeal expected to continue through most of today, Mr. McMillan disputed as contradictory Mr. Tugendhat's three-pronged approach to the question of where privilege applied and argued that Mr. Judge never stated in his affidavit that he had considered the question of privilege and then dismissed it as not applying because of the suspicion of illegal activity.

"The record should show that he carefully turned his mind to it before making his decision,'' Mr. McMillan told the court, saying that Mr. Judge had not anywhere in his affidavit specifically mentioned that he had considered the question of how privilege might be accorded to some files in the office.

Mr. McMillan used several legal precedents citing English law cases to point out how other judges have shown how they considered privilege and documented their consideration of the matter.

The hearing resumes today.