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Judgment on Injunction Application for Breach of Confidence Published by English High Court Despite Parties Settling

In HML PM Ltd v. Canary Riverside Estate Management Ltd and another EWHC, [2019] 3496 (QB) the High Court dismissed an application for an interim injunction to restrain defendants from using allegedly confidential and privileged documents. Proceedings settled after the application was heard and prior to the publication of the judgment but the court published the judgment anyway. The case highlights the fact that a claimant must have standing to advance the actual claim underpinning the injunctive relief sought, the correct claimant in a breach of confidence case being the person with the power to say whether the information should be communicated elsewhere.  The decision to publish the judgment notwithstanding settlement is another example of the court publishing judgments where the case raises points of general interest.

The First-tier Tribunal (Property chamber) had appointed an employee and director of the claimant, HML PM Ltd (HML), Mr Coates, to manage a residential estate in Canary Wharf following an application by residential sub-tenants complaining about estate management and the level of service charges. The first defendant (D1) was the head lessee and the second defendant the freehold owner. Mr Coates replaced D1’s managing agents. HML sought injunctive relief after D1 sent allegedly confidential and, in some cases, privileged documents concerning Mr Coates’ role as estate manager to the residential sub-tenants. D1 also referred to some of the documents in the tribunal proceedings. An unidentified person had sent the documents (seemingly after the theft of Mr Coates’ laptop), to D1 as evidence of alleged misconduct by Mr Coates.

The court held that HML lacked standing to bring the underlying breach of confidence claim. The duties of confidence were owed to Mr Coates (not HML as his employer), Mr Coates having been appointed as an individual. The beneficiary of an obligation of confidence concerning information was the person with the power to say whether it should be communicated elsewhere (Fraser v. Evans [1969] 1 QB 349). It would be inconsistent with Mr Coates’ personal responsibility to the tribunal if HML could veto or insist on dissemination of confidential material related to Mr Coates’ role. Furthermore, even if some documents were subject to litigation privilege, HML was not entitled to an injunction, as they were not created with the dominant purpose of HML seeking legal advice in connection with litigation. Sometimes, someone other than the immediate beneficiary of the privilege might choose (or be obliged) to assert privilege as a shield against a third party’s attempt to compel disclosure. However, HML sought here to use Mr Coates’ privilege as a sword without establishing its own right to the remedy sought.

 

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Judgment on Injunction Application for Breach of Confidence Published by English High Court Despite Parties Settling

 


Ben Hobden
Partner

Cayman Islands   +1 345 814 7366


Sarah McLennan
Associate

Cayman Islands   +1 345 814 7882


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