Argus Media Ltd v Mr Mounir Halim Judgment
| Jurisdiction | England & Wales |
| Judge | Mr Justice Freedman |
| Judgment Date | 07 February 2019 |
| Neutral Citation | [2019] EWHC 215 (QB) |
| Docket Number | Case No: HQ18X03224 |
| Court | Queen's Bench Division |
| Date | 07 February 2019 |
[2019] EWHC 215 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
SITTING AT BRISTOL CIVIL JUSTICE CENTRE
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Freedman
Case No: HQ18X03224
Gavin Mansfield QC and Nicholas Goodfellow (instructed by Locke Lord (UK) LLP for the Claimant)
Mounir Halim appeared in person
Hearing dates: 12–21 December 2018, 15, 29 January 2019
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
THE HONOURABLE Mr Justice Freedman
Introduction
Judgment in this case was handed down on 15 January 2019 and was adjourned to 29 January 2019 when I heard consequential applications including for permission to appeal.
Although the Defendant (“Dr Halim”) was represented by solicitors and counsel up to 16 January 2019, namely Ms Naina Patel instructed by Pennington Manches LLP, from then onwards he appears in person. This was foreshadowed at various stages during the trial, when I was told by Ms Patel that his finances were about to run out and so after judgment, he would be appearing in person. At the hearing on 29 January 2019, the Claimant (“Argus”) appeared through Leading and Junior Counsel as above and Dr Halim appeared in person.
On 29 January 2019, Dr Halim applied for permission to appeal restricted to his contention that Clause 17.4 of his contract of employment was void for restraint of trade, contending that its scope was broader than was reasonably necessary. This comprised a part only of the matters which were determined by the Judgment. I rejected the application for permission to appeal and found that an appeal had no real prospect of success and that there was no other compelling reason for an appeal.
I reserved the other matters which were argued for a written judgment. They are as follows:
(1) The costs of the claim inclusive of the costs which were in the case following the hearing of 13 September 2019;
(2) The reserved costs of 20 and 28 November 2018 applications;
(3) Whether any costs ordered should be assessed on the standard basis or the indemnity basis;
(4) Whether there should be payment on account of costs pursuant to CPR 44.2(8), and if so, what that payment should be;
(5) What directions of all outstanding matters relating to quantum including any damages and equitable compensation and/or an account of profits should be ordered;
(6) Continuation and/or the scope of the undertaking of Mr Justice Andrew Baker dated 21 September 2018 or any order for preservation of evidence in place of that undertaking.
The costs of the claim
I am satisfied that the costs of the claim should be dealt with at this stage, since there only remains to be dealt with quantum.
Argus was substantially successful in its claims. It succeeded on the core issues relating to the enforceability of the restrictive covenants, and final injunctions were issued mirroring Clauses 17.2, 17.3 and 17.4 of Dr Halim's contract of employment.
Although Argus has succeeded on the vast majority of matters in issue, it has beaten the without prejudice save as to costs offer of Dr Halim comprising undertakings in terms of Clauses 17.2 and 17.3, nothing in respect of Clause 17.4, and seeking costs in his favour of £55,000 excluding VAT. Further, Argus has made an offer which restricted Clauses 17.2 and 17.3 to 13 April 2019 and Clause 17.4 to 3 months from the date of settlement, but with a confidentiality undertaking in the terms of the covenant and 50% of its costs. That offer was only available for acceptance over the course of two working days.
There were parts of the claim where Argus did not succeed. It did not obtain a final injunction in respect of confidentiality. However, it did succeed in establishing breaches of confidence and a legitimate interest to protect by reference to confidential information. The reasons why no further injunctions were granted for breach of confidence were in part because there was protection through the restrictive covenant and in part because the covenant about breach of confidence and the order sought went beyond the interests which could be protected following termination of employment: see the Judgment at [226]. It follows that the bulk of the issues concerning breach of confidence have been decided in favour of Argus, but there was no additional injunction in respect of breach of confidence.
There was a more substantial aspect in which Argus has not succeeded namely as regards springboard relief. Argus's position in this regard is set out at [232] of the judgment. For the reasons set out at [234], including that it was not established that any relief was required beyond the PTRs, the claim for springboard relief was not granted.
The starting point as regards costs is that Argus is the successful party. The general rule that costs should follow the event is the starting point, and save as regards the matters referred to above in paragraphs 8 and 9 above, there is no reason to depart from that: see CPR 44.2(2).
Dr Halim contends that Argus acted in too high handed a manner by its letter of Friday 31 August 2018 seeking a response over the weekend, and in proceeding immediately following his response of 3 September 2018 issuing proceedings and seeking injunctions. He says this particularly by reference to the fact that Argus was a global business and his role was small relatively to the whole and the damage that he could do was very small (£100,000 per annum of revenue). He also needed to have representation to prepare to meet the case against him, and he was given very little time. He says that in those circumstances, there was a “preposterously short timescale” and that Argus does not come to the Court with “clean hands”.
I reject the foregoing for the following reasons:
(1) Dr Halim's information provided on 12/13 July and 3 September 2018 was for the reasons set out in the Judgment at paragraphs 50–63 not “a full or accurate account of his plans and/or such information as he did provide was misleading”;
(2) Thus, it does not lie to Dr Halim to say that he should have had longer to cooperate and answer the inquiries in circumstances where the answers provided had been unsatisfactory;
(3) On the contrary, Dr Halim was undeterred and was going to the Rwanda conference despite the concerns about the competing business;
(4) I have found that Afriqom was a competing business and that there had been breaches of Dr Halim's duty of fidelity and confidence, and that his participation in the business was to involve breaches of the PTRs;
(5) I reject the notion that since Dr Halim's business was on a small-scale relative to Argus's business that Argus should not have taken action. It was entitled to act quickly to preserve its business in the light of activities which I found to be unlawful in the Judgment.
I therefore do not make any reductions in the amount of the costs to take into account the conduct of Argus. Argus was entitled to act in the way in which it did to protect its interests, and having regard to his conduct, Dr Halim has nothing about which to complain.
However, I am satisfied that there should be a small deduction in respect of the issues at paragraphs 7 and 8. I am satisfied that they are significantly less than 10% of the time spent both during trial and in preparation for trial. I must have in mind not only the costs incurred by Argus where it did not succeed, but also the costs incurred by Dr Halim resisting those aspects CPR 44.2(6) and (7). It is undesirable to have a split issue by issue order in respect of these matters. I am likely to have a better feel of this issue as trial judge than a costs judge is likely to have. The proportion depends on my overall feel as to time spent, the significance of the issues and the overall justice of the order.
Before making a deduction, I take into account the fact that the offer made by Argus to where Dr Halim, in most respects, it was more favourable to Dr Halim than fighting the case. Despite giving some weight to this, I consider that it is still appropriate to make a deduction to the extent that Argus did not succeed. Argus's offer as regards the covenant about confidentiality required more than I ordered. On this basis, I apportion the costs so that Argus is deprived of 10% of its costs. I therefore make an order that Dr Halim pays 90% of the costs of Argus. This includes the costs of the application before Mr Justice Andrew Baker which follow the event of the claim.
The reserved costs
The majority of the costs of the applications before Mr Justice Pepperall comprised an application for specific disclosure. Argus substantially succeeded on the application. Moreover, as trial judge, I have been able to observe how important the application turned out to be both as regards the number of documents disclosed and their use during the trial. The documents comprised the documents in Bundle 24 relating to matters such as the Benadada emails (see Judgment paragraphs 35–43) and also documents relating to the creation of the Afriqom report. In the circumstances, the costs of the disclosure application should be paid by Dr Halim to Argus.
However, there were also applications to serve a Rejoinder and for Further Information. Dr Halim was successful in these applications. Costs should follow the event. In my judgment, the lion's share of the applications were those relating to disclosure. I do not have costs schedules about these costs, but it would be disproportionate to order that to take place. I can rely on an overall feel. Instead of a split order, I shall order that 60% of the costs of...
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