Brandeaux Advisers (UK) Ltd and Others v Chadwick
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE JACK,Mr Justice Jack |
| Judgment Date | 17 December 2010 |
| Neutral Citation | [2010] EWHC 3241 (QB) |
| Date | 17 December 2010 |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ10X01868 |
[2010] EWHC 3241 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Jack
Case No: HQ10X01868
Mr Adam Solomon (instructed by Fox Williams LLP) for the Claimants
Mr Adam Tolley (instructed by Lewis Silkin LLP) for the Defendant
Hearing dates: 16—23 November 2010
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.
Introduction
In this action the claimant companies seek an order for the delivery up of confidential information by the defendant former employee. The information in question was sent by her by e-mail to her private e-mail address and consists of a vast number of documents relating to the companies' affairs, which she received in the course of her employment. She has not disclosed them to anyone save her solicitor, and has not made any use of them. She asserts that she is entitled to retain them because she may need them if any question arises in respect of her performance of her duties as the executive in overall charge of compliance in the claimant group, and in connection with her claims for wrongful dismissal made in the action and also her claims in the Employment Tribunal. The first claimant also has a claim against her for damages in the sum of £59,916 being her salary between the date when it is said she would have been dismissed if she had reported her wrongdoing, 22 February 2010, and the date of her actual dismissal, 22 June 2010. That claim is made on the basis that the defendant was obliged to report her wrongdoing and would then have been dismissed and so the salary would have been saved. The defendant has a claim for wrongful dismissal in the sum of £21,189, her salary between 22 June and 10 August 2010 when her employment would otherwise have ended. At the start of the trial the defendant's position by way of open offer was that she was prepared to give up her own possession of the documents but not her solicitors' on the basis that she could use them for the two purposes I have stated. The claimants' position was that the defendant should give up her possession of the documents totally but might obtain documents from the claimants on reasonable request for the two purposes, any dispute to be settled by the court. I was told that the anticipated costs on each side to the end of the trial were of the order of £300,000, which means a total of some £600,000.
The three claimants are members of the Brandeaux Group of companies. Brandeaux Advisers (UK) Limited is incorporated in England and provides investment advice to Brandeaux Managers Limited. Brandeaux Managers is incorporated in the British Virgin Islands, and is the manager of the eight Brandeaux property funds. The funds are invested in student accommodation, typically halls of residence for university students, and in reversionary interests in long leases. Brandeaux Administrators Limited is incorporated in Ireland, and carries on business in Dublin as administrator of the funds. The funds have assets of over £1.7 billion in the United Kingdom. I will refer to the companies as 'Advisers', 'Managers' and 'Administrators'. The chairman of the group is Ms Kay Brandeaux. She is the founder and is the sole shareholder in Advisers and Administrators, but she has no shareholding in Managers. The chief executive of the group is Mr Roger Boyland, who is Ms Brandeaux's partner.
Between 4 February 2008 and 22 June 2010 when she was summarily dismissed the defendant, Ms Ruth Chadwick, was employed by Advisers as Head of Research & Business Development. Her background is in compliance, that is, in ensuring compliance by financial institutions with the requirements of their regulatory bodies, thus, in England, the FSA. Her employment prior to coming to Brandeaux had been with the Financial Services Commission of the British Virgin Islands, the regulator of Managers. Before I come to the issues I will provide a resume of the main events.
An outline of the events
Prior to her employment commencing on 4 February 2008 it had been agreed that Ms Chadwick should be the chief executive officer of Administrators and should spend the first four days of each week in Dublin and should work in the London office on Fridays. She was provided with a flat in Dublin. She was also given overall responsibility for compliance within the group. The individual companies had separate compliance officers. Denise Whelan was compliance officer for Administrators. Following the financial difficulties of the banking world and as a result of redemption requests, on 12 December 2008 Brandeaux suspended the issue and redemption of shares in all its funds. All funds were re-opened by 30 April 2010. The senior management of Brandeaux were involved in this period in substantial extra work. Ms Chadwick received a bonus for 2008 which was less than she said she had been led to expect. She complained to Ms Brandeaux and Mr Boyland at the end of the year, and she says that her complaint was received with hostility. In June 2009 she became ill from stress and had to take time off. That stress arose from a number of matters. Those which I am able to identify were the proper pressures of her responsibilities, her having to commute each week to Dublin from London where she lived, the management style of Ms Brandeaux, the dismissal of Denise Whelan and her claim against Administrators in Dublin, and the fact that she was having major work done to her house following her making a claim under an NHBC guarantee – which required her to vacate the house for a while. The consequence was that on 8 July 2009 while still on sick leave she tendered her resignation, that is to say, gave notice orally to Mr Boyland. She returned to work on 13 July. She was later persuaded by Mr Boyland and Ms Brandeaux not to leave, and Ms Brandeaux e-mailed her on 27 July: 'Both Roger and I are very pleased that you have decided to hang in there with us as we value your contribution and skills and we like having you as part of the Brandeaux family.'
As part of the arrangements following the withdrawal of her resignation it was agreed that Ms Chadwick should no longer spend most of her time in Dublin and should work from the London office. A new chief executive for Administrators was found, Mr Robert McNally. In August and September 2009 there was consideration of Ms Chadwick's job description and of her directorships. 'Brandeaux Head of Group Compliance' was added to her job title. But despite the withdrawal of her resignation and the change as regards Dublin Ms Chadwick continued to suffer from stress-related ill health. She also had other health problems. She visited her doctor on 18 occasions between 8 July and 16 November 2009. On 15 October 2009 she had a telephone appointment with a psychological wellbeing practitioner of the West London Mental Health Psychological Therapies Service. The Service's letter of 3 November 2009 recorded that Ms Chadwick had said she was experiencing a high level of stress due to work related issues and she did not get on with her boss: this had caused her to become depressed: she was finding it very difficult to 'deal with the huge responsibilities' she had at work: she wanted to find a new job, but that was extremely hard: she had lost her self-confidence: she was not sleeping properly. A course of cognitive therapy was decided on. The papers contain a number of depression screening forms completed by Ms Chadwick between 13 September and 2 November 2009, which show a substantial improvement.
At the end of 2009 Ms Chadwick was told what her bonus for the year was to be, namely £25,000 on top of a salary of £160,000, which was what she had received for the previous year. She expressed dissatisfaction, which was conveyed to Ms Brandeaux and Mr Boyland. On 11 January 2010 she had a meeting with them. She did not succeed in getting it increased. Later that day or possibly the following day she went into Mr Boyland's room to locate the draft of a document which she had copied to him but had subsequently worked on further. She looked for it among a pile of papers which were on a credenza against the wall. These were papers which Mr Boyland had taken from his brief case following his arrival from abroad that morning. She was observed by Ms Brandeaux who told Mr Boyland what she had seen. Mr Boyland saw her the next day and reprimanded her for going into his office without his permission when he was not there and looking through confidential papers. She apologised, saying that she had been told that the document was there by Mr Boyland's newly arrived p.a. On 22 January Mr Boyland sent her an e-mail about the incident saying that it was unacceptable that she had sifted through his confidential material, that he was very surprised and disappointed, that he wished to move on from the incident and not to have to refer to it again, but he was asking that a copy of the e-mail go onto her HR file. Ms Chadwick replied immediately, apologising profusely, explaining how it had come about and saying that it would never happen again. In her evidence Ms Chadwick tried to justify what she had done, saying that she had worked with Mr Boyland in his office sitting at the keyboard at his desk while they worked on documents and suggesting that she had his implied permission to act as she did. Her recognition at the time that she had done wrong is more impressive than her explanations in the witness box.
A little later that day, 22 January, Ms Chadwick sent Mr Boyland an e-mail saying that she had noticed that...
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