Cbs Butler Ltd v (1) Joe Brown (2) Alastair Millar (3) Peopleforce Recruitment Ltd
| Jurisdiction | England & Wales |
| Judge | The Honourable Mr Justice Tugendhat,Mr Justice Tugendhat |
| Judgment Date | 16 December 2013 |
| Neutral Citation | [2013] EWHC 3944 (QB) |
| Docket Number | Case No: HQ13X04157 |
| Court | Queen's Bench Division |
| Date | 16 December 2013 |
[2013] EWHC 3944 (QB)
The Honourable Mr Justice Tugendhat
Case No: HQ13X04157
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Richard Leiper (instructed by asb law LLP) for the Claimant
The First and Second Defendants appeared in person
Hearing dates: 21 November 2013
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 Tugendhat Mr Justice Tugendhat The Claimant carries on business as a recruitment agency that specialises in technical and functional recruitment for engineering, manufacturing and technology-based organisations. It was formerly the employer of the First and Second Defendants, Mr Brown and Mr Millar. The Third Defendant is a company acquired by Mr Brown and Mr Millar when they decided to set up their own recruitment consultancy. Mr Brown resigned on notice to the Claimant on 13 August 2013. Mr Millar resigned on 26 July 2013. Mr Brown and Mr Millar were two relatively junior employees, and the Claimant is a substantial company with around 75 employees across various locations in the UK.
On 20 August 2013 the Claimant obtained an order without notice to the Defendants (the claim form had been issued on 16 August). The Claimant sought an order which was substantially in two parts. The first part was described by Turner J (according to the note of his judgment) as "a hybrid of a simple preservation order and a search/Anton Piller order". The second part was an injunction in terms broadly corresponding to restrictive covenants and confidentiality agreements which Mr Brown and Mr Millar had entered into with the Claimant.
The effect of the first part of the order was that the Defendants were required (by para 7 of the Order) to permit solicitors for the Claimant, a supervising solicitor, and a computer expert to enter their homes and specified offices, and to have effective access to the 'disclosable items' for purpose of making an image of them. Para 6 of the Order, provided that :
"Upon service of this Order [the Defendants] must identify to the persons identified in Schedule A to this Order ('the Representatives') any of the following which is in his possession or under his control … any computer…, any mobile device (including mobile phone or tablet), any personal e-mail account, any external media (including hard drives …) and any cloud storage (together 'the disclosable items')".
The Defendants were required to permit the computer forensic expert appointed by the Claimant to make images of these storage devices (for which the Defendants were required to disclose any passwords). The Claimant undertook not, without the permission of the court or the agreement of the Defendants, to search or otherwise use the images obtained as a result of the carrying out the order.
The order provided for a return date of 27 August. The order was executed.
On 23 August the Particulars of Claim were served. On 27 August the case was adjourned to 3 September for the court to consider the steps to be taken in relation to the examination of the images taken.
On 3 September the court directed that any application by the Claimant for permission to examine the images should be filed on 6 September, and that the hearing of that application be on 20 September. The court refused permission for the Claimant to examine the images, save that the Claimant's expert was permitted to search the images by keyword and to produce a report of the number hits that search produced. The images to which that order referred were "the images taken pursuant to paragraphs 6 to 8 of the Order dated 20 August 2013".
In his oral submissions Mr Brown stated that the documents searched were dated over a period going back six or seven years, and in some cases thirteen years. A search over so long a period is not relevant. The Defendants were not employed by the Claimant for more than seven years, and there has been no suggestion that they were acting in breach of any restrictive covenant or confidentiality obligation for the entire period of their employment.
On 5 September the Claimant issued an application notice seeking "permission to search the images taken pursuant to the Order dated 20 August 2013". The form of order that the Claimant sought included the following:
"2. The … image shall be interrogated by [the Claimant's expert] as follows:
(a) in relation to all files (save for system files and forensic artefacts)
(i) a search shall be undertaken by Keyword and Blacklist;
(ii) in so far as a file contains a Keyword, but not a Blacklist, that file shall be produced to both parties;
(iii) in so far as a file contains a Keyword and a Blacklist, that file shall be produced only to [the Defendants] solicitors for them to determine (within 48 hours …) whether the file is, or contains information which is, irrelevant or privileged. To the extent that the file contains information which is relevant, such information as is irrelevant or privileged shall be redacted the document produced to [the Claimant]'s solicitors
(iv)(1) Keyword refers to a word on a list of keywords for the purpose of identifying documents relevant to the claim, set out in Schedule C hereto;
[(iv)](2) Blacklist refers to a word on a list of keywords for the purposes of identifying documents which contain material which is irrelevant to the claim (including information that is entirely personal) or which is privilege …"
On 10 September the Defendants issued an application to discharge the order of 20 August. They contended that there had been a failure to make full and frank disclosure, an oppressive and/or improper execution of the order, and a breach of an undertaking by the Claimant. The Defendants' application has not been pursued.
On 17 September 2013 the Defendants served their Defence, settled by solicitors. They contended that the restrictive covenants were too wide, and so unenforceable. They denied that, while preparing during the period of their employment for what they were to do after that had ended, they had done anything which they were not permitted to do. They set out what they said was the innocent explanation for the various acts or omissions which the Claimant had relied on in support of the application on 20 August, and which the Claimant relied on again in the Particulars of Claim, as demonstrating that Mr Brown and Mr Millar had acted in breach of their alleged contractual and fiduciary duties.
On 20 September the Defendants offered undertakings as to the use of any confidential information, and as to restrictions they would accept until 13 February (for Mr Brown) and 26 January (for Mr Millar) as to competing with the Claimant. The Claimant's application of 5 September was adjourned (it came before me on 21 November). On 20 September the Defendants were represented by leading counsel.
In early October 2013 the Defendants ceased instructing solicitors, and fully engaged in representing themselves.
Following service of the Defence disclosure became due in the normal course. But the Claimant did not wish for disclosure of electronic documents ("e-disclosure") to be conducted by the Defendants in the normal way. It wished for an order in the terms sought on 5 September.
On 15 November it issued an application notice for disclosure to take place in the form sought in the application made on 5 September. The Claimant also made other applications for directions. These included a direction for standard disclosure of those documents which are not in electronic form. Save for the application in relation to e-disclosure, these directions were substantially agreed. At the end of the hearing on 21 November I refused the Claimant's application. I ordered that:
"By 4pm on Monday 9 December 2013 the Defendants shall provide standard disclosure in relation to the images identified as A001, A002, A003, A004, A005, A006, A007, A008, A011, J002, J003, J004, and J005 in the report produced by ProvenIT and exhibited at DRL4 page 39 in relation to all files (save for system files) by keyword search (by reference to the keywords set out in the said report exhibited at DRL4 pages 40–43, but excluding the terms SAT, ADD, Princess and Vietnam and including the term Muggeridge) from 1 January 2013."
I said that I would give my reasons for refusing the Claimant's application in writing and these are they.
THE LAW
The CPR provides for disclosure to be given by the parties. So, for example, CPR r.31.7 provides that:
"When giving standard disclosure, a party is required to make a reasonable search for documents…"
Search orders (or Anton Piller orders as they used to be known) make a quite different provision. According to the model order in Practice Direction 25A at para 6 the provision to be made is that:
"The Respondent must permit [the applicant's solicitor and other identified individuals] to enter the premises mentioned in Schedule A to this order and any other premises of the Respondent disclosed under paragraph 18 below and any vehicles under the Respondent's control on or around the premises ('the premises') so that they can search for, inspect, photograph or photocopy, and deliver into the safekeeping of the Applicant's solicitors all the documents and articles which are listed in Schedule B to this order ('the listed items')."
The order of 20 August 2013 departs from this standard form (as Turner J observed), and it does so in a manner favourable to the Defendants. The order divides into two stages the different actions referred to by the words:...
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