David Neil Gerrard v Eurasian Natural Resources Corporation Ltd
| Jurisdiction | England & Wales |
| Judge | Richard Spearman |
| Judgment Date | 27 November 2020 |
| Neutral Citation | [2020] EWHC 3241 (QB) |
| Date | 27 November 2020 |
| Docket Number | Claim No. QB-2019-003176 |
| Court | Queen's Bench Division |
[2020] EWHC 3241 (QB)
Richard Spearman Q.C.
(sitting as a Judge of the Queen's Bench Division)
Claim No. QB-2019-003176
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
MEDIA AND COMMUNICATIONS LIST
Royal Courts of Justice
Strand, London, WC2A 2LL
Thomas de la Mare QC and Daniel Burgess (instructed by Jones Day) for the First Defendant
Anya Proops QC (instructed by RIAA Barker Gillette (UK) LLP) for the Second Defendant
Adam Wolanski QC, Lorna Skinner and Sandy Phipps (instructed by Enyo Law LLP) for the Claimants
Hearing dates: 3–4 November 2020
Table of Contents
| INTRODUCTION AND NATURE OF THE HEARING | 1 |
| OVERVIEW OF THE APPLICATIONS | 11 |
| THE RELEVANT LEGAL PRINCIPLES | 16 |
| THE PLEADED CASE OF HARASSMENT | 27 |
| THE MATERIAL PARTS OF THE REPLY | 28 |
| THE CLAIM FOR HARASSMENT | |
| (i) The submissions of ENRC and Diligence | 29 |
| (ii) The submissions of Mr and Mrs Gerrard | 31 |
| (iii) The case law concerning the PHA | 32 |
| (iv) Discussion and conclusion | 78 |
| (v) The contention that the proposed amendments are embarrassing | 118 |
| THE LITIGATION PRIVILEGE ISSUE | |
| (i) How the issue arises | 122 |
| (ii) The submissions of ENRC and Diligence | 124 |
| (iii) The submissions of Mr and Mrs Gerrard | 131 |
| (iv) Discussion and conclusion | 153 |
| CONCLUSION | 189 |
Richard Spearman QC:
INTRODUCTION AND NATURE OF THE HEARING
In these proceedings, the Claimants (“Mr and Mrs Gerrard”) bring claims for breaches of data protection law, misuse of private information, harassment, and trespass arising from surveillance activities carried out on behalf of the First Defendant (“ENRC”) by various persons, including, since February 2017, the Second Defendant (“Diligence”). The proceedings form part of high profile litigation between Mr Gerrard, ENRC and others.
Until April 2011, Mr Gerrard was a partner at DLA Piper UK LLP. He is now a partner at Dechert LLP. In those capacities, between December 2010 and March 2013, he acted as a solicitor for ENRC, which is a holding company in a diversified natural resources group with extensive mining operations. In sum, he was instructed to conduct an investigation into a number of ENRC's subsidiaries. Diligence provides intelligence and surveillance services. So far as material to this claim, it has provided services to ENRC since 2017.
On 25 September 2017, ENRC issued proceedings in the Commercial Court (the “Commercial Court Proceedings”) claiming damages for breach of fiduciary duty and negligence. It is alleged in those proceedings that (1) during the course of the retainer Mr Gerrard sought to encourage (and thereafter increase) the intervention of the SFO in the investigation being conducted by Dechert LLP, in order to expand the scope of that firm's retainer and thus his own ability to generate fees; (2) Mr Gerrard said on one occasion with regard to ENRC that he was planning to “screw these fuckers”; (3) Mr Gerrard was aiming to generate millions of pounds in fees from ENRC, and the fees in fact amounted to over £16m; and (4) the wrongdoing included secretly, and without authorisation, leaking ENRC's confidential and privileged material to both the media and the SFO.
On 25 March 2019, ENRC brought further proceedings in the Chancery Division (the “Chancery Proceedings”) against the Director of the SFO, for inducing Dechert LLP to breach its contract with ENRC, inducing Dechert LLP and/or Mr Gerrard to breach their fiduciary duties to ENRC, and misfeasance in public office. The factual allegations relating to Mr Gerrard's unlawful conduct were repeated by ENRC in those proceedings.
On 6 September 2019, Mr and Mrs Gerrard brought the present claim against Diligence. By a consent order made by me dated 17 October 2019, ENRC was added as a defendant. The substance of their claim is that ENRC has been seeking to obtain personal information relating to Mr Gerrard since at least December 2013, and has been conducting surveillance in relation to him from at least 2014. Further, Diligence has since February 2017 been instructed by ENRC to provide intelligence and surveillance services in respect of Mr Gerrard, and, starting on a date no later than 1 January 2019, has been undertaking surveillance activities in relation to both Mr and Mrs Gerrard. All the actions complained of are said to be unlawful, and, among other things, the surveillance is said to have extended to protracted surveillance of their home at Hunters Farm in East Sussex.
By application dated 14 October 2019, Mr and Mrs Gerrard sought an injunction to restrain ENRC from making any use of the information obtained via the surveillance and from carrying out any further “monitoring” of Mr and Mrs Gerrard. ENRC and Diligence provided undertakings in lieu of the injunction that was sought, pursuant to another Consent Order that I made on 17 October 2019 (the “Undertakings Consent Order”).
On 20 January 2020, ENRC and Diligence filed separate Defences. Their case, in substance, is that: (1) the surveillance carried out by Diligence on behalf of ENRC was part of an investigation into Mr Gerrard's wrongdoing for the purposes of (i) the ongoing Commercial Court Proceedings and (ii) the then potential Chancery Proceedings (together “the Litigation”); (2) the instructions provided to Diligence and the documents produced in respect of the investigation were for the dominant purpose of the Litigation and thus subject to litigation privilege; (3) the surveillance was reasonable and necessary in pursuit of the legitimate aim of investigating (and preventing) the wrongdoing (together the “Legitimate Aim”); and (4) the surveillance was not calculated to be, and was not, harassing of Mr or Mrs Gerrard, and was reasonable in light of the Legitimate Aim.
Initially, Mr and Mrs Gerrard chose not to file a Reply, and a deadline of 3 February 2020 for them to do so expired. Instead, they applied to stay the present proceedings. That application was dismissed, following a contested hearing, by Master Sullivan on 22 April 2020. Thereafter, Mr and Mrs Gerrard filed a Reply dated 12 May 2020.
There then followed the various applications which are now before me. They comprise: (1) the applications of ENRC and Diligence dated 16 June 2020 to strike out parts of the pleaded case of Mr and Mrs Gerrard (“the Strike Out Applications”), (2) the application of Mr and Mrs Gerrard dated 18 September 2020 for permission to amend their pleaded case (“the Amendment Application”), now to take the form of a draft Re-Amended Particulars of Claim dated 13 October 2020 (“the RAPOC”), and (3) cross-applications relating to costs arising from a Consent Order of Master Eastman dated 9 June 2020, whereby it was ordered that a CCMC listed for 11 June 2020 should be adjourned and that the “costs of the adjourned CCMC” were reserved to the Judge hearing the strike out applications of ENRC and Diligence (“the Costs Applications”). During the course of the hearing, the parties agreed that determination of the Costs Applications should be deferred until after I had given judgment in relation to the other three Applications.
The applications were very ably argued by Mr de la Mare QC for ENRC, Ms Proops QC for Diligence, and Mr Wolanski QC for Mr and Mrs Gerrard. I am grateful to all of them.
OVERVIEW OF THE APPLICATIONS
The Strike Out Applications are not in the same terms. ENRC's application relates to paragraphs 30–33 of the RAPOC and paragraphs 8(a)(ii), 8(a)(iii), 8(b), 8(d)(ii)(2), 8(e)(i), and 8(e)(ii) of the Reply, and is made under CPR 3.4(2)(a) (“the statement of case discloses no reasonable grounds for bringing or defending the claim”) and/or CPR 3.4(2)(b) (“the statement of case is an abuse of the court's process or is otherwise likely to obstruct the just disposal of the proceedings”). Diligence's application relates to paragraphs 8 (a)(ii), 8 (a)(iii), 8(b), 8(d) and 8(e) of the Reply, and is made under CPR 3.4 2(a) alone. So far as concerns the Amendment Application, at the start of the hearing it became clear that the only contested aspects related to paragraphs 30–33 of the RAPOC.
The substance of the applications is that ENRC and Diligence seek summarily to dispose of: (1) the entirety of Mr and Mrs Gerrard's claim for harassment pursuant to section 3 of the Protection from Harassment Act 1997 (“PHA”), and (2) various aspects of Mr and Mrs Gerrard's case that ENRC and Diligence are not entitled to rely on litigation privilege in respect of the surveillance and other activities about which they complain.
The applications overlap, not least because one significant feature of the claim under the PHA is that harassment, if made out, gives rise to criminal as well as civil liability. This, in turn, is relevant to the merits of the argument of Mr and Mrs Gerrard that ENRC and Diligence are unable to rely upon litigation privilege because they are guilty of iniquity. It emerged during the hearing that the prize, or at least a prize, which the parties are fighting over concerns the extent of the obligations of ENRC and Diligence at the disclosure stage of the litigation, which has not yet been reached. It was suggested on behalf of ENRC and Diligence that Mr and Mrs Gerrard may be using the present proceedings as a means of gaining access to documents which may assist them in the Litigation but which (presumably) they would be unable to obtain on disclosure in the...
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