Ig Index Plc v Johannes Hendrik Cloete
| Jurisdiction | England & Wales |
| Judge | The Honourable Mr Justice Tugendhat,Mr Justice Tugendhat |
| Judgment Date | 11 December 2013 |
| Neutral Citation | [2013] EWHC 3789 (QB) |
| Date | 11 December 2013 |
| Court | Queen's Bench Division |
| Docket Number | Case No: HQ13X03979 |
[2013] EWHC 3789 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
The Honourable Mr Justice Tugendhat
Case No: HQ13X03979
D W Mayall (instructed by Morton Law) for the Claimant
David Hirst (instructed by Pinder Reaux & Associates) for the Defendant
Hearing dates: 18 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 By notice dated 17 October 2013 the Defendant applies to strike out the Claimant's entire claim pursuant to CPR r.3.4(2)(b), on the ground that it is an abuse of the process of the court. The action was commenced by a claim form issued on 7 August 2013. The Claimant claimed orders for the delivery up of "all documents that are the property of the Claimant or that contain confidential information belonging to the Claimant". These included documents recorded on a USB memory stick containing documents ("the Listed Items") which the Defendant had disclosed in Employment Tribunal Proceedings he had brought against the Claimant ("the Employment Tribunal Proceedings"). The Claimant asked for the destruction of any copies, injunctions to restrain disclosure of confidential information, and damages.
The Defendant submits that, because the proceedings are based on documents disclosed in separate proceedings before the Employment Tribunal, they have been commenced in breach of the rule that a party to whom a document has been disclosed may use the document only for the purpose of the proceedings in which it is disclosed (CPR r31.22(1)). No permission has been sought by the Claimant to use the documents for the purposes of the present action.
On 15 August 2013 there was a hearing of the Claimant's application for interim relief before the court in the vacation. The Defendant appeared in person. The Judge who heard the application ("the Judge") made an order for delivery up of the Listed Items, and for the destruction of electronic copies. He also made ancillary orders for disclosure to be made by the Defendant. He granted the interim injunction sought, gave directions for service of statements of case, and ordered the Defendant to pay the costs of the application.
The evidence in support of the application before the Judge was in a witness statement dated 5 August by Jackie Bornor, Head of Human Resources for the Claimant. Although not referred to in the Order of 15 August, there was also a witness statement from the Defendant dated 14 August 2013. The Defendant also responded orally to questions from the Judge, as appears from a transcript of the proceedings.
The Claimant carries on the business of spread betting in currencies, commodities, shares and other securities. Clients access the service online. The Defendant was employed by the Claimant as a network services engineer in the IT department. He had entered into a number of covenants for the protection of the confidential information relating to the business of the Claimant and the dealings of its clients. In June 2011 the Defendant had reported to the head of the Claimant's legal department concerns he had over the security of certain data of the Claimant. In October 2011 the Claimant took disciplinary action against the Defendant in respect of what Ms Bornor refers to as unauthorised work the Defendant had carried out. Following further disciplinary proceedings, the Defendant was dismissed with effect from 3 July 2012.
In October 2012 the Defendant commenced the Employment Tribunal Proceedings. He made a number of complaints, including that he had been unfairly dismissed. Those proceedings were ongoing at the time of the application to the Judge.
On 10 June 2013 the Employment Tribunal wrote to the parties informing them that the Tribunal had directed that they fix a time and place for the physical exchange of documents.
Pursuant to that direction, on 15 July 2013, the Defendant delivered to the Claimant a USB memory stick containing the Listed Items. The USB stick contained, in Ms Bornor's words:
"documents, all of which are the property of [the Claimant] and contain confidential information relating to [the Claimant]'s clients…: (i) a client list relating to [the Claimant]'s South African office; (ii) a list of [the Claimant]'s prospective clients; (iii) a list of [the Claimant]'s South African clients' bank payment details; (iv) a list of [the Claimant]'s broker client list for South Africa".
Ms Bornor stated that the Defendant had no justifiable reason in the course of his employment for copying or retaining such information. However, she also stated that the Defendant had written to the Information Commissioner on 21 February 2012 to express concerns about security of the Claimant's data, and that she believed that he enclosed with that letter some or all of the Listed Items. She also stated that there was no evidence as to how the Defendant had obtained the Listed Items. No security alert had been triggered.
Ms Bornor also stated that the Claimant intended to disclose to the Defendant in the course of the Employment Tribunal Proceedings lists similar to the Listed Items, but with the names and client details redacted.
On 24 July 2013 Ms Bornor wrote to the Defendant requiring him immediately to return the originals and copies of the Listed Items, and to provide undertakings in a form attached to the letter. She stated that if he did not return them by 31 July the Claimant would consider legal action. He did not respond.
On 2 August 2013 the Claimant wrote to the Employment Tribunal seeking permission to amend its response to the Defendant's claims, so as to include a reference to his having copied and retained the Listed Items.
In her witness statement Ms Bornor wrote the following in support of the application for the interim relief sought before the Judge:
"Although I have no evidence that [the Defendant] has used or disclosed these documents, other than to the Information Commissioner, as referred to in paragraph 20 above, and to [the Claimant] as part of the disclosure process in the Employment Tribunal Proceedings, I am concerned that he may do so in further breach of the terms of the Deed of Covenant."
In his witness statement the Defendant confirmed that he had written to the Information Commissioner, which, he contended, was not a breach of any obligation he owed to the Claimant. He wrote that he had not retained the Listed Items from the time when he was employed, but that they had been sent to him by the Information Commissioner six months after his employment had been terminated. Since then he had had them in his possession for a further period of almost eight months (that is since January 2013). In that period, he states, he had not reproduced them or disclosed them to any third party, and that he had no intention to use them for any purpose other than the ongoing Employment Tribunal proceedings. He expanded on that in his oral responses to the Judge. He also said that he could obtain the Listed Items again from the Information Commissioner by a further application to the Information Commissioner, but that he needed it for the hearing in the Employment Tribunal listed for 9 September.
In his judgment the Judge recited the facts and the contentions of the parties. He then said:
"… I turn briefly to the well-known criteria for the grant of an interim injunction in accordance with the principles laid down by the House of Lords in American Cyanamid. … It is plain, in my judgment, that there is a good arguable case in favour of the applicant, and there is a serious issue to be tried. Secondly, it is clear in my judgment that damages would not afford an adequate remedy to the applicant. Conversely, damages should afford an adequate remedy to the respondent, particularly because the usual cross-undertaking in damages is proffered by the applicant. However, even if that were wrong, I turn to the balance of convenience. In my judgment that balance lies firmly in favour of granting the order sought by the applicant. As I have already said, there is an obvious and pressing interest to retain the confidentiality for example with third party clients. On the other side of the balance the legitimate interest which the respondent has so that he can conduct his proceedings in the Employment Tribunal fairly will be taken care of and is preserved by the proviso to which I have already made reference."
The proviso referred to by the Judge permitted a disclosure required by a court of law or a regulatory body, and for the purposes of his taking legal advice in connection with the Employment Tribunal Proceedings.
There is no mention in any witness statement, or in the transcript of the hearing before the Judge, of the rule which (as Mr Hirst submits) precluded the Claimant from bringing the present proceedings without the permission of the court.
On 20 August 2013 the Claimant served Particulars of Claim. In para 20 the Claimant pleads that, in copying, retaining and disclosing (to the Information Commissioner) copies of the Listed Items, the Defendant was in breach of the express terms of the covenant and contract he had entered into with the Claimant. In para 25 the Claimant pleads that the Defendant is also in breach of the Copyright and Rights in Databases Regulations 1997.
Although the prayer for relief includes a claim for an injunction, the Particulars of Claim do not include an averment that the Defendant is threatening to commit a further breach. There is a claim for damages which does not include any special...
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