Vanden Recycling Ltd v Kras Recycling BV

Factual and Procedural Background

This appeal concerns a summary judgment granted by Mrs Justice Cox on 17 December 2015 in favour of the Third Defendant, Company B ("Kras"), dismissing the claims brought by the Plaintiff, Company A ("Vanden"). The judgment was based on the effect of a Consent Order made on 25 June 2015 between the Plaintiff and the Second Defendant, Company C ("Bolton"), which provided for payment in full and final settlement of the Plaintiff's claims against Bolton. Having satisfied that judgment, the court held there was no remaining claim against Kras, who was alleged to be a joint tortfeasor liable for the same damage.

Company A is part of an international group specialising in plastic waste management, acting as a broker between suppliers and recyclers. The First Defendant, an individual ("Ms Tumulty"), was employed by the Plaintiff in a business development role focused on European customers. The Second Defendant, Bolton, is a waste management company involved in plastic waste collection and disposal. The Third Defendant, Kras, is a Netherlands-based waste management company engaged in purchase, cleaning, and resale of plastic waste.

Following a change in Ms Tumulty’s role and her subsequent resignation, the Plaintiff suspected unlawful conduct involving the sharing of confidential information with the Defendants. A forensic investigation revealed evidence that Ms Tumulty had provided confidential and commercially sensitive information to Bolton and Kras, and that all three Defendants had conspired to divert business away from the Plaintiff and compete against it.

The Plaintiff placed Ms Tumulty on garden leave and terminated her employment, then initiated proceedings against all three Defendants seeking urgent interim relief and damages. Interim relief was granted against Ms Tumulty and Bolton, and a trial was scheduled. Subsequent negotiations led to Consent Orders with Ms Tumulty and Bolton, including a settlement sum of £275,000 from Bolton in full and final settlement of the Plaintiff's claims against it.

Kras acknowledged service but did not agree to undertakings, and the Plaintiff’s application for interim relief against Kras was not granted. Kras later applied for summary judgment or strike out of the claim against it, contending that the satisfied Consent Order against Bolton extinguished the Plaintiff’s claims against Kras as a joint tortfeasor.

Legal Issues Presented

1. Whether the Consent Order with Bolton was intended to, or had the effect of, extinguishing the Plaintiff’s claims against Kras as a joint tortfeasor.
2. Whether the claims against Kras included distinct causes of action separate from the conspiracy claim covered by the Consent Order.
3. Whether satisfaction of the Consent Order barred all claims against Kras, including claims for injunctive relief and damages for breach of confidence and inducement of breach of contract.
4. The proper legal effect and interpretation of the Consent Order as a consent judgment or compromise agreement.

Arguments of the Parties

Plaintiff's Arguments

• The Consent Order was not a consent judgment but an order giving effect to a compromise agreement and did not fix the full measure of the Plaintiff’s loss.
• The language of the Consent Order contemplated ongoing proceedings against other Defendants and permitted use of disclosure materials in continuing claims.
• The claims against Kras included distinct causes of action such as breach of confidence and inducement of breach of contract, which were separate from the conspiracy claim against Bolton.
• Claims for injunctive relief and delivery up of confidential information remained viable despite the Consent Order.
• The damages claimed were not limited to the estimate in the Claim Form and included claims for account of profits and hypothetical licensing damages (Wrotham Park damages), which are not subsumed by the conspiracy claim.

Third Defendant's Arguments (Kras)

• The Consent Order was a consent judgment fixing the full measure of the Plaintiff’s loss and its satisfaction extinguished all claims against Kras as a joint tortfeasor.
• Intention is irrelevant when determining the effect of a judgment; the order is binding regardless of parties’ subjective intentions.
• The claims made against Kras were subsumed within the conspiracy claim covered by the Consent Order.
• The undertakings given by Kras in interim relief proceedings effectively addressed injunctive relief claims, negating the need for further claims.
• The award of damages to Bolton transferred ownership of confidential information, precluding claims against Kras for the same information.
• Claims for account of profits are not available where the Plaintiff has elected to claim damages, as reflected in the Consent Order.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Jameson v CEGB [1998] 1 AC 455	Fixing of unliquidated damages by judgment or agreement bars further claims against other tortfeasors once judgment is satisfied.	Confirmed that satisfaction of a judgment extinguishes claims against other joint tortfeasors liable for the same damage.
Heaton v AXA Equity & Law Life Assurance Society plc [2002] UKHL 15	Clarified the effect of compromise agreements or consent judgments in fixing the full measure of loss and barring subsequent claims against other tortfeasors.	Applied to interpret the Consent Order as a judgment fixing the loss, precluding further claims against Kras.
Bryanston Finance Ltd v de Vries [1975] 1 QB 703	Judgment fixes loss regardless of parties’ intentions.	Supported the conclusion that the Consent Order’s judgment effect fixed the Plaintiff’s loss irrespective of intention.
Community Care North East v Durham County Council [2012] EWHC 959 (QB)	Distinction between consent orders and Tomlin orders regarding enforceability and effect.	Used to differentiate the Consent Order as a consent order with court order status, not a Tomlin order.
Seager v Copydex Ltd (No.2) [1969] 1 WLR 809	Ownership and delivery up of confidential information following settlement.	Rejected Kras’s argument that damages award transferred ownership of confidential information, noting delivery up obligations.
Marathon Asset Management LLP v Seddon [2017] EWHC 300 (Comm)	Availability of Wrotham Park damages for conspiracy claims.	Considered authority that Wrotham Park damages are not available for conspiracy claims; court accepted Plaintiff’s real prospect of establishing otherwise.

Court's Reasoning and Analysis

The court analysed the legal effect of the Consent Order made with the Second Defendant, concluding that it constituted a consent judgment rather than a mere compromise agreement or Tomlin order. The court reasoned that the order fixed the full measure of the Plaintiff’s loss in respect of claims against Bolton and that satisfaction of this judgment barred further claims against other joint tortfeasors liable for the same damage, including Kras.

The court applied established legal principles from key authorities, notably Jameson and Heaton, to affirm that once damages are fixed by a judgment and satisfied, claims against other tortfeasors for the same damage are extinguished regardless of the parties’ intentions.

However, the court found that the summary judgment was improperly broad in dismissing all claims against Kras. The Plaintiff’s claims included distinct causes of action such as breach of confidence and inducement of breach of contract, which involved separate breaches and potentially different losses from those covered by the conspiracy claim against Bolton. The court acknowledged that claims for injunctive relief were not barred by the Consent Order and that the particulars of loss had not been fully particularised due to premature termination of proceedings.

The court rejected Kras’s argument that the settlement with Bolton transferred ownership of confidential information, noting that the Consent Order required delivery up of such information, inconsistent with transfer of ownership.

Accordingly, the court held that summary judgment should have been confined to the conspiracy damages claim, which was subsumed within the Consent Order, but not extended to all other claims against Kras.

Holding and Implications

The court’s final ruling was to ALLOW the appeal in part, overturning the summary judgment dismissing all claims against Kras except for the claim for damages for conspiracy. The summary dismissal was upheld only insofar as it applied to the conspiracy damages claim, which was barred by the satisfied Consent Order against Bolton.

The direct effect is that the Plaintiff’s claims against Kras for breach of confidence, inducement of breach of contract, injunctive relief, and other damages remain extant and may proceed. The decision does not establish new precedent but clarifies the application of settled principles to the interpretation of consent judgments and the scope of claims barred by satisfaction of such judgments in cases involving multiple tortfeasors.