Taylor and Others v. Director of the Serious Fraud Office and Others

Factual and Procedural Background

In 1994 Company A (a United-Kingdom fraud-investigation agency) examined an alleged US $8 million fraud. Funds had passed through Appellant, a solicitor practising in The State, and through Company B, with which Appellant was connected. An investigator employed by Company A (Investigator A) sent a letter to the Attorney-General of The State requesting the compulsory interview of Appellant under local legislation. A subsequent internal file note recorded views critical of Appellant.

Neither document was ever used in court, but both were revealed to defence solicitors in separate fraud proceedings as “unused material” under the prosecution’s common-law disclosure duty. Relying on those two documents, Appellant and Company B began a defamation action against Company A, Investigator A, and two officials of Company C (a professional-regulatory body).

The High Court (per Judge Davies) struck out the claim, holding that the disclosed documents were subject to an implied undertaking restricting any collateral use. The Court of Appeal, bound by its earlier decision in Mahon v. Rahn, rejected that ground but nonetheless struck out the claim on the alternative basis that the documents were protected by absolute immunity. Appellants appealed to the House of Lords.

Legal Issues Presented

1. Does an implied undertaking, analogous to that governing civil discovery, restrain collateral use of prosecution material disclosed to a criminal defendant?
2. If not, does absolute witness immunity extend to statements made by investigators, prosecutors, and other non-witnesses during the course of a criminal investigation, thereby barring a defamation action?

Arguments of the Parties

Appellants’ Arguments

• The Court of Appeal impermissibly broadened absolute immunity to persons who were neither witnesses nor potential witnesses.
• No implied undertaking attached to material disclosed by the prosecution; therefore the documents could lawfully form the basis of a libel claim.

Respondents’ Arguments

• An implied undertaking automatically arises on disclosure of unused prosecution material, prohibiting any collateral use without leave of the court.
• Alternatively, public-policy necessity warrants extending absolute immunity to investigators and others engaged in the investigative process, so the action is barred in any event.

Table of Precedents Cited

Court's Reasoning and Analysis

Judge Hoffmann, with whom the majority agreed, held that:

• The policy underpinning civil-discovery undertakings—limiting invasion of privacy and maintaining court control over documents—applies with equal force to prosecution material disclosed under modern, expansive criminal-disclosure duties.
• Individuals who supply information during a criminal investigation should be encouraged to do so without fear that such information will later be deployed for unrelated purposes; an implied undertaking best secures that objective.
• The Court of Appeal’s reliance on Mahon v. Rahn was misplaced; that decision incorrectly denied the existence of any implied undertaking.

Although some Law Lords (notably Judge Hoffmann and Judge Hope) also analysed the alternative ground of absolute immunity, the majority declined to base the outcome on that question once the implied-undertaking point sufficed to dispose of the appeal. Nevertheless, they expressed the view that extending absolute immunity to investigators and informants is both logical and necessary to avoid a chilling effect on criminal inquiries.

Holding and Implications

APPEAL DISMISSED.

The House of Lords affirmed the strike-out of the defamation claim. It ruled that documents disclosed by the prosecution are subject to an implied undertaking preventing their use for collateral purposes unless the court gives leave. Because Appellants could not rely on the documents without such leave, the libel action was an abuse of process.

Implications include a clear confirmation that an implied undertaking governs unused prosecution material, restoring judicial control over its collateral deployment. While some judges favoured recognising wider absolute immunity for investigative communications, the final decision rested on the implied-undertaking principle; hence no definitive precedent was set on the immunity issue.