Factual and Procedural Background
A company ("Company A") dismissed its employee ("Defendant"). The Defendant brought a claim for unfair dismissal and, as ordered by the employment tribunal, disclosed various documents including a USB stick containing copies of some of Company A's highly confidential documents. Company A's staff recognized these documents as their own confidential materials. Company A initiated proceedings in the High Court against the Defendant seeking an order for delivery up of these documents or copies, deletion of the confidential documents from the Defendant's electronic devices, injunctive relief, and damages. Company A did not apply for permission to use the disclosed documents from the tribunal proceedings in support of its High Court claim.
The High Court ordered the Defendant, who was unrepresented at the time, to deliver up any confidential documents in his possession except those held on electronic storage media and to delete any on his electronic devices. The Court also made a disclosure order and granted an injunction preventing use or copying of any confidential information of Company A until trial, and ordered the Defendant to pay the costs of the application. The Defendant complied with the order.
Two months later, now represented by solicitors, the Defendant applied to strike out the entire action on grounds that the proceedings were an abuse and contempt because they were based on the Defendant's disclosure in the tribunal proceedings, thus breaching CPR 31.22. The question before the court was whether the strike out was appropriate.
The Court initially struck out the action as an abuse, revoked the costs order requiring the Defendant to pay Company A, and ordered Company A to pay the Defendant's costs. The present appeal concerns whether this decision was correct.
Company A is a spread betting business operating online, and the Defendant was employed as a network service engineer with covenants protecting confidential information. The Defendant had raised concerns about data security and made copies of confidential documents which he sent to the Information Commissioner's Office (ICO) as evidence of security breaches. These documents included client lists and bank payment details, described as highly confidential.
The Defendant was dismissed and brought an unfair dismissal claim. During the tribunal proceedings, Company A disclosed redacted copies of confidential documents, and the Defendant disclosed a USB stick containing copies of the confidential documents. Company A expressed concern about this disclosure and initiated High Court proceedings for delivery up, deletion, injunction, and damages.
The High Court granted interim relief in favor of Company A, ordering delivery up, deletion, and injunction against use or copying of the confidential information, with costs awarded to Company A. The Defendant later applied to strike out the action on the basis that the claim constituted an abuse of process due to the use of disclosed documents without permission under CPR 31.22.
Legal Issues Presented
- Whether Company A was required to obtain permission under CPR 31.22 to use documents disclosed in employment tribunal proceedings in separate High Court proceedings.
- Whether the use of information derived from disclosed documents, including knowledge of the Defendant's possession of those documents, constitutes "use" prohibited without permission under CPR 31.22.
- Whether the High Court judge erred in striking out the action as an abuse of process and ordering Company A to pay the Defendant's costs.
- Whether retrospective permission to use disclosed documents could or should be granted by the court.
- Whether permission to use disclosed documents can be implied from the orders made by the court or must be expressly granted.
- Which court has jurisdiction to grant permission to use disclosed documents under CPR 31.22 when disclosure occurs in employment tribunal proceedings.
Arguments of the Parties
Appellant's Arguments (Company A)
- Company A did not use the disclosed confidential documents or the information contained in them in the High Court claim; rather, it used information that the Defendant had possession of those documents, which was learned through disclosure.
- CPR 31.22 prohibits use of documents and information derived from them but does not preclude use of information that the Defendant possessed the documents.
- The confidential documents were the property of Company A, and thus use of those documents or information about their possession should not be restricted by CPR 31.22, citing Process Development v Hogg.
- The failure to seek permission under CPR 31.22 was inadvertent and not deliberate or reckless, and retrospective permission should be granted.
- The High Court was the appropriate court to grant permission to use the documents since the employment tribunal is not a court as defined by the CPR.
- Singh J's order implicitly permitted use of the documents by Company A, and if not, retrospective permission should be granted.
Respondent's Arguments (Defendant)
- The proceedings were an abuse of process and contempt because Company A used documents disclosed in the tribunal proceedings without permission, breaching CPR 31.22.
- The use of information derived from the documents, including knowledge that the Defendant possessed them, constitutes prohibited use under CPR 31.22.
- Permission to use documents must be expressly granted by the court; it cannot be implied from an order where the issue was not considered.
- The High Court judge was correct to strike out the action and order Company A to pay costs.
- The employment tribunal could not grant permission under CPR 31.22 because it is not a court as defined by the CPR.
Table of Precedents Cited
| Precedent |
Rule or Principle Cited For |
Application by the Court |
| Smithkline Beecham v Generics [2004] 1 WLR 1479 |
CPR 31.22 is a complete code governing the use of disclosed documents; implied undertaking applies to documents and information derived from them. |
Court confirmed CPR 31.22 applies to employment tribunal disclosures and prohibits use of documents and derived information without permission. |
| Crest Homes Plc v Marks [1987] 1 AC 829 |
Implied undertaking extends to information derived from disclosed documents. |
Supported the principle that information from disclosed documents is protected. |
| Process Development v Hogg [1996] FSR 45 |
Use of documents that are the claimant's own property is not restricted by the implied undertaking; discretion applies for disclosure outside litigation. |
Distinguished between use of defendant's documents and claimant's own property; Court found use of claimant's property did not breach undertaking. |
| Miller v Scorey [1996] 1 WLR 112 |
Retrospective permission to use disclosed documents is rare and requires just cause; striking out may be appropriate if no permission granted. |
Court considered retrospective permission but declined it due to prejudice to defendant; relevant to retrospective permission discussion. |
| Yousef Abdul Latif Jameel v Dow Jones & Co Inc [2005] EWCA Civ 75 |
Considerations relating to striking out claims and overriding objective. |
Referenced in argument on whether the claim should be struck out for being no longer worthwhile. |
| Shlaimoun v Mining Technologies [2012] 1 WLR 1126 |
Implied permission to use disclosed documents may arise where the court orders disclosure anticipating subsequent proceedings. |
Court held implied permission can be recognized if the order contemplates use in subsequent proceedings; distinguished from present case. |
| McBride v The Body Shop International S.A. [2007] EWHC 1638 (QB) |
High Court can grant orders restricting use of disclosed documents; employment tribunal may lack power to restrict use in higher court. |
Confirmed High Court jurisdiction to grant permission under CPR 31.22 when disclosure arises from tribunal proceedings. |
| Riddick v Thames Board Mills [1977] 1 QB 881 |
Disclosure is an invasion of privacy and use of disclosed documents should be limited to the litigation in which disclosure is made. |
Supported the policy rationale behind CPR 31.22 and the implied undertaking. |
Court's Reasoning and Analysis
The Court analyzed the application of CPR 31.22, which restricts use of disclosed documents to the proceedings in which they are disclosed unless exceptions apply. The Court recognized that the implied undertaking restricting use of disclosed documents extends to information derived from those documents, not merely the documents themselves.
Although the disclosure occurred in employment tribunal proceedings, the tribunal rules do not explicitly restrict use of disclosed documents. However, the Court found it implicit that recipients of disclosure in tribunals are subject to the same restrictions as in County Court proceedings.
Company A argued that it only used the information that the Defendant possessed the documents, not the documents or information within them. The Court rejected this distinction, reasoning that use of the fact of possession is inseparable from use of the documents and the information contained therein. Therefore, permission under CPR 31.22 was required before using this information in separate High Court proceedings.
The Court distinguished the Process Development v Hogg decision, emphasizing that the confidential documents disclosed were not the Defendant's property but copies created and retained by him, thus protected by the implied undertaking.
The Court concluded that the order made by Singh J implicitly assumed permission to use the documents but that no explicit permission under CPR 31.22 was granted. Implied permission requires a conscious decision by the court, which was absent here as the issue was not raised or considered at the time.
The Court held that retrospective permission should not have been refused. The failure to seek permission was inadvertent, and retrospective permission would likely have been granted if sought. Striking out the claim as an abuse was disproportionate and unjust, especially since Company A had obtained delivery up, destruction orders, and an interlocutory injunction.
The Court recognized that the High Court is the appropriate forum to grant permission under CPR 31.22 for use of disclosed documents arising from tribunal proceedings, as the tribunal is not a "court" under CPR definitions.
Finally, the Court found that continuing the action had a useful purpose, given ongoing concerns about potential misuse of confidential information, and that the interlocutory injunction and other relief remained relevant.
Holding and Implications
The Court ALLOWED THE APPEAL and set aside the orders of the lower court which had struck out the action as an abuse, revoked the costs order in favor of Company A, and ordered Company A to pay the Defendant's costs.
The Court granted Company A retrospective permission to use the confidential documents disclosed in the employment tribunal proceedings for the purposes of the High Court action.
The decision restores Company A's ability to pursue its claim for delivery up, deletion, injunction, and damages based on the confidential documents. It clarifies that permission under CPR 31.22 is required for use of disclosed documents in separate proceedings, that such permission must be expressly granted or properly implied, and that retrospective permission should be considered rather than striking out claims as an abuse where failure to seek permission was inadvertent.
No new precedent was established beyond the application and clarification of existing principles relating to CPR 31.22 and implied undertakings in the context of employment tribunal disclosures and subsequent High Court proceedings.