Facts
The case arose out of one incident in the case brought by the
Claimant against PricewaterhouseCoopers in respect of their
accounting. At some stage, the draft advice of leading and
junior counsel to the Claimant was stolen. Clearly, this was
a highly confidential document.
The Defendant operated a website specialising in gossip.
She invited people to post “juicy bits of gossip” on the
website. Some time before 11 March 2000, the contents of the
stolen advice were given to the Daily Express, but an injunction
prevented publication. On 12 March, the contents of the
advice appeared on the Defendant’s website, although at that stage
the Defendant was unaware of it. She subsequently became
aware of it, and realised it was of “value” (but not necessarily of
monetary value) as it concerned a famous person. There were
no complaints, so she gave it more prominence on the website by
providing a link on the home page to the advice.
The Daily Express told the Claimant’s solicitors that the advice
was on the Defendant’s website, and they obtained an injunction on
27 March against the Defendant. However, some time before
that, the Defendant had deleted the advice from the website.
She gave undertakings not to re-post or republish the advice.
The Claimant sought damages for breach of confidence. The
Defendant claimed that she did not know and did not realise that
the advice was confidential material. She could not know if
the advice was a prank and could not know if the advice was in fact
genuine. The Claimant applied under CPR Part 24 for summary
judgment.
Judgment
The action for breach of confidence arises when information is
received without inducement but when the recipient knows or ought
to know that it is being imparted in breach of confidence or when
the information is initially received innocently but the recipient
later becomes aware that it was imparted in breach of
confidence.
In this case, any intelligent person would know that an advice
from counsel is confidential and privileged, and the Defendant
ought to have known that there was a risk that it was being
imparted in breach of confidence and should not have continued to
have it on her website.
Accordingly, the Defendant had no real prospect of succeeding in
her defence and the Claimant was entitled to summary judgment and
to damages to be assessed.
Commentary
This case raises similar issues to those discussed in
Totalise plc v The Motley Fool Ltd (reported above), and
further extends the obligations of ISPs regarding the monitoring of
material posted on their websites.
In Godfrey v Demon Internet Ltd (discussed above) the
ISP was held liable for publication from the point it was advised
that defamatory material existed on its website. In the
current situation, although the Defendant was aware of the material
(which was confidential, rather than defamatory), she alleged that
she did not know the material was confidential as she had no idea
whether the advice was a prank, nor whether it was genuine
(although she did raise the profile of the material by creating a
link from her home page). As soon as she was advised by
solicitors for the Claimant that the material was considered
confidential, she removed it from her site.
First, Master Leslie held, as common ground, that liability for
breach of confidence did not occur until the Defendant actually
became aware of the material in question. Thus, the mere
posting of the material on the bulletin board (by whatever source)
did not render the ISP liable for breach of confidence. The
first time the ISP could be liable for such breach was when it
became aware of the material.
Second, Master Leslie held that the test for breach of
confidence was not whether the Defendant knew that the material was
imparted in breach of confidence, but whether the Defendant ought
to have known that it was being imparted in breach of confidence
(including where there was a risk that it was being so
imparted). Master Leslie stated,
“Here, it seems to me that any
intelligent person, as the Countess undoubtedly is, must know or
ought to know, if they do not actually know, that an advice from
counsel is confidential and privileged, and whether or not she
thought it might be a prank, she ought to have known that there was
a risk that it was being imparted in breach of confidence and
therefore ought not to have continued to have it on her website;
far less should she have created a link.”
Accordingly, it would appear that if an ISP becomes aware of
material on its website and there is a risk that it was imparted in
breach of confidence, the ISP has an obligation to discontinue
access to the material. Correctly, this obligation only takes
effect when the ISP becomes aware of the material, but becoming so
aware is not dependent on some aggrieved party advising the ISP
about the material which it considers confidential. The
obligation applies as soon as the ISP becomes aware of the material
by any means and if the ISP ought to consider there a risk that the
material was imparted in breach of confidence. Thus the
Defendant was found liable for damages despite the fact she removed
the material from the website as soon as she was advised by the
Claimant’s solicitors that it was confidential and gave
undertakings not to re-post the material.
Again, we are seeing the liability of ISPs concerning the
content of postings on bulletin boards extended. In this
decision and that of Totalise plc v The Motley Fool Ltd
considerable emphasis was placed on the fact that the offending
material was so clearly confidential or defamatory that an
obligation was forced onto the ISP to remove the material.
What is not clear is the position where the material is not so
obviously confidential or defamatory, but there is a risk that it
might be so. This uncertainty is somewhat unsatisfactory as
it is the ISP which bears the risk of assessing the material.
One further observation of Master Leslie in this case is of
note. In relation to the assessment of damages for the breach
of confidence, guidance was given that the confidential information
was available on the website for only 14 days and “all the
evidence is that it was a puny or obscure web site with not very
many visitors”. AOL and Yahoo! beware.
