Practice and Procedure


PUBLISHED March 3, 2003

The claimants were unsuccessful in their application for an injunction restraining the defendants from relying on privileged communications between the claimants and an anonymous source. The court found that there had been forgery by the claimants and the public interest in the disclosure of wrongdoing and the proper administration of justice required that no injunction be granted.Application by the claimants for an injunction to restrain the use of email correspondence which the defendants had obtained from a person (whose identity was apparently not known to either party) with whom the claimants had said they had been conducting privileged communications with a view to obtaining evidence for use in the action. The claimants were part of the ISTIL group. The first defendant ('Z') was a director of the claimants and the beneficial owner of the second defendant ('R'). The second claimant ('MCL') agreed a contract ('the contract') with an entity owned by the Ukrainian government. The claimants contended that the contract, which they alleged would have been very valuable, had been diverted to R by Z and claimed relief against both defendants on the basis of the alleged breaches of Z's contractual and fiduciary duties to the claimants. In September 2002, on the claimants' application, a worldwide freezing order was made against the defendants. The defendants denied diversion and contended that Z had fully and properly accounted to the claimants in respect of the contract. An email containing a list of Z's assets was sent to a director ('M') of the claimants. M claimed they were sent to him anonymously and unsolicited by somebody signing himself or herself "ISTIL Friend". M also claimed to have received a fax from ISTIL Friend with details of a letter of credit pertaining to the contract, about which Z had allegedly lied. The claimants' solicitors gave the defendants' solicitors ISTIL Friend's email address. Z sent an email to the address, and in reply received a series of copy emails that showed two-way correspondence between M and ISTIL Friend. The defendants' solicitors sent copies to the claimants' solicitors, contended that no privilege attached to them, and that in some instances the communications were indicative of fraud. The claimants claimed that all the documents were covered by litigation privilege, since they had come into existence for the purpose of gathering evidence, and applied for a final negative and mandatory injunction for restraint of use and delivery up of the documents in the possession of the defendants and their solicitors. They contended that: (i) all communications between a solicitor and a potential witness for the purpose of evidence gathering in the course of litigation were self evidently confidential; (ii) there had been no need for an agreement between ISTIL Friend and the claimants in order for their communications to have had the requisite quality of confidence; (iii) a privileged communication with a witness could not be disclosed or used by the other party unless the party in whom privilege resided waived that privilege; and (iv) privilege existed even if the communications were with an anonymous party. The defendants resisted the injunction on the grounds that: (a) nothing on the face of the emails indicated that they were confidential; (b) there was no evidence that ISTIL Friend undertook to the claimants to keep their contents confidential and, by forwarding the emails to Z, ISTIL Friend had demonstrated that s/he did not regard himself as being under any duty of confidentiality to the claimants; (c) the documents printed out by Z and the defendants' solicitors were not brought into existence by or at the direction of the claimants for the dominant purpose of use in the litigation, and they (the defendants) were in a position to give secondary evidence of the contents of the communications from the claimants and their solicitors to ISTIL Friend; (d) even if privilege might have existed, that privilege did not protect documents coming into existence in furtherance of fraudulent conduct; (e) by seeking to rely on documents emanating from an undisclosed source the claimants had to be taken to have waived the privilege otherwise applicable in relation to correspondence between them, their solicitors and ISTIL Friend; and (f) even if the documents were confidential, the public interest required their disclosure, because they indicated iniquity.HELD: (1) The communications to ISTIL Friend were intended to be confidential and the circumstances would have made ISTIL Friend aware of that. (2) This was a case in which, in the exercise of the Lord Ashburton v Pape (1913) 2 Ch 469 jurisdiction, the court was entitled to balance the public interest in supporting legal professional privilege on the one hand, and the public interest in the proper administration of justice on the other hand. (3) There had been forgery and a deliberate decision not to adduce evidence in a context that had made the evidence which had been put forward misleading. (4) The combination of forgery and misleading evidence made this a case where the equitable jurisdiction to restrain breach of confidence gave way to the public interest in the proper administration of justice. (5) The injunction had to be refused in relation to the emails sent by M and by the claimants' solicitors on the ground that the public interest in the disclosure of wrongdoing and the proper administration of justice required that no injunction be granted to prevent reliance on the emails by the defendants. In respect of all the other emails between ISTIL Friend and the claimants and their advisers the injunction was also refused on the discretionary ground that the claimants had misled the court in a material respect connected with the documents for which the remedy was claimed.Application dismissed.

[2003] EWHC 165 (Ch)