Recent Important Developments in the English Law of Confidence: While Michael Douglas's Attempt to Create a Legal Right to Privacy Has Gotten Most Media Focus, There Are Other Significant Cases

By Pierce, Jennifer | Defense Counsel Journal, April 2003 | Go to article overview

Recent Important Developments in the English Law of Confidence: While Michael Douglas's Attempt to Create a Legal Right to Privacy Has Gotten Most Media Focus, There Are Other Significant Cases


Pierce, Jennifer, Defense Counsel Journal


WE LIVE in an age in which confidential information is of prime importance to business and in which there is an increasing storage and use of information relating to private individuals. The English law of confidence has been flexible, created and developed by the courts. This area of law has assisted both businesses and prominent private individuals, and it continues to do so in many different ways.

The law of confidence has been supplemented by data protection laws, which were first introduced in 1984 and were initially under-utilised, but are now used as the basis for additional claims. (1) The Human Rights Act 1998 also has been considered in this field of law. Both of these topics, together with speculation about the possible creation of an English law of privacy, have been the subject of a great many articles.

There have also been incremental developments in other areas that are equally important in a commercial context. Recent English cases show the diversity and potential application of this body of law.

ENGLISH LAW OF CONFIDENCE

The basic tenets of the English law of confidence were set out in Coco v. A.N. Clark (Engineers) Ltd. (2) and were summarised recently by Lord Justice Mummery in the Court of Appeal in Inline Logistics Ltd. v UCI Logistics Ltd. : (3)

* The information must have the quality of confidence. All that means is that it must not be common knowledge or published information, nor must it be obvious or trivial information.

* The information must be imparted in circumstances that give rise to an obligation of confidence on the part of the recipient. There may be a contract in effect, but that is not a requirement in order to protect confidential information in equity.

* There must be shown to have been an unauthorised use of the information which is detrimental to the confider.

A. General Commercial

1. Scope of Protection

Inline Logistics Ltd. V. UCI Logistics Ltd. was a decision of the Court of Appeal, following a first instance judgment in the High Court. The relevant information related to design drawings for warehousing, which had been made by Inline, a specialist designer, for UCI, a company providing warehousing services. The designs were made for the purpose of a specific tender by UCI. As Inline was unable to revise the drawings swiftly before the tender deadline, UCI engaged a different designer to complete the work for the tender.

The judge at first instance found that a considerable degree of skill and knowledge is required in order to design a warehouse that efficiently and safely satisfies the requirements of the owners of the goods. He decided that the combination of design features, as selected, was protectable as confidential information, but the individual features were not protectable as they did not have the necessary quality of confidence.

Lord Justice Mummery stated: "It is clear from the authorities that, as a matter of law, a particular combination of individual design features--themselves not confidential because they are common knowledge, obvious or commonplace--may be protected as confidential information." However, he also decided, "The quality of confidence generally requires more than just the expenditure of skill and effort on the production of information." This was a borderline case on the facts.

Having established that there was confidential information, it was then necessary to decide whether that information had been used. Mummery, L.J., agreed with the judge at first instance that the question of use of confidential information must be approached differently from infringement of copyright. It is not a question of substantial use, as with copyright, but whether the material has been used at all. However, in this case it was necessary to decide whether the combination of features that was protectable had been used, as opposed to the individual features outside that combination. …

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