Hilton v Barker Booth & Eastwood

A solicitor who holds confidential information obtained from one client cannot disclose it to another client without consent. If the information is relevant to the proposed transaction, the solicitor must decline to act or require one client to instruct independent solicitors. The solicitor cannot continue acting and then rely on the duty of confidentiality as a defence to the conflict.

The duty of disclosure depends on the nature and terms of the retainer. A solicitor may have to disclose relevant non-confidential information obtained in the transaction. Loss caused by failure to decline the retainer must nevertheless be proved by evidence; it cannot be presumed.

Barker Booth & Eastwood acted for Bromage in criminal proceedings and acquired confidential information about his convictions and financial history. They later acted for Hilton in a proposed property development transaction with Bromage, without disclosing that information or advising Hilton to obtain independent solicitors.

The trial judge held that BBE’s breach consisted in continuing to act for Hilton despite the conflict, rather than failing to disclose Bromage’s confidential information. He concluded that Hilton had not proved consequential loss and entered judgment for BBE. Hilton appealed, contending that BBE also owed him a duty to disclose the information.

1. Appeal dismissed. The Court of Appeal upheld the judgment for BBE.
2. The Vice-Chancellor held that a solicitor’s duty of disclosure depends on the nature and terms of the retainer. A solicitor acting for more than one party may have to disclose information obtained in the transaction from one client to another. However, the solicitor is under no obligation, and indeed has the opposite duty, to disclose confidential information obtained under an earlier retainer from a former client.
3. The confidentiality obligation owed to Bromage continued after the criminal retainer and prevented disclosure to Hilton without Bromage’s consent. No waiver by Bromage was alleged or proved. BBE therefore could not properly perform Hilton’s retainer and should have told him promptly to instruct other solicitors.
4. The Court rejected the argument that section 199 of the Law of Property Act 1925 created a different rule for sales of land from mortgage transactions. The statutory doctrine of notice concerns priorities between competing property interests, not the scope of a solicitor’s common-law duty of disclosure.
5. The breach was the failure to decline or terminate the conflicting retainer, not a breach consisting in disclosure of Bromage’s confidential information. Hilton could recover only loss caused by that breach. He had to prove that independent solicitors would have discovered the relevant information; the evidence did not establish that proposition, so no loss was proved.
6. The Vice-Chancellor expressed doubt, obiter, about the breadth of the reasoning in Bristol and West BS v Baden, Barnes and Groves concerning non-confidential information known before and independently of the transaction. That point did not arise for decision.

• Court of Appeal (Civil Division): appeal from the judgment of His Honour Judge Maddocks, sitting as a deputy judge in the Chancery Division, dismissed.
• Chancery Division: judgment entered for Barker Booth & Eastwood with costs; permission to appeal granted.