Stiedl v Enyo Law LLP & Ors

Where a solicitor obtains an opponent’s confidential or privileged information without a previous solicitor-client relationship, the ordinary remedy is an injunction restraining use of the information, rather than removal of the solicitor from the case. The court must assess all relevant circumstances and decide whether there is a real risk that the information will provide an advantage or cause prejudice. A real risk is more than fanciful or theoretical, but need not be substantial. The court should take a realistic and robust view of the evidence, including the nature of any document review, the reviewers’ recollection, the relevance and content of the documents, and the prejudice caused by disqualification. On the facts, the cursory review created no real risk of material prejudice, and disqualification would have been disproportionate.

The claimant, a defendant in complex proceedings concerning alleged losses from technology investment schemes, applied to restrain Enyo Law LLP and Addleshaw Goddard LLP from acting for the claimants in those proceedings. He alleged that an external hard drive supplied to the solicitors contained his confidential and privileged documents, and that the documents had been reviewed by members of the firms.

Independent reviewers identified 25 documents as both relevant and prima facie privileged. The application required the court to determine the appropriate remedy where solicitors had obtained allegedly privileged information without having previously acted for the person asserting privilege, and whether continued representation created a real risk of prejudice.

1. Application dismissed. Enyo was permitted to continue representing the claimants, subject to the undertaking that the documents identified as prima facie privileged were not to be used without further order.
2. Where there was no previous solicitor-client relationship, the ordinary remedy was an injunction restraining use of the confidential or privileged information. That distinction concerned the ordinary form of relief and was not inflexible.
3. The court rejected the submission that departure from the ordinary remedy required unusually powerful factors. It had to consider all relevant circumstances and ask whether there was a real risk that the information could advantage the solicitor’s client or disadvantage the person asserting privilege. A real risk was more than fanciful or theoretical, but need not be substantial.
4. The evidence showed that the Tier 1 review was cursory and directed to eliminating unrelated documents. The reviewers did not substantively analyse the documents, the relevant Enyo reviewer could not recall the contents, and there was no evidence that information had been communicated within the firm. No real risk of usable information therefore arose.
5. Even assuming detailed consideration of the documents, most contained information already known, matters expressed generally, material consistent with the claimant’s defence, or material incapable of causing material prejudice. Disqualification would have been wholly disproportionate.
6. Articles 6 and 8 of the European Convention on Human Rights informed the assessment but permitted the balancing exercise inherent in domestic equitable relief.