Fairstar Heavy Transport NV v Adkins & Anor

Information, including the content of an e-mail, is not ordinarily property capable of supporting a proprietary claim merely because it was created or received by an employee or agent while acting for a principal. The physical medium carrying information must be distinguished from the information itself. Protection against misuse is ordinarily provided by confidentiality, contract or copyright. A proprietary analysis based on ownership by the sender, recipient, licensed control or shared ownership creates impractical and unrealistic consequences. The court therefore rejected a proprietary claim to inspect e-mail contents, while expressing no view on other possible grounds of relief.

Fairstar obtained interim orders preserving e-mails sent or received by its former chief executive, Mr Adkins, while acting for Fairstar. At the return hearing, Fairstar sought inspection by an independent IT expert. Mr Adkins sought to set aside the order and argued that Fairstar had no proprietary claim to the content of the e-mails.

The parties agreed that the hearing should determine only whether Fairstar had an enforceable proprietary claim to the e-mail contents. Copyright, confidentiality and contractual claims were not relied upon. The central issue was whether information conveyed by e-mails could constitute property for this purpose.

1. The agreed issue was determined against Fairstar. The application to inspect the e-mails could not succeed on the proprietary ground advanced.
2. The court distinguished the physical medium carrying information from the message or information conveyed. A letter, disc or other object may be property, but that does not make the information recorded on it property capable of supporting a proprietary claim.
3. Lamb v Evans did not establish that all materials created or obtained by an employee necessarily belong to the employer. Its reasoning supported restraint of misuse arising from the principal-agent relationship and duties of good faith, rather than the broad proprietary proposition advanced.
4. The preponderance of authority pointed strongly against a proprietary right in information, including confidential information. The court accepted that this was not settled law, but found no binding authority supporting Fairstar’s case. The discussion in Boardman v Phipps did not decide whether the information was trust property; the observations on that question were not part of the ratio.
5. The court considered possible models of ownership of e-mail content. Ownership by the sender or recipient would produce impractical consequences. Licensed or shared ownership would either replicate confidentiality controls or create extensive and undesirable ramifications. There was no compelling practical or logical basis for recognising such property.
6. Protection against misuse of information was adequately available through equity’s jurisdiction over confidential information, contract where applicable, and copyright. The court expressed no view on any alternative basis for relief. Costs of earlier applications were left for agreement or further hearing.