UK Dry Risers Ltd v Maher

On the civil balance of probabilities, the seriousness of an allegation affects the inherent probabilities and the strength of evidence required, but does not create a higher standard of proof. Contractual undertakings are interpreted objectively and contextually. Specific provisions must be read with the general obligation they particularise. An undertaking directed to confidential information does not prohibit conduct that makes no use or disclosure of that information. Information in the public domain is not confidential. Nor is information supplied by an upstream contractor necessarily confidential information belonging to a downstream contractor. The claim for conversion therefore succeeded on the facts, while the contractual claim failed because the installations did not use the claimant’s confidential information.

UK Dry Risers Ltd claimed that Jack Maher and J M Fire Protection Maintenance Ltd had converted dry-riser components and breached contractual undertakings given in April 2018. The alleged breaches concerned two installations at Dunmore Point and Granard House. The defendants denied the theft and installation allegations. J M Fire Protection Maintenance Ltd also counterclaimed for unpaid invoices.

The court determined the factual dispute, the proper interpretation of the undertakings, whether the relevant information remained confidential, and the counterclaim.

1. Conversion. Applying the civil standard of proof, with appropriate regard to the inherent improbability of serious allegations and the need for stronger evidence, the court found that Mr Maher stole UKDR’s components and installed them at Dunmore Point and Granard House. The defendants were liable in conversion. Damages were awarded in the value of the components, £3,690.72, plus interest.
2. Contractual interpretation. The undertakings had to be interpreted objectively and contextually, considering the contract as a whole and the background reasonably available to the parties. The words used remained of primary importance. Business common sense could not justify rewriting an agreement. The approach was consistent with [1998] 1 WLR 896, [2011] UKSC 50, [2015] UKSC 36 and [2017] UKSC 24.
3. Paragraphs 6.4 and 17.2(1) were not free-standing prohibitions. They were specific instances of the general obligations in paragraphs 5 and 6 and required use or disclosure of UKDR’s confidential information.
4. The relevant information concerning London borough dry-riser installations was in the public domain by the material time and was therefore no longer confidential. Alternatively, Mr Maher acted on information supplied by TDK, which was not UKDR’s confidential information. The contractual claim consequently failed. The court did not need to decide the restraint of trade issue, although it would have been concerned about the breadth of the injunction sought.
5. Counterclaim. UKDR had no sufficient defence to the unpaid invoices. Any implied right to delay payment pending snagging could operate only for a short period, which had expired. The counterclaim succeeded for £13,628 plus VAT and interest.
6. The interim undertakings given on 9 August 2018 were discharged.