The plaintiff printed and published a multi-lingual European trade directory, engaging the defendants as commission agents to solicit paid entries for the directory. The businessmen could, if they wished, supply wood blocks or other materials from which illustrations could be printed in the directory. The defendants left to work for a rival publication, intending to use the wood blocks and other materials still in their possession to get illustrations printed in the rival publication. There was nothing in their contract which expressly prevented them from doing so.
Held: The injunction, having been granted to restrain breaches of good faith, was upheld.
Lindley LJ said: ‘That suggests this question – which has nothing to do with copyright – What right has any agent to use materials obtained by him in the course of his employment and for his employer against the interest of that employer? I am not aware that he has any such right. Such a use is contrary to the relation which exists between principal and agent. It is contrary to the good faith of the employment, and good faith underlies the whole of an agent’s obligations to his principal. No case, unless it be the one which I will notice presently, can I believe be found which is contrary to the general principle upon which this injunction is framed, viz, that an agent has no right to employ as against his principal materials which that agent has obtained only for his principal and in the course of his agency. They are the property of the principal. The principal has, in my judgment, such an interest in them as entitles him to restrain the agent from the use of them except for the purpose for which they were got.’
Bowen LJ said: ‘Has not the Plaintiff a right to restrain the Defendants from using such blocks and materials or copies as they obtain while they were in the employment of the Plaintiff and for the purposes of their service and work which they had to do, that is to say, which they obtained for the purpose of doing their duty to the Plaintiff? Ought not the Plaintiff be able to restrain them from afterwards using those materials and of those documents in competition with the Plaintiff himself? It is not a question of copyright – that must be kept out of sight altogether – nor is it, on the other hand, a simple question of the absolute property at law in the documents themselves or in the blocks themselves. It is a question of whether the Plaintiff, whatever the property in the documents may be, or whatever the property in the materials may be, has not sufficient special property in them to entitle him to restrain the use of them against him when they had been obtained for his use by his agents in the course of their employment. That depends entirely, I think, upon the terms upon which the employment was constituted through which the fiduciary relation of principal and agent came into existence. I think my Brothers have already during the course of the argument expressed what I fully believe, that there is no distinction between law and equity as regards the law of principal and agent. The common law, it is true, treats the matter from the point of view of an implied contract, and assumes that there is a promise to do that which is part of the bargain, or which can be fairly implied as part of the good faith which is necessary to make the bargain effectual. What is an implied contract or an implied promise in law? It is that promise which the law implies and authorises us to infer in order to give the transaction that effect to the parties must have intended it to have and without which it would be futile.’
Referring to cases where an employee has ‘surreptitiously copied something which came under his hands while he was in the possession of that trust and confidence’, Kay LJ said that the employee ‘has been restrained from communicating that secret to anybody else, and anybody who has obtained that secret from him has also been restrained from using it.’
He agreed, saying that he assumed that the agents would have had notebooks in which they would note down all the information collected from the people they canvassed. He then said: ‘The argument was put most forcibly as I followed it in this form: Why should they not retain these notebooks in their hands, having now left the Plaintiff’s employer, and use them in order to find out the persons abroad with whom they had formally entered into engagements, and to obtain from those advertisers authority to put advertisements of theirs into a rival publication to be published as a rival of the Plaintiff’s book? The answer is a very simple one. All those materials were obtained awhile you, the Defendants, were acting as the Plaintiff’s agents, while you were in that confidential relation to him and for the purpose for which he employed and paid you, viz, of compiling this book of the Plaintiffs, and therefore to allow you to use any of those materials for your own purposes would be allowing you to use them for a purpose for which they were not compiled – you, while you compiled them, being in the position of the Plaintiff’s agent, and there being a confidential relation between you and the Plaintiff. I turn to one of the leading cases on the subject, and I take the language of Lord Justice Turner in his judgment in Morison v Moat: ‘That the Court has exercised jurisdiction in cases of this nature does not, I think, admit of any question. Different grounds have indeed been assigned for the exercise of that jurisdiction. In some cases it has been referred to property, in others to contract, and in others, again, it has been treated as founded upon trust or confidence – meaning, as I conceive, that the Court fastens the obligation on the conscience of the party, and enforces it against him in the same manner as it enforces against a party to whom a benefit is given, the obligation of performing a promise on the faith of which the benefit has been conferred; but upon whatever grounds that jurisdiction is founded, the authorities leave no doubt as to the exercise of it . . The jurisdiction against these Defendants is because these materials which they want to use were obtained by them when they were in the position of agents for the Plaintiff, and, although the Plaintiff might not be able to prevent anybody else in the world from publishing or using such materials as he is trying to prevent these Defendants from using, that would be no answer, because these Defendants, from the position in which they were in, are put under a duty towards the Plaintiff not to make this use of the materials.’
Judges:
Kay LJ, Lindley LJ, Bowen LJ
Citations:
[1893] 1 Ch 218
Citing:
Approved – Prince Albert v Strange ChD 8-Feb-1849
The Prince sought to restrain publication of otherwise unpublished private etchings and lists of works by Queen Victoria. The etchings appeared to have been removed surreptitiously from or by one Brown. A personal confidence was claimed.
Held: . .
Approved – Morison v Moat 20-Aug-1851
A servant, Moat, sought to use a secret formula of his employer’s. The plaintiff requested an injunction to restrain use of the formula.
Held: The Vice Chancellor reiterated the principles, as to which he said there was ‘no doubt’, adding: . .
Cited by:
Cited – Lord Ashburton v Pape CA 1913
Pape’s bankruptcy discharge was opposed by Lord Ashburton. He subpoenaed Brooks, a clerk to Lord Ashburton’s solicitor and obtained privileged letters written by Lord Ashburton to Mr Nocton, which Pape proposed to use. Pape and Brooks had colluded. . .
Cited – Tchenguiz and Others v Imerman CA 29-Jul-2010
Anticipating a refusal by H to disclose assets in ancillary relief proceedings, W’s brothers wrongfully accessed H’s computers to gather information. The court was asked whether the rule in Hildebrand remained correct. W appealed against an order . .
Cited – The Newspaper Licensing Agency Ltd and Others v Meltwater Holding Bv and Others ChD 26-Nov-2010
The claimant newspapers complained of the spidering of the web-sites and redistribution of the materials collected by the defendants to its subscribers. The defendants including the Public Relations Consultants Association (PRCA) denied that they . .
Cited – The Newspaper Licensing Agency Ltd and Others v Meltwater Holding Bv and Others CA 27-Jul-2011
The defendant companies provided media monitoring services, automatically searching web-sites for terms of interest. The claimant newspapers operated a licensing system through the first claimant permitting the re-use of the content on its members . .
Cited – Fairstar Heavy Transport Nv v Adkins and Another CA 19-Jul-2013
The court was asked whether the appellant company was entitled to an order requiring its former Chief Executive Officer, after the termination of his appointment, to give it access to the content of emails relating to its business affairs, and . .
Lists of cited by and citing cases may be incomplete.
Employment, Information
Updated: 18 May 2022; Ref: scu.270395
