In Douglas, the claimants said that the defendants had interfered with their contract to provide exclusive photographs of their wedding to a competing magazine, by arranging for a third party to infiltrate and take and sell unauthorised photographs.
In OBG, the defendants acted as receivers under an invalid charge, and were accused of unlawful interference with the company’s contractual relations.
In Mainstream, employees diverted a contract for their own benefit. The defendants had innocently financed the deal. The House considered the various form of tort.
Held: A duty of confidence was enforceable where arrangements had been made to protect the commercial value of photographs. English law should not adopt a view that motive should affect liability for the causation of economic loss. It had been incorrect to bring together the two torts of inducing a breach of contract, and causing economic loss by unlawful means by the so called ‘unified theory’. They are separate torts. Those cases referring to ‘unlawful interference with contractual relations’ were really cases of a wider tort of ‘causing loss by unlawful means’, which included the tort of intimidation but remained distinct from the tort of procuring a breach of contract.
Procuring a breach of contract is an accessory liability, dependent upon the primary wrong of a third party breaching its contract with the claimant. There must be primary liability first. Causing loss by unlawful means is a primary tort requiring the defendant to have intended and caused loss through unlawful means interfering with the liberty of third parties to deal with the claimant. Such unlawful means might be threats and intimidation but could also be any other actionable wrong against the third party.
Lord Hoffmann said: ‘the principle of accessory liability for breach of contract . . cannot be subsumed in the tort of causing loss by unlawful means . . simply by classifying ‘seduction’ as unlawful means. That only adds a pejorative description to a circular argument . . To induce a breach of contract is unlawful means when the breach is used to cause loss to a third party . . but it makes no sense to say that the breach of contract itself has been caused by unlawful means.’
and ‘Whatever may have been the position of the Douglases, who, as I mentioned, recovered damages for an invasion of their privacy, ‘OK!’s’ claim is to protect commercially confidential information and nothing more. So your Lordships need not be concerned with Convention rights. ‘OK!’ has no claim to privacy under article 8 nor can it make a claim which is parasitic on the Douglases’ right to privacy. The fact that the information happens to have been about the personal life of the Douglases is irrelevant. It could have been information about anything that a newspaper was willing to pay for. What matters is that the Douglases, by the way they arranged their wedding, were in a position to impose an obligation of confidence. They were in control of the information.’
Otherwise, OBG Limited and others v Allan and others
Lord Hoffmann stated: ‘No secondary liability without primary liability’.
Lord Hoffmann, Lord Nicholls of Birkenhead, Lord Walker of Gestingthorpe, Baroness Hale of Richmond, Lord Brown of Eaton-under-Heywood
[2007] UKHL 21, Times 03-May-2007, [2007] 2 WLR 920, [2008] 1 AC 1
Bailii
England and Wales
Citing:
Appeal from – OBG Ltd OBG (Plant and Transport Hire) Ltd v Raymond International Ltd; OBG Ltd v Allen CA 9-Feb-2005
The defendants had wrongfully appointed receivers of the claimant, who then came into the business and terminated contracts undertaken by the business. The claimant asserted that their actions amounted to a wrongful interference in their contracts . .
Appeal from – Mainstream Properties Ltd v Young and others CA 13-Jul-2005
The claimant appealed refusal of his claim for inducing a breach of contract against the sixth defendant. It said that an intention to disturb a contract could be inferred.
Held: A mere recklessness as to whether contractual rights were . .
Appeal from – Douglas and others v Hello! Ltd and others (No 3) CA 18-May-2005
The principal claimants sold the rights to take photographs of their wedding to a co-claimant magazine (OK). Persons acting on behalf of the defendants took unauthorised photographs which the defendants published. The claimants had retained joint . .
Cited – Garret v Taylor 1620
The defendant was held liable under the tort of causing loss by unlawful means, after he drove away customers of Headington Quarry by threatening them with mayhem and vexatious suits. . .
Cited – Tarleton v M’Gawley 1790
The master of the Othello, anchored off the coast of West Africa, was held to be liable in tort for depriving a rival British ship of trade by the expedient of using his cannon to drive away a canoe which was approaching from the shore: ‘that an . .
Cited – Lumley v Gye 1853
Inducing breach of contract is a Tort
An opera singer (Miss Wagner) and the defendant theatre owner were joint wrongdoers. They had a common design that the opera singer should break her contract with the plaintiff theatre owner, refuse to sing in the plaintiff’s theatre and instead . .
Cited – Allen v Flood HL 14-Dec-1898
Tort of Malicicious Inducement not Committed
Mr Flood had in the course of his duties as a trade union official told the employers of some ironworkers that the ironworkers would go on strike, unless the employers ceased employing some woodworkers, who the ironworkers believed had worked on . .
Cited – South Wales Miners’ Federation v Glamorgan Coal Company HL 1905
The union was accused of unlawful interference in contractual relations, and replied that their intention in calling a strike (inducing miners to break their contracts of employment) was to restrict production of coal and thereby raise its price. . .
Cited – Rookes v Barnard (No 1) HL 21-Jan-1964
The court set down the conditions for the award of exemplary damages. There are two categories. The first is where there has been oppressive or arbitrary conduct by a defendant. Cases in the second category are those in which the defendant’s conduct . .
Cited – Unilever Plc v Chefaro Proprietaries Ltd; Chiron Corp etc v Organon CA 24-Nov-1994
The Court of Appeal gave guidance on what criteria are to be used by them for expediting appeals cases.
Glidewell LJ stated that what must be shown ito establish common design in an allegation of tort is that there are ‘facts from which an . .
Cited – CBS Songs Ltd v Amstrad Consumer Electronics Plc HL 12-May-1988
The plaintiffs as representatives sought to restrain Amstrad selling equipment with two cassette decks without taking precautions which would reasonably ensure that their copyrights would not be infringed by its users.
Held: Amstrad could only . .
Cited – J T Stratford and Son Ltd v Lindley HL 1965
Lord Reid considered the tort of causing loss by unlawful means where the defendant was accused of calling a strike: ‘the respondent’s action made it practically impossible for the appellants to do any new business with the barge hirers. It was not . .
Cited – Quinn v Leathem HL 5-Aug-1901
Unlawful Means Conspiracy has two forms
Quinn was treasurer of a Belfast butchers’ association. Leathem, who traded as a butcher, employed some non-union men, although when the union made difficulties he asked for them to be admitted to the union, and offered to pay their dues. The union . .
Cited – Hollywood Silver Fox Farm v Emmett 1936
The plaintiffs farmed silver foxes for their fur. During the breeding season, they were nervous, but the neighbour defendant farmer deliberately encouraged his son to fire guns near the pens in order to disturb the breeding and cause economic loss. . .
Cited – Mogul Steamship Company Limited v McGregor Gow and Co QBD 10-Aug-1885
Ship owners formed themselves into an association to protect their trading interests which then caused damage to rival ship owners. The plaintiffs complained about being kept out of the conference of shipowners trading between China and London.
Cited – GWK Ltd v Dunlop Rubber Co Ltd 1926
GWK company made motor cars and the ARM company made tyres. GWK contracted to fit all their new cars with ARM tyres and to show them with ARM tyres at trade exhibitions. On the night before a motor show in Glasgow, Dunlop employees removed the ARM . .
Cited – D C Thomson and Co Ltd v Deakin CA 1952
The defendant Trades Union was alleged to have indirectly prevented a supplier from performing its contract to supply paper to the plaintiffs by inducing its members to withdraw their services from the supplier.
Held: It is a tort at common . .
Cited – Daily Mirror Newspapers Ltd v Gardner CA 1968
The Federation of Retail Newsagents decided to boycott the Daily Mirror for a week to persuade its publishers to pay higher margins, and advised them accordingly. The publishers sought an injunction saying the Federation was procuring a breach of . .
Cited – Torquay Hotel v Cousins CA 17-Dec-1968
The plaintiff contracted to buy oil for his hotel from Esso. Members of the defendant trades union blocked the deliveries of oil by Esso to the Hotel because of a trade dispute they had with the management of the hotel. The hotel sued for an . .
Cited – Merkur Island Corp v Laughton HL 1983
The shipowner claimants were party to a contract under which their obligation to prosecute their voyages with the utmost despatch was qualified by clauses providing for the vessel to go off hire and for charterers to have a right after 10 days to . .
Cited – British Industrial Plastics Ltd v Ferguson CA 1938
The defendant received information about a patentable invention from the plaintiff’s former employee. He said that his (mistaken) view was that since the employee had himself made the invention, it was patentable by him, and not covered by the . .
Cited – British Industrial Plastics Ltd v Ferguson HL 1939
The plaintiff’s former employee offered the defendant information about one of the plaintiff’s secret processes which he, as an employee, had invented. The defendant knew that the employee was obliged by his contract not to reveal trade secrets but . .
Cited – Emerald Construction Co v Lowthian CA 1965
The defendant union officials threatened a building contractor with a strike unless he terminated a sub-contract for the supply of labour. They obviously knew that there was a contract, since they wanted it terminated, but did not know its terms . .
Cited – Manifest Shipping Co Ltd v Uni-Polaris Shipping Co Ltd and Others HL 23-Jan-2001
The claimant took out insurance on its fleet of ships (the Star Sea). It had been laid up in its off season. The ship’s safety certificates were renewed before it sailed. It was damaged by fire. The insurers asserted that the ship had been . .
Cited – Mogul Steamship Co Ltd v McGregor, Gow and Co HL 18-Dec-1891
An association of shipowners agreed to use various lawful means to dissuade customers from shipping their goods by the Mogul line.
Held: The agreement was lawful in the sense that it gave the Mogul Company no right to sue them. But (majority) . .
Cited – National Phonograph Co Ltd v Edison-Bell Consolidated Phonograph Co Ltd CA 1908
The defendant had intentionally caused loss to the plaintiff by fraudulently inducing a third party to act to the plaintiff’s detriment. The court considered the tort of wrongful interference in contractual relations where a fraud had clearly been . .
Cited – Oren, Tiny Love Limited v Red Box Toy Factory Limited, Red Box Toy (UK) Limited, Index Limited, Martin Yaffe International Limited, Argos Distributors Limited PatC 1-Feb-1999
One plaintiff was the exclusive licensee of a registered design. The defendant sold articles alleged to infringe the design right. The registered owner had a statutory right to sue for infringement. But the question was whether the licensee could . .
Cited – Lonrho plc v Fayed CA 1989
There had been a battle to purchase the share capital of the House of Fraser which owned Harrods. Lonrho alleged that the Fayed brothers had perpetrated a fraud on the Secretary of State, and thereby secured permission to buy the company without a . .
Cited – Royal British Bank v Turquand CEC 1856
The plaintiff sought payment from the defendants, a joint stock Company, on a bond, signed by two directors, under the seal of the Company whereby the Company acknowledged themselves to be bound to the plaintiff in pounds 2,000. The company said . .
Cited – Barretts and Baird (Wholesale) Ltd v Institution of Professional Civil Servants (IPCS) 1986
A strike by civil servants in the Ministry of Agriculture in support of a pay claim was not intended to cause damage to an abattoir which was unable to obtain the certificates necessary for exporting meat and claiming subsidies. The damage to the . .
Cited – Fowler v Hollins 1872
The plaintiff claimed in conversion of bales of cotton bought in good faith through a broker in Liverpool.
Held: The purchasers were strictly liable.
Cleasby J said: ‘the liability under it is founded upon what has been regarded as a . .
Cited – Hollins v Fowler HL 1875
One who deals with goods at the request of the person who has the actual custody of them, in the bona fide belief that the custodier is the true owner, or has the authority of the true owner, should be excused for what he does if the act is of such . .
Cited – Dimbleby and Sons v National Union of Journalists HL 1984
The Trades Union caused its members to withdraw their labour from the plaintiff, so preventing the plaintiff from performing a contract with a firm of printers. The conduct was aimed, primarily, not at the plaintiff but at the printers, with whom . .
Cited – RCA Corporation v Pollard CA 1982
The illegal activities of bootleggers who had made unauthorised recordings of concerts, diminished the profitability of contracts granting to the plaintiffs the exclusive right to exploit recordings by Elvis Presley.
Held: The defendant’s . .
Cited – Lonrho Ltd v Shell Petroleum Co Ltd (No 2) HL 1-Apr-1981
No General Liability in Tort for Wrongful Acts
The plaintiff had previously constructed an oil supply pipeline from Beira to Mozambique. After Rhodesia declared unilateral independence, it became a criminal offence to supply to Rhodesia without a licence. The plaintiff ceased supply as required, . .
Cited – Morris v Kanssen HL 1946
The House considered the effect of provisions relating to the acts of directors in the 1929 Act. Lord Simonds said: ‘There is, as it appears to me, a vital distinction between (a) an appointment in which there is a defect or, in other words, a . .
Cited – Greig v Insole 1978
The court was asked whether the Test and County Cricket Board had, by passing certain resolutions, induced cricketers with contracts with World Series Cricket Pty Ltd, the plaintiff, to break those contracts. The TCCB had acted in good faith and . .
Cited – Emerald Construction Co v Lowthian CA 1965
The defendant union officials threatened a building contractor with a strike unless he terminated a sub-contract for the supply of labour. They obviously knew that there was a contract, since they wanted it terminated, but did not know its terms . .
Cited – Hunter and Others v Canary Wharf Ltd HL 25-Apr-1997
The claimant, in a representative action complained that the works involved in the erection of the Canary Wharf tower constituted a nuisance in that the works created substantial clouds of dust and the building blocked her TV signals, so as to limit . .
Appeal from – OBG Ltd OBG (Plant and Transport Hire) Ltd v Raymond International Ltd; OBG Ltd v Allen CA 9-Feb-2005
The defendants had wrongfully appointed receivers of the claimant, who then came into the business and terminated contracts undertaken by the business. The claimant asserted that their actions amounted to a wrongful interference in their contracts . .
See Also – OBG Ltd and Another v Allan and others CA 21-Feb-2005
The Court reduced the amount of damages owed to the applicants to GBP 244,000 plus interest. . .
Cited by:
Cited – Brennan v National Westminster Bank Plc QBD 27-Nov-2007
The claimant, a customer of the defendant had been charged sums when he went overdrawn beyond his limit. He claimed that the sums were unlawful penalties under the Regulations. The bank said that it had refunded the charges. The claimant sought . .
Cited – Total Network Sl v Revenue and Customs HL 12-Mar-2008
The House was asked whether an action for unlawful means conspiracy was available against a participant in a missing trader intra-community, or carousel, fraud. The company appealed a finding of liability saying that the VAT Act and Regulations . .
Cited – Norris v United States of America and others HL 12-Mar-2008
The detainee appealed an order for extradition to the USA, saying that the offence (price-fixing) was not one known to English common law. The USA sought his extradition under the provisions of the Sherman Act.
Held: It was not, and it would . .
Cited – National Commercial Bank Jamaica Ltd v Olint Corp Ltd (Jamaica) PC 28-Apr-2009
Jamaica – The customer appealed against refusal of an order requiring its bank not to close the customer accounts after the customer had been accused of fraud. There was no evidence that the account was being used unlawfully.
Held: In the . .
Cited – White v Withers Llp and Dearle CA 27-Oct-2009
The claimant was involved in matrimonial ancillary relief proceedings. His wife was advised by the defendants, her solicitors, to remove his private papers. The claimant now sought permission to appeal against a strike out of his claim against the . .
Cited – Digicel (St Lucia) Ltd and Others v Cable and Wireless Plc and Others ChD 15-Apr-2010
The claimants alleged breaches of legislation by members of the group of companies named as defendants giving rise to claims in conspiracy to injure by unlawful means. In effect they had been denied the opportunity to make interconnections with . .
Cited – Gray v News Group Newspapers Ltd and Another; Coogan v Same ChD 25-Feb-2011
The claimants said that agents of the defendant had unlawfully accessed their mobile phone systems. The court was now asked whether the agent (M) could rely on the privilege against self incrimination, and otherwise as to the progress of the case. . .
Cited – Phillips v Mulcaire SC 24-May-2012
The claimant worked as personal assistant to a well known public relations company. She alleged that the defendant had intercepted telephone message given by and left for her. The court was asked first as to whether the information amounted to . .
Cited – VTB Capital Plc v Nutritek International Corp and Others SC 6-Feb-2013
The claimant bank said that it had been induced to create very substantial lending facilities by fraudulent misrepresentation by the defendants. They now appealed against findings that England was not clearly or distinctly the appropriate forum for . .
Cited – Fenty and Others v Arcadia Group Brands Ltd (T/A Topshop) and Another ChD 31-Jul-2013
The claimant (Rihanna), a famous singer, complained that the defendant company had used her image on a T-shirt. The defendant had a licence from the photographer but not Miss Fenty. . .
Cited – Fenty and Others v Arcadia Group Brands Ltd and Another CA 22-Jan-2015
. .
Appeal from – OBG Ltd And Others v United Kingdom ECHR 13-Nov-2009
Statement of Facts . .
At HL – OBG Ltd And Others v United Kingdom ECHR 29-Nov-2011
Admissibility . .
Cited – Your Response Ltd v Datateam Business Media Ltd CA 14-Mar-2014
The claimant employed the defendant to manage subscription lists for the claimant’s magazines. The claimant came to seek damages, and the defendant for non-payment of its invoices. The court was now asked whether it was possible to assert a common . .
Cited – Heythrop Zoological Gardens Ltd (T/A Amazing Animals) and Another v Captive Animals Protection Society ChD 20-May-2016
The claimant said that the defendant had, through its members visiting their premises, breached the licence under which they entered, by taking photographs and distributing them on the internet, and in so doing also infringing the performance rights . .
Cited – Heythrop Zoological Gardens Ltd (T/A Amazing Animals) and Another v Captive Animals Protection Society ChD 20-May-2016
The claimant said that the defendant had, through its members visiting their premises, breached the licence under which they entered, by taking photographs and distributing them on the internet, and in so doing also infringing the performance rights . .
Cited – JSC BTA Bank v Khrapunov SC 21-Mar-2018
A had been chairman of the claimant bank. After removal, A fled to the UK, obtaining asylum. The bank then claimed embezzlement, and was sentenced for contempt after failing to disclose assets when ordered, but fled the UK. The Appellant, K, was A’s . .
Cited – Secretary of State for Health and Another v Servier Laboratories Ltd and Others SC 2-Jul-2021
Economic tort of causing loss by unlawful means
The Court was asked whether the ‘dealing requirement’ is a constituent part of the tort of causing loss by unlawful means; whether a necessary element of the unlawful means tort is that the unlawful means should have affected the third party’s . .
Cited – The Secretary of State for Health and Another v Servier Laboratories Ltd and Others ChD 2-Aug-2017
Roth J struck out the unlawful means tort claim, saying that, in OBG ‘the ratio of Lord Hoffmann’s determination of the elements of the tort is in para 51’ of his speech: ‘Unlawful means therefore consists of acts intended to cause loss to the . .
Cited – Warner-Lambert Company Llc v Generics (UK) Ltd (T/A Mylan) and Another SC 14-Nov-2018
These proceedings raise, for the first time in the courts of the United Kingdom, the question how the concepts of sufficiency and infringement are to be applied to a patent relating to a specified medical use of a known pharmaceutical compound. Four . .
Lists of cited by and citing cases may be incomplete.
Torts – Other, Intellectual Property
Leading Case
Updated: 11 November 2021; Ref: scu.251628