AON Ltd. v JCT Reinsurance Brokers Ltd. & Ors [2009] EWHC 3448 (QB)

Case No HCO9X04015

[2009] EWHC 3448 (QB)

IN THE HIGH COURT OF JUSTICE

QUEEN’S BENCH DIVISION

Venue Royal Courts of Justice

Date Wednesday, 7 th October, 2009

Strand

London WC2A 2LL

Before

MR JUSTICE MACKAY

Between

AON LIMITEDClaimant

-v-

Between

JCT REINSURANCE BROKERS LIMITED & OTHERSDefendant

Digital Transcript of Wordwave International, a Merrill Communications Company 101 Finsbury Pavement London EC2A 1ER

Tel No: 020 7422 6131 Fax No: 020 7422 6134

Web: www.merrillcorp.com/mls Email: mlstape@merrillcorp.com

(Official Shorthand Writers to the Court)

MR McGREGOR QC and MR S FANSHAW appeared for Claimant.

MR P GOLDING QC and MR P NICHOLLS appeared for First Defendant.

MR A HOCHAUSER QC appeared for Second Defendant.

J U D G M E N T

[1]MR JUSTICE MACKAY: The claimant Aon Limited is an insurance broking company involved, among other things, in insuring aviation risks with a presence in London, Hong Kong and Taiwan. It is one of four major players in this market, together with the first defendant JLT and the companies known for shorthand reasons as Willis and Marsh. It is a very competitive field. The claimant’s case is that JLT has carried out what is commonly called a “team poaching” exercise and has procured the resignations of 16 of the claimant’s staff, all experienced and all valued with established contact with clients and confidential information which belongs to the claimant. These have all resigned from the claimant’s employ and moved to JLT on various dates in May to August of this year, the bulk of them in the month of July. The claimant’s case is that this is concerted action and is the result of JLT procuring the services of these staff in breach of their contacts of employment.

[2]The second defendant, Alan Griffin, had worked for the claimant Aon and its predecessor companies for 30 plus years. He resigned in June 2004, was compelled to serve a period of a year’s garden leave, and then joined JLT, of which company he is now the chairman and chief executive officer. He is said to have procured these resignations and to have sought to access confidential information belonging to the claimant.

[3]The third defendant, Jonathan Palmer-Brown, is a very senior long-serving director and employee of the claimant, though at the relevant time he was on a part-time contract working two days a week. He was deputy chairman and a director of the company, but resigned as a director on 9th July 2008. His contract required him to give 12 months’ notice, which seems to have been a common stipulation in the cases of senior employees in this field. He is currently, therefore, still employed on garden leave. He went through a form of exit interview (as they are called) on 20th July, where he claimed to be acting on his own in forming the decision to leave and join JLT and to have no knowledge of any concerted approach to others by that company. Among other evidence put against him are two particular incidents said to be examples of conduct capable of supporting an adverse inference that his preparations to leave were in fact formed much earlier than this. A list of contacts was sent to his home at his request in April and he changed the number of his personal telephone to the number of his business telephone. He admits factually that these things happened, but puts forward an explanation which, if accepted, is consistent with innocence, and those will be two of the matters for a trial in this case.

[4]The fourth defendant, William Smith, never was a director of the claimant but was a senior man variously described as “team leader”, or in an organisation chart that I have seen as the person responsible for “airline client relationships”. He had a 12 months’ notice period in his contract. At his exit interview in July he is said to have lied by saying he had not spoken to anyone else about joining JLT and was not aware that others were contemplating departure. The claimant’s case is that they have evidence refuting this and evidence of his actions from May onwards encouraging others to join.

[5]The fifth defendant, Alan May, is said to have been head of claims and in a senior position, though there is something of an issue as to his precise position and his duties. He too was never a director. He too has a 12 months’ notice requirement in his contract and is now, like the third and fourth defendants, on garden leave. He was seen on 17th August to be copying a list of his contacts. He admits that he did this, but gives an explanation for that which, if accepted, would be consistent with evidence and will feature at any trial of this case.

[6]Not among the present defendants is Martin Trumper, a Hong Kong based employee whose contract was subject to Hong Kong law, and there are parallel proceedings in that jurisdiction against him.

[7]On 7th September 2009, having taken some weeks to prepare their case, the claimants made a without notice application to Keith J to obtain relief against what had happened. He held, having heard what the claimants had to say and having seen the evidence they put before him, that the claimant had shown it had a good arguable case for advancing these propositions. First, that the directors’ fiduciary duty to the company included a duty to inform the company of any determined attempt from outside to poach staff, and arguably that senior employees were under a duty of trust and confidence which imposed a duty similar to that on directors to alert their employers to such attempts and of their own intentions to join such moves. And, he said, there was a good arguable case on the material before him that the defendants may have gone “over the line”, as he put it. He held that there was a good case to say that the second and fourth defendants had been in contact about these matters and that there was some evidence, though not all that strong, that the third and fifth defendants may have intended to make use of their list of contacts. His order, made to a return date of 17th September, provided in outline for the following relief:(a) a preservation of evidence;

(b) the third to fifth defendants to comply with their contractual fiduciary duties;

(d) the prevention of misuse or disclosure of the claimant’s confidential information;

(e) the delivery up of documents and electronic communication devices by cloning by the second, third, fourth and fifth defendants; and

(f) disclosure by affidavit by all five defendants on or before 22nd September – that date being deliberately put after the return date so as to permit the matter to be argued by the defendants on that return date. There was also a claim for what is commonly called “springboard relief”. Keith J was not inclined to grant that on a without notice application.

[8]So the return date came and the matter was heard on 17th and 18th September by Underhill J, who heard extended argument. The defendants told him, as it seems, that the substantial pre-trial issues were these: their intention to apply to discharge the disclosure provision in its entirety and, secondly, the modification of the wording of the definitions in the order which occupy several pages of the order and are quite involved. The upshot of that hearing was that the time for compliance with the disclosure order was further extended to 9th October and the other issues were adjourned to a special appointment on 2nd and 5th October, which is the hearing I have been engaged on. So within a month such is the heat and intensity behind this litigation. There have been five days of hearings before three different High Court judges and really we have hardly started.

[9]The claimants’ original skeleton (called “confidential skeleton”) conveniently set out at pages 15 to 30 a large number of instances of behaviour said to evidence the breaches of duty by the defendants, communications between them in pursuit of a common aim, suspicious behaviour, and the like. That was summarising the witness statements that had been put before Keith J. Since the appearance before Underhill J the delivery up part of the order has now been complied with and, say the claimants, that discloses yet further evidence supporting and confirming their original allegations in these respects, and that can be conveniently seen summarised in the claimants’ skeleton argument for this hearing and is to be found on pages 11 to 16.

[10]So at the hearing before me there were initially two main areas of dispute. First, the order for disclosure – paragraph 9 of the original order, paragraph 5 of the new proposed order. The defendants say it should be discharged in its entirety and should not revive. The claimant argues for it to continue to trial, albeit in a slightly modified form. Secondly, the wording of parts of the order defining terms used through the order. This is largely now agreed and I shall put it to one side for the moment.

[11]I should start by setting out, albeit it is rather lengthy, the disputed disclosure order sought. It is paragraph 5 of the new proposed order. There is a subparagraph (a) which is not controversial. The rest of the order reads as follows:

“5. The respondents (in and in the case of the first respondent by a duly authorised officer thereof) shall make and serve upon the claimant’s solicitors on or before…affidavits:… (b) giving such full particulars as lie within their knowledge of the recruitment or attempted recruitment by the first or second respondents or any relevant entity of any relevant employee, where the planning of or preparations for or the taking of any step in the recruitment or attempted recruitment is known to the third respondent, fourth respondent and/or fifth respondent prior to the resignation of the employee in question or, in the case of an attempted recruitment, where the relevant employee has not resigned prior to the date on which disclosure is required pursuant to paragraph 5 of this order, including without prejudice to the generality of the foregoing, the planning of such recruitment and the steps carried out to implement the same, and any advice and assistance in such recruitment process provided by any relevant employee; and (c) giving such full particulars as lie within their knowledge of the solicitation of any client or prospective client for aviation brokerage services of the claimant or any group company of the claimant conducted by or on behalf of the first or second respondent or any relevant entity and using any confidential information or employing the advice or assistance of any relevant employee (save in respect of the period commencing 7th July 2009, Mr Gregory Bouthright and Mr Andrew Swann) and which such canvassing or solicitation occurred at any time after 1st March 2009; and (d) giving such full particulars as lie within their knowledge of any disclosure to or use by the first respondent (or any relevant entity) or the second respondent of any confidential information identifying any relevant employee providing to any of the aforesaid respondents any such confidential information and the date whereon and the manner in which the same was provided and identifying the directors or officers or employees or agents of the first respondent or any relevant entity to whom any such confidential information was provided and any disclosure or use of confidential information and full particulars as aforesaid of any disclosure or use of confidential information by any relevant employee on behalf of the first respondent (or any relevant entity) or the second respondent; and exhibiting to such affidavits all relevant documents.” and exhibiting to such affidavits all relevant documents.”

[12]The claimants’ fundamental point is this. Because they have, as Keith J found and as is not for today’s purposes under challenge, a good arguable case about breach of duty, whether fiduciary or contractual, and no answer has yet been given to that. They say the third to fifth defendants should be required to carry out their obligations as employees to alert their employer to this damaging attack. Three reasons were advanced by Mr McGregor QC for the claimant as to why this is now both necessary and appropriate as an order. First, the claimant does not yet know the full extent of the wrongdoing so as to plead its case and seek summary judgment. As he put it, summarising his case:

“That’s why we’re here.”

Second, it needs to take what he called “pragmatic steps” to repair the damage already done and to prevent even more staff from leaving and thus protect its business, and in this context it cannot afford delay. It asks rhetorically: who else is planning to go and what clients have already been approached? Thirdly, the claimant says that without this disclosure it cannot effectively police the relief that it has already got and will continue to have elsewhere in the order until trial. Two instances of what they are concerned about were given as examples: a lunch which is said to have taken place on 8th September, before service of the without notice order, attended by a current employee Mrs Vincent, who was carrying a slip case which would have contained, it is said, highly confidential information relating to the claimant’s business and who took that to this lunch which was also attended by representatives of the first defendant. Secondly, there is an email that has been obtained by the processes already carried out from the second defendant to the chief executive of JLT after a dinner attended by the third defendant, suggesting that costs and revenues have been discussed such as might be expected to result for the benefit of JLT should the third defendant move and join them. It is fair to say that neither of these two particular events, which are far from being a full account of the claimant’s case, or any other new evidence of wrongdoing that has resulted from the delivery up order, points to any unlawful action occurring after service of Keith J’s order, and no further defections have been added to the original 16 since August. But, argues Mr McGregor, what the defendants did continues to impact on their business and therefore they should now account for what they did which was in breach of duty, fiduciary or contractual, when they did it. Then the claimants can do what they need to do and, in particular, get back to clients who may have been approached and put the position right. One way of limiting future damage would have been springboard relief preventing further defections. That was originally sought. It was not granted by either of my predecessors and is not for the moment pursued in this hearing.

[13]The defendants’ response to the disclosure claim is that it is excessively wide, compliance with it is onerous, it will involve them in lengthy and widespread enquiries, and disclosure of “all relevant documents” amounts to an obligation to give standard disclosure in a case which has not yet been formulated against them. They are concerned that the order could cover legitimate recruitment by the first defendant of former claimant employees, even where they were out of notice or not subject to post-termination restraints and, as Keith J pointed out, there is nothing that should prevent that happening. It requires the first and second defendants to swear to whether steps taken were known to the other three defendants prior to the resignation, etc, to be in breach of duty, and how can they come by this knowledge. There are also arguments addressed because of the width of the definition of confidential information, but I think I can leave those particular arguments to one side for the moment in view of the position the parties have, I understand, reached on that.

[14]Secondly, the defendants complain of material non-disclosure by the claimant of the without notice hearing in two main respects. First, that the second defendant had in fact previously worked for the claimant for many years in a senior role and would, therefore, have known, without further help from others, many of the departing staff, their attributes and abilities, and that is something which, if known, would have drawn some of the sting from their case. The claimant’s deponents say that they did not disclose this because they did not know this as a matter of fact. They also say it would not have materially altered the decision that Keith J took. The cloudy factual issue around this matter means that my present view is that there was not non-disclosure that was material to a significant degree in this respect. Secondly, what was not revealed was the contents of the claimant’s website. This contained, in terms of a sales puff or pitch, quite a lot of information about the market, the state of the market and the airlines who were in the market, and it specifically contained information of the renewal dates for certain airlines who were clients of Aon and within the definition of confidential information that Keith J was being asked to apply. Renewal dates were said by the claimant’s principal deponent witness to be something which was “highly confidential”. The evidence exhibited shows that in fact other brokers in this field do very much the same. The same applies to contact details of relevant staff, also said to be confidential, whereas there is a website page exhibited which gives every possible detail enabling a person to contact one of the relevant employees, Martin Trumper. This is certainly something which should have been disclosed from the outset and which was not. The defendants do not go so far as to say that the consequence of this is that there should be a denial of all relief or indeed this part of the relief on this ground, but in effect are saying that this is a factor that should weigh against the claimant when I am exercising my discretion, if I have one, as to whether this paragraph should remain in force. My view is that it may go into the scales, but is unlikely in the event to be highly influential in my final decision.

[15]Thirdly, the defendants say that this is an application, in effect, for an interlocutory mandatory injunction and the court cannot move beyond the good arguable case that Keith J found to the higher risk of assurance that it ought to have as to the likely success of the claim before a mandatory order is given, and this is because of a greater risk of injustice to the defendants that will result if it is proved to have been wrongly granted. They rely on dicta in Zockoll Group Limited v Mercury Communications Limited

[1998] FSR 354

, where at 366 Phillips LJ (as he then was), having looked at earlier authorities, said this:

“A more concise summary, which I would commend as being all the citation that should in future be necessary, is the following passage in the judgment of Chadwick J. in Nottingham Building Society v. Eurodynamics Systems [1993] FSR 468 at p. 474:‘In my view the principles to be applied are these. First, this being an interlocutory matter, the overriding consideration is which course is likely to involve the least risk of injustice if it turns out to be `wrong' in the sense described by Hoffmann J. Secondly, in considering whether to grant a mandatory injunction, the court must keep in mind that an order which requires a party to take some positive step at an interlocutory stage, may well carry a greater risk of injustice if it turns out to have been wrongly made than an order which merely prohibits action, thereby preserving the status quo. Thirdly, it is legitimate, where a mandatory injunction is sought, to consider whether the court does feel a high degree of assurance that the plaintiff will be able to establish this right at a trial. That is because the greater the degree of assurance the plaintiff will ultimately establish his right, the less will be the risk of injustice if the injunction is granted. But, finally, even where the court is unable to feel any high degree of assurance that the plaintiff will establish his right, there may still be circumstances in which it is appropriate to grant a mandatory injunction at an interlocutory stage. Those circumstances will exist where the risk of injustice if this injunction is refused sufficiently outweigh the risk of injustice if it is granted.’”

[16]For his part, Mr McGregor reminds me of that final paragraph, which says that this is not an area where the law is inflexible. Essentially, as it seems to me, I am engaged, as judges always are on interlocutory applications of this nature, on a form of balancing exercise to consider where the greater hardship lies should the making of the order prove in the end to have been wrong. Jurisdiction to make this order.

[17]1. Statutory powers and rules of court. The statutory basis for this and all interim injunctions is found in section 37 of the Supreme Court Act 1981, which empowers judges to make them “in cases in which it appears to the court to be just and convenient to do so”. There is a great and obvious width to this basic power. 2. The overriding objective of the Civil Procedure Rules is so well-known that I can be forgiven for not setting it out in this judgment, but essentially it requires me to deal justly between the parties and to do so in the way that is economic in the use of court time and in terms of costs. 3. CPR 25(1) lists the interim remedies that a court may order in some detail, but goes on to state at sub-rule (3) that “this list is not exhaustive”, but it is the case that the order that is actually sought in this case does not feature on that list. 4. CPR 31.16 deals with pre-action disclosure orders against likely parties requiring them to disclose documents if that is desirable to dispose fairly of the proceedings and assist the dispute to be resolved or save costs. I have been helped by reading Steel J’s decision in Hutchinson 3G UK Limited v O2 UK Limited & Others

[2008] EWHC 55 (Comm)

and especially his approach to the exercise of discretion at paragraph 63. 5. CPR 18 – orders for further information. It is trite law that there should under this provision be limited and focused requests confined to what is necessary and proportionate so as to avoid disproportionate expense – see King v Telegraph Group Limited

[2005] 1 WLR 2282

at paragraph 63, Brooke LJ, where he said:

“It will be observed that the emphasis, as always in the CPR, is on confining this part of any litigation (in which costs tended to get out of control in the pre-CPR regime) ‘strictly’ to what is necessary and proportionate and to the avoidance of disproportionate expense. Lord Woolf MR spoke trenchantly about the governing principles in his judgment in McPhilemy v Times Newspapers Ltd [1999] 3 All ER 775, 792-794.”

This order, say the defendants, is the antithesis of a focused and limited request. Relevant authorities

[18]To say that applications such as this are fact sensitive is a trite proposition. The assistance therefore to be derived from decisions in other cases is limited except where clear statements of principle can be discerned. Cases where disclosure has been ordered in connection with freezing orders, where disclosure of assets appears now in the standard form of order prescribed, and in search and seize orders are of little utility to me in this case. However, even in the case of the latter the Court of Appeal has said that they must not be used as an excuse for not setting out the claimant’s case in a traditional accusatorial way merely “in order to see what sort of charges they can make” – see Hytrac Conveyors Limited v Conveyors International Limited

[1983] 1 WLR 44

at 47H. Lest it be thought that this is a sentiment from another age of litigation, that very dictum was cited with apparent approval by Rix LJ in Black & Others v Sumitomo Corporation

[2002] 1 WLR 1562

at paragraph 55. But the claimant has taken me to cases where disclosure has been ordered. First, Intelsec Systems v Grech-Cini

[2000] 1 WLR 1190

, a decision of Mr Nicholas Warren QC sitting as a Deputy High Court judge (now Warren J) which requires careful consideration. In that case the defendants, after termination of their contracts of employment, had contacted the customers of the claimant saying that they still acted for the claimants and/or that the product they were selling was something they were entitled to sell. The claimant sought, among other things, disclosure of names and addresses of all those the defendants had attempted to supply the product to. The claim was put primarily as one of passing off, but also as breach of the duties of good faith and/or fiduciary duties. At 1206H the judge said this:

“The position is more difficult in relation to persons approached after the termination of the employment contract. In some cases, there may be an improper use of confidential client lists by the employee; but, even here, the appropriate remedies are damages and injunctions in relation to that improper use. The justification for an order for disclosure of names and addresses is the need to rectify misrepresentations arising out of the passing off, not the misuse of confidential information.”

A little later he continued at 1207B:

“Quite apart from passing off, it seems to me that the plaintiffs have a strong case for claiming disclosure of contacts and customers who were in contact with the plaintiffs through [the defendants] at any time on or before 17 December 1998 [i.e. the date on which the last contract of employment terminated]. In so far as contacts were made with them as representatives of the plaintiffs [the defendants] were, in my judgment, under a duty as part of their duties of good faith (or fiduciary duties…) to hold and use the information learnt - in particular the names and addresses of the contacts and the potential customers - for the benefit their employer. And that information is something which the plaintiffs are entitled to be told even though the employment has now finished. I am willing on that basis to make the order sought under paragraph (A)3(b) in respect of events on or prior to 17 December but not thereafter…”

He then continued at H:

“In my judgment, the plaintiffs are entitled to some order, but it must be proportionate: the defendants are entitled to have their own information adequately protected…”

A little later he continued at 1207B: He then continued at H:

[19]It is instructive to see how he approached the formulation of the order. He limited it to written material only, not oral communications, which he regarded as something which was too onerous, and said that it should be made in the first place to the claimant’s solicitors only. So the order he made was, it is argued, and it seems to me rightfully argued, principally triggered by his views on the passing off aspect of the claim, albeit he found a second basis for it in breach of statutory duty. The rationale was to correct the misrepresentations which had been sown in the minds of the claimant’s clients that the defendants had been entitled to approach them as they had.

[20]Next I was taken to Thomas Marshall v Guinle

[1979] 1 Ch 227

. This was a case of an egregious breach of fiduciary duty by the managing director of the claimant company, who during his contract of employment traded surreptitiously in direct competition with his employer. He then gave notice and resigned his position and said that that released him from the effect of the terms of his contract. Most of the seven days occupied by the case seem to have focused on the existence and extent of the duties of good faith following a unilateral termination of the contract and on the definition of confidential information. None of those issues are of great concern to me today. They are conspicuously issues for trial. But a full disclosure order had been made ex parte/on notice at an earlier hearing. Despite what had been said in American Cyanamid v Ethicon

[1975] AC 396

about the undesirability of lengthy mini trials of this nature at an interlocutory stage, the then Vice-Chancellor felt that the case warranted the length hearing he gave it, perhaps encouraged by the fact that the defendant admitted most of the factual allegations of wrongdoing against him (see 235C-D). But so far as the wide disclosure order made at an earlier hearing on 13th January 1978 and continued by the Vice-Chancellor in his order, it seems clear from a reading of the report that the leading counsel for the defendant and his distinguished team of juniors did not address any argument against it to the court, or, if they did, it is not reported. Whether it had been argued at the earlier hearing is not clear (see 235A-B).

[21]Next, SBJ Stephenson v Mandy

[2000] IRLR 233

, a decision of Bell J, was drawn to my attention by Mr McGregor. In that case a disclosure order had been made at an earlier hearing and the decision of Bell J at the trial was to order injunctions, and he was not at that stage, as I read it, concerned with the question of disclosure. It was, as far as one can see, a case turning on its own facts (as many of these cases do) and it seems also that the defendant admitted that the information initially was the property of the claimant. It is not clear whether the interim order for disclosure had been argued or conceded.

[22]Next, Tullett Prebon Plc v BGC Brokers

[2009] EWHC 819

QB, which I believe is due for trial on Monday in this court. This was an interim hearing before Jack J. He ordered disclosure in these terms at paragraph 18:

“The applicants seek an order that the first four respondents should provide them with certain information by affidavit. In broad terms, they are entitled to information which is required either to assist in giving effect to the injunctory relief, or to assist them in undoing the harm which has been unlawfully done. They are not entitled to information simply to assist them in establishing their claims. It is accepted on those respondents’ behalf that some information should be provided. That includes giving the details as to employees approached by the fifth respondent and by any other employees of the applicants at BGC’s request.”

I have been directed to the terms of the actual order made which seem to have followed what is said in that paragraph. I have been directed to the terms of the actual order made which seem to have followed what is said in that paragraph.

[23]Universal Thermosensors Limited v Hibben

[1992] 1 WLR 840

is of very limited assistance to me in this case. By the time of trial before the then Vice-Chancellor Sir Donald Nicholls the only remaining issues in a complex piece of litigation were a claim for damages by the claimant in respect of the defendant’s misuse of confidential information and a counterclaim by the defendants for loss falling within the claimant’s cross-undertaking in damages given when obtaining interlocutory injunctive relief. The Vice-Chancellor held at 854C-D that an injunction restraining a defendant from dealing with customers who had already been approached was not appropriate and damages were the remedy in respect of past wrongs. I find the case of no very great assistance.

[24]In conclusion, I do not doubt, and nor has it really been strenuously argued by the defendants, that there are no circumstances and there is no case in which disclosure of this general type can be ordered where it is appropriate to do so in the exercise of the court’s discretion. The issue for me is whether the circumstances here are such that it is appropriate to make what is on any view an exceptional and not a routine order, one which should not be made as a matter of course where prohibitory injunctions of the type found elsewhere in this proposed order are to be found. Discretion.

[25]Relevant to the exercise of my discretion in this case seem to me to be these following issues.

[26]1. Inability of the claimant to plead a case without this relief. This is the main purpose of this application, says Mr McGregor. As a matter of fact I am not able to accept that that is the case. The 24 witness statements already exchanged, the exhibited documents and the summaries that I have already referred to in the claimant’s two skeleton arguments suggest to me that there is already a case, and after all the claimants themselves currently call it a good one, against these defendants which could be pleaded now. It would, of course, be incomplete and partial, but it would serve to set in motion the proceedings within which, dependent on the terms of any defences forthcoming, disclosure and further information can be sought in the normal way. I see no reason here to subvert the normal accusatorial basis of our litigation, where the horse precedes the cart, into an inquisitorial one starting from an assumption that guilt has been proved, and saying to the defendants, “Tell us everything you and others have done which was wrong.” I remind myself that all that has been shown to date is a good arguable case, no more and no less. 2. The width of the order sought. I here set out the order in full, and it is apparent from that that full particulars are required of any recruitments or attempted recruitments by the first two defendants where the third to fifth defendants knew that a target was under a contract of employment, together with planning, steps carried out, advice and assistance, any solicitation of any client or potential client using confidential information and disclosure of any confidential information identifying a relevant employee, and so forth – all this to be verified by affidavit. The duly authorised officer of the first defendant under the threat of a penal sanction would have to make thorough enquiries through the first defendant and any group companies of all these matters. Added to that it amounts to an order for standard disclosure in full in a non-pleaded case. This order is far wider than anything I can see in any other case discussed and is the very antithesis of the focused and proportionate approach that might have made such an application more palatable. 3. The saving of costs. This will not, I think, be the result of my granting this order. Litigating in this sequence is likely to increase interlocutory activity rather than decrease it, albeit already very substantial costs will have been incurred. I can readily foresee additional costs flowing from this order, requests by the claimant for yet further disclosure, allegations that the disclosure is manifestly incomplete and, on the other hand, by the defendants to compel the claimant now to plead its case. 4. The adequacy of damages as a remedy. It is not the same thing, in my judgment, to say damages may be difficult to prove as to say that damages are an inadequate remedy. To take one example, Mr McGregor says there is evidence to show that the claimant may already, as a result of these defections, have lost a major Far-Eastern airlines business. If that is so, it would have to show that without the defections, if they were the result of breach of duty, it would have retained this business and how long it would have retained it for. Proof of a future loss, or the loss of a chance of future gain dependent on the action or decisions of third parties is something which is not straightforward but is something on which the courts are regularly engaged. The cost of recruiting replacement staff and enhanced marketing to retain clients can likewise be awarded. Though no part of the claimant’s case has been understated, in my view, it is not suggested that this company will go out of business irretrievably as a result of this episode. An example of how damages can be considered and decided in cases of this nature is to be found in Hart J’s decision of British Midland Tool Limited v Midland International Tool Limited

[2003] EWHC 466 (Ch)

, 188253, and indeed the decision of the Vice-Chancellor in Universal Thermosensors Limited v Hibben, cited above. I am not impressed by this argument. 5. The need to take pragmatic steps to protect the business from future and further loss. There are said to be 115 relevant staff in London and a smaller number in the Far East, according to an organogram exhibited by the claimant’s principal witness Mr Woods. He lists the eight who have been approached and who have resisted the first defendant’s advances. He says that retention arrangements are in place, and he does not give details of them, perhaps understandably, at this stage. So there are things that an employer can do to discourage his employees from leaving, and one of them is to talk to the employees concerned. As for clients, the evidence is that there are at most some 250 companies for whose business the claimant and first defendant would be in competition. It is a compact world, as it seems to me. These defections will be widely known about. Again there are steps of a commercial nature the claimant can take to bind the clients to them. 6. The need to police the order. The relief already granted and proposed to be continued to trial in the uncontentious parts of this order is powerful, specific and will be widely known about by the relevant staff and clients. I do not consider that further such breaches are a lively or likely risk, though of course they cannot be ruled out. The defendants point out there have been no departures since August and that all has been quiet since the service of Keith J’s order. Of course I understand the claimant’s sensitivity in the circumstances, but I do not consider that it justifies the making of the order sought. The current protection the claimant will enjoy to trial appears to me to be adequate in the circumstances.

[27]For all the reasons above I decline to exercise my discretion to renew or order the continuation of what is now paragraph 5 of the proposed order, which will therefore have to be discharged. __________

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