In brief

The recent High Court case of Fairstar Heavy Transport NV v Adkins and another reaffirmed the generally accepted position of the English courts that proprietary rights do not exist in information, and applied this principle to emails.   An employer will not, therefore, have a proprietary claim over the content of the emails of its employees and consultants.

How does it affect you?

The case is a reminder that:

  • Contractual agreements, such as employment contracts and consultancy agreements, may need to include obligations about the use and retention of emails and the return of emails upon request by the employer or at the end of the term of the contract.
  • Emails sent and received by employees or consultants should be stored and backed up on the employer’s system.  Particular care should be taken where emails are sent by an employee or consultant from their personal computer.  

Background

Mr Adkins performed services for Fairstar as Chief Executive Officer.  Fairstar was taken over by another company and Mr Adkins’ service arrangements were terminated.  The point at issue was whether Fairstar could obtain emails that Mr Adkins possessed relating to certain business dealings of Fairstar prior to the change of ownership and, in particular, a $37 million cancellation charge under a ship building contract.

Decision

The judge noted that the existing authorities strongly suggested that no proprietary rights exist in information, citing a House of Lords case from 1967.  That case held that information is not property, and is normally open to all who have access to it unless it has been acquired in circumstances where it would be a breach of confidence to disclose it.  In those circumstances, equity can restrain a recipient from communicating the information to a third party.

The judge in Fairstar rejected the view that the circumstances of the modern world now dictate that the content of an email is a form of property.  He considered that the range of possible ways in which ownership could attach to the content of an email presented highly impractical consequences.  For example, if ownership were deemed to stay with the sender, the sender would have the right at any time after sending the email to require its return or deletion.  The judge said that sufficient protection against misuse of emails could be found in copyright law and equitable restrictions on the disclosure of confidential information, and in contract law.