In Fairstar Heavy Transport v Adkins, the Court of Appeal revisited the case (reported by us in Dec 2012) of a CEO who was not directly employed under a contract, but provided his services through a service company. The Court of Appeal considered whether the company was entitled to information contained in emails sent and received by him on the company’s behalf, which were held on his personal computer, when his agency agreement was terminated.
In the High Court hearing, Fairstar argued that it owned those emails. The Court disagreed and held that emails are ‘information’, not ‘property’ that can be legally owned.
In the Court of Appeal, Fairstar argued that after termination of an agency agreement, it is the legal duty of an agent to produce and deliver up books and records held for the purposes of the agency relationship.
The Court of Appeal agreed with this argument; the same principle should apply to materials held in paperless form. The company was therefore entitled to inspect the emails and make copies if desired.
Points to note –
- The problem in this case was that the CEO was not an employee, and had done nothing wrong. He had not misused confidential information nor had he acted in breach of fiduciary duty. Further, he did not hold company ‘property’ which the court could order him to hand back. Therefore in instances such as this, employers are provided with a useful tool, based on the law of agency, to force delivery up of information.
- It was irrelevant that the information was held on the CEO’s personal computer.