Breach of Confidence – A Complete Guide

What is Breach of Confidence?

The law on breach of confidence is aimed to protect secrets which in return helps the innovators to protect their ideas and concepts and reap the rewards of their labour and intuition.

It is important to note that the law on confidence protects the ideas, concepts and visions even before the work can be carried out on them. The person to whom the idea is disclosed can be prevented from exploiting the idea and publicising that idea to other people“.

Read Time: 5 minutes


What is Included on this Page?

  • What is Breach of Confidence
  • Basic Requirements for Breach of Confidence
  • Necessary Quality of Breach of Confidence
  • Doctrine of Springboard
  • The Obligation of Confidence
  • Contractual Obligations
  • Private Information
  • Unauthorised use of Information
  • Defence
  • Remedies
  • Law on Privacy
  • Test for a claim in Privacy
  • Exploiting Privacy (Celebrities)
  • Anonymised and Super Injunctions

What can be protected?

The basic requirement for an idea to be protected is that the idea must be sufficiently developed so that it can be seen as a concept capable of being realised as an actuality. Once the idea or the concept is capable enough to be realised, the privacy law imposes an obligation of breach of confidence on those people who are in a position to know or who need to know the details of the invention, for example, an application for patents or a potential investment meeting with an investor.

Any budding entrepreneur with an innovative idea would be nervous with the prospect of disclosing the details of his idea, however, an unscrupulous investor cannot take advantage.as long as the right steps are taken, the details can be protected under privacy law.

It is worth noting that the privacy law imposes similar obligations of breach of confidence on financial institutions who are  involved in financing, the project managers, business partners any other person related to the development of a business

Finally, the law on breach of confidence can be used to protect the secrets between husband and wife, friends, employees and directors etc.

Examples

John shared his secret recipe for a unique medicine with his partner Ali for marketing and sale purposes. Law of breach of confidence imposes an obligation on Ali to keep the information secret. Ali then discloses this information to his brother Kiren. Ali has effectively breached the law of confidence.

Mark has a unique motorcycle design, he entered into negotiations with Delmer Co for production, for some reason the Mark and Delmer Co could not continue further with negotiations. The law of Breach of Confidence restricts Delmer Co to use the information shared by Mark to produce motorcycles

John and Jill are friends John has told some personal stuff to Jill. Jill is in negotiation with a local newspaper to disclose the personal stuff about John. The law of confidence will restrict Jill from selling or sharing the personal information of John to anybody including the newspaper.

Breach of Confidence
Breach of Confidence

Basic Requirements for Breach of Confidence

A claimant has to fulfil following three conditions

  1. the information must have the necessary quality of confidence about it;
  2. the information must have been imparted in circumstances importing an obligation of breach of confidence;
  3. there must be unauthorised use of that information to the detriment of the party communicating it.

Necessary Quality of Breach of Confidence

The information which requires the protection of the law of breach of confidence must hold the necessary quality of confidence.

  • By the necessary quality of confidence, it means that the information should not be in the public domain.
  • A substantial number of ordinary people should not be aware of it. And
  • The release of information must be injurious to the owner of the information or of advantage to his/her rivals
  • The owner of the information must believe that the information which is shared with is reasonably confidential
  • If it is a trade secret, the standards of confidentiality within the trade or sector must also be taken into account.

Doctrine of springboard

Law of Breach of confidence also prevents a trader from using the information given to the trader by his client and using that information to build or provide services in his name.

Example

John outsourced the production of unique plastic material from Alpha Corporation and the plastic material is already on the market for 1 year or so, Under the doctrine of springboard the Alpha Corporation will not be allowed to use the information provided by John and produce a plastic material similar to John’s for a certain period, although the plastic is already readily available in the market. The rule is there to prevent Aloha Corporation from taking unfair advantage of the information a process used in the production of John’s plastic material

The Obligation of Breach of Confidence

The second condition to fulfil is that the information must be provided/shared in circumstances which require an obligation of confidence. This condition is based upon the relationship between the person who shares the information and the person who receives it

Contractual Obligations

The parties to a contractual relationship or agreement may have an express term of breach of confidence in their contract which may prohibit any disclosure. The term of obligation is also implied under contractual relationships and it also extends to pre-contractual disclosures as well, even if no contract materializes

Contract of Employment

Under the Business Law A contract of employment also expressly and impliedly imposes the obligation of confidence on the employees

  • However, an employee is under no obligation to keep a secret about the employer’s wrongful or unlawful act.
  • The employee is only accountable for trade secret.
  • Any employee is free to use the skills, experience, know-how and general knowledge which he/she could have gained during the employment. These skills and general knowledge are the property of the employee

Non- Contractual Relationship

The obligation of confidence also applies to a fiduciary (trust) relationship such as solicitor and client, doctor and patient, even the secrets disclosed to friends, husband and wife give rise to an obligation of trust based on the relationship of trust.

Third Parties

Third parties can also be held accountable and will be in breach of the law of confidence where a third party discloses information and it is obvious (to that third party) that the information was confidential. The media is also under an obligation not to publish information of a confidential nature which is passed on to them by the recipient.

Non-pre -existing relationship

Since the incorporation of the Human Rights Act, 1998 into the English legal system the obligation of confidence is extended to strangers as well provided the information and/or activities observed by a stranger are private.

Private Information

Private information is identified by English Courts as something worth protecting as an aspect of Human “Autonomy” and “Dignity”.

Example

A common example of private information is sexual conduct witnessed by a stranger, between consenting adults in a private residence or a private birthday or wedding party held in private at a private location.

3.Unauthorised use of Information

The third and final condition for a successful claim under breach of confidence is that the information which is used or passed to somebody else has been used without the owner’s consent and authority.

Defence; Public Interest

The only defence available to the person who has disclosed the information without the authority or consent of the owner of the information is the “defence of public interest”.

The court will uphold the public defence argument if it can be shown that it is in the public interest to publish such information. However, the court will consider how much disclosure the public interest requires; the fact that some disclosure may be required does not mean that disclosure to the whole world should be permitted or can be permitted.

Remedies

Where information is used by a person in breach of the law of breach of confidence, courts may award a range of remedies to the aggrieved party/claimant. Most common remedies are

Damages

Damaged are calculated based on the concept that the aggrieved party must be compensated. The level of compensation is based on the business relationship i.e. whether the relationship is contractual or no contractual?

Injunction

The injunction will simply prevent the disclosure of the information. The court will restrict the use of information. Injunctions also include interlocutory injunction and super injunctions discussed further below in this chapter.

Law on Privacy and Breach of Confidence

The incorporation of Human Rights Act 1998 has given rise to privacy rights and breach of confidence on individuals and privacy law in general.

Article 8

The foundation of privacy law is based on Article 8 of the EU Convention on Human Rights Which Provides that “everyone has the right to respect for his private and family life”.

  • However, it is not an absolute right it is subject to the condition that this right can be interfered with where it is necessary for a democratic society for the protection of the rights and freedom of others.

Article 10

Article 8 always compete with Article 10 which provides a competing right of freedom of expression. It provides that everyone has “the right to freedom of expression”.

  • Freedom of expression includes the freedom to hold opinions, receive and impart information and ideas without any interference by a public body including Government and Courts
  • Freedom of expression is not an absolute right and is also subject to restrictions which are necessary for the protection of the reputation or rights of others or for the prevention of disclosure of information which is received in confidence.
  • English courts are constantly involved in process of balancing these competing rights.
  • English courts’ rulings have a deep impact on the way the media operates and how people in the public eye can seek to protect or exploit their reputation

Important

English Courts have incorporated the new developing law (Human Rights, Privacy) into the existing law of breach of confidence.

Test for a claim in Privacy

The courts will ask two questions

  1. Whether a person has a reasonable expectation of privacy? if yes then
  2. Whether the right of privacy, family and private life overrides any other right

Where the right to a family and private life overrides any other right especially freedom of expression the courts have always upheld the Article 8 rights.

Principles developed under Privacy law

  • The law of breach of confidence is strengthened by article 8
  • The duty of confidence will arise whenever the party who wants to disclose the information either knows or ought to know that the other person can reasonably expect his/her privacy to be protected.

Important

An individual may be engaged in a particular activity in a public place is not necessarily confidential, however, if that information is then reused or re-utilised in a way that the individual would not expect then this will breach the law of confidence or this will be a breach of article 8.

Example.

Khan was engaged in attempted suicide in public. His CCTV video was captured by the authorities. This video was then passed on to local TV which was broadcasted on TV for a few days. This will breach the right of privacy of Khan as he would not have expected that the local TV would broadcast it

Sexual and other Private Activities

  • The media can print the basic facts of a celebrity or other concerned individual but they are not allowed to print the details of their private life, for example, sexual or other private activities

Exploiting Privacy (Celebrities)

Privacy law has provided celebrities with greater rights over how their fame and personality can be exploited commercially.

  • Celebrities have a right to trade their fame and personality
  • Celebrities have a right to prevent others from interfering with their commercial contracts through which they exploit their fame
  • The damages for interference with commercial contracts could be substantial
  • Family of celebrities especially children may have a higher expectation of privacy.
  • Taking just a photo of a celebrity or their family in public places is not illegal, however, broadcasting such videos or photographs may be illegal
  • Writing about celebrities and people engaged in private acts within the public domain may be a lawful exercise of freedom of expression, however, publishing photographic or video material is often treated as a disproportionate exercise of freedom of expression
  • Sexual and other private acts carried out on private premises between consenting adults are private and must not be disclosed either by way of photographs or by the written description. Celebrities and other individuals have the right to stop their publication 
  • Employees of celebrity and those who have the express or implied condition of confidentiality in their employment contracts are restrained from sharing any information to anybody and it is very difficult for a news outlet to justify the publication of such information
  • The only defence available to the person who has disclosed the information or who has published the information is that the information is in the public interest, however, it is increasingly made difficult by the ruling of courts in recent cases to use this as a defence especially where the acts are carried out in private and at a private residence.

Anonymised and Super Injunctions

They are interim injunctions which will restrict publishing and reporting of various facts of the fact and also the terms of the court order

Anonymised Injunction

Under this interim injunction, the media is prohibited from reporting information related to the applicant or information about all the parties including their names as well

Super Injunction

Super injunctions are one step further ahead from Anonymised Injunction. Under the super injunction, the media (print, social, and digital) is prohibited from publishing any information at all including the allegations, names or the court order itself. Consequently, until the case is decided nobody in public would likely to know anything about the case, allegations and about parties involved in the case.

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