I am frequently approached by company directors or senior employees who don’t appreciate the perils of using and sharing what could be classified as confidential information. There is often a misconception that the absence of a non disclosure agreement or a contractual obligation in say an employment contract or a shareholder agreement gives them free rein to share and use that information as they see fit, irrespective of how they have come into possession of that material.
The case of Weiss Technik should act as a warning to take legal advice to ensure that no equitable duty of confidence arises before you share or use it.
It is commonly accepted that an equitable duty of confidence arises when:
- The information has a quality of confidence about it;
- It was imparted in circumstances in which the obligation arises;
- The subsequent sharing was unauthorised and to the detriment of the party imparting that information.
In Weiss the court held that, regardless of any contractual obligation it was plainly obvious to the parties involved that the information they were sharing and using was confidential and should be treated as such.
As regards SJJ, the same facts establish a clear breach of its equitable obligations, in its use of Weiss software and passwords. The evidence indicates that SJJ used at least some of the Weiss software and related materials that the company managed to obtain – e.g. the 27 February 2018 email from Mr Jones cited at §129 above, noting that the Contour package that had “found its way into my van” could be used for another customer….”. As recorded above, it can also be inferred that the passwords provided to SJJ were used for the purposes of SJJ’s business. That is corroborated by the fact that passwords were shared internally,.
141. There is no doubt that Mr Jones, SJJ’s director, knew that both the software and the passwords for that software were confidential