Injunction prevents former in-house lawyer from acting for a new law firm in a case involving their former employer

Tom Dane

In Western Avenue Properties Ltd & another v (1) Sadhanh Soni (2) Denning Sotomayor Ltd [2017] EWHC 2650 (QB) the claimants were granted an injunction to prevent their former in-house lawyer from acting for another party who had an interest adverse to the claimants in order to avoid the risk that confidential information might be used to the claimants’ disadvantage.

The first defendant (D1) was a former in-house lawyer employed by the first claimant (C1). D1 resigned as an in-house lawyer and went on to work as a solicitor at D2.

C1 became engaged in a dispute with a third party (A) regarding some land. C1 brought legal proceedings against A for possession and trespass.

A approached D1 and asked her to advise A on the dispute (via the solicitors firm D2).

The claimants sought an injunction restraining D1 and D2 from acting for A on the basis that during her employment D1 had access to confidential information in respect of the assets and financial and legal affairs of C1.

The claimants submitted that it was clear that D1 was, or had been, in possession of information which was confidential to the claimants, and they had not consented to the disclosure of such information which might be relevant to possible proceedings involving A.

The court granted an injunction restraining D1 and D2 from acting for A:

  • The claimants had established that D1, and through her D2, had been in possession of information which was confidential to the claimants, and to the disclosure of which they had not consented.
  • The claimants did not have to identify every item of confidential information in order to establish the right to an injunction as there was an irresistible inference that, while working as an in-house lawyer, D1 would have had access to confidential legal and financial information which might be relevant to the dispute between the claimants and A.
  • It was very important for the administration of justice that D1, as a solicitor who had been in possession of confidential information, should not act in any way that might appear to put that information at risk of coming into the hands of someone with an adverse interest. The court should intervene unless it was satisfied that there was no risk of disclosure.
  • The fact that an injunction would deprive A of his choice of legal representation was not a relevant consideration.

It is well established that a solicitor that has come into possession of confidential information via a retainer with one client that might be relevant to subsequent legal proceedings cannot act for another party in such proceedings unless the court is satisfied that there is no risk of disclosure of confidential information. This is a very high hurdle. The principles have usually been applied in the context of solicitors firms where a firm acts for one client and then later accepts an instruction from a new client to act on a dispute involving the former client. This case is an example of the principles being applied to a situation where an in-house lawyer acquires confidential information in their capacity as an employee before moving to work for a law firm on a matter adverse to their former employer. It is not surprising that the courts have applied the same strict principles to ensure there is no risk of confidential information being used inappropriately.

Western Avenue Properties Ltd & another v (1) Sadhanh Soni (2) Denning Sotomayor Ltd [2017] EWHC 2650 (QB)

Post By Tom Dane (4 Posts)

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