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26 February 2020

A question of purpose and the public interest: the dividing line between how evidence is obtained and when it may be admitted

There is no rule in English law that evidence obtained illicitly or improperly is automatically rendered inadmissible. Instead, the court has a general power under CPR 32.1 to control evidence. This discretion extends to excluding evidence that would otherwise be admissible. When examining the issue in Jones v University of Warwick [2003] EWCA Civ 151, the Court of Appeal provided guidance:

  • The court must seek to give effect to the conflicting public interests involved in establishing the true position of a case versus discouraging illicit conduct in obtaining evidence.
  • The weight attached to each of these interests will vary according to the circumstances.
  • The court can mark its disapproval in other ways, most obviously through an adverse costs order.

The recent case of Prinse v Landmasters (Overseas) Ltd and others [2020] EWHC 281 (Ch) illustrates this balancing exercise in action. The court had to weigh up (1) whether to admit evidence around which there were serious questions as to whether it had been obtained improperly or not, and (2) enforcing the terms of a consent order, the breach of which had come to light (and been acknowledged) as a result of this evidence.

In reaching its decision, the court placed weight on the purpose for which the evidence was deployed, namely the enforcement of a court order, and the public interest that the court has in seeing that its orders are enforced. While fully acknowledging that the court should not be seen to be condoning unacceptable practices, the court held that the balance on this occasion came down in favour of admitting the evidence.

Background

Proceedings had been compromised by way of a consent order. Among other things, the order provided that the claimant and defendants were not to transfer or assign any property of the first and second defendant to themselves or to any company owned in part by them. The claimant submitted evidence to the court, including bank statements relating to the accounts of the second defendant and the fourth defendant’s joint account with his wife, which showed that the second defendant (through the third and fourth defendants) had paid £25,000 to the fourth defendant’s company in breach of the consent order.

The claimant applied for a declaration that the third and fourth defendants had breached the consent order and that they should repay the sum. In response, the third and fourth defendants submitted that the bank statements had been unlawfully obtained and reliance on them breached the principles of confidentiality.

Obtaining the bank statements

The defendants had been pressing for an explanation as to how the bank statements had been obtained for several months. Initially, counsel for the claimant indicated to the court that he did not have any instructions on the matter. Later in the hearing, counsel indicated, on instructions, that the bank statements had been obtained after the claimant had spoken to the relevant bank, which had freely provided the statements to him. When the court queried how this could have happened, particularly in relation to personal bank statements relating to a joint account apparently not only held by the fourth defendant but also his wife, the claimant’s explanation was that he had been accompanied by his grandfather (the father of the fourth defendant) who had asked the bank for the statements.

Decision

The court noted that the explanation provided by the claimant was not formally in evidence. It made it a condition of its order (requiring the return of the £25,000) that the explanation be set out in a witness statement verified by a statement of truth.

In the court’s view, there were clearly still issues around whether the bank statements were properly obtained and the lawfulness of that exercise. In particular, it observed that it would be surprising that a reputable clearing bank would be prepared to hand over bank statements merely on the say-so of the father of one of two personal account holders. Notwithstanding this, and even if it was to be assumed that the bank statements had been obtained unlawfully, the court did not consider it was appropriate to exercise its power to rule them inadmissible.

Ultimately the question whether the bank statements, which were clearly admissible in evidence (given their relevance), should be excluded as inadmissible involved the court in exercising its discretionary procedural and case management powers in accordance with the overriding objective of dealing with the case justly and at proportionate cost, bearing in mind the need to ensure that parties were on equal footing and that the application was dealt with fairly. In applying this test to the instant case:

  • If the bank statements were necessary to enable the claimant to identify and articulate the breach, which was now admitted, then, clearly, he was on an unequal footing in relation to the defendants, who knew all about what had happened.  
  • The reason why reliance was placed on the bank statements was to identify and establish a breach of a court order. 
  • There was a clear public interest in such matters being placed before the court, which had a clear interest in ensuring that its orders are observed.  That also was an outward-facing matter of public interest that had resonance in cases other than the instant case.

The defendants argued that the claimant was effectively relying upon its own inequitable conduct in asserting relief. However, the court observed that it could equally be said that the defendants would be seeking to avoid their own breach of a court order in seeking to exclude evidence of such breach in reliance on those bank statements. In this case, there would be an element of each side seeking to come to court with not entirely clean hands. Therefore, even if the court were to accept that the bank statements had been improperly obtained, it would not, for that reason, refuse to admit them in evidence in support of what was an admitted breach of a court order. 

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