Csav Group (Hong Kong) Ltd and Another v. Jamshed Safdar

DCCJ 586/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 586 OF 2006

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BETWEEN

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Coram : H.H. Judge Chow in Chambers

Dates of Hearing : 31^st August and 22^nd December 2006

Date of Handing Down Decision : 29^th January 2007

DECISION

 1.On 23 August 2006, the Plaintiffs took out a summons for an order that the Defendant do make and file an affidavit (1) to verify the list of documents made and filed by the Defendant on 24 May 2006, and (2) to state whether he has or has at any time had in his possession, custody or power any class of document specified in the Schedule annexed to the Summons and if the said documents have been but are not now in his possession, custody or power stating when he parted with the same and what have become of the same.

2.The application was part-heard on 31 August 2006, and adjourned to 22 December 2006.  On 22 November 2006, Master Lai granted leave to the Plaintiffs to amend the summons.  What I have to deal with are (i) the application under paragraph. 1A of the amended summons, namely, the Defendant do file a further and better list of documents containing the items in the Schedule annexed to the amended summons, and (ii) the application that the Defendant do within 7 days make and file an affidavit verifying the list to be made pursuant to para. 1A, and (iii) the application under (2) of the amended summons, which is the same as referred to in paragraph 1 of this Decision.

3.There are 4 paragraphs under the amended Schedule:

(1)	The hard drive of the Defendant's home personal computer (“Computer”), as referred to in, inter alia, his Third Affirmation dated 20th April 2006 (“Defendant's 3rd Affidavit”) and any forensic images of the Computer's hard drive (including any forensic images of the hard drive and items therein produced by Ernst & Young Transactions Limited).
(2)	All documents (whether in electronic or in documentary form), including the “Freight Rate Report”, “Guest List” and “Press Contact List” job descriptions, marketing presentations, a “volume report”, a “report on the status of the shipping market” belonging to the Plaintiffs which are presently or were formerly in the Defendant's personal possession during the last 6 months of the Defendant's employment with the Plaintiffs.
(3)	All documents (including emails, word processing files, spreadsheets and presentation documents) which the Defendant allegedly produced or amended for the Plaintiffs from the Defendant's home using the documents sent from the Plaintiffs' office computer to the Defendant's personal email account during the last 6 months of the Defendant's employment with the Plaintiffs.
(4)	All documents (including emails, word processing files, spreadsheets and presentation documents) which the Defendant viewed, created or modified on the Plaintiffs' office computers which were related to the establishment or operation of companies and/or businesses in competition with the Plaintiffs.

4.Regarding the application to file a further and better list of documents to contain items in the Schedule, the Defendant submits that the Plaintiffs have not satisfied the requirements of Order 24 rule 3 of the Rules of the District Court in that the documents contained in the Schedule must be relevant to the issues in question.  Order 24 rule 3 (1) provides:-

“

Subject to paragraph (3) and rules 4 and 8, the Court may order any party to a cause or matter …… to make and serve on any other party a list of the documents which are or have been in his possession, custody or power relating to any matter in question in the causes or matter, and may at the same time or subsequently also order him to make and file an affidavit verifying such a list and to serve a copy thereof on the other party.”

(Underlines provided)

5.Does the discovery of the hard drive of the Defendant's home personal computer relate to any matter in question in this case?  One of the issues in this case is that the Defendant, during his employment with the Plaintiffs, in breach of his duty of such employment, emailed to his personal email address a number of confidential documents and files belonging to the Plaintiffs.

6.In the second affirmation of the Defendant dated 4 April 2005 he admitted:-

“	8.	The emails containing the Guest List and Press Contact List were forwarded from my Norasia account to my netvigator account.  It has not been passed on to any third parties nor do they exist in a hard copy format.  The softcopies of the documents have been deleted.
	9.	I forwarded to my netvigator account a copy of job descriptions from my Norasia account.  The soft copy of these job descriptions were deleted after I read them.
	10.	In the past 6 months I would have forwarded from my Norasia account to my netvigator account a copy of a presentation which I prepared describing the Marketing Department and I used this presentation when introducing new staff to the department and on occasion to customers and agencies of the Plaintiffs.  The document was forwarded to my netvigator account so I could work on it from home.  The soft copy of the presentation has been deleted.”

7.The Plaintiffs alleged that the documents referred to above were confidential documents and files belonging to the Plaintiffs.  The hard drive is a document relating to a question in this case.  In his Third Affirmation dated 20 April 2006, the Defendant stated, “The hard drive of my computer will be listed as one of the documents in the List of Documents which will be prepared by my solicitors.  My solicitors will make available to the Plaintiffs' solicitors at the discovery stage copies of documents obtained from the hard drive which they consider to be relevant to the issues”.  When he made this statement he was represented by solicitors.  He could not have misconceived his case as to whether the hard drive should be listed as one of the documents in the list of documents.  Had he so misconceived his solicitors would have given him the proper advice. The hard drive was made use of at least for the purposes mentioned in paragraphs 8, 9 and 10 of the Defendant's second affirmation.  Some of the documents and files of the hard drive, which had been deleted, were retrieved by Ernst and Young Transactions Limited.  The forensic images of these documents and files are matters subject to discovery (See the following paragraph).  The hard drive, which contains these images, must of course be subject to discovery.  Obviously the hard drive is a document relating to a matter in question in this case.  The Defendant objects to the discovery of the hard drive, on the ground that it is not necessary, because the Plaintiffs know the whereabouts of the hard drive.  The hard drive is at present in the custody of Clyde & Co. solicitors for the Defendant.  Clyde & Co. gave an undertaking to the Court of Appeal that the hard drive would be kept in its safe case and custody whilst the proceedings are pending.  The issue is not whether the Plaintiffs know the whereabouts of the hard drive.  Knowing the whereabouts of a document does not render it unnecessary for it to be made an object subject to discovery.  The issue is whether it is subject to discovery.  The answer is clearly “yes”.  

8.The forensic images of the Computer's hard drive (including any forensic images of the hard drive and items therein produced by Ernst & Young Transactions Limited) are essentially images of the documents and files contained in the forensic report obtained by the Defendant from Ernst & Young Transactions Limited which conducted an inspection of the hard drive.  The Defendant referred to and relied upon the report in his 3^rd Affirmation filed in support of his appeal to the Court of Appeal, so privilege to it was waived.  The report contains documents relating to an issue in this case, so it is a discoverable document.  In any event, in the Defendant's written submission, there is no submission specifically made in respect of the discovery of these items.  I note the affirmation of Jezamine Corrina Fewins of Messrs. Clyde & Co., solicitors, that she has inspected the contents of the hard drive and the has not been able to identify any documents on it which are relevant to the issues in question in this case.

9.Regarding item 2, the Defendant takes issues with the description of Item No. 3 as being too broad and unspecific, contending that it has been highlighted by the Court of Appeal that items such as PR news reports do not belong to the Plaintiffs and these documents are akin to newspapers.  In its decision dated 28 April 2006 the Court of Appeal, on an appeal by the Defendant against my decision on 22 March 2006, stated,

“

15.

In coming to his conclusion that such an order should be made the judge took into account the fact that the defendant had sent copies of the PR Newswire articles from the plaintiffs' offices.  When it was put to Mr Smith SC, who appeared on behalf of the plaintiffs on this appeal, he did not seek to argue that the plaintiffs could have any claim to copyright or confidential information in the Newswires.  He argued that they were the plaintiffs' property in the sense that they had paid for them but he went no further than saying that it could be said that the defendant had been in breach of his contract of employment in making such use of them as he did.  In my view the Newswire articles were no more than electronic newspapers and there is no suggestion that they would not have been available to any member of the public who chose to pay for them.  As such they did not constitute confidential information and it is not clear why the judge thought it significant to refer to one of those articles at the outset of his consideration of whether to grant the inspection order.”

10.One of the issues in this case is that the Defendant emailed to his personal email address a number of confidential documents and files belonging to the Plaintiffs.  According to the Court of Appeal decision the PR Newswire articles did not constitute confidential information, and as such these articles should not be covered by Item 2.

11.Regarding Item 3, the Defendant argued that if the Defendant worked on documents he would have emailed them from his email account to Norasia's account.  The Plaintiff would have a copy of the same in its inbox.  As the Defendant has limited space storage on the email account any documents he worked on would have been deleted.  The Plaintiffs who would have large amounts of storage space on their servers would not share this problem.  The Plaintiffs should disclose documents received from the Defendant's Netvigator account to the Norasia account.  If the Defendant wishes the Plaintiffs to produce documents, he is entitled to do so by making an application in Court.  There is no such application before this Court.  According to paragraph 10 of the Defendant's 2^nd Affirmation, there is no doubt that he did send documents referred to paragraph 3 of the Schedule.  The Defendant's submission is related to why he deleted the documents.  It is not a defence to an application of discovering the documents covered by Para. 3 of the Schedule, in so far as these documents are relating to any matter in question in this case.

12.In respect of Para. 4 of the Schedule, the Defendant submits that the Plaintiffs already know that only 3 such documents exist which are referred to in item Nos. 103, 105 and 106 of the Defendant's Supplemental List of Documents.  The Plaintiffs by virtue of their list of documents knew that these documents were forwarded to the Defendants' Netvigator account.  The documents in question belong to the Defendant.  The Plaintiffs have all the documents in their possession in relation to these documents.  In my judgment, if these documents are covered by Para. 4 of the Schedule, and if these documents are relating to a matter in question in this case, they are documents subject to discovery. 

13.For the reasons set out above, I allow the application in relation to the hard drive under paragraph 1 of the Schedule.  But I order that any PR Newswire articles under paragraph 2 of the amended Schedule are to be excluded.  In respect of all the documents referred to in the 4 paragraphs of the amended Schedule, they are confined to those documents relating to a matter in question in the cause.  Subject to the above-said, I make an order in terms of paragraphs 1A, 1 (1) and (2) of the amended summons.

Costs

14.I make an order nisi, to be made absolute in 14 days' time, that the Defendant do pay 3/5 costs of this application to the Plaintiffs (without certificate for Counsel), to be taxed, if not agreed.

The Plaintiff : represented by Mr. Douglas Lam, instructed by Messrs. Holman, Fenwick & Willan, Solicitors.

The Defendant : represented by Mrs. Fewins of Messrs. Clyde & Co., Solicitors.