Johnson v Medical Defence Union

This case raises some striking issues arising out of the Data Protection Act 1998 [the 1998 Act]. The case has nothing, or almost nothing, to do with the protection of the privacy and integrity of a person whose personal data is held by another person on a computer, which is usually regarded as being the central mission of the 1998 Act and, even more so, of Directive 95/46/EC [the Directive] that the 1998 Act seeks to implement: as to which see further §§ 15ff below. Rather, it is claimed that the 1998 Act has created rights between the parties that are in substance though not in form of a contractual nature; and rights to compensation for infringement of those primary rights of a nature that did not previously exist in English domestic law.

That claim arises in this way. As will be explained more fully below, Mr Johnson complains that the insurance cover and professional support that he had previously enjoyed under his membership of the defendant [the MDU] was withdrawn unfairly, and by reason of that withdrawal he suffered loss and damage. It is agreed that as a matter of contract, or otherwise in domestic law, he could not complain of that decision, however much he objected to it and however unfair it was. He accepts that the MDU had an absolute discretion to terminate his membership but (at this stage to speak generally of a much-contested issue) decision-making within the MDU that led to the decision to terminate Mr Johnson’s membership involved dealing with and assessing information about Mr Johnson that was held on a computer. That is said to change the entire case, because Mr Johnson can now claim, not that the decision itself was unfair, or not open to the MDU, but that the processing of information that led to that decision was done unfairly. That was a breach of the requirements of the 1998 Act; it caused the decision to withdraw cover; and Mr Johnson can thus recover damages for the loss caused to him by that withdrawal. It should be emphasised that those damages are not calculated according to the common law principles that would be applied if Mr Johnson’s claim had its legal basis in the removal of his cover, but rather are damages calculated and assessed according to the special rules attaching to breach of the terms of the 1998 Act that are set out in section 13 of that Act. Absent the computer, none of these claims would have been maintainable, under the 1998 Act nor under any other chapter of English law.

These propositions, as far as this court is aware novel in their nature, have led to difficult and complex litigation both in this court and below. I apologise in advance for the length of this judgment, which nonetheless only sets out the very minimum required to understand the various issues to which the case gives rise.

Both we and the parties have the benefit of what, if I may respectfully say so, was an eminently thorough and careful judgment by Rimer J, extending to 79 pages of single-space type. The parties were good enough to indicate to this court that they did not take issue with the Judge’s account of the facts, background or structure of the MDU’s operations. In explaining what occurred I shall draw heavily on that account, in many places verbatim. If anyone thinks that they need further information about the case over and above what is contained in the present judgment they may safely resort to the judgment of Rimer J.

I can take this directly from the first nine paragraphs of the Judge’s judgment.

We have already noted the MDU’s policy, which is to assess risk according to the incidence of allegations against a member, rather than according to a member’s claims record, or whether allegations had proved to be well-founded. Something more now needs to be said about that policy, and about the machinery for assessing members and their continuation in membership in the context of that policy. Again, I can rely on the Judge, this time at §§ 30-36 of his judgment:

We have seen, from §32 of the Judge’s judgment, that Mr Johnson makes no complaint about the procedure or the decision of the RAG as such. His complaint is that the material on which it had to work, and in particular the RAR form, was drawn up unfairly, because it was, first, drawn up on the basis of the MDU’s policy of assessing members according to number of incidents or complaints rather than according to their outcome; and second that, because of that policy, the RAR form did not contain, and therefore the RAG did not see, any explanation by the member of the various incidents reported to it. It is this part of the process, the compilation of the RAR form, that is said to fall within the ambit of the 1998 Act. We therefore need to concentrate on how that job was done in Mr Johnson’s case.

Once more, I can rely on the agreed account given by the Judge. He recorded at his §44 that the decision of the MDU Board to refer Mr Johnson for a risk review sprang from consideration of his file No 0001331. It will illustrate the process to set out by way of example the summary of that file that eventually appeared on the RAR form:

Since the point is of some importance at a later stage of the argument, it should be noted that three of the files that Dr Roberts worked off were already in electronic form. Those included file 0001331, already mentioned, and also the files about two complaints made to the GMC about Mr Johnson. Mr Johnson contended that it was the matters contained in those files that formed the main basis of the MDU’s adverse decision in his case. The rest of the files were “manual”, that is paper files of the traditional sort. The “day one summaries” were usually one-sentence summaries, on computer, of each of those files. The realistic position is, therefore, that a very significant part of the information that Dr Roberts used was held on a computer, and in order to access the information she had to process the data in the sense of calling the information up on to her computer screen.

The Judge then went on to set out Dr Roberts’ summary of each of the files that she had read. I do not repeat that exercise here; further reference will be made to it when considering the issue of fairness. Dr Roberts, having summarised the files, then made various “observations” that drew attention to certain particular aspects of the files, and went on to complete the standard score sheet. That sheet listed a large range of categories of incident to which, if occurring, a standard points score was awarded. It was Dr Roberts’ task to categorise the various matters revealed by the files, which she did. The score that she gave Mr Johnson was 60 points. She left open for the RAG itself the possibility of adding a further 20 points under the heading of “failure to change behaviour”, that arising in connexion with the repeated complaint about computer misuse that is referred to in §8 above. The RAG did in the event take that step. Dr Roberts also added further observations setting out what she thought should be particularly drawn to the attention of the RAG.

Dr Roberts said that both when categorising the incidents and when making her observations she was not being “judgmental”, but simply applying a standard process. She also said that no-one taking part in the assessment would have been misled by the absence of comment by Mr Johnson, because everyone realised that the process was taking place within the standard policy of the MDU already described. I understand the Judge to have accepted both of those contentions.

The RAR form, score sheet and RAG sheet were duly considered by the RAG, which recommended to the MDU Board that Mr Johnson’s membership should be discontinued. Again, the judgment below goes into considerable detail as to what happened at those stages of the process, but since no complaint is made to us in respect of them I do not need to do more than note the outcome.

I now turn to the Judge’s four questions that are set out in his §8, which I repeat for ease of reference:

The claim is brought under the 1998 Act, which however has to be interpreted in the light of Directive 95/46/EC, which it seeks to transpose into domestic law. The 1998 Act in some places uses different wording from that of the Directive, and the discrepancies were the subject of a good deal of consideration in the written stages of this appeal. However, Mr Howe QC, for Mr Johnson, indicated that in the event nothing in his view turned on the various differences in wording. Nor was it argued, at least in respect of the present issue of the definition of “processing of data,” that the Directive had been inadequately transposed into English law.

The Directive is stated to be “on the protection of individuals with regard to the processing of personal data and on the free movement of such data”. That clearly states the main objects of the Directive. First, as is recognised in particular in recitals (1)-(3), the economic development of the Community and of the internal market will be supported by the free flow of data between member states, which free movement will be promoted by uniformity of national laws that affect the use, transfer and retention of data. Second, that use of data, and the national laws that relate to it, must respect the rights of individuals. The most prominent right, specifically set out in the Directive, is the individual’s right to privacy. Accordingly, a leading principle of the Directive is that data should be handled in such a way as to protect the privacy of the data subject. That is shown by various of the recitals to the Directive, such as:

Recital 10 is particularly striking. Under the Marleasing doctrine, Case C-106/89 [1990] ECR I-4135, we are bound to interpret the domestic legislation so as to give effect to the purpose of the Directive. It is not easy to extract from this Directive any purpose other than the protection of privacy, and thus not easy to see any way in which the Directive drives an interpretation in favour of Mr Johnson, who does not claim that his privacy, in the usually understood meaning of that term, was infringed by the MDU. Mr Johnson initially sought to argue, in particular in connexion with an aspect of his claim for damages, that the somewhat general reference in recitals to privacy has to be viewed as a reference to all rights arising under article 8, which latter is noted in general terms in recital 10. But article 8 does not extend its protection to the loss of employment or loss of insurance cover that Mr Johnson fears or complains of. For that conclusion I would respectfully adopt the judgment, binding on us, of the Master of the Rolls in R(Countryside Alliance) v Attorney-General [2006] 3 WLR 1017, especially at §§ 100-103. Mr Howe indicated that in the light of that authority, not reported until well after the written submissions in this appeal had been formulated, he did not pursue the contention that the treatment accorded to Mr Johnson infringed any right under article 8 or, as I understand it, any other article of the Convention.

Section 1 of the 1998 Act lists “basic interpretative provisions”. I set out the main relevant provisions, together with some initial commentary on how they apply in this case:

In the present case, and for reasons that it is not necessary to take time in explaining, we are not concerned with a “relevant filing system”. The case is concerned only with automatic processing of data as envisaged in sections 1(1) (a) and (b). In that context, the following points are not in issue.

The information held by the MDU in relation to Mr Johnson’s career and claims record was his personal data

The MDU was a data controller in respect of that data

It was therefore the duty of the MDU to comply with the data protection principles in respect of that information.

The Data Protection Principles are set out in Schedule I to the 1998 Act, the relevant parts of which are as follows:

By far the most important part of these Principles in this case is principle 1(a), fair processing of data. That requires the consideration of the present issue, of whether there was processing of data; and, if so, whether that processing had been fair, a question addressed in the next part of this judgment.

Processing of Mr Johnson’s personal data did take place at various stages of the MDU’s dealings with him and with his case: for instance, when information about him was recorded on the computer files; when Dr Roberts extracted that information from the computer files; when Dr Roberts transmitted her analysis to the RAG; and when the opinion of the RAG was transmitted to the MDU Board or to its delegate Dr Tomkins. But in order to succeed Mr Johnson has not merely to identify an act of processing his data, but to identify such an act that was done unfairly. That act was said by him in his Particulars of Claim to be, and the trial and this appeal proceeded on the basis that what was alleged was

To deal first with a point on which Mr Spearman QC placed some weight in his initial submissions, “selection” of information is not listed amongst the acts of processing specified in the definition of that term in section 1(1) of the 1998 Act. But there is no doubt that during the process Dr Roberts performed operations on Mr Johnson’s data such as retrieving or consulting it; and in any event the examples given in the definition are only examples of the general category of “carrying out any operation or set of operations on the information or data”. The pleading accordingly identifies the stage in the process where Mr Johnson says that unfair processing of data took place, but uses “selection” as essentially a word of such identification rather than of definition.

However, that said, the difficulty for Mr Johnson remains that the selection, and thus the carrying out of operations, of which he complains was done by Dr Roberts, using her own judgement, and not by any computer or by any automatic means. To the extent that the material on which she worked was already recorded on a computer Dr Roberts had to operate that computer in order to access the information, but no complaint is made of that: because it is not suggested that in looking at Mr Johnson’s record Dr Roberts shut her mind to, and therefore refused even to look at, any particular data. Similarly, having made her decisions Dr Roberts recorded them, or caused them to be recorded, in electronic form; but by that stage Dr Roberts had already made her decision, so the subsequent mechanical recording of her decision did not add to the alleged unfairness.

The respondent accordingly says that the answer is simple. The carrying out of the operation on his data that Mr Johnson says was done unfairly was not done by means of equipment operating automatically in response to instructions given for that purpose, as section 1(1) of the 1998 Act requires. Nor was it the processing of personal data wholly or partly by automatic means, to which article 3.1 of the Directive says that its provisions (other than those relating to relevant filing systems) are limited. Rather, the selection of data of which complaint is made was all done not by a machine but by a human being, Dr Roberts. She made the decisions complained of, and no automatic process entered into that decision-making.

This simple approach has undoubted attractions, some of which I shall explain in more detail below. The appellant raised a number of objections to it, which I now consider.

Various parts both of the 1998 Act and of the Directive were relied on to indicate that “processing” was not limited to the automatic treatment of data.

First, by section 1(1) “processing” includes obtaining or recording information or data, and by section 1(2) “obtaining” or “recording” in relation to personal data (our case) includes “obtaining or recording the information to be contained in the data”. It was therefore suggested (in an argument developed more fully in relation to the claim that the whole operation performed by the MDU should be taken as one, discussed in §§ 30ff below) that when obtaining the information about Mr Johnson that was contained in the computer files and day one summaries Dr Roberts was then automatically processing Mr Johnson’s data. That contention does not work, for two reasons. First, it is not the recording or the obtaining of the information that is complained of. It is not suggested that Dr Roberts made errors in retrieval, but rather that, having retrieved the information, she then analysed the information unfairly. Second, what was obtained or recorded by Dr Roberts was already Mr Johnson’s personal data. What further was “to be contained in” his personal data were the expressions of opinion by Dr Roberts that were contained in the RAG sheet and other documents drawn up by Dr Roberts. Those expressions of opinion were further personal data of Mr Johnson; but his complaint is as to the way in which they were arrived at by Dr Roberts, and is not based at all on the fact that, once Dr Roberts had reached her conclusions as to what opinions she should express, those opinions were then recorded on a computer.

Second, it was contended that when Dr Roberts retrieved the material contained in the electronic files she was “using” information that was being automatically processed under sub–paragraph (a) of the definition of “data” and sub-paragraph (b) of the definition of “processing” in section 1(1) of the 1998 Act. Here again, however, one has to revert to the complaint made by Mr Johnson. He does not complain of the way in which Dr Roberts got the material about him on to her computer screen, but about what she did with it once she saw it there. The latter was not any sort of automatic process.

Third, weight was placed on article 2(b) of the Directive, which states that

This contention, which persuaded the Judge, depends on analysing the whole of the dealing with Mr Johnson’s case, from the gathering of the information by Dr Roberts through to the adoption of the recommendation of the RAG by Dr Tomkins, as one continuous and single operation. Since some, indeed as we have seen many, stages of that operation involve the automatic processing of data, the whole operation is argued to fall under the statutory definition, even in respect of stages such as Dr Roberts’s process of reasoning that were not performed by automatic means. To quote Mr Howe’s skeleton in reply in this court, that whole set of operations amounts to ‘processing’ in the terms of the 1998 Act since it is sufficient if one or more steps are performed by automatic means.

It is quite true, indeed obvious, that Dr Roberts’s selection and analysis of the material was only one step in a more lengthy operation. But as we have seen, the way in which Mr Johnson’s case was presented isolated that selection as the only part of the operation of which complaint was made. Nor was that simply a pleading point, or a mistake by Mr Johnson’s advisers. The stage at which the unfairness allegedly arose, in the shape of the failure to seek Mr Johnson’s explanation or point of view, was when Dr Roberts did her work: not earlier and, because the RAG took the RAG sheet as read, not later either. And the case presented in these proceedings is not that the operation taken as a whole was unfair; and there is good reason why the appellant did not so contend. That is because to complain of the overall decision-making of the MDU would underline even more clearly than did the presentation of the case at trial that the complaint is about the general policy of the MDU with regard to qualification for membership, and not about the way in which the MDU processes data.

Even, therefore, if the approach now under consideration were open to Mr Johnson on his pleadings it would seem highly artificial to say that Dr Roberts was processing data, not because of the conclusions that she drew from the data, but because those conclusions came either before or after the automatic operation of a computer on that or other data. Nor is there any support for the appellant’s analysis in the wording either of the Directive or of the 1998 Act. It was suggested that assistance could be obtained from article 3 of the Directive:

I should also note that reference was made to the decision of the European Court of Justice [ECJ] in Case C-101/01 [2004] QB 1014 (Lindqvist). A web page containing personal information about L and some of her fellow parishioners was composed by L on her home computer and placed on the internet. She was prosecuted for processing personal data by automatic means. The national court referred to the ECJ the question:

But Mr Howe has more formidable support from authority nearer home, the decision of this court in Campbell v MGN Ltd [2003] QB 633. That case was regarded by the Judge as conclusive in Mr Johnson’s favour on the processing issue, and it must therefore be analysed in some detail.

The facts are notorious, but must be briefly restated. C complained of the publication by MGN in its newspaper of information and photographs that invaded her privacy. This court explained, at its §122, that

The court drew attention to the provisions both in the Directive (article 23) and in the 1998 Act (section 13) for compensating persons suffering damage by reason of unlawful processing of data. It said, at its §104, that

The court accordingly approached the terms of the 1998 Act as follows in its §§ 101 and 103:

I respectfully agree with the Judge that this is an extremely broad approach, that in its literal terms encompasses as “processing” the selection of data undertaken by Dr Roberts. There are, however, four reasons why we are not compelled to that conclusion: a conclusion that, for the reasons that I set out in the next section of this judgment, leads to very surprising results, that I do not think would have been countenanced by the court in Campbell.

First, although the court expressed itself about the status of collection of data before the automated stage of the operation commenced, that was not the question that it was asked, nor was it the issue that concerned it in that case. It is, with deference, perfectly possible to say that the publication of information that has already been automatically processed can, in accordance with the aims of the Act and Directive, be regarded as falling with the terms of the Act and activating its compensation provisions, without taking the same view of the manual analysis of data before any automated processing begins. The court in Campbell did not consider that distinction because it did not need to do so. In our case we are forced to confront the distinction.

Second, the court in Campbell was strongly influenced by the fact that it was dealing with a case of breach of the proper privacy of the processed information. It (rightly) saw the protection of privacy of information as a prime interest of the Directive, so that the 1998 Act had to be interpreted in that spirit: see and compare §15 above. There is no such driving force in our case. For the reasons stated in §16 above Mr Johnson makes no complaint of invasion of his privacy in the sense in which the term is used in the Directive, nor could he do so. Rather, he complains that unfair decisions have been taken, not by the malfunctioning of a computer or by the way in which it was programmed, but by a human being. It is not possible to find in the Directive any concern that human reasoning needs to be covered just because the reasoning is exercised on automated material.

Third, that the court in Campbell was exercised by the particular problem that faced it in that case is further illustrated by its approach to section 32 of the 1998 Act, which (put shortly) exempts from liability personal data processed “with a view to the publication by any person of any journalistic material”. The argument put to the court, which had been adopted by the trial judge, was that the expression “with a view to” limited the exemption to acts prior to publication. The court was very concerned that that limitation would effectively nullify the investigative journalism that the exemption seemed designed to protect. It pointed to how that conclusion could be avoided in its §129:

Fourth, to revert to the issue in this case, as we shall see when we consider the way in which it is said that Dr Roberts acted unfairly, the main thrust of Mr Johnson’s complaint is that Dr Roberts applied what he says is the unfair policy of the MDU. I do not find it easy to think that the court that decided Campbell would, if confronted with that question, have thought that the use of automatic processing once Dr Roberts had finished her work exposed that work to the compensation provisions of the 1998 Act.

That consideration leads to a wider concern, that the interpretation urged by the appellant and accepted by the Judge would give rise to very surprising outcomes. First, a number of types of situation that under English law do not involve legal rights and obligations would do so if a computer were to be involved in any aspect of them. Second, a very wide range of decision-making would be exposed to potential scrutiny by the court in terms of “fairness”, expressed in the entirely general terms of the 1998 Act. Those concerns are explored in the next section.

If the Judge is correct, any exercise in decision-making by an individual the results of which are then as part of the same operation recorded or transmitted in electronic form will be subject to scrutiny under the Data Protection Principles, including the requirement that the processing (such as, on this view, the decision-making is) should have been conducted fairly. That leads to many alarming examples: some of these render justiciable decisions that are socially trivial; others render justiciable decisions in respect of which there are good policy reasons why the courts should abstain from interfering. Some but not all of these were explored with counsel in the course of argument.

Hotels, or doctors, or barbers, now often keep their appointments lists on a computer. The putting on to the computer of the name of the customer (personal data) who has been allocated a particular room or appointment involves automatic processing of that data. If the human decision on allocation of rooms or appointments that precedes that processing is itself part of the processing, the hotel or doctor will have to answer for the allocation under the first Data Processing Principle. Mr Howe agreed that that would be so, but only if the manager consulted computerised information (for instance, as to whether the client was a regular customer) before deciding who should get the better room. That is alarming enough; but I am not at all sure that it was consistent with Mr Howe’s argument to make even that reservation, if presence of automatic processing at any stage of the operation (in the present case, entering the client’s name on the room register) is sufficient to bring all parts of the operation within the 1998 Act.

Judges when they have decided what their reserved judgments should say place those conclusions on a computer, or dictate those conclusions for typing up by their clerk, again by use of a computer. Judgments tend to contain or to refer to a good deal of personal data in respect of the parties to the case. Judges are for that reason data controllers under the terms of the 1998 Act; but one does not need to stress the oddity of a conclusion that the typing of the judgment brings the decision-making process that preceded the typing within the “fairness” terms of the first Data Processing Principle. Mr Howe, as I understood him, did not demur from the suggestion that that was indeed the effect of the provisions of the 1998 Act, but said that the judge would be immune from suit under the rule of judicial privilege or immunity, which Parliament must be taken to have had in mind when enacting the 1998 Act. That may well be so. The point rather is that it is odd and unsatisfactory to have to rely on that doctrine in order to avoid the application to the judge of what the appellant says is the meaning and effect of the words used in the 1998 Act.

And that defence would not avail parties who do not benefit from special immunities, unconnected with data protection, provided by domestic law. Thus, employers assess employees for promotion on the basis of their personal qualities, which involves decision-making based on personal data. If that personal data is held on a computer, alternatively once the decision is typed up on a computer, it follows from the appellant’s argument that the fairness of that decision becomes justiciable not in terms of employment law, but in terms of data protection. The same is the case in the public as well as the private sector. Government no doubt has to make many policy decisions that involve taking a view on individuals. Again, whether based on computerised data or once made typed on to a computer, the decision can be challenged on grounds of fairness, even if there is no other ground of challenge in law, and strong reasons of policy why there should not be a challenge in law.

The width of the contention advanced by the appellant is shown by the present case, where Mr Johnson, who agrees that he has no right in contract or in any other chapter of English law to challenge Dr Roberts’s selection of the information contained in his personal data, asserts that he can nonetheless mount these proceedings because her act of analysis is covered by the First Data Protection Principle. I would not be prepared to conclude that the 1998 Act has had that effect, and the other widespread effects suggested in §§ 44-47 above, unless I was driven to it. Far from that being the case, neither the 1998 Act nor the Directive give any support to the appellant’s case. I would therefore hold that the Judge was wrong to find that Dr Roberts’s selection of the data amounted to processing of data in the terms of the 1998 Act, and I would allow the cross-appeal on that point.

After the text of the foregoing section of this judgment, §§ 14-48 above, had been completed I had the benefit of reading in draft the judgment to be delivered by Arden LJ. With appropriate diffidence I venture some brief further observations.

First, the principles to be applied in reading Community legislation, including the detailed guidance given by my lady in her judgment in Commissioners of Customs & Excise v IDT Card Services Ltd [2006] STC 1252, are not in doubt. Those principles have to be applied to the only issue in this part of the case: whether the act complained of by Mr Johnson as identified in his pleadings as quoted in §21 above, the selection of information by Dr Roberts, was an act of processing of data in the terms of the Directive.

Second, I entirely accept that it is not conclusive that the proposition on which that claim rests (that the mental process of selection became the processing of data because it was prefatory to the recording of the results of the selection on a computer) leads to the practical results indicated in §§ 44-47 above; even though counsel had no adequate explanation for those practical results, and even though none of the examples given are covered by the exceptions to the Directive’s ambit to which my lady refers. I also entirely accept that it is not conclusive that the claim is plainly inconsistent with recital (15) to the Directive. I was not aware that I had argued that recital (15) must predominate over the rest of the Directive, and regret if the terms of my judgment give that impression.

Third, however, both of those factors mentioned in §51 above should cause us to proceed with care. That care leads me to be very cautious about a reading of article 2(b) of the Directive that allows the words “whether or not by automatic means” effectively to override the scheme of the rest of the Directive: see §29 above. And that caution is borne out, in relation to the present case, by article 3.1, the “scope” provision, which limits the reach of the Directive to either (i) processing wholly or partly by automatic means; or (ii) or processing of data in relation to a [relevant] filing system. This is not a filing system case; and the act with which we are concerned, I repeat, the selection by Dr Roberts, was not partly by automatic means, but not by any automatic means at all.

So far as authority is concerned, Lindqvist is of no assistance, because the issue in that case concerned what was on any view processing, the adding of material to an internet home page. And it would be fruitless to speculate as to whether the apparent absence from the European jurisprudence of any further discussion relevant to the present issue indicates that no-one has previously thought that the Directive has the application that Mr Johnson asserts. As to Campbell, I do not understand it to be argued that the case is authoritative in the sense that, whatever appears to us to be the state of the Community jurisprudence, we are obliged to follow Campbell under the rule in Kay v Lambeth LBC [2006] 2 AC 465; and to the extent that it is suggested that a ratio of the case relevant to the present point is to be found in §129 of Campbell I venture to draw attention to what I say in §41 above. The reality is that Campbell was not addressing the present issue, and for reasons that I have already set out at length cannot be used to drive to a conclusion on that issue that is otherwise unpersuasive.

The decision on the cross-appeal is sufficient to dispose of the entire proceedings in favour of the MDU, but in view of the detailed argument that we have received about the other issues I go on to consider them as well.

There were three potential ways in which it was said that the processing, in the shape of Dr Roberts’s selection of the information, was unfair. First, that she herself acted unfairly or wrongly even within the limits of the MDU’s policy that she was applying. Second, that the processing of information in the “non-lead” files (that is, files containing information obtained from other members of the MDU rather than from Mr Johnson himself) was automatically unfair, because, in breach of paragraph 2(1) of Part II of schedule 1 to the 1998 Act (see §18 above), Mr Johnson had not been informed that the MDU held that data, or what they were intending to use it for. Third, that the policy of the MDU that Dr Roberts applied, of only having regard to incidents and not to their outcome, and of not taking into account the member’s explanations or counter-arguments, was unfair in itself.

As to the first of these potential objections, the judge took it upon himself to go in careful detail in his §§ 127-195 through all of the analysis of information undertaken by Dr Roberts. He concluded in respect of the files generally, in his § 197, that

Second, as to the (two) non-lead files, the Judge held, at his §112, that they had been processed unfairly, on the ground mentioned in §50 above, but not because Mr Johnson ought to have been consulted about them. However, Mr Howe very fairly said that he was not able to challenge the Judge’s further conclusion, in his §199, that the processing of the non-lead files had not made any material difference to the decision that was taken about Mr Johnson’s membership, and therefore that the unfairness had not caused any loss. It is not therefore necessary to pursue further the Judge’s conclusion as to the initial unfairness.

That leaves Mr Johnson’s major criticism of the MDU, that its policy was unfair. I preface consideration of that issue with a warning. This part of the judgment is necessarily hypothetical, because it addresses an issue that on my finding set out in §47 above does not arise. That causes an even more significant artificiality than is normally the case with hypothetical issues. The enquiry is and has to be into the MDU’s general policy. That policy would exist whether or not there was any processing at all involved in the MDU’s operations, and the fairness or otherwise of the policy has to be assessed entirely divorced from the processing that is relied on to bring the policy into issue in the first place. That that is the outcome of the appellant’s case on processing is another reason that compels me in the direction of thinking that that case must be wrong. The hypothesis however requires me to bring quite general considerations to the quite general issue of the MDU’s policy, without limiting the enquiry to any specific question regarding the MDU’s holding and use of automatic data.

The Judge came to his consideration of the fairness of the MDU’s policy by addressing the complaint made by Mr Johnson under paragraph 2(3)(d) of Part II of Schedule 1 to the 1998 Act and (the same wording) article 11 of the Directive, that he had not received information that was required to guarantee the fairness of the processing. However, as the Judge pointed out, what Mr Johnson wanted was not information as such, but rather to know what Dr Roberts was proposing to put into the RAR form, so that he could add to that information and make submissions to the RAG about it. Of that, the Judge said in his §107:

The Judge then went on to consider whether consultation was in any event appropriate, whatever the guidance in the legislation. Of that, he said this, at his §§ 109-110:

Mr Howe criticised the Judge’s very generally expressed statement that the court could not pass judgement on the MDU’s commercial policy, and I think that that criticism was, in verbal terms, well-founded. Once the court is launched on an enquiry into “fairness”, it cannot conclude that conduct is fair just because it is adopted in obedience to the party’s commercial policy. The judge’s statement may indeed reflect some (justified) unease on his part at the way in which the very broad construction that he was persuaded to place upon the 1998 Act had led him into an enquiry from which the court would normally be excluded. However, the Judge did not in the event regard his view as to the paramountcy of the MDU’s policy as excluding him from considering the justification for that policy in terms of fairness, which he did in his §§ 114-126, under the heading “Was the processing anyway unfair?”

Various decisions of the Data Protection Tribunal were put before the Judge and before us. The Judge did not find them of assistance, save in that they explained that “fairness” required consideration of the interests not only of data subjects (such as Mr Johnson), but also of data users (such as the MDU). I would respectfully endorse that judgement. The Judge went on to apply that approach in his §123:

Some complaint was made that the Judge had not received proper evidence to support his view of the MDU policy, and in particular that the MDU witness who explained it to him was not a statistician, and therefore could not vouch for the reliability of the MDU’s assumptions as to risk. That evidence was summarised in §§ 35-36 of the Judge’s judgment, set out in §6 above. I am not moved by those objections. The Judge was entitled to take the commonsense view that the MDU were responsible for running the business, in the interests of members as a whole, were in no respect suggested to be acting in bad faith, and had adopted a rationally thought-out policy that, at the lowest, was not clearly unjustified. And the Judge’s analysis, set out above, was entirely open to a judge with considerable experience of company affairs.

I would accordingly hold that there is no basis for dislodging the Judge’s finding that in any relevant respect the MDU’s processing was not unfair. Mr Johnson fails on that point also. Again, however, I go on to pile hypothesis on hypothesis, and consider whether, if Dr Roberts’s application of the policy had been “processing”, and if that processing had been unfair, that unfairness would have affected the MDU’s decision.

The Judge first considered what would have occurred had Mr Johnson been permitted to state his case, but the MDU had adhered to its policy. That was a somewhat unreal set of hypotheses, because, as the Judge said in his §200, the MDU would have regarded what Mr Johnson had to say as irrelevant under the policy.

Mr Spearman also submitted that if one read the Judge’s lengthy account of the files summarised by Dr Roberts in the light of the explanations that Mr Johnson gave in the present proceedings, it was clear that in many cases what Mr Johnson wanted to say would have made his position worse. I do not pursue that argument (well though I understand why the MDU properly wanted it to be before the court), because the Judge’s findings were dependent on the MDU’s policy, which at this stage of the discussion he had held Mr Johnson could not in any event challenge.

The Judge however went on to consider the case from a more radical standpoint, which can be best described in his own words, from §§ 201-202 of the judgment:

Mr Spearman complained that his clients had been given no warning of this part of the Judge’s consideration, and had had no chance to meet it. I think that that complaint is justified. The discussion of the hypothetical outcome if Mr Johnson had been given a chance to put his case had all taken place in the context of the existing policy. What would have happened if the RAG had applied to Mr Johnson’s explanations the more sensitive analysis mentioned by the Judge at the end of his §202 never seems to have been addressed. Because it understood, rightly, that what was complained of was the steps preliminary to the deliberations of the RAG the MDU called as witnesses none of the RAG’s decision-makers, who could have given evidence as to their view of Mr Johnson’s case assessed against the Judge’s hypothesis. Mr Howe said that that was not a sufficient answer, because causation had been put in issue generally. But that had been done in Mr Johnson’s pleadings in terms that can at best be described as gnomic:

Mr Spearman also took us to the evidence of Dr Tomkins (as to whom see §§ 31 of the Judge’s judgment, set out in §6 above) who had attended the RAG meeting, and who said that she did not think that it would have made a difference to the deliberations if the RAG had been given Mr Johnson’s account of the files. Some caution must be exercised about that statement, because it seems to have been made in the context of the MDU’s existing policy. The point however remains that there was no sufficient evidential base for the Judge’s conclusion; and for my part I do not consider that that conclusion is self-evident to the extent that it can be reached without hearing the view on it of the MDU executives who would have had to make the decision.

I therefore conclude that the claim that a different policy would have led to a different result was not sufficiently pleaded, and in any event not sufficiently proved. The conclusion in §202 of the judgment was not open to the Judge.

Even, therefore, if I am wrong both on the issue of processing and on the issue of fairness Mr Johnson’s case still fails. I nonetheless go on to consider what compensation would have been recovered by Mr Johnson on what is now the triple hypothesis that his case fell under the 1998 Act; was handled unfairly in the terms of that Act; and that unfairness caused him to lose his membership of the MDU.

Article 23 of the Directive states that

Mr Johnson sought damages under three heads: pecuniary loss, incurred in achieving cover from another society, the MPS; damage for the distress caused to him by the removal of his cover with the MDU with no explanation given; and damage inflicted on his reputation by the removal of his MDU cover. Damages for distress are, by the plain terms of section13(2)(a), only available if the claimant also suffers other “damage”. Mr Howe argued that that limitation was inconsistent with the general rule of compensation for damage to be found in the Directive. The latter should be read in an autonomous Community sense, as requiring the provision of compensation for any sort of damage recognised in national law.

While, like the Judge, I find this point not entirely straightforward, also like him I cannot accept it. In the absence of specific Community authority, none of which we were shown, I do not accept that the Directive has to be read so widely. I bear in mind Mr Spearman’s warning that the national laws of the member states differ in their approach to damages, and in particular in relation to compensation for injury to feelings or reputation. There is no compelling reason to think that “damage” in the Directive has to go beyond its root meaning of pecuniary loss. Nor do I accept Mr Howe’s contention that the fact that the Directive envisages the protection of rights under article 8 of the European Convention (as to which, see §15 above) entails that compensation must be available in every case for loss of a type or category that would be covered by article 8: for example, damages for distress. If a party could establish that a breach of the requirements of the Directive had indeed led to a breach of his article 8 rights, then he could no doubt recover for that breach under the Directive, without necessarily pursuing the more tortuous path of recovery for a breach of article 8 as such. But that is not this case, since it is agreed that Mr Johnson can make no complaint under article 8: see §16 above. There is no reason to think that the Directive nonetheless requires Mr Johnson to be able to recover for a head of loss available under article 8 even if domestic law denies him that recovery.

This issue of construction matters in the present case in particular because by the terms of section 13 distress damages are only available if damage in the sense of pecuniary loss has been suffered. With that in mind I turn to the three heads of compensation that were claimed.

Mr Johnson originally claimed substantial amounts allegedly incurred in his attempt to obtain cover from the MPS. All of that case failed. However, at a late stage of the trial, and after Mr Johnson had left the witness box, a hotel bill was produced allegedly relating to the negotiations with the MPS. That bill showed items that, as the Judge found, were incurred by Mr Johnson for other purposes, but also included, apart from Mr Johnson’s own bed and breakfast charges, a sum of £10.50 for an additional breakfast. After some lengthy consideration of the matter the Judge concluded, at his §230, that

Applying as I do the terms of section 13(2)(a), this claim fails in limine by reason of Mr Johnson’s failure to prove damage in the terms of section 13(1). The Judge would have awarded £5,000 under this head if he had found the case proved. Mr Spearman criticised that amount, as plainly too high for the modest level of distress that the Judge had found, when compared with the standard measures for various kinds of personal damage. I agree with that criticism, but in view of the findings in the rest of this judgment it would be an undue use of judicial time to reason the matter out.

Unlike “distress”, this head of loss is not envisaged in the 1998 Act, and there is no reason to think that it is inherent in the provisions of the Article. The Judge rejected on the facts a number of specific claims under this head, and his decisions are not appealed But in addition, and no doubt inspired by the English law of defamation, the appellant, although he did not prove any actual loss of reputation, much less any financial loss or other tangible detriment that had flowed from it, nonetheless relied on assumptions that his reputation must have been damaged and that a financial value must be put on that damage. I am certainly not prepared to import those assumptions, peculiar to, and in the view of some an unedifying feature of, the English law of defamation into this wholly different chapter of the law. Mr Johnson’s inability to prove any loss destroys this claim, as the Judge rightly held. Nor can English law be said in that regard not to respect its obligation to give compensation for loss of reputation caused by unfair processing of automatic data. If an Englishman thinks that that has occurred he can always actually sue in defamation, with the prospect of recovering far more, and on a less exacting basis, than he would find in other member states of the Community.

I would dismiss the appeal; allow the cross-appeal; and uphold the Judge’s order dismissing the claim.

The appellant has applied for certain questions to be submitted to the European Court of Justice. We deferred that application until we had heard the appeal. With the benefit of the considerations set out in the body of this judgment I would not make any reference Only two of these issues give me pause. The first concerns the proper understanding of processing in the context of the Directive. But although this court is unfortunately divided on that issue, the majority has been able to reach a conclusion on it without the need of the assistance of the ECJ. The second issue is the proper construction of article 23 of the Directive, and whether it is properly transposed into domestic law by section 13 of the 1998 Act. However, and additionally, there are substantial grounds, not affected by either of those issues, why the appeal must fail in any event. That being so, it would not be appropriate to occupy the time of the ECJ on matters that cannot affect the outcome of the litigation.

I have had the benefit of reading in draft the judgments of Buxton and Longmore LJJ. I agree with the judgment of Buxton LJ, save on one issue, that of processing. I consider that the judge came to the right conclusion on this issue. It follows that I am not in agreement with the judgment of Longmore LJ on the same issue. In my judgment, Dr Roberts' selection of the data amounted to “processing” for the purposes of the Data Protection Act 1998 (“the 1998 Act”). I also wish to make some additional observations about the application of the first data protection principle, that of fairness, and the question of a request for a preliminary ruling. I agree with Longmore LJ’s observations in paras. 158 to 160 of his judgment that the assessment of risk by reference to allegations without further reference to explanations or outcomes is not unknown to the law for the reasons that he gives, and that this lends support to the conclusions reached by Buxton LJ and myself in relation to the fairness principle.

In my judgment, for the reasons given below:

the statutory definition of “processing” in the 1998 Act can be interpreted in conformity with the directive;

my conclusion on processing is consistent with the conclusion of this court in Campbell v MGN [2003] QB 633;

accordingly, the judge was right to conclude that the selection of personal data about Mr Johnson and its presentation on the RAR form, the RAG form and the score sheet constituted “processing” for the purpose of the 1998 Act, and the Medical Defence Union Ltd (“the MDU”) as the data controller thus had a duty to comply with the data protection principles.

The facts are very fully set out in the judgment of the judge, now reported at (2006) 89 BMLR 43, and it is unnecessary for me to repeat them. Like the judge, I will refer to the risk assessment review form as the “RAR form” and to the risk assessment group sheet as the “RAG sheet”.

As recorded in the minute of order of Deputy Master Arkush dated 20 September 2005, the acts of processing relied upon by Mr Johnson are “selecting the information contained in the personal data and thereby presenting a false picture of the situation”. The act of selection was accordingly relied on as a step towards the presentation of the information by automated means. The personal data were listed in schedule 1 to the amended particulars of claim and included information extracted from MDU’s files and inserted into the RAR form and the observations added by Dr Roberts’ word processor. The gravamen of the MDU’s case before the judge was that the directive and the 1998 Act required both steps to be done by automatic means; otherwise, the selection of information was not “processing” for the purpose of the directive or the 1998 Act (see judgment, para 91). The judge rejected that argument (judgment, paras 96 and 97). Accordingly, on this appeal, the sole issue on processing is whether Dr Roberts, by virtue of manually selecting information from various (non-electronic and electronic) files, which thereafter was presented by automated means, thereby “processed” information for the purposes of section 1 of the 1998 Act. At its very essence, the question is whether, and if so when, the statutory restrictions on data processing apply to extracting information from non-electronic files and putting them into electronic form.

Mr Spearman QC, for the MDU, accepts that the 1998 Act applies to information which has been, or is being, automatically processed. His case is that the 1998 Act does not apply to information processed or selected manually except in three situations. Those situations are: (i) where the information is stored in a “relevant filing system” at as defined in the 1998 Act; (ii) where a manual element has been introduced in an attempt to avoid the mandatory requirements of the 1998 Act, and (iii) (if contrary to his primary submission this court was correct in law in para. 103 of its judgment in the Campbell case) where information is stored by electronic means but is then produced in hardcopy format as part of a process linked to that of automatic processing. None of those situations arises in this case.

A concrete example may help to illustrate the importance of the issue on “processing” arising here. Suppose that an employee provides his employer with a medical report in hard copy. Can the employer select and obtain information from that report, even going beyond what the employer needs to discharge his own obligations to the employee, and add it to his electronic records about the employee free from any restriction under the 1998 Act? I appreciate that, by section 2(c) of the 1998 Act, such a report would be “sensitive personal data”, which is a special category of “personal data”, but, if Mr Spearman is right and the judge was wrong, it would mean that neither the data protection principles nor the special protections set out in sched 2 to the 1998 Act will apply in this example. So, if, as Buxton LJ states, there are startling conclusions if the judge is right, there may also be startling conclusions if he is wrong. The data protection principles would apply to the retrieval, use or holding of information but they may not apply in the same way if information can be added to the employer's electronic files without restriction. Moreover, the directive would provide no protection to the individual at the initial stage of putting the information on to the computer, which will process the information by automatic means. Particular examples of the results of an interpretation are often useful as a way of testing any conclusion on statutory interpretation and as throwing light on its likely intendment. In this particular case, however, I consider that particular examples are of limited use as examples may be taken to support the likelihood of either interpretation in issue. Accordingly the most important task for the court is the interpretation of the relevant legislation in the light of its provisions and the instruments and concepts to which it refers.

Thus, the correctness of Mr Spearman's submission turns on the true interpretation of the 1998 Act. As the 1998 Act implements the directive, it is necessary to identify the principles of interpretation applicable to domestic legislation implementing directives, next to seek the meaning of the directive and lastly to interpret the 1998 Act in the light of the directive. I do this in the next four sections of this judgment which amplify my reasons for the first four conclusions set out in the above summary.

It is well established that where domestic legislation implements a directive of the European Community, the domestic legislation must so far as possible be interpreted in conformity with the directive. To ascertain the meaning of a directive the court is enjoined by the Court of Justice to consider other language versions of the directive (CILFIT Srl and Lanificio di Gavardo v Ministry of Health (Case 283/81) [1982] ECR 3415). We have not been taken to the directive in this case in other languages but the French version at least does not seem to me to provide any further help on the question at issue here. I turn therefore to the question of how domestic legislation implementing a directive should be interpreted.

In IRC v IDT Card Services Ltd [2006] STC 1252, I pointed out that European legislation is often less precise than domestic legislation:

I then summarised the principles which apply when the court has to interpret domestic legislation in conformity with a directive. In the interests of simplicity I set out what I said in the IDT case:

In my judgment in the IDT case I referred to the recent case of Pfeiffer v Deutsches Rotes Kreuz Kreisverband v Waldshut [2004] ECR1-8835, in which the Court of Justice summarised and developed the relevant principles. I drew the following conclusions from this case:

I went on to hold that the court could adopt the same approach to interpretation of domestic legislation in conformity with a directive as the court adopted under section 3 of the Human Rights Act 1998. I referred to Ghaidan v Godin-Mendoza [2004] 2 AC 557, and continued:

Pill and Latham LJJ agreed with my judgment, and Pill LJ delivered a concurring judgment. In my judgment, the IDT case demonstrates that Community law imposes a duty of some intensity on national courts to interpret domestic legislation so that it conforms with Community law. Domestic courts are expected to use their powers of statutory interpretation under domestic law in full to achieve that result. Domestic courts are required loyally to find the meaning of the Community instrument, and, as this will inevitably be the driving force in the interpretation of domestic law, the logical place to start must be with that instrument itself.

I now turn to those provisions of the directive which throw light on the question whether and in what circumstances information which is manually processed is within the scope of the directive. I am mindful of Mr Johnson’s application for a reference for a preliminary ruling from the Court of Justice with which I deal in para 151 below. Even if I had concluded that the application should be granted, I would still have needed to analyse the meaning of “processing” in Community law (to some extent at least) in order to establish whether this court could itself determine that meaning with the appropriate degree of confidence. Since it appears that the court is divided on the meaning of “processing” under the directive, I doubt whether the court as a whole could be so satisfied.

The title of the directive describes it as a directive “on the protection of individuals with regard to the processing of personal data and on the free movement of such data”. The directive is remarkable for a number of recitals. It has 72 recitals but only 34 articles. It is impossible to set out a fair selection of the recitals. They demonstrate the width of the directive.

Buxton LJ points out that the most prominent right, specifically set out in the recitals to the directive, is the individual’s right to privacy. I agree. As the recitals point out, that right of privacy is recognized both in art 8 of the European Convention on Human Rights (which confers the right to respect for private and family life) and in the general principles of Community law. Moreover, recital (2) makes it clear that data-processing systems must respect the right to privacy:

Buxton LJ makes the point that art 8 does not extend to “the loss of employment or loss of insurance cover that Mr Johnson fears or complaints of” (judgment, para. 16) and that no complaint is made as to whether the treatment accorded to Mr Johnson infringed any right under art 8. However, there is a separate point as to whether the carrying out of any particular operation on personal data falls within art 8 by virtue only of that fact. If it is, then since, as recital (2) shows, one of the purposes of regulating data-processing systems is to ensure respect for art 8 rights, the scope of the directive is unlikely to exclude an aspect of processing which would engage art 8. Although we were not taken to the authorities on this point, it appears from the jurisprudence of the European Court of Human Rights (“the Strasbourg court”) that art 8 is engaged by the creation and maintenance of a record of data relating to the “private life” of an individual and that the term “private life” includes certain professional or business activities (Niemietz v Germany). Thus, in Amann v Switzerland (16 February 2000, application no 27798/95), the applicant complained at the interception of a telephone conversation between himself and a person from the former Soviet embassy in Berne and the creation and maintenance by a public authority of a record of the call in a manual filing system stating that he was a contact of the Russian Embassy. The court held that art 8 was engaged because the details filled in on the record card were data relating to the applicant's “private life”. It held :

The court went on to hold that art 8 had been infringed by both the creation and storage of the information:

Accordingly, in my judgment, art 8 is relevant to the processing issue for this reason. It provides some support for the view that the directive is likely to be concerned with the creation and maintenance of a computerised record of personal information even if it was created manually. The creation of the RAR form containing personal data relating to Mr Johnson was the creation of such a record. It is interesting to note that the Convention of 28 January 1981, which is referred to by the Strasbourg court in the Amann case and which is also referred to in the recitals to the directive, did not protect information in a manual filing system as the directive now does. The introduction of references to manual systems was one of the major differences between the directive on the one hand and that Convention and the 1984 predecessor of the 1998 act on the other. The point that I wish to make for present purposes is that, if personal data relating to complaints made against Mr Johnson in a professional capacity is selected manually and then recorded electronically, art 8 is likely to be engaged. In so far as the directive is intended to confer protection on persons in situations arising out of the recording of personal data within the ambit of operation of that article, Mr Johnson would appear to be within its intendment.

Recital (15) would appear to provide that all processing must be automated:

The conclusion reached by Buxton LJ in para 29 of his judgment would appear to have the effect of making recital (15), read with art. 2(b), predominate over, or govern, other provisions of the directive. This is a matter which I will have to refer below. Recital (15) needs to be read with other provisions of the directive. Recital (27) provides:

Art 2 sets out definitions:

Art 3(1) of the directive, headed “scope” and dealing with the scope of the directive, provides that processing can be wholly or partly the automatic means:

Art 3(1) thus states that the directive applies to processing personal data whether it is carried out “wholly or partly” by automatic means. The definition of “personal data” makes it clear that information can be “personal data” even if it is not recorded or held by automatic means. It simply applies to “any information” relating to an identified or identifiable natural person. Art 3(1) does not lay down the extent to which information may be recorded partly by automatic means. This is clearly a different method of recording information from recording information in any filing system for the purpose of the second limb of art 3(1). In respectful disagreement with Longmore LJ, in my judgment, it would naturally include information selected manually though I would accept that such selection is unlikely to be a sufficient condition in itself. Some guidance can be gained from the definition of “processing of personal data”, which includes the “collection” of personal data. I return to that point in para. 113 below.

The interpretation placed on the directive by Buxton LJ involves reading down the definition of processing data by reference to recital (15). In effect, in my respectful judgment, this gives precedence to recital (15) over art 3(1). In his judgment, no reliance can be placed on art 3(1), because that is dealing with the processing to which the directive applies and not with the question whether there was processing. In my judgment, there is no distinction between processing to which the directive applies and processing as defined by the directive. Moreover, in my judgment, recital (15) does not have the effect of excluding the application of the directive from collecting information by manual means and recording it by automatic means. I now set out my reasons for that conclusion.

First, in the interpretation of a directive, the provisions of an article are generally to be given precedence over any provision in a recital. Thus, in Deutsches Milch-Kontor v Hauptzollamt-Hamburg-Jonas (Case C-136/04), the Court of Justice held:

There are other decisions of the Court of Justice to the same effect. In Wirtschaftsvereinigung Stahl v Commission (Case C-441/97P) [2000]ECR I-10293 at [38], the Court of Justice stated that, although the preamble to a Commission decision in the form of an aid code indicated “that the rules contained in the earlier aid codes prohibit “any other operating or investment aid to steel firms, those words in the preamble are not endorsed by any provision of the [code]. It follows that those words in the preamble cannot by themselves change the scope of the [code].” Likewise, in Leclerc-Siplec v TF1 Publicité SA (Case C-412/93)[1995] ECR I-179, at [47] the Court of Justice did not adopt a particular interpretation of a provision in a directive even though that interpretation appeared to follow from a recital where the interpretation was not supported by the wording of the provision. Similarly, in Gunnar Nilsson (Case C-162/97) at [54], the Court of Justice stated that “the preamble to a Community act has no binding legal force and cannot be relied on as a ground for derogating from the actual provisions of the act in question”, but in that case the question - which was whether member states could impose additional restrictions on the breeding of livestock - arose in criminal proceedings.

Secondly, recital (15) is dealing with the scope of the directive (see the word “covered”). It is not dealing with the definition of any particular term used in the directive. Therefore it is to be read with the operative provision of the directive dealing with scope, namely art 3. When read with art 3, it is clear that it conflicts with art 3 because if recital (15) is read literally it excludes any step within automatic processing which happens to be manual whereas art 3(1) clearly anticipates that automatic processing can include a manual stage because it uses the words “wholly or partly by automatic means”. To read the “scope” provision in art 3 as not applying to that aspect of processing would not only be to fail to take account of the express wording of art 3 but also contravene the principle just mentioned about the interpretation of recitals. I do not consider that it would be any answer to this point to read down art 2(b) and then to use that provision to read down art 3(1). The argument would be that the reference to "wholly or partly by automatic means" in art 3(1) has to be read as a reference to the circumstances in which under the definition of "processing of personal data" in art 2(b) processing can occur manually and then that the relevant words in art 2(b) (“whether or not by automatic means”) have to be interpreted by reference to recital (15). On that basis the “processing of personal data” would only apply to operations which were either exclusively automatic or within the second limb of recital (15) and that definition would then be inserted into art 3(1) with the effect that the words "wholly or partly by automatic means" in art 3(1) would mean only operations which were either exclusively automatic or within the second limb of recital (15). I reject this approach for the reasons that I have already given. It would be using recital (15) dealing with the scope of the directive impermissibly to read down the operative provision on scope in art 3(1), and that is not made permissible by the fact that it is done by two steps rather than one.

Put another way, the first part of recital (15) states that processing is covered by the directive “only if it is automated”. Art 3(1) provides that the directive applies to processing “whether wholly or partly by automatic means”. In my judgment, these two provisions conflict, and under the jurisprudence of the Court of Justice the operative provision, that is art 3(1), must prevail.

Thirdly, and in any event, recital (15) has to be read with the other recitals, particularly recital (27). Recital (15) expressly contemplates that the directive applies to information, which is to be contained in a filing system, even before it has been placed in that system. It would indeed be curious if that problem was addressed only in the context of manual systems. Recital (27) makes it clear that the scope of protection conferred by the directive is not to “depend on the techniques used”. In my judgment, when those two recitals are read together, it is clear that recital (15) does not mean that when automated means are used they must be exclusively used. If that were the true interpretation of recital (15), the passages in Campbell set out below could not stand and there would be no room for interpreting the directive as applying to the end product of a system, which is automated, but from which hard copy is obtained. That would greatly reduce the scope of operation of the directive. It follows, in my judgment, that the expression “wholly or partly by automatic means” in art 3(1) cannot be read as narrowly as Mr Spearman submits. In his submission (accepted by Buxton LJ in para. 32 of his judgment), this expression is limited to creating an anti-avoidance provision to prevent arguments that because some manual operations had occurred in the course of processing none of the processing could fall under the directive. On my interpretation, that expression must, or must also, include manual operations connected to automatic processing which would be within the directive if the whole of the processing has been a manual operation and, instead of using automatic means, the data controller had used a manual process to which the directive applied.

Mr Spearman submits that the directive specifically provides that not all manual operations are within its provisions. He further submits that to treat the directive as applying to manual operations in connection with automatic processing, other than in the very exceptional situations accepted by him (see para. 85 above), would be to render otiose the limitation in the directive, in the case of manual processing, to structured filing systems. This argument would be correct if the effect of the expression “wholly or partly by automatic means” in art 3(1) was to bring processing, that was substantially done manually, within the purview of the directive. However, that is not the effect of my interpretation. I have not purported to give a comprehensive definition of when processing by automatic means can include manual operations, but the formulation in the last paragraph does not render the restriction to filing systems otiose.

Mr Spearman further submits that the judge effectively disregarded the fact that data was being collected for private use rather than for mass use, for example, marketing. However, the directive cannot be read as excluding the use of personal data in circumstances such as the present.

Fourthly, as I have observed, the definition in the directive of “processing” applies to the “collection” of personal data, and that data as defined need not be automated. Recital (28) also refers to the collection of data, which underlines the fact that references to the collection of data are no accident. The references to the “collection” of information are not limited to the relevant filing systems. Accordingly, in my judgment, under the directive, personal data can be “processed” by the collection of information held by non-automated means for recording by automatic means.

Fifthly, in so far as relevant, I do not find this conclusion surprising. No database can be set up without the collection of information held manually. Moreover, a person inputting personal data to a computer must know that he or she is likely to be within any legislation conferring data protection, because he or she is actually putting information on to a computer. Furthermore, in that instance, there is a link between the action said to constitute processing and the automatic means of processing. No one has suggested that the collection of data, which does not involve the use of computer, would constitute processing unless it is stored in a filing system of the kind to which the directive and the 1998 Act apply.

As the example which I gave in para 86 above shows, there are important effects of the judge’s view being wrong as well as of its being right. For my own part, and with respect to Buxton LJ, I do not consider it would be appropriate for this court to try to form any overall assessment as to that question. Whether the instances given by Buxton LJ are indeed far-reaching effects outside the likely scope of the directive must also in part depend on the width of the exceptions conferred by it, (see for example arts. 3(2), 8(2) and 9), on which we were not fully addressed.

I would add, by way of respectful disagreement with the judgment of Longmore LJ on processing, that the above analysis of the directive and the Act shows that processing can include a non-automated step. This court in the Campbell case came to the same conclusion on the different facts of that case. I deal with that case below.

In the Lindqvist case, the Court of Justice held that the listing of details of fellow parishioners on a self-made internet home page did constitute the “processing” of personal data. The selection of the data in question had been manual but the act of uploading the data via a server was automatic. The first question submitted by the Gota hovratt in Sweden, the referring Court, was “whether the act of referring, on an internet page, to various persons and identifying them by name or by other means, for instance by giving their telephone number or information regarding their working conditions and hobbies”, constituted “the processing of personal data wholly or partly by automatic means within the meaning of Article 3(1)” of the directive. The opinion of the Advocate General provides no assistance in this case as he concluded on the facts that the case fell under the exception provided in art 3 (2) of the directive.

In its reply, the Court of Justice stated that:

Buxton LJ concludes that the question posed was limited to whether using the computer to place the list on the internet was processing and that the decision in Lindqvist does not assist the appellant (judgment, para. 33). However, the question referred by the Swedish court to the Court of Justice was not limited to placing data on the internet, but to the listing on a self-made internet page of personal data. Thus the Swedish court did not isolate for consideration the actual means of placing the information on the internet. Moreover, an analysis of the various submissions in response to this question suggests that various intervening parties construed it more broadly. Indeed, the Swedish Government argued that “the processing of personal data wholly or partly by automatic means” in art 3(1) of the directive covered all processing in computer format (see [2004] QB 1032, at [21]). It is also interesting to note that, in their submissions, the Commission argued that the directive applied to all processing of personal data referred to in art 3 regardless of the technical means used and that, accordingly, making personal data available on the internet constituted processing wholly or partly by automatic means, provided that there were no technical limitations which restrict the processing to a purely manual operation (see [2004] QB 1032, at [23]). This would also suggest that an element of automation is sufficient, and that “processing” would only be excluded where there was no automated element whatsoever. Finally, the response of the Court of Justice in paras. 25 and 26 of its judgment also appears to accept the submission of the Commission and to look merely for an element of automation, which was indeed provided by the need to use a server. Accordingly, the judgment of the Court of Justice, provides some, albeit slight, support for the view expressed above that the directive applies to the selection of information and placing of it on to a computer.

Now I have interpreted the directive, I can take the question of the interpretation of the 1998 Act, which was enacted to implement the directive, more shortly. The relevant statutory provisions are as follows:

It is common ground that the information in the present case did not constitute a filing system for the purposes of either the directive or the 1998 Act. There is no issue but that the MDU is the data controller for the purposes of the 1998 Act in relation to the personal data included in the RAR form and the duty of a data controller in relation to personal data is, subject to any applicable exemption provided for by section 27(1) (none are suggested in this case), to comply with the data protection principles in schedule 1 to the 1998 Act. The crucial issue is whether the selection of material and its insertion into the RAR form, the score sheet and the RAG form constituted processing for the purposes of 1998 Act.

It is clear from the definitions in the 1998 Act set out above that “processing” can occur in relation to either data or information. Likewise, it is clear from the definition of “obtaining” that, “in relation to personal data”, the obtaining can be of information which is to be contained in “data”. I do not agree with Buxton LJ that the only relevant words in the definition of “processing” in this case are the words “or carrying out any operation or set of operations on the information or data.” (judgment, paras.22 and 27). To “obtain” means to “come into possession or enjoyment of; secure or gain as a result of request or effort; acquire, get” (Shorter Oxford English dictionary). Dr Roberts obtained information in this sense when she opened the files and selected the information that she wanted from them and copied that information into the RAR form. In my judgment, it is appropriate to take a wide meaning of “obtaining” because there is no requirement that the information be obtained from any person. If the obtaining has to be by the MDU, rather than Dr Roberts, in my judgment the MDU can still be said for this purpose to be obtaining information when Dr Roberts performs the task explained above. In the same way, an employer can be said to obtain information from his employees when he conducts an inquiry into some matter affecting his organisation, even if that information would have been attributed to him before the inquiry started. If that is wrong, then in my judgment the task she performed constituted the recording of information by her or the MDU. The extended definition in section 1(2) applies to “recording” as much as it does to “obtaining”. The recording of information is the presentation of it for the purpose of Mr Johnson’s allegation in this case.

When Dr Roberts completed the RAR form, she added her own opinions in the score sheet and RAG assessment form. These were not “obtained” from the files but formulated at the end of her work. But for the issue whether copying those expressions of opinion is processing within the 1998 Act, the RAR was a newly created file on the computer and those opinions would undoubtedly be “personal data”. For my own part I cannot see that they were not “recorded” for the purposes of the 1998 Act. Furthermore by the time they were created the RAR form had been created. It would be difficult to say that, since the score sheet and RAG assessment form were separate documents, Dr Roberts’ opinions were not inserted into and thereby presented in “data” for the purposes of the 1998 Act, which includes “information which …is being processed by means of equipment operating automatically in response to instructions given for that purpose” (section1(1) of the 1998 Act).

The extended definitions of “obtaining” and “recording” in section 1(2)(a) of the 1998 Act apply only in relation to “personal data”. The definition of “personal data” in section 1(1) of the 1998 Act is dependent on the term “data”. The definition of “data” requires that the information must be information that is being processed by means of equipment or operating automatically in response to instructions given for that purpose.

The judge reached his conclusion by accepting the submissions of Mr Martin Howe QC, who appeared for Mr Johnson here and below. Mr Howe relied upon the paras 101 to 103 of the judgment of the Court of Appeal in Campbell v MGN Ltd [2003] QB 633, especially para 103. Mr Howe submitted that in Campbell this court had recognized that there could be relevant processing when part of the operation was automatic and part was manual. Mr Howe also relied on the words “whether or not by automatic means” in art 2(b) of the directive. Mr Howe also relied on the similar wording in art 3 of the directive. The judge considered that Mr Howe’s interpretation of the 1998 Act more closely accorded with its wording and that of the directive than that advanced by Mr Spearman.

On this appeal, Mr Spearman submits that the judge was wrong. Mr Spearman submits that “selecting” information does not constitute “obtaining, recording or holding the information or data”. He submits that, accordingly, the act of selecting is only processing within section 1(1) of the Act if it is applied to personal data and at the stage Dr Roberts made her decision there was no “personal data” as defined in section 1(1). There cannot be personal data unless there is information which is actually being processed, by means of equipment operating automatically. That stage is only reached after Dr Roberts has made a selection and has inputted it on to her word processor. Mr Spearman further submits that, by virtue of recitals (15) and (27) and art 3 of the directive, processing can only be carried out by automatic means or by a relevant filing system. This appeal is not concerned with the latter.

It is important to note that under the directive and the 1998 Act the data protection principles can be applied to any step in the operation of processing. They are not required to be applied only to the overall effect of processing. This is because the data protection principles apply to processing (directive, art 6) and the directive defines "processing of personal data" to mean "any operation or set of operations…" thus clearly encompassing individual steps in processing as well as the exercise as a whole. The definition of “processing” in the 1998 Act is differently expressed but in my judgment it is to the same effect. Accordingly, I do not attach significance to the fact that Mr Johnson does not allege that the whole exercise of processing was unfair. It is sufficient if any step in the processing was unfair. In so far as Buxton LJ has come to the contrary conclusion (as to which see para 31 of his judgment), I respectfully disagree. I have proceeded on that basis and accordingly for my purpose it is sufficient that the selection and presentation of Mr Johnson's personal data constituted processing for the purpose of the directive and the 1998 Act, even if the complete exercise also involved for instance transmission of the data to the members of the RAG group.

In my judgment, for the reasons given above, the court's duty is to interpret section 1(2)(a), so far as possible, in accordance with the directive. On the view that I have formed of the meaning of directive, “processing” applies to the act of obtaining personal data to be placed on to a computer, and putting it on to a computer. I consider that section 1(2)(a) can to be interpreted in conformity with the directive because the words “in the data” in section 1(2)(a) refer back to “personal data” as used in the phrase “in relation to personal data”. On that footing, the expression “personal data” in section 1(2)(a) includes putative personal data, that is information which will constitute “personal data” when both the act of obtaining the information to be contained in the data and the act of inputting it onto a computer have been completed.

On that basis, the selection by Dr Roberts of material and the placing of that material on to a computer constituted “processing” for the purposes of section 1 of the 1998 Act. That conclusion is consistent with the directive, and the court is not precluded from coming to the conclusion that the selection of material is capable of being “processing” by reason of the fact that the selection occurs before any information is put on to the computer.

Indeed, if that distinction were made, the question might arise whether processing could be said to occur as soon as some of the information had been put on to the computer. That would be a possible, but not very satisfactory or logical, approach.

In Campbell v MGN, Miss Campbell complained that, by publishing information and photographs about her attendance at a meeting place for a drug users’ self-help group, MGN were liable to her in damages for breach of confidentiality, and also for compensation, under section 13 of the 1998 Act. We are not concerned with the confidentiality claim. MGN relied on an exemption in section 32 of the 1998 Act for the publication of journalistic material in the public interest. This court held that that the term “processing” included the act of publishing the newspaper in hard copy form, and that for that reason (among others) section 32 applied to that publication. The paragraphs of its judgment where the court dealt with the issue of processing are paras 101 to 103 and 106:

This court then referred to the provisions in the directive and the 1998 Act on compensation. This court concluded that, if those provisions were to be effective, publication must be treated as part of the operations covered by the requirements of the Act (para 105). Neither counsel has submitted that the ratio decidendi went further than this, though I note that the principle is expressed more widely in para 103 and that that principle would cover this case. This court summarised its conclusion on processing in para 106 of its judgment:

Mr Spearman submits that this court erred in law in para 103 above, on the basis that processing for the purposes of the directive does not apply to information that is produced in hard copy. I do not consider that that submission is open to Mr Spearman in this court as the conclusion in para 106 on the meaning of “processing” for the purposes of the Act is part of the ratio of the decision (see further para 129 of the judgment). In any event I do not accept that submission. For the reasons already given, the provisions of art 3(1) of the directive apply to processing “wholly or partly by automatic means”. Those words are sufficiently wide to cover the situation described by this court in the Campbell case where processing occurs automatically, but there is some essential step, linked to the automatic processing, which is not done by automatic means. The selection and inputting of personal data, such as occurred in this case, is an essential step of this type. It is consistent with the reasoning of this court in para 103 of its judgment in the Campbell case that such selection and inputting should constitute processing on the basis that the same reasoning should apply to non-automated steps which occur before the processing by automatic means as occur thereafter.

I agree with Buxton LJ that this court in the Campbell case was not concerned with the situation that we have in the present case, where the essential issue is whether the manual selection of data prior to its input on to a computer constitutes “processing”. However, I do not consider that the Campbell case can be distinguished because it concerned a claim for breach of confidentiality, whereas Mr Johnson’s claim is that he is entitled to compensation because the fairness principle, as contended for by him, was not applied to the manual part of data processing carried out on behalf of the MDU. I accept that this court in the Campbell case was very concerned not to nullify the effect of the exemption in section 32, which applies only to data, but this court's decision on the meaning of processing was not expressed to be limited to that section. It would have been open to this court to say that some different definition of processing must apply for the purposes of that section since all of the statutory definitions in section 1(1) apply “unless the context otherwise requires”, but that is not the course which this court took.

The approach of this court in the Campbell case to “processing” is consistent with the pragmatic but principled approach that I have adopted to the interpretation of section 1(2) of the 1998 Act, and provides further support for that approach.

It follows that I agree with the judge’s conclusion that the selection and presentation of personal data about Mr Johnson on to the RAR form, the RAG form and the score sheet constituted “processing” for the purpose of the 1998 Act, although I have reached my conclusion for different reasons. The MDU as the data controller thus had a duty to comply with the data protection principles. The only data protection principle relied on is that of fairness. As I have said, I agree with the judgment of Buxton LJ on the application of the principle and merely wish to add some short observations of my own, which I do in the next section of this judgment.

Art 6 of the directive sets out a number of principles relating to data quality, including the fairness principle set out in art 6(1)(a). This provides that member states must provide the personal data must be “processed fairly and lawfully”. This principle is expressed as separate and additional to the other data protection principles in art 6, which are in general more specific and which do not appear to be in any way subject themselves to the fairness principle.

Art 6(1)(a) is implemented by the fairness principle set out in paragraph 1 of schedule 1 to the 1998 Act. This provides so far as relevant:

at least one of the conditions in schedule 2 is met, and

…”

Para. 1 of schedule 2 to the 1998 Act includes a condition that the data subject has given his consent and it provides so far as relevant that:

Mr Howe submits that, if the fairness principle applies, the MDU has to go back and consult the member affected even though the contract gives it absolute discretion to decide whether to withdraw the benefits of membership from any member. Accordingly the application of the fairness principle in this case raises the general issue of the relevance of the contractual relationship between the data user and the data subject to the fairness principle. The rights and obligations in the directive are superimposed on the parties’ contractual relationship without any express indication as to how the two sets of rights and obligations are to interact.

Recital (28) states that “any processing of personal data must be lawful and fair to the individuals concerned”. I do not consider that this excludes from consideration the interests of the data user. Indeed the very word “fairness” suggests a balancing of interests. In this case the interests to be taken into account would be those of the data subject and the data user, and perhaps, in an appropriate case, any other data subject affected by the operation in question.

The directive gives little guidance as to the application of the fairness principle. However para. 1(1) of schedule 2 to the 1998 Act provides:

This provision does not appear to implement any specific provision of the directive, but Mr Howe does not suggest that it is inconsistent with the directive. In my judgment, this provision addresses not only the case where a person has been deceived into providing data but also the position where a person has by contract freely agreed to provide information which the other party to the contract wishes to process. The effect of this provision is that when applying the fairness principle the existence of any contract between the parties is a relevant factor even if a party’s consent to the terms of the contract does not amount to the giving by the data subject of an explicit consent to data processing in accordance with provisions for giving such consent in the directive. This factor is likely to be a critical one where the parties have freely entered into a contract, the data user intended to do no more by way of processing of the information than he was entitled to do with it manually under the terms of the contract and the data subject should reasonably have foreseen that the data user might wish to process the information for this purpose. In this situation, the question of fairness has to be approached on the basis that the parties have made their agreement. If this were not so, the “privacy” interest protected by the directive would be privileged over the contractual rights of the other contracting party. The directive concept of fairness does not in my judgment require or permit the conflict between those two interests to be resolved in that way in the case I have postulated.

Mr Johnson’s membership of the MDU, and accordingly access through membership of the MDU to professional indemnity insurance, was on the terms of the memorandum and articles of association of the MDU, which is a company limited by guarantee and not having a share capital. The articles of association gave the board of management the power to manage the affairs of the MDU and thus the right to determine any risk assessment policy. Article 11 of the MDU’s articles provides the material part that:

On the facts found by the judge, professional indemnity cover was provided as one of the benefits of membership of the MDU, but it ceased when the member ceased to be a member of the MDU in respect of occurrences subsequent to the determination of his membership. Moreover, when his membership was renewed, Mr Johnson gave his consent to the processing of personal data for a number of purposes, including risk management. The directive requires consent to be unambiguous (art 7). However, in my judgment, Mr Johnson did not have to know the nature of the MDU’s risk assessment policy to give a valid consent for this purpose.

In this case, the judge reached his conclusion that the fairness principle did not apply to the lead files on the basis that the MDU was entitled to have a risk assessment policy and that the risk assessment policy seemed to him to be one on the evidence that it could properly adopt. The judge referred to para. 2 of schedule 2, which provides:

The judge rejected the argument that under subpara.(3) the MDU should have given him further information than it did about the lead files. The judge reached a different conclusion on the non-lead files, where information had been provided by other members. In the case of the non-lead files he held that the MDU, either at the time of or promptly following Dr Roberts’s processing the data in the non-lead files, should have notified Mr Johnson of the existence of that data and at least of the purpose for which it was being or had been processed and his right of access to and to rectify such data (judgment para. 112). This conclusion on the non-lead files follows art 11 of the directive and I agree with it.

However, the judge did not accept Mr Johnson’s submission, either in relation to the lead files or the non-lead files, that the MDU had an obligation to consult Mr Johnson about the processing exercise or to invite his representations upon it.

In my judgment the judge was right to hold that the fairness principle did not require this. For the reasons explained above, as a general proposition a party to a contract cannot in my judgment use the fairness principle as a means of upsetting any contractually permitted use of information where, as here, processing was foreseeable. I see no basis for displacing this general proposition in this case.

The judge also held, after a detailed examination of each of the files, that none of the summaries of the information extracted from the files for the purposes of the MDU’s risk assessment policy was unfair. The presentation of information in the summaries was inevitably assessed by the judge on the basis of that policy and although Mr Howe has taken a number of points of detail on the judge’s conclusions on the summaries he has not in my judgment shown that the judge’s findings on the summaries were not ones which he was entitled to make.

I agree with Buxton LJ that no request should be made to the Court of Justice for a preliminary ruling in this case on the interpretation of the directive. Although I have come to a different conclusion from Buxton and Longmore LJJ on the processing issue, my conclusions on the causation issue mean that, even if I had agreed with him on this issue, the appellant would not have succeeded. The interpretation of the directive is accordingly not critical to the outcome in this case. It is not suggested that any point of Community law arises on causation. Different considerations would have arisen if the meaning of the directive had been critical to this court's decision.

For the reasons given above, I would dismiss this appeal but allow the respondent’s notice in part.

My Lord and My Lady have analysed the provisions of the Data Protection Directive (95/46/EC) and the Data Protection Act 1998 in a way that I could not hope to emulate. Since they are divided on the question whether the inputting of information (by an individual such as Dr Roberts) into an automatic computer system constitutes automatic processing for the purposes of the Act, I should express my own view. As I agree that the decision in relation to this point is not decisive for the purpose of the disposal of the appeal, I shall do so only shortly.

Both the Directive and the Act require that any automatic processing of personal data shall be done fairly and lawfully. Article 3(1) of the Directive provides that the Directive is to apply to the processing of date wholly or partly by automatic means. The Act is to the same effect.

To my mind when an individual decides what information to put into an automatic system, he or she is not automatically processing that information either partly or wholly. An exercise of judgment by an individual is not automatic at all. Indeed it is the antithesis of automaticity. It might be different if the information was being automatically inserted into a computer but, in this case, although the RAR form was created on computer by Dr Roberts it was not automatically processed at that stage. It was fed in by the exercise of human judgment.

Mr Howe QC for Mr Johnson had an alternative argument viz that one had to look at the whole process from the origination of a file to the creation of the Risk Assessment Group Pro Forma and, if there were any automatic processing in the course of that operation (which there was), then every part of that process including the exercise of judgment in creating the RAR form would be covered by the Directive and the Act. There is no language in the Directive which would justify that approach. In any event, the issue in any particular case is, in my judgment, whether the processing of the information which is complained of as being unfair is or is not automatic processing. If it is not, that is the end of the matter.

It is for these short reasons that I agree with Buxton LJ on the issue of automatic processing.

One of Mr Johnson’s arguments on the later part of the case was that the MDU policy of taking into account incidents of which they had been informed but not taking into account any outcome or any explanations offered by the member was an inherently unfair policy. As a free-standing submission, it is a submission with which it is possible to have some initial sympathy. But that initial sympathy is rapidly dispelled when one considers the practical implications of any other policy from the point of the MDU as set out by the judge in paragraph 123 of his judgment. It is, moreover, worth adding that assessment of risk by reference to allegations without further reference to explanations or outcomes is by no means unknown to the law.

Thus this court has recently decided in relation to a doctor that there are circumstances in which it may be justifiable to issue an “Alert Letter” to Health Authorities when a number of allegations of sexual assault have been made against him even though the doctor was never convicted in the Crown Court nor disciplined by the General Medical Council in relation to such assaults, see R (Dr D) v Secretary of State for Health [2006] EWCA Civ 989.

Perhaps more relevantly for the purposes of the present case it is almost a truism that in the law of insurance it is necessary for an applicant for insurance to disclose any material allegations that have been made against him or her. This applies not merely to unproved allegations, Brotherton v Aseguradora Colseguros SA [2003] EWCA Civ 705, [2003] 2 All ER (Comm) 298 but even to allegations which, after the placing, have been held to be false, North Star Shipping Ltd v Sphere Drake Insurance Plc [2006] EWCA Civ 378, [2006] 2 Lloyd's Rep 183. The apparent distaste with which the court arrived at the latter conclusion in the circumstances of that case does not detract from the fact that any insurer (and indeed anyone such as the MDU arranging for others to provide insurance) needs to know about incidents more than outcomes or explanations.

Against this legal background it is, in my judgment, impossible to designate MDU’s policy as in any way unfair for the purpose of the first principle set out in part 1 of Schedule 1 to the Data Protection Act 1998, even if the Act otherwise applies.