Rowland & Anor v Stanford

To begin with, it is obviously right to say that the Claimants have a good arguable case that a form of legally recognised wrong has been committed against them. It is clear on the evidence that someone – Mr Stanford now identifies that person as Mr Wright – has obtained data in the form of the Archive, which has been passed to Mr Stanford. There is plainly a good arguable case that the data was taken without authorisation, and a good arguable case that it is data belonging to Mr Jonathan Rowland, and containing information which is personal and confidential to him. I do not think the settlement achieved by Mr Stanford’s Trustee in Bankruptcy with the Kaupthing entities can have any bearing on this question: I have not been provided with a copy, but it seems unlikely it would inhibit personal claims by Mr Jonathan Rowland of the present type. Overall, therefore, I conclude that Saini J’s first condition – the Arguable Wrong Condition – is satisfied.

I also find it inescapable that Mr Stanford has been mixed up in the wrongdoing so as to have facilitated it. Mr Stanford has received the Archive, and not only as a passive recipient, but as someone who seems to wish to make use of its contents, and indeed has sought to do so. I accept Mr Grant’s submission (see [32] above) that the jurisdiction extends to protection against further wrongdoing, and that that principle is relevant here insofar as material from the Archive is in the hands of Third Party Recipients, giving rise to a risk that they may seek to misuse it.

It is convenient at this point to deal with one of Mr Stanford’s main arguments, namely that the present procedure is an inappropriate one, and what the Claimants should really be doing is bringing proceedings against him, or perhaps an application for pre-action disclosure, or at any rate a form of claim or application which would require them to be exposed to the rigours of the English litigation process. What Mr Stanford seemed to be saying in this submission was that, if it was right to characterise him as having been involved in wrongdoing, then the proper course was for the Claimants to sue him as defendant to a substantive claim, rather than relying on the Norwich Pharmacal jurisdiction. I raised this point with Mr Grant QC in the course of the hearing, by reference to the decision of Lightman J in the Mitsui case, which I have already mentioned.

It seems to me the proper analysis is as follows. First, the fact that Mr Stanford may be more than an entirely passive and innocent facilitator does not mean the NorwichPharmacal procedure is an inappropriate one. Although Norwich Pharmacal itself was a case in which the respondent was an entirely innocent participant, other cases show that the jurisdiction is not limited in the sense of only being available against such participants: see for example, X Ltd v Morgan Grampian (Publishers) Ltd [1991] 1 AC 1, in which Lord Lowry at [54] held that, where a party had received confidential information from a source and then sought to publish that information, the case was “not only covered by Norwich Pharmacal Co v Customs and ExciseCommissioners [1974] AC 133 but is a fortiori, because he and the source were joint tortfeasors.” Mr Grant QC emphasised that in the present case, his clients do not press any allegation that Mr Stanford is a joint tortfeasor, but they say that even if he were, that does not mean the remedy is not available; on the contrary, the case for a remedy in such a case is even stronger.

Second, it seems to me that on proper analysis the Mitsui decision is not really in point. The essential feature of that case was that Norwich Pharmacal relief was not necessary, because the claimant already had a basis for seeking pre-action disclosure against a prospective defendant (who was identified), and so it was not necessary for the claimant to obtain relief against a third party. It seems to me the key part of Lightman J’s reasoning is the following passage, from paragraph [28]:

“It must be quite exceptional where necessary information is available both from a likely party to proceedings and an innocent third party (in this case the defendant) that an order for disclosure should be made against the innocent third party and not the likely party to proceedings … . Yet that is the position which the claimant says prevails in this case.”

That is saying that if the relevant information is available both from an innocent Norwich Pharmacal defendant and a person who is already identifiable as a prospective party to a substantive claim, the information should be sought from the latter not the former. I do not see a parallel with this case. Here, there is no more suitable or appropriate person to supply the requested information than Mr Stanford himself. Indeed, if one thinks of the main item which remains substantively in dispute, namely information about Mr Stanford’s communications with as yet unidentified Third Party Recipients, Mr Stanford is the only person who can supply that information.

In my view, this condition is also obviously satisfied. Mr Stanford is in possession of information both about the Supplier of the Archive and about his communications with Third Party Recipients. The former is relevant to the identification of possible historic wrongdoing involving the Archive, and the latter to the prevention of possible future wrongdoing.

I come on to the fourth of Saini J’s conditions, what he called the Overall Justice Condition. It is convenient under this heading to address three topics, namely (1) Mr

As to this, Mr Stanford’s concern seemed really to be about the Claimants trying to take steps to cover up the criminality he alleges against them. He said he had been concerned about the Claimants seeking some form of gagging order. I think that is a misplaced concern, because the Claimants have sought no such order from me. In fact, they have said expressly that nothing in the order they seek is intended to have any gagging effect. That is obviously correct. It is designed simply to enable them to identify what use has been made of the Archive. In principle, and subject to the observations made below, it seems to me they should be entitled to do that.

Of course it may be that at some future stage, the Claimants will want to restrain the use of information deriving from the Archive in the hands of Third Party Recipients. At that stage, the public interest factors which Mr Stanford has referred to may come into play, and it may be highly relevant precisely what sort of information is sought to be used. There may well be a difference, for example, between medical information and commercial or business information. But I do not consider that such factors come into play at the present stage, given the conclusions I have already expressed that the Claimants have shown at least an arguable case that information belonging to

Mr Stanford originally said that the Claimants did not come to court with clean hands because of their involvement in the fraud against him concerning his assets held by the Kaupthing Group. As I pointed out in argument, however, the “clean hands” doctrine is perhaps narrower than one might think as a matter of first impression. In RBS v. Highland Financial Partnerships [2013] EWCA Civ 328, Aikens LJ said as follows (my emphasis):

Faced with this, Mr Stanford adapted his argument in one of his Notes submitted after the hearing, and said that the Claimants lacked clean hands because they were not being truthful about their actual intention, which in fact was to bring claims against him. There are a number of problems with this, however. For one thing, I have the evidence of Mr Shacklady, already referred to above, about his clients’ present intention, and it seems to me I have to attach appropriate weight to that. For another, even if one acknowledges the qualified nature of that evidence (i.e., no “present intention”), and even if one accepts there is therefore some risk that proceedings may be commenced against Mr Stanford, that is not a reason to deny the relief: see my reference at [48] above to the speech of Lord Lowry in the Morgan Grampian decision. For yet another thing, there was a basic inconsistency in Mr Stanford’s position, because as I have already noted, another part of his argument was that he wished to be made the subject of proceedings by the Claimants, and complained about use of the Norwich Pharmacal procedure because it did not involve the Claimants actually suing him.

The next point is the privilege against self-incrimination. As mentioned above, this formed the basis of Mr Stanford’s wholesale objection to paragraph 2 of the draft Order (he appeared to make no real objection at all to paragraph 1 – i.e. the imaging provision).

As already noted, this was raised as a point by Mr Stanford in his First Witness Statement, but not really developed in his submissions. It was nonetheless a matter of concern to me, principally in light of the email from Jonathan Rowland mentioned above at [38], in which he accuses Mr Stanford of blackmail. I was conscious also of Mr Stanford’s status as a litigant in person, who may not have appreciated the relative strength of the arguments available to him. I therefore invited Mr Grant’s comments on the possibility of including in any order a proviso along the lines of that typically included in freezing orders, which entitles the respondent to decline to provide information likely to incriminate him - see, e.g., the present version of the Commercial Court Guide, Appendix 11, paragraph 9, under the heading, “Provision of Information”. Paragraph 9(2) is as follows:

“If the provision of any of this information is likely to incriminate the Respondent, she or he may be entitled to refuse to provide it, but is recommended to take legal advice before refusing to provide the information. Wrongful refusal to provide the information is contempt of Court and may render the Respondent liable to be imprisoned, fined or have its, her or his assets seized.”

Mr Grant resisted the idea of including such a proviso. He said there was a particular reason for it in the standard freezing order case, which is that the order is typically made without notice, and so there is no opportunity for the court to consider on a reasoned basis whether there was in fact any appreciable risk of incrimination. He said the same logic does not apply here. Mr Grant submitted that the burden rested on Mr Stanford to identify a real and appreciable risk of his prosecution for a criminal offence recognised by the law of any part of the United Kingdom, and he had failed to do so. This was despite being on notice of the proceedings for many months, and apparently having some degree of access – as Mr Stanford accepted during the hearing before me – to legal advice from Bindmans and others on criminal law matters. Mr Grant said there was thus nothing to suggest any real risk of incrimination in actual or threatened criminal proceedings in England.

I have already mentioned above (see at [41]) the Note on self-incrimination provided by Mr McDonnell QC after the hearing, and the further Notes filed by the Claimants dealing (amongst other things) with the same topic. This exchange of Notes revealed a further complexity. That is whether the privilege against self-incrimination, even if otherwise available to Mr Stanford, could be relied on as a basis for resisting the production of documents which came into existence independently of any legal obligation compelling their production. The Claimants said not, and so argued that come what may, there was no basis for Mr Stanford to resist disclosure of copies of the documents sought by para. 2(2) of the draft order, i.e. (i) communications between him and the Supplier (apparently Mr Wright) which led to the supply of the Archive, or (ii) communications with Third Party Recipients in relation to the Archive.

In order to evaluate these arguments, it is necessary to summarise the principles of law in play.

As regards the test to apply in determining whether the privilege is properly invoked, both parties drew my attention to the following statement of Sir Robert Megarry V-C in British Steel Corporation v Granada Television Ltd [1981] AC 1096, at p. 1106DE:

“[Counsel for Granada] had to establish that Granada had reasonable grounds for believing, and did believe, that if they disclosed the source of the documents, there would be a ‘real and appreciable danger’ that ‘in the ordinary course of things,’ and under ‘the ordinary operation of law,’ they would be prosecuted for some criminal offence: Reg v Boyes (1861) 1 B & S 311 at 330, approved in Ex parte Reynolds (1882) 20 ChD 294. The latter case makes it plain that the privilege against self-crimination can be invoked only by someone who does so in good faith for his own protection, and not for some ulterior purpose”.

Mr Grant QC also drew attention to the following summary in the latest edition of Matthews and Malek on Disclosure (5^th Edn, Sweet & Maxwell 2017) at [13.11]:

“The mere fact that the party concerned believes, even swears, that his supplying information would tend to incriminate him is not conclusive. Instead, what matters is that the risk should be apparent to the court. The court does not try to assess the probability of the risk of proceedings being taken. But it must be satisfied that ‘there is reasonable ground to apprehend danger’ to the party claiming privilege, or that the risk is ‘reasonably likely’ or that ‘there must be grounds to apprehend danger to the witness, and those grounds must be reasonable, rather than fanciful’, or that there is a ‘real and appreciable’ risk of prosecution if the documents are produced for inspection. A ‘mere possibility’ of grounds for charge being disclosed is insufficient.”

As regards the question of whether the privilege extends in any event to documents coming into existence independently of any legal obligation compelling their production, both parties referred me to C plc v. P (Attorney General intervening) [2008] Ch 1. In that case, there was a division of view on this issue in the Court of Appeal. At [28] Longmore LJ (with whom Nourse LJ agreed) drew a distinction between “admissions obtained in breach of a defendant’s right to remain silent and material which is obtained by the use of compulsory powers but which has an existence independent of the will of the defendant”, the former engaging the privilege against self-incrimination but the latter not doing so. At [36] Longmore LJ concluded that on the facts, there was “no privilege in the offending material itself which is material which existed independently of the order.”

Lawrence Collins LJ dissented on the point of principle. He did not think it appropriate to rule on the question whether “it is open to this court to find as a general rule that there is no privilege in respect of what has been described as preexisting or independent material” (see at [44]). That was in light, in particular, of the earlier decisions of the House of Lords in Re Westinghouse [1978] AC 547, RankFilm Ltd v. Video Information Centre [1982] AC 380, and Istel (AT&T) v. Tully [1993] AC 45.

Mr Grant QC said that the majority view in C Plc was binding on this Court, and therefore that the documents sought by means of the Claimants’ order were not on any view covered by privilege. Mr McDonnell argued that they were, on the basis that even taking the majority view in C Plc v. P as the starting point, the documents sought in this case could not properly be described as “independent documents” or “independent evidence.” That is because their provision is sought under paragraph 2 of the draft Order, and that requires the provision by Mr Stanford of an Affidavit, setting out details of the relevant communications and producing copies as an Exhibit.

Drawing the threads together, my views on the topic of the privilege against selfincrimination are as follows.

To begin with, it is clear that the exercise for the Court is to evaluate the risk of prosecution: is there a real and appreciable risk or something less than that? On this basic question, the parties had entirely polarised views: Mr Grant QC said there was no appreciable risk (or at least that none had been made out); and Mr McDonnell (see at [41] above) said there was a real danger to Mr Stanford of being “prosecuted for some criminal offence” (my emphasis).

Both positions, if I may say so, are somewhat crude responses to a situation which in reality is rather more complicated. Mr Grant’s submission ignores the background, which includes the circumstances in which the Archive first came to be taken, and also the efforts made by Mr Stanford to make use of it, which Mr Grant’s client has himself described as involving blackmail (see [38] above). Bearing in mind that background, it seems to me the Court is entitled to have, at a minimum, real sensitivity as to the risks involved in Mr Stanford being required under compulsion to answer questions about the manner in which he came to receive the Archive and the steps he has taken to deploy it.

On the other hand, Mr Stanford’s position is also unsatisfactory. He says only that there is a risk of prosecution for some offence, but he does not say which, and as the Divisional Court explained in R (Malik) v. Manchester Crown Court [2008] 4 All ER 403, at [68], it is important that the relevant offence is identified, since that is of great assistance in the evaluating the associated risk. That is perhaps particularly so in the present case given the different types of information sought by paragraph 2 of draft order. Depending on the offence said to be relevant, it may be that some topics can be addressed without any real risk of incrimination, but not others. (I should add at this point that nothing in my comments above should imply any criticism of Mr McDonnell QC, who stepped in to help Mr Stanford at short notice and with limited time to take instructions. I am extremely grateful to him for his assistance).

Given the uncertainty, how best to proceed? I am not persuaded that I should adopt the position advocated by the Claimants, and say that Mr Stanford’s attempted invocation of the privilege should simply be rejected. Given Mr Stanford’s status as a litigant in person and the manner in which the privilege issue developed, I think it would be wrong and unfair to adopt such a blanket approach. At the same time, however, I also think it would be wrong on a blanket basis to decline to make any order at all in the terms of paragraph 2 of the Claimants’ draft.

Instead, it seems to me the better approach is to make an order modelled on paragraph 2 of the Claimants’ draft, but with two important modifications. The first, despite Mr

I accept that this may be a novel approach, and that the circumstances are different to those of the typical freezing order case. Nonetheless, it seems to me the same basic principle of fairness applies. In the unusual circumstances of this case, Mr Stanford, like the respondent to a freezing order, should both be encouraged to consider his position and to take advice in relation to it, and then, if it is justified, should be entitled to decline to provide some or all of the information otherwise demanded by what is presently para. 2(1). If his position is challenged, it can then be further considered but with the benefit of a clearer explanation of Mr Stanford’s position than is presently available.

I should say that in stating that conclusion, I am conscious of Mr Grant’s concern that the inclusion of a proviso might only lead to further obfuscation and delay in the provision of the information his clients say they are entitled to. Avoiding delay is a legitimate concern, but I think not a material point in this case given that the Claimants have had suspicions about Mr Stanford’s possession of the Archive since late 2017 (see [8] above). In any event, nothing in what I have said should be construed as an encouragement to take unfounded objections with a view to buying time. It is axiomatic that the privilege against self-incrimination may only be invoked by someone acting in good faith and for his own protection, and not for some ulterior purpose. The proviso I suggest makes it clear that the wrongful refusal to provide the information sought is a contempt. My hope and expectation is that, with the benefit of the legal assistance which appears to be available to him, Mr Stanford will be able to undertake a properly considered examination of his position on this important point which was rather lost in the mix in his earlier written and oral submissions.

The second point requiring a modification concerns the documents sought by means of the draft order, i.e. the present para. 2(2).

As to pre-existing documents, I note that the Divisional Court in Malik (at [74]) said that the issue revealed by C Plc v. P had been the subject of considerable debate in domestic law and in the Strasbourg jurisprudence. At the point in time at which Malik was decided, the House of Lords had in fact given leave to appeal against the majority decision in C Plc v. P, although in the event the appeal did not proceed.

Before me, however, the controversy reflected in the difference of view in C Plc v. P is not a matter of direct concern. What is of concern is whether there is authority on the issue of pre-existing documents which is binding on this Court. As to this, I was referred to the very careful analysis of the authorities (including C Plc v. P) conducted by Popplewell J (as he then was) inJSC BTA Bank v. Ablyazov [2012] EWHC 2784 (Comm) at [52]-[72]. At [72], Popplewell J summarised the position as follows:

“In my view, it has been established by the authorities that the privilege against self-incrimination does not extend to provide a person with protection against the risk of incriminating himself by the provision of a document or documents which come into existence independently of any order, statute or other instrument of law which compelled their production. It does not normally cover documents other than those which come into existence by an exercise of will pursuant to a testimonial obligation imposed upon the party.”

I respectfully agree with that summary, and indeed I did not understand Mr McDonnell QC in his Note to take issue with it.

What are the consequences for para. 2(2) the Claimants’ proposed order?

Mr McDonnell QC’s point in his Note at para. 19, as I understand it, is effectively that because the order requires the provision of such documents as exhibits to the proposed Affidavit, they cannot properly be viewed as “independent documents” or “pre-existing documents.” Mr Grant QC, on the other hand, said he found this conclusion “baffling,” and submitted that the law is clear that the documents sought by para. 2(2) do not engage the privilege against self-incrimination.

On this point, I have concluded that I prefer Mr Grant’s position.

In my view, Mr McDonnell’s position is one of form over substance. The substance of it on the evidence is that documents in the relevant categories are in Mr Stanford’s possession. Their production, on the basis of the law as it stands, does not engage the privilege against self-incrimination. Mr McDonnell’s objection is really about the format in which the documents are produced, i.e. as exhibits to an Affidavit. It seems to me that point is easily addressed by decoupling the requirement to produce documents from the requirement to provide information on Affidavit. In other words, I propose to modify the draft order so as to contain a stand-alone provision for the production of the documents sought. That is the substance of the Claimants’ request, and will have the consequence that, however Mr Stanford chooses to respond or not respond on Affidavit to what is presently para. 2(1) of the draft order, the specified documents will need to be produced.

For all those reasons, I propose to accede to the Claimants’ application, and to make an Order in terms of the revised draft annexed to this Judgment.

By 4 pm on [the date14 days from the date of this Order], the Defendant shall permit the Claimants’ solicitors to take an image of (i) the documents and all other data contained upon the hard drive received by him in April 2015 (being the hard drive referred to in paragraph 34 of the draft complaint which he sent to the Claimants on or about 20 April 2020), such hard drive containing the data in an email account belonging to the First Claimant as it stood at or about 21 June 2013 (the “Archive”); (ii) the documents and all other data transferred on or about 11 October 2015 from a laptop in the possession or control of Mr Michael Wright to a laptop acquired by or on behalf of the Defendant (being the laptop referred to in the letter dated 17 February 2021 from the Defendant to the Claimants’ solicitors); and (iii) each and every copy and each and every partial copy of the Archive stored on any device in the Defendant’s power, possession or control or within any cloud repository (including, without limitation, Google Drive) to which the Defendant has access

By 4 pm on [the date 28 days from the date of this Order], the Defendant shall provide to the Claimants copies of all correspondence or communications (in whatever physical or electronic form) passing between:

By 4 pm on [the date 28 days from the date of this Order], the Defendant shall swear and serve on the Claimants’ solicitors an affidavit providing full and accurate details of: