Alexander Halban discusses a recent High Court judgment, Contingent & Future Technologies Ltd v Onea, in which the court found multiple breaches of the duty of full and frank disclosure at an injunction hearing (including false witness evidence). The court discussed an applicant’s duties in preparing evidence for a without notice hearing, steps an applicant must take if it discovers a breach of duty is discovered, and the sanctions for breach of duty.
Any applicant for an injunction made without notice, or on short notice, owes the duty of full and frank disclosure. The applicant, and its lawyers, is obliged to put all the material facts before the court, including facts and legal arguments which support the respondent’s position. It extends to facts which would have been discovered had the applicant made proper inquires. The consequences of breach are serious: the injunction will usually be discharged for a deliberate or serious breach, and the applicant may be heavily penalised in costs.
The purpose of the duty has been expressed in a recent High Court judgment:
‘I would stress that the duty of full and frank disclosure is an important element in ensuring that justice not only is done but is seen to be done. A respondent to a without notice application is excluded altogether from the court’s decision-making. A respondent who is given short notice may have some opportunity to participate but is at a major disadvantage when compared with the applicant, through lack of time to prepare and marshal evidence. If the court makes its decision based on inaccurate information that can create the perception that the odds are unfairly stacked against the respondent and, in litigants in person in particular, contribute to a conspiracy mindset. The duty, therefore, has a vital role to play in demonstrating to respondents that their case will be heard fairly and with an open mind by the court.’
Contingent & Future Technologies Ltd v Onea, 27 June 2022, Joanne Wicks QC (sitting as a Deputy High Court Judge) at . A transcript of the judgment is available here.
The applicant in Contingent was found to have breached the duty by providing inaccurate information and false witness evidence. It then compounded its breach by not providing a clear explanation or correcting the position, and by resisting disclosure of evidence which would have showed the true position. The case is a useful illustration of how far the duty to make inquiries extends and of what an applicant should, and should not do, if it has breached the duty.
The principles governing the duty are:
Mr Onea was a founding shareholder, director and employee of the applicant tech company, Contingent. He was suspended pending disciplinary action (which he alleged was a plan to remove him from the company). During his suspension, restrictions were placed on his access to the company IT systems. He later left Contingent.
Contingent alleged that Mr Onea had accessed its Google-hosted IT systems without authorisation during his suspension and sought an injunction to restrain him. It relied on a spreadsheet apparently showing Mr Onea accessing and downloading documents from its IT systems to his computer, primarily on 4 October.
Mr Onea denied accessing the system on 4 October and said it appeared that Contingent’s IT administrator (a senior officer and a fellow founding shareholder) had done so on Mr Onea’s behalf, and those actions were attributed to Mr Onea by Google.
Despite this explanation, Contingent obtained an injunction in November 2021 on short notice, prohibiting Mr Onea from accessing its system, relying on the spreadsheet.
However, what Contingent did not tell the court was that the administrator had indeed logged into the system on 4 October and had carried out the actions attributed to him. Contingent later withdrew its allegation of access on 4 October and claimed that this was an error in misinterpreting the Google logs.
Breaches of duty of full and frank disclosure
At the return date of the injunction in June 2022, the Judge found multiple breaches of the duty of full and frank disclosure.
First, Contingent had failed to take proper inquiries as to the accuracy of the spreadsheet, as it was obliged to under the duty of full and frank disclosure. These inquiries included checking other Google logs to see if Mr Onea had logged in on 4 October, and checking other events on the same day, which would have shown the administrator’s login instead. The administrator should also have reflected on whether his actions could have corrupted the evidence seemingly showing Mr Onea’s access.
Secondly, Contingent’s explanation of these matters in its witness statements was seriously deficient. Critically, it had even failed to tell the court that the administrator had logged in to the system on 4 October. While there may have been an innocent explanation for the errors in the spreadsheet, Contingent’s explanations, and denial of Mr Onea’s position, were misleading.
Thirdly, Contingent compounded its breaches. It failed to correct the position quickly on learning the truth and it never explained why it gave ‘obviously false evidence’ to the court, nor what inquiries it made to check the accuracy of Mr Onea’s explanation. It also refused to disclose Google audit logs which would have revealed the true position. Mr Onea requested the logs for months without success, and applied to court to stop them being automatically deleted, before Contingent disclosed them shortly before the return date.
The court found all these breaches were serious and material to the original injunction. The court would normally have discharged the injunction. However, Mr Onea had given undertakings relating to access to the IT system, and on other matters involving delivery up of confidential information, and so there was no purpose served by discharging the order.
Instead, the court marked its displeasure at the breaches by depriving Contingent of its costs of the original hearing and 50% of its costs of the return date, and awarding Mr Onea 50% of his costs on the indemnity basis.
The facts of the case are striking. It is rare to have an applicant present false and misleading evidence to the court at an injunction hearing and then not explain its errors properly – as shown by the Judge’s strong criticism of the applicant.
Some conclusions on the duty of full and frank disclosure, and necessary steps following a breach, can be drawn from the judgment:
Alexander Halban appeared for the successful respondent, instructed by Daniel Williams and Jake Slinger of DWF.
 Brinks Mat Ltd v Elcombe  1 WLR 1350, 1356-7, CA.