Imaging orders: High Court confirms lower test than for search orders

Key takeaways

1. Lower threshold: Imaging orders are less intrusive than search orders because they do not involve physical entry into a party’s premises. The Court therefore applies a slightly lower threshold when granting them, making them a potentially more accessible and practical option for preserving and accessing data.
2. Beyond pre-action: Imaging orders can be sought on a without notice basis, and are not limited to the pre-action stage. They can be sought, for example, during the disclosure phase of litigation, allowing the Court to enforce compliance with disclosure duties where a party’s efforts are inadequate or obstructive. However, they will only be available in such cases where aggravating factors are present, for example where there is evidence of the destruction or deliberate concealment of relevant documents.
3. Strict safeguards: Imaging orders typically come with strict conditions to safeguard against the misuse of private or irrelevant data. The Court is likely to expect independent IT experts, supervised by independent solicitors, using specified search parameters, to ensure that only material relevant to a dispute is identified and accessed by the parties and their solicitors.

Facts of the case

The claimants (the “Cs”) are assignees of various causes of action from the insolvency practitioners (the “IPs”) who liquidated a company where the defendant (the “D”) was a former director.

During the disclosure phase of the proceedings, the Cs raised concerns about D’s compliance with his disclosure obligations. In particular:

• The Cs alleged that D failed to disclose key documents, such as (i) financial projections and communications relating to a project central to the claim, and (ii) WhatsApp messages, with D having stated during a public examination by the IPs that he was uncertain whether he had used WhatsApp for business purposes; and
• The Cs questioned D’s handling of a company laptop, which he returned after permanently deleting its contents using a “zero-filling” process that made data recovery impossible. D claimed this action was necessary to protect legally privileged documents and said he had transferred relevant data to another device, but there was no independent verification of this transfer.

Despite D’s assurances, the Cs discovered undisclosed WhatsApp messages between D and another director. These messages, spanning several years, were highly relevant to the case and directly contradicted D’s claim that no additional material existed.

The Cs applied ex parte for an imaging order to preserve evidence on D’s electronic devices. They argued that D’s actions showed a significant risk of further non-disclosure or concealment of evidence, making the order necessary.

The decision

The Court granted the imaging order, citing the following factors:

• The Cs presented prima facie evidence of D’s failure to comply with disclosure obligations. D’s actions, such as failing to disclose existing WhatsApp messages and permanently deleting data from a laptop using a “zero-filling” process, demonstrated a serious risk of further non-compliance or deliberate concealment of evidence. These issues, together with D’s dismissal of the Cs’ request that he revisit his disclosure, were aggravating factors.
• The Cs satisfied the standard of showing with a “high degree of assurance” that they would establish their claims at trial. This is less stringent than the “extremely strong prima facie case” test required for search orders, given that search orders are more intrusive.
• The imaging order would incorporate strict safeguards to minimise intrusion into D’s privacy. Independent IT experts, under the supervision of an independent solicitor, would conduct the imaging. The imaged data would also remain inaccessible until a return hearing, preventing premature disclosure of irrelevant, private, or privileged material. Further, even after the return hearing, Cs’ access would be restricted to relevant documents identified through pre-agreed search parameters.
• Such safeguards would also remove the risk of Cs obtaining information not otherwise available through the litigation process and passing it to the IPs for a collateral purpose.

The decision underscores the Courts’ willingness to use imaging orders to address risks of evidence destruction or concealment at any stage of a dispute, while maintaining a balance between disclosure obligations and privacy rights.