Norwich Pharmacal Relief: Court expands test to include the ‘proper purpose’ condition

In Green v CT Group Holdings Ltd [2023] EWHC 3168 (Comm), the High Court held that it should be a condition for granting Norwich Pharmacal relief that the application is made for a legitimate purpose. This condition should be satisfied in addition to the other well-established conditions for relief. There is no legitimate purpose if the application is made in order to obtain evidence for use in foreign civil proceedings.

Background

The Applicant applied for a Norwich Pharmacal order (NPO) against the Respondent. A NPO is a type of disclosure order which compels a third-party (who is involved or mixed up in a wrongdoing, whether innocently or not) to disclose certain documents or information to the applicant.

The NPO application was made against a backdrop of proceedings in Jersey and Guernsey concerning the restructuring of certain family trusts, to which the Applicant was a party (the Channel Island Proceedings). The Applicant sought disclosure of the source of certain documents in relation to the Channel Island Proceedings. The Applicant’s case was that she was the victim of serious wrongdoing, involving the fabrication of documents intended to cause her prejudice in the Channel Island Proceedings. The Applicant argued that the NPO would enable her to identify the wrongdoers and/or obtain the information necessary to allow legal redress to be sought.

Test for granting a NPO

The legal principles of a NPO derive from the House of Lords decision in Norwich Pharmacal Co & Others  v Customs and Excise Commissioners [1974] AC 133 (Norwich Pharmacal). In Collier v Bennett [2020] EWHC 1884 (QB) (Collier) the court identified and defined the following four conditions for the grant of such relief:

1. The Arguable Wrong Condition: the applicant must demonstrate a good arguable case that a form of legally recognised wrong has been committed against them by a person;
2. The Mixed Up In Condition: the respondent to the application must be mixed up in, so as to have facilitated, the wrongdoing;
3. The Possession Condition: the respondent to the application must be able, or likely able, to provide the information or documents necessary to enable the ultimate wrongdoer to be pursued; and
4. The Overall Justice Condition: requiring disclosure from the respondent must be an appropriate and proportionate response in all the circumstances of the case, bearing in mind the exceptional but flexible nature of the jurisdiction.

Decision

The application was dismissed. The Court considered that, other than as part of the Overall Justice Condition, the formulation of the test in Collier did not, as it should, take account of the decision in R (on the application of Omar) v Secretary of State for Foreign and Commonwealth Affairs [2013] EWCA Civ 118 (Omar) and the resulting line of cases. The effect of those cases is that where the purpose of the Norwich Pharmacal application is to obtain evidence for use in foreign civil proceedings (as was the case here) or in connection with criminal proceedings or a criminal investigation being carried on outside the United Kingdom, the courts have no jurisdiction to make a NPO. This is because the exclusive remedy for obtaining evidence in such circumstances is under the respective statutory scheme. In civil cases, the relevant statute is the Evidence (Proceedings in Other Jurisdictions) Act 1975. The Court found that the Omar line of authority would be incorporated by adding a fifth condition to the test set out in Collier. The additional condition was that the application for a NPO must be made for a legitimate purpose (the Proper Purpose test). The Proper Purpose test would be used to exclude applications where the purpose was to seek information which should be sought under the relevant statutory scheme.

Applying that test to the present case, the Court considered that the Applicant had not shown a legitimate purpose for the Norwich Pharmacal application. The Court was not satisfied that an order would serve a useful and legitimate purpose in any event and it did not regard the Overall Justice Condition as being satisfied.

The court held that:

• It would not be a proper purpose to seek the information for civil or criminal proceedings abroad.
• In any case with a jurisdictional element (such as this one) it was not good enough to adopt a “wait and see” attitude to the purpose of the application in terms of how the information sought might be used.
• There was nothing in this case which connected it with this jurisdiction other than the residence of the Respondent. There was no reason on the evidence to believe the ultimate wrongdoer had anything to do with the jurisdiction. It was therefore unlikely that obtaining the information would lead to civil or criminal proceedings in this jurisdiction, either against the Respondent or against the ultimate wrongdoer.
• As for the Applicant’s suggestion that the purpose of the application could be to bring proceedings against the Respondent within the jurisdiction, the court considered that the application would have needed to be framed very differently and should have been brought under CPR 31.16 for pre-action disclosure. In any event, the court would not have been satisfied that there was a good arguable case of wrongdoing against the Respondent.

The Judge commented that the jurisdictional limitations of the Norwich Pharmacal procedure do not seem to have occurred to anyone in the first fifty years since Norwich Pharmacal was decided and some of the earlier Norwich Pharmacal cases will need to be reconsidered as a result.

Key takeaways

This decision underlines the importance, in multi-jurisdictional cases, of considering and identifying the purpose for which Norwich Pharmacal relief is sought. If the intended purpose is an illegitimate purpose (including obtaining evidence for use in foreign civil proceedings) the court will not make a NPO. Applicants should therefore ensure that they express their application in such a way as to demonstrate that it satisfies all five conditions for the grant of such relief.

With thanks to Dani Bass for her assistance in preparing this post.