Lloyds TSB Insurance Services Ltd & Anor v Shanley

Judgment

Lord Justice Kitchin:

Introduction

This is an appeal against that part of the judgment of HHJ Pelling QC sitting as a judge of the High Court dated 25 February 2013 and his consequential order whereby he held that the first defendant (“Lloyds”) had infringed the copyright of the claimant (“Mr Shanley”) and had misused Mr Shanley’s confidential information by using in the course of its business a particular piece of software called a scoping tool, and whereby he found that the second defendant (“Halifax”) had also infringed Mr Shanley’s copyright and acted in breach of its duty of confidence to him by supplying the scoping tool to Lloyds.

The judge also held that Halifax had itself used the scoping tool but he rejected Mr Shanley’s claim that this too constituted an infringement of his copyright or a breach of confidence. Mr Shanley has not sought to appeal against this finding.

So far as the claim in respect of the use of the scoping tool by Lloyds was concerned, the crucial issue was whether, at a meeting in September 2006, Mr Shanley gave Halifax permission not only to use the scoping tool itself but also to allow its use by Lloyds. It is accepted that absent such permission the use of the tool by Lloyds did amount to an infringement of Mr Shanley’s rights. The judge held that Mr Shanley granted no such permission. On this appeal, Lloyds and Halifax say that he fell into error both as a matter of law and in making findings that were not open to him on the evidence.

Background

The judge set out the background in his full and comprehensive judgment. The following is a summary of those matters relevant to the issues which arise on this appeal. I have drawn them in large part and with gratitude from the judgment.

Mr Shanley is an experienced building contractor and businessman and in 2002 he formed a company called Completecare Scotland Ltd (“CSL”) to carry on a business of repairing properties on the instructions of building insurers. Mr Shanley appreciated that the profitability and efficiency of this business would be increased by the use of a scoping and claims management system. He therefore entered into a collaboration with Mr Muirhead, a software designer, and by 2006 they had created for use by CSL a computerised claims management system which incorporated and used a scoping tool called “Estimate Builder”. As the judge explained, this was, in effect, a spreadsheet which consisted of a series of different pages, one for each of the va