Decision
Right to Know and Waterford City and County Council
From Office of the Information Commissioner (OIC)
Case number: OIC-113365-F6H8X8
Published on
From Office of the Information Commissioner (OIC)
Case number: OIC-113365-F6H8X8
Published on
Whether the Council was justified in refusing access to certain records relating to the decision to end the contract with a named company for the purchase and redevelopment of Waterford’s North Quays under sections 35(1), 36(1) and 15(1)(a) of the FOI Act
5 August 2022
The North Quays area of Waterford City has been designated as a Strategic Development Zone and its regeneration is one of the key projects listed for the Waterford City and Metropolitan Area in the National Planning Framework (NPF) “Ireland 2040”. In 2018, the Council entered into a contract with a named company (the company) for the proposed sale of a substantial piece of land on the North Quays. However, on 17 May 2021, the Council announced that it would be terminating this contract as the company had been unable to meet the contractual obligations required for the completion of the sale.
In a request dated 31 May 2021, the applicant sought access to copies of any records held in the email account of the Chief Executive of the Council referring or relating to the decision to end the contract with the company for the redevelopment of the North Quays, from 1 March 2021 to the date of the FOI request.
The Council did not issue a decision within the statutory four-week timeframe, thus effectively refusing the application. On 2 August 2021, the applicant sought an internal review of that effective refusal. As the Council again failed to issue a decision within the statutory time-frame, the applicant subsequently applied to this Office for a review of the deemed refusal of his request. Following communications with this Office, the Council issued a late decision on 21 September 2021 in which refused the request in full. It refused access, under sections 35(1)(b) and 36(1)(b) of the Act, to the records it had identified as relevant to the request. It said the contract was formally terminated on 18 May 2021, and refused to release any records from that date onwards under section 15(1)(a) of the Act, on the basis that no relevant records existed. On 23 September 2021, the applicant informed this Office that he wanted the review to proceed.
I have now completed my review in accordance with section 22(2) of the FOI Act. In carrying out my review, I have had regard to the submissions made by the Council and by the company and to the applicant’s comments in his communications with this Office. I have also examined the contents of the records concerned. I have decided to conclude this review by way of a formal, binding decision.
In a Schedule of Records provided to this Office, the Council listed 24 records it had identified as falling within the scope of the applicant’s request, in which it claimed that two records (13 and 21) were also exempt from release under section 31(1)(a) (legal professional privilege).
Accordingly, this review is concerned with whether the Council was justified in refusing access, under sections 31(1)(a), 35(1)(b) and 36(1)(b) of the Act, to the 24 records it identified as falling within the scope of the request and whether it was justified in refusing access, under section 15(1)(a), to any further records created after 18 May 2021, on the grounds that no such records exist.
Before considering the exemptions claimed, I wish to note the following points. First, it emerged in the course of the review that the Council had not provided the applicant with a Schedule of Records. On request from this Office, the Council sent a copy of the Schedule to the applicant. In the copy provided to the applicant, the names of third parties were redacted from the description of each record. The applicant commented that it was unclear to him how a person’s name could fall to be exempt under section 35 or section 36 of the Act. He also stated that the details contained within the Schedule were insufficient in assisting him to make a submission.
It is regrettable that, as well as failing to adhere to the statutory timelines in making a decision on the applicant’s request, the Council only provided the applicant with the Schedule having been asked to do so by this Office during the investigation. The late decision the Council issued on 21 September 2021 provided an opportunity for it do so. Not only did it not do so but it also failed to provide even the most basic information in its letter, such as how many records it had identified as falling within the scope of the request or a general description of the nature of those records.
As the Council has been subject to the provisions of the Act since 1998, I am sure it is aware of the existence of detailed supporting documentation on the website of the Central Policy Unit (CPU) of the Department of Public Expenditure and Reform. Such documentation includes a detailed manual for processing requests which contains, amongst other things, a sample schedule of records and guidance on preparing schedules, and sample decision letters. I urge the Council to take appropriate measures to ensure that its decision makers are familiar with the CPU guidance materials and that they are used when processing requests.
As regards the content of the Schedule provided by the Council, I note that it broadly follows the format recommended in the FOI processing manual published by the CPU. The applicant raised concerns about the basis on which names were redacted from the Schedule. This review is limited to whether the Council was justified in refusing to release the records at issue and does not extend to the Schedule. Nevertheless, it is worth noting that the Schedule provided contains details of the exemptions the Council relied upon in refusing access to the records sought, exemptions that the applicant is quite familiar with. As such, I am satisfied that the Schedule provided contained sufficient particulars to allow the applicant to understand the basis on which the Council decided to refuse access to the records and, if he so chose, to make submissions on that basis. It is often the case that applicants are limited in their ability to make detailed submissions. However, this generally stems from the fact that the precise contents of the records are not known to them, and not as a result of the absence of detailed information in a schedule.
Secondly, section 18 of the FOI Act provides for the deletion of exempt information and the granting of access to a copy of a record with such exempt information removed. This should be done where it is practicable to do so and where the copy of the record thus created would not be misleading. However, the Commissioner takes the view that neither the definition of a record nor the provisions of section 18 envisage or require the extracting of particular sentences or occasional paragraphs from records for the purpose of granting access to those particular sentences or paragraphs. Generally speaking, therefore, the Commissioner is not in favour of the cutting or "dissecting" of records to such an extent. Being "practicable" necessarily means taking a reasonable and proportionate approach in determining whether to grant access to parts of records.
Finally, it is important to note that while I am required to give reasons for my decision under section 22(10) of the FOI Act, I am also required to take reasonable precautions to prevent disclosure of information in an exempt record, under section 25. This means that the extent to which I can describe the records and the level of detail I can discuss in my analysis are somewhat limited in this case.
As stated above, I am constrained by the provisions of section 25(3) in terms of the level of detail I can give when describing the records at issue. However, it is worth noting that the applicant specifically sought access to emails referring or relating to the decision to end the contract with the company for the redevelopment of the North Quays and it is also public knowledge that the Council terminated its contract with the company as it was unable to meet the contractual obligations required for the completion of the sale. This information was made public by the Council in press releases and media interviews, and is detailed in minutes of various meetings of the Council. As such, I do not believe that I am in breach of section 25(3) by describing the records as emails or chains of emails, some of which contain attachments, between members of staff of the Council, between the Council and representatives of the company, and between the Council and its legal advisors in relation to the termination of the contract. Given the nature of email chains, there is a significant degree of repetition across the records.
Section 31(1)(a) – Legal professional privilege
The Council claimed that records 13 and 21 are exempt from release under section 31(1)(a) of the Act. That section provides for the mandatory refusal of a request if the record sought would be exempt from production in proceedings in a court on the ground of legal professional privilege. The exemption does not require a consideration of the public interest for or against release.
Legal professional privilege enables the client to maintain the confidentiality of two types of communication:
a. confidential communications made between the client and his/her professional legal adviser for the purpose of obtaining and/or giving legal advice (advice privilege); and
b. confidential communications made between the client and a professional legal adviser or the professional legal adviser and a third party or between the client and a third party, the dominant purpose of which is the preparation for contemplated/pending litigation (litigation privilege).
The concept of "once privileged always privileged" applies where privilege is based on legal advice privilege, but not where it is based on litigation privilege. Thus, unless otherwise lost or waived, legal advice privilege lasts indefinitely. Moreover, this Office takes the view that privilege also attaches to records that form part of a continuum of correspondence that results from the original request for advice.
Records 13 and 21 are both emails from a solicitor to the Chief Executive of the Council containing legal advice on the Council’s contract with the developer. I am satisfied that both of these records constitute confidential communications between a client and a professional legal advisor for the purpose of giving legal advice, and as such the records attract legal advice privilege. I find that the Council was justified in refusing access to records 13 and 21 under section 31(1)(a) of the FOI Act.
Section 36 – Commercially sensitive information
The Council claimed that all the records are exempt from release under section 36(1). This section of the FOI Act provides a mandatory exemption for commercially sensitive information. In its submissions, the Council referred to both sections 36(1)(b) and 36(1)(c).
Section 36(1)(b) provides that an FOI body shall refuse to grant an FOI request if the record concerned contains financial, commercial, scientific or technical or other information whose disclosure could reasonably be expected to result in a material financial loss or gain to the person to whom the information relates, or could prejudice the competitive position of that person in the conduct of his or her profession or business or otherwise in his or her occupation.
The harm test in the first part of section 36(1)(b) is that disclosure "could reasonably be expected to result in material loss or gain". This Office takes the view that the test to be applied is not concerned with the question of probabilities or possibilities but with whether the decision maker's expectation is reasonable. The harm test in the second part of section 36(1)(b) is that disclosure of the information "could prejudice the competitive position" of the person in the conduct of their business or profession. The standard of proof to be met here is considerably lower than the "could reasonably be expected" test in the first part of this exemption. However, this Office takes the view that, in invoking "prejudice", the damage which could occur must be specified with a reasonable degree of clarity.
Section 36(1)(c) provides that an FOI body shall refuse to grant an FOI request if the record concerned contains information whose disclosure could prejudice the conduct or outcome of contractual or other negotiations of the person to whom the information relates. The standard of proof required to meet section 36(1)(c) is relatively low in the sense that the test is not whether prejudice or harm is certain to materialise but whether it might do so. Having said that, the Commissioner expects that a person seeking to rely on section 36(1)(c) would be able to show that contractual or other negotiations were in train or were reasonably foreseen which might be affected by the disclosure and explain how exactly the disclosure could prejudice the conduct or the outcome of such negotiations.
Section 36(1) does not apply if the public interest would, on balance, be better served by granting rather than refusing the request (section 36(3) refers).
Submissions from the Council
The Council argued that the disclosure of the records could reasonably be expected to result in a material financial loss to either or both the Council and the company and would be very likely to prejudice the competitive position of the Council in the conduct of its business, and to prejudice the conduct or outcome of contractual or other negotiations entered into by the Council. It emphasised that the Council is actively attempting to procure another developer to agree the acquisition of the Strategic Development Zone site at the North Quays whereby that site will then be the subject of a mixed use development. It said that the future development of the site will be a major economic and social stimulus for the city of Waterford and it is of critical importance that the Council completes a successful negotiation with a developer on the best possible terms. It said that disclosure of the records would be likely to hinder and obstruct the Council in doing this.
The Council said that some of the records contained commercially sensitive information, and the publication of such information would put the Council at a significant competitive disadvantage in any future negotiations for the disposal of the North Quays site, and thereby financial loss. It said that some of the records contained detailed analysis of projected viability/profitability of a future development of the site and, should such information come into the public domain, it would impact greatly on the Council’s competitive position for any future negotiation on a resale of the site to a new developer. It said that for those records that did not contain specific commercial information, public disclosure would at the same time be a deterrent to prospective purchasers given that any such purchaser would require confidentiality for a transaction that most likely would be prolonged and subject to pre-conditions to be complied with over a period of a number of months.
In relation to section 36(1)(c), the Council said that it clearly follows from the above that release of the records would most likely prejudice the conduct and outcome of whatever future contractual or other negotiations the Council might engage in with regard to the site.
Submissions from the company
The company made a submission objecting to the release of any records. It said that the transaction was commercially sensitive in a number of ways and contained a number of commercial elements which should remain private, including funding arrangements and detailed information on the company’s commercial partners. It noted that two other named companies connected to the company were joined in the contract as guarantors and that it was not beyond the realm of possibility that one of these might in the future become an active bidder for the North Quays site, or other sites in Ireland. It said that if that were to happen, the company (and/or its connected companies) would be at a severe disadvantage if information contained in the contract with the Council were to be in the public domain and available to a rival bidder for the site. It also said that the contract and related documents contained extremely sensitive commercial communications between the company and the Council which, if released, could have a negative impact on its ongoing commercial operations world-wide.
Analysis
As a general principle, the Commissioner takes the view that section 36 is primarily aimed at protecting the commercial interests of parties engaged in commercial activity. He has found that there is some uncertainty as to the position of FOI bodies under section 36. However, depending on the circumstances of the case, the Commissioner has accepted that the FOI Act does not prohibit an FOI body, either as a decision making body or as a third party applicant to his Office, from relying on the provisions of section 36.
In this case, while the Council has made some reference to release of the records harming the company, these harms have not been specified to any real extent by the Council beyond repeating the provisions of the legislation. It seems to me that the Council’s main concern is that the release of the records will harm its own commercial interests. The company itself made its own arguments as to why its commercial interests could be adversely affected by the release of the records. In the circumstances of this case, where the Council continues to be in the process of looking for a purchaser for a large piece of land where major regeneration and development is planned, its seems reasonable to me to take into consideration the commercial interests of both the company and of the Council in examining the records at issue.
With this in mind, having carefully examined the remaining records at issue, I accept that records 2- 4, 6 -12, 14, 15, 18 -20, and 22 - 24 contain financial, commercial or other information whose disclosure could prejudice the competitive position of the Council in the conduct of its business (i.e. seeking to secure a purchaser/developer for the land at issues on the North Quays) or could prejudice the competitive position of the company and its associated companies in the conduct of its business. I am satisfied that the information contained in these records would not otherwise be available to prospective purchasers of the North Quays or other interested parties or competitors of the company. I find that disclosure of this information could provide insights to others that could prejudice the conduct or outcome of the Council’s contractual negotiations for the North Quays. I find that sections 36(1)(b) and 36(1)(c) apply to records 2- 4, 6 -12, 14, 15, 18 -20, and 22 – 24.
On the other hand, it does not seem to me that records 1, 5, 16 or 17, contain financial, commercial or other information whose disclosure could result in the harms set out in section 36(1)(b) or (c). These records contain information already in the public domain including press releases, and administrative matters around setting up meetings etc. I find that neither section applies to these records.
Section 36(2) provides for the release of information to which section 36(1) is found to apply, in certain circumstances. I am satisfied that none of the circumstances identified at section 36(2) arise in this case. Under section 36(3), I must also consider whether, on balance, the public interest would be better served by granting than by refusing the information in question.
In relation to the public interest test contained in section 36(3), I wish to emphasise that in carrying out any review, this Office has regard to the general principles of openness and transparency set out in section 11(3) of the FOI Act. In sum, section 11(3) recognises the need to enhance public scrutiny and accountability of government and public affairs, particularly the activities and decision making of FOI bodies.
However, in a judgment delivered on 25 September 2020 (The Minister for Communications, Energy and Natural Resources and the Information Commissioner & Ors, available on our website), the Supreme Court held that general principles of openness and transparency do not provide a sufficient basis for directing the release of otherwise exempt information in the public interest. Rather, a “sufficiently specific, cogent and fact-based reason” is required “to tip the balance in favour of disclosure”.
Moreover, while the Court stated that the public interest balancing test involves a “weighing of the respective private and public interests in the analysis of the records in issue”, it did not disturb the guidance that it previously gave in The Governors and Guardians of the Hospital for the Relief of Poor Lying-In Women v. the Information Commissioner [2011] IESC 26 ("the Rotunda Hospital case") in which it drew a distinction between private and public interests. Relevant private interests are those that are recognised by law and, in particular, through the protection afforded by the exemption provisions.
I therefore consider that I am required to identify a specific public interest, identifiable following an analysis of relevant records in this case, which is sufficiently strong as to outweigh the interests of commercial sensitivity.
The applicant did not advance any arguments in relation to the public interest. The Council stated that in its view the public interest would be best served by the future development of the site, as a catalyst for regeneration of the North Quays and Waterford City more generally. It said that the release of the records would make it more difficult for this to be achieved. I am not aware of any sufficiently specific, cogent and fact-based reason to tip the balance in favour of disclosure of the information in this case. I consider that the public interest would not be better served by the records at issue. I find therefore that the following records are exempt from release under section 36(1)(b) and 36(1)(c) of the Act: 2- 4, 6 -12, 14, 15, 18 -20, and 22 - 24.
Section 35 – Information obtained in confidence
As I have already found that section 31 or section 36 applies to all records in the scope of the review apart from records 1, 5, 16 or 17, I need only consider whether section 35 applies to these remaining four records. It is the position of both the Council and the company that release of any records falling within the scope of the FOI request would breach a confidentiality clause in the contract for sale that was signed by both parties in 2018.
Section 35(1)(a) provides a mandatory exemption for certain records containing information given to an FOI body in confidence. Section 35(1)(b) provides a mandatory exemption for records where disclosure of the information would constitute a breach of a duty of confidence provided for by a provision of an agreement or enactment or otherwise by law.
Section 35(2) provides that subsection (1) shall not apply to a record which is prepared by a head or any other person (being a director, or member of the staff of, an FOI body or a service provider) in the course of the performance of his or her functions unless disclosure of the information concerned would constitute a breach of a duty of confidence that is provided for by an agreement or statute or otherwise by law and is owed to a person other than an FOI body or head or a director, or member of the staff of, an FOI body or of such a service provider. As section 35(1) does not apply where the records fall within the terms of section 35(2), the application of section 35(2) to the facts of the case should always be considered at the outset.
Confidentiality Clause
Special Condition 23 of the 2018 contract reads as follows:
“The Vendor and the Purchaser agree to keep the contents and existence of this Contract confidential and not to discuss the contents of this Contract or any documentation related thereto with any third party save as may be required to be disclosed by law or by any regulatory or governmental body provided that the parties shall not be prevented from disclosing:
a. information to solicitors, architects, engineers, bankers, accountants, agents or professional advisors and persons necessary to enable this sale to complete or to enforce the terms hereof, once the parties shall ensure that any such third parties shall be obliged to observe the contents of this confidentiality obligation; and
b. information which has clearly and previously come into the general public domain through no fault of the disclosing party; and
c. information with the prior written consent of any other party hereto, which consent shall not be unreasonably withheld or delayed; and
d. in the case of the Purchaser, information to its lender and its associated entities.
The Vendor and the Purchaser further agree that no announcement in relation to the existence of this Contract on completion of the Sale (other than as required by law or any regulatory authority) shall be made by any party without the written consent of any other party hereto (such consent shall not be unreasonably withheld or delayed).”
Submissions from the Council
The Council’s position is that both section 35(1)(a) and 35(1)(b) apply to the records concerned. It said that Special Condition 23 renders confidential not only the contents and existence of the contract, but also “any documentation related thereto” which includes all the records within the scope of the FOI request. Some of the records were prepared by the Chief Executive or Council staff members in the performance of the Council’s duties as a local authority and the Council acknowledged that section 35(2) is therefore relevant. However, it said that because a duty of confidence is owed to the company, which is not an FOI body or a service provider, section 35(2) does not serve to dis-apply section 35(1).
In relation to section 35(1)(a), it said that on the basis of the confidentiality clause in the contract, the information in the records was given to and received by each party in confidence and on the express basis that it would be treated as confidential by both parties. It said that if the records were released, this would clearly have the potential to prejudice the Council in negotiating and entering into commercial agreements with third parties in general, given that the confidentiality clause that might be contained in such agreements would be deemed by such third parties to be unreliable, and not honoured by the Council. It said that disclosure could also cause reputational damage to the Council, given that a perception may arise that the Council failed to honour a commitment given to another party. As the Council intends to negotiate and sell the site to another party as soon as terms are agreed, it said that it expects that any prospective purchaser would expect a confidentiality clause to be a term of the sale. It said that where sales are agreed with pre-conditions that need to be worked through over a period of time, it is of great commercial importance that confidentiality is maintained, as disclosure of the sale price or sale pre-conditions can cause serious difficulties for one or both parties. The Council’s position is therefore that it is of great importance that any future sale documentation would have a standard confidentiality clause that would be enforceable and operative.
Submissions from the company
In its submissions, the company stated that it would never have entered into the contract without assurance that the contents would remain confidential, and likewise the emails sent by the company were issued on the same assurance of confidentiality. It said that its understanding, and the understanding of the guarantor which is a related company, was that the confidentiality clause at Special Condition 23 meant that anything and everything to do with the contract was to remain confidential between it and the Council.
It said that it was not aware of anything in the contract which expressly stated that confidentiality no longer applied if the sale did not complete and the contract was rescinded. It also said that the emails issued by the company to the Council were issued before the contract was rescinded and that they must be covered by the confidentiality clause.
Analysis
Records 1 and 5 consist of an email from the Chief Executive of the Council (the same email) and brief responses from representatives of the company. Record 16 is an email exchange between the Council and concerning the wording of a press release. Record 17
is an internal Council email containing the text of a press release.
Record 17 is clearly a record prepared by a member of staff of the Council in the performance of his/her functions and section 35(2) is relevant. Parts of records 1, 5 and 16 were prepared by a member of staff of the Council in the performance of his/her functions and therefore section 35(2) is relevant also to those parts. Therefore, section 35(1) will not apply to record 17 or parts of records 1, 15 and 16 unless disclosing them would constitute a breach of a duty of confidence owed to a person other than an FOI body/service provider etc. under an agreement or statute or otherwise by law.
As stated above, it is the position of both the Council and the company that such a duty of confidence is provided for by the confidentiality clause in the 2018 contract and that this duty is owed to the company. Clearly, the company is not an FOI body and, as a private entity negotiating the purchase of land from the Council for development, albeit as part of a scheme planned by the Council, I am satisfied that it cannot be characterised as a service provider within the definition at section 2 of the FOI Act. Therefore, the question is narrowed down to whether release of these records would constitute a breach of a duty of confidence owed to the company as provided for by Special Condition 23, or otherwise by law.
Having carefully reviewed the wording of the confidentiality clause in the context of the 2018 contract as well as taking into account the contents of the records at issue, I make the following observations. Firstly, I note that the clause is a general confidentiality clause which concerns the entire contract, any documentation related to the contract and in fact the very existence of the contract. It is not a specific confidentiality clause covering particular information within the contract which the parties consider to be, for example, a trade secret or commercially sensitive, and agree to treat as confidential. The issue of commercially sensitive information has already been dealt with in my findings under section 36 above.
Secondly, the clause allows for disclosure “as may be required to be disclosed by law”. It seems to me that a direction by the Information Commissioner to release records under the FOI Act would constitute disclosure required by law and would therefore not breach the confidentiality clause. FOI law has been in force for over 20 years. The Council was seeking to sell publicly-owned land for development in line with its planning scheme for the North Quays Strategic Development Zone. In the circumstances, I cannot accept that the parties could reasonably have had a mutual expectation of confidentiality over every aspect of the contract governing that sale, continuing on even after the contract had been rescinded. If that were correct, it would allow public bodies to circumvent the FOI Act merely by entering into very broad confidentiality agreements with third parties. I do not accept that this can have been the intention of the Oireachtas. I note that the Central Policy Unit of the Department for Public Expenditure and Reform Notice No. 5 on FOI & Public Procurement states: “the Freedom of Information Act 2014 means that FOI bodies are not in a position to give guarantees of confidentiality”. The FOI Act contains various provisions and exemptions that permit refusal or require refusal of the release of certain types of information, including when third parties are involved and/or when a particular harm is envisaged as a result of a release of a particular record. I do not consider that this blanket confidentiality clause could be enforced so as to oust the application of FOI to the entirety of a contract between an FOI body and a private company, and any documentation related to that, to sell publicly-owned land.
Thirdly, the clause also allows for the disclosure of information which “has clearly and previously come into the general public domain through no fault of the disclosing party”. It seems to me that most of the information contained in the records at issue is already in the public domain (including on the Council’s own news website).
Finally, contracts may be terminated in a number of ways including by breach, when one party fails to perform its obligations under the terms of the contract, or by performance, when all parties have performed their side of the contract as agreed. Special Condition 23 contains a general prohibition on release of information and then a specific one dealing with termination by performance. There is no specific mention of how the clause operates if the contract is terminated by breach, which is ultimately what happened in this case. In addition, clause 11 of the contract (“survival of provisions”) provides that the Special Conditions shall continue to be binding on the parties after the completion of the sale and 13.6 provides that if the contract was terminated or rescinded at any stage, that the deposit would be returned to the company within a specific time frame. While the company stated that it was not aware of a provision which expressly stated that confidentiality no longer applied if the sale did not complete and the contract was rescinded, it seems to me that the parties did turn their attention to the question of what might happen if the contract was not completed but did not make any express provision for the continuation of the confidentiality clause in those circumstances. In contrast however, the parties did include a specific provision for confidentiality on completion of the sale. I am not satisfied that the Council can rely on Special Condition 23 post termination of the contract by breach. I do not consider it relevant that the records are dated prior to the termination of the contract.
Taking all of the above into account, I find that release of the records at issue would not constitute a breach of confidence owed to the company that is provided for by an agreement. A duty of confidence may also be provided for by a provision of an enactment or “otherwise by law”. There is no evidence to suggest that a duty of confidence is provided for by statute or enactment. It is well settled that a duty of confidence provided otherwise by law includes an equitable duty of confidence. Neither party has put forward arguments or evidence to suggest that an equitably duty of confidence exists but for completeness I will examine it.
In the Supreme Court decision in the case of Mahon v Post Publications Ltd [2007] 3 I.R. 338 Fennelly J confirmed that the requirements for a successful action based on a breach of an equitable duty of confidence, at least in a commercial setting, are found in the judgment of Megarry J in Coco v. A. N. Clark (Engineers) Ltd. [1969] R.P.C. 41, at 47:
“[T]hree elements are normally required if, apart from contract, a case of breach of confidence is to succeed. First, the information itself ... must 'have the necessary quality of confidence about it'. Secondly, that information must have been imparted in circumstances importing an obligation of confidence. Thirdly, there must be an unauthorised use of that information to the detriment of the party communicating it."
Fennelly J summarised or restated the requirements of what he called “the contours” of the equitable doctrine of confidence as follows:
“1. the information must in fact be confidential or secret: it must ... “have the necessary quality of confidence about it”;
2. it must have been communicated by the possessor of the information in circumstances which impose an obligation of confidence or trust on the person receiving it;
3. it must be wrongfully communicated by the person receiving it or by another person who is aware of the obligation of confidence.”
In order to establish that an equitable duty of confidence exists, it should first be shown that the information has the necessary quality of confidence. Factors relevant for consideration in this regard include, for example, whether the information is confidential or secret or concerns private matters. Having carefully examined the records at issue and taking into account the information that is already in the public domain, including the press releases, I does not seem to me that records 1, 5, 16 or 17 contain confidential or secret information. I do not find that an equitable duty of confidence arises here.
I find that pursuant section 35(2), section 35(1) does not apply to record 17 or the parts of records 1, 5 and 16 prepared by staff of the Council. The test to be met in section 35(1)(b) is essentially the same as that set out in section 35(2). For the same reasons as I have set out above, I am satisfied that section 35(1)(b) does not apply to the relevant parts of records 1, 5 and 16 that were prepared by the company. It remains only for me to examine whether section 35(1)(a) applies to these records. In order for the section to apply, it is necessary to show the following:
All four of these requirements must be satisfied for section 35(1)(a) to apply. Even then, the section is subject a public interest balancing test set out in section 35(3).
On the basis of the confidentiality clause as discussed above, and the parties’ mutual understanding of this clause, I am satisfied that the first two elements of the test set out above have been met. However, having regard to the specific content of these records, I am not satisfied that its disclosure would likely prejudice the giving to the Council further similar information from the company or similar bodies. I find that section 35(1)(a) does not apply to the parts of these records prepared by the company.
In summary, I find that section 35(1) does not apply to records 1, 5, 16 or 17.
Section 37
Section 37(1) of the Act provides for the refusal of a request where access to the record sought would involve the disclosure of personal information relating to third parties. While the Council did not rely on section 37 to refuse any part of the request, it would not be appropriate for me to direct the release of third party personal information contained in a record simply because I was not satisfied that the record was exempt under a different exemption. I find that section 37(1) applies to the email addresses of third parties in records 1, 5, and 16 and that none of the other provisions of section 37 serve to disapply section 37(1).
Section 15(1)(a) – Search issue
The applicant’s FOI request sought records covering the period 1 March 2021 to 31 May 2021. The Council stated that the contract with the company was formally terminated on 18 May 2021, and refused to release any records from that date onwards under section 15(1)(a) of the Act, on the basis that no relevant records existed.
Section 15(1)(a) of the Act provides for the refusal of a request where the records sought do not exist or cannot be found after all reasonable steps to ascertain their whereabouts have been taken. The Commissioner's role in a case such as this is to review the decision of the FOI body and to decide whether that decision was justified. This means that I must have regard to the evidence available to the decision maker and the reasoning used by the decision maker in arriving at his/her decision and also must assess the adequacy of the searches conducted by the FOI body in looking for relevant records.
The evidence in “search” cases generally consists of the steps actually taken to search for the records along with miscellaneous and other information about the record management practices of the FOI body, insofar as those practices relate to the records in question. It is important to note that the FOI Act does not require absolute certainty as to the existence or location of records, as situations arise where the records are lost or simply cannot be found. Furthermore, this Office can find that an FOI body has satisfied the requirements of section 15(1)(a), even where records that an applicant believes ought to exist have not been located.
The Council was asked to provide details of the searches carried out for records from 18 May 2021 onwards. In its submissions, the Council stated that no record exists or ever existed for the period 18 – 31 May 2021. It stated that the request relates to records which refer or relate to the decision to end the contract and that as of 18 May 2021, the decision was not only taken but fully implemented. It did not provide any details of searches conducted.
The applicant in his submissions to this Office stated that it seemed unlikely to him that because the contract was terminated all communications relating to the project would stop. I think this is a reasonable point, particularly given the scale of the project in question and the importance of this decision to the Council.
While it may well be the case that no further records exist, in the absence of any detail about the searches conducted, I simply cannot find that the Council has taken all reasonable steps to ascertain the whereabouts of such records. In the circumstances, I consider it appropriate to direct the Council to complete its searches of the email account of the Chief Executive for the period 18-31 May 2021 and if it finds relevant records, to make a fresh decision on them in accordance with the provisions of the FOI Act. When making its new decision I would again remind the Council of the detailed supporting documentation on processing FOI requests available on the website of the Central Policy Unit (CPU) of the Department of Public Expenditure and Reform.
Having carried out a review under section 22(2) of the FOI Act, I hereby vary the Council’s decision. I find that it was justified in refusing access, under sections 31(1)(a) and 36(1) of the Act, to records 2-4, 6-15, and 18-24. I find that it was not justified in refusing access to records 1, 5, 16 or 17, and I direct their release subject to the redaction of the email addresses of third parties. I find that the Council was not justified in refusing access, under section 15(1)(a) of the FOI Act, to further records relating to the applicant’s request from 18-31 May 2021. I annul this aspect of the decision and direct the Council to conduct further searches and a fresh decision-making process on this part of the request.
Section 24 of the FOI Act sets out detailed provisions for an appeal to the High Court by a party to a review, or any other person affected by the decision. In summary, such an appeal, normally on a point of law, must be initiated by the requester not later than eight weeks after notice of the decision was given, and by any other party not later than four weeks after notice of the decision was given.
Stephen Rafferty, Senior Investigator