BLAKE v. THE UNITED KINGDOM

FOURTH SECTION

DECISION

AS TO THE ADMISSIBILITY OF

Application no. 68890/01
by George BLAKE
against the United Kingdom

The European Court of Human Rights (Fourth Section), sitting on 25 October 2005 as a Chamber composed of:

MrJ. Casadevall,, President,
MrM. Pellonpää,
MrR. Maruste,
MrK. Traja,
MrS. Pavlovschi,
MrL. Garlicki,
LordBrown of Eaton-under-Heywood,
and Ms F. Elens-Passos, Deputy Section Registrar,

Having regard to the above application lodged on 19 January 2001,

Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant,

Having deliberated, decides as follows:

THE FACTS

1. The applicant, Mr George Blake, was born in the Netherlands in 1922. He submits that he held a British passport, was granted Soviet citizenship in 1967 and remains a citizen of the Russian Federation. He has lived in Russia since around 1966. He is represented before the Court by Ms N Mole, of the AIRE Centre, a non-governmental organisation in London.

A. The circumstances of the case

The facts of the case may be summarised as follows.

1. British Secret Intelligence Service (“SIS”) and the autobiography

2. Between 1944 and 3 May 1961 the applicant was a member of the SIS. On 16 August 1944 he signed an undertaking pursuant to the Official Secrets Act 1911 (“the 1911 Act”). He does not submit the undertaking and neither did the Attorney General (“AG”) in the domestic proceedings described below. However, the AG claimed (before the Court of Appeal) that the declaration recited section 2(1) of the 1911 Act and contained the following undertaking by him:

“I understand that the above clauses of the [1911 Act] cover also articles published in the press and in book form, and I undertake not to divulge any official information gained by me as a result of my employment, either in the press or in book form. I also understand that these provisions apply not only during the period of service but also after employment has ceased.”

3. In or around 1951 the applicant became an agent for the Soviet Union having been detained during the Korean war by North Korean troops. From then until his arrest in 1960 he disclosed secret information and documents to the Soviet authorities. On 3 May 1961 he pleaded guilty to five counts of unlawfully communicating information contrary to section 1(1)(c) of the 1911 Act. He was sentenced to 42 years’ imprisonment. His trial was in camera and the details of the charges against him were never made public. In 1966 he escaped from prison. He made his way to Berlin and from there to Moscow where he lives to date.

4. In 1989 he wrote his autobiography entitled “No Other Choice” (“the Book”). The High Court later described the Book as follows:

“In it he describes his background and early life, the part he played in the 1939–1945 war and his assignment during the war to the S.I.S. He provides details of his training and work as an S.I.S. officer after the war. He describes how, in the Korean War, he was taken into custody by North Korean troops and how, during his internment, he became converted to the cause of communism and offered his services to the K.G.B. He provides details of his activities as an S.I.S. officer after his release from captivity on the termination of the Korean War. He describes the circumstances in which his role as a Soviet agent became known to the British authorities, his trial, his imprisonment and subsequent escape. He provides an account of his life in the Soviet Union following his escape. The [Book] may be fairly described as his apologia for the course his life has taken. It will be apparent from his brief description of the contents of the [Book] that substantial parts of the contents relate to the [his] activities as a member of the S.I.S. and are based on information acquired by him while an S.I.S. officer.”

5. On 4 May 1989 the applicant signed a publishing contract with Jonathan Cape Ltd (“the Publisher”) granting the latter an exclusive licence to publish the Book in the United Kingdom. The Publisher agreed to pay the applicant, by way of advances on royalties, the sum of 50,000 pounds sterling (GBP) on signature of the contract, GBP 50,000 on delivery of the final manuscript and GBP 50,000 on publication of the Book. By 14 September 1990 the applicant had been paid GBP 50,000. After deduction of agents’ fees and tax, he received a net sum of GBP 33,650. A further GBP 10,000 was then paid to the agent, leaving GBP 90,000 outstanding from the Publisher to the applicant (an after-tax sum of GBP 55,000). The applicant did not seek authorisation from the Crown to publish the Book. He submitted the manuscript to the Publisher at the end of 1989.

In early September 1990 a press release announced the impending publication of the Book.

6. On 14 September 1990 the Treasury Solicitor wrote to the Publisher alleging that some of the information in the Book was subject to the applicant’s obligation of confidentiality to the Crown, that the Crown would hold the Publisher liable for these breaches of the duty of confidentiality and requested the Publisher to undertake by 18 September 1990 that they would direct any payments to the Crown which were due to the applicant. On 17 September 1990 the Publisher responded pointing out that it was common knowledge, since at least 9 September 1990, that it was to publish the Book but that the Crown had waited until the eve of publication to write. However, they undertook not to make payments to the applicant without 7 days’ prior notice to the Crown.

The Book was published in the United Kingdom on 17 September 1990.

7. On 23 November 1990 the Treasury Solicitor wrote to the Publisher indicating that, having considered the matter further, they took the view that the applicant owed a fiduciary duty to the Crown, that he was liable to account for his profits to the Crown, that the equitable right to the copyright of the Book belonged to the Crown and that the legal copyright was held on constructive trust for the Crown. On 14 December 1990 the Publisher rejected these claims.

2. The High Court

8. The AG issued a writ in the High Court on 24 May 1991 seeking to extract from the applicant any financial benefit he would obtain from publication based on the contention that in writing and authorising the publication of the Book, he had acted in breach of the duty of confidence he owed to the Crown as a former member of the SIS. The Statement of Claim (paragraph 3) described the alleged duty as:

“(i) not to use his position as a former servant of the Crown so as to generate a profit or benefit for himself, (ii) not to use any information imparted to him in his capacity as a servant of the Crown so as to generate such a profit or benefit, and (iii) to give restitution to the Crown of any such profit or benefit generated by misuse of his position and/or the information aforesaid.”

9. It was contended by the AG that the Crown was the beneficial owner of copyright in the Book and that the applicant was accountable to it for all sums received or receivable from the Publisher. While the sums already paid to him were accepted to be irrecoverable, the Crown intended to recover GBP 90,000 still owed to the applicant together with any future royalties. The AG did not rely on any contravention of the 1911 Act or of the Official Secrets Act 1989 (“the 1989 Act”), or on the applicant’s written undertaking signed in 1944.

10. Having filed an appearance on behalf of the applicant, his solicitors then filed his defence on 6 January 1992. The applicant denied that in writing or authorising the publication of the Book he had breached any duty to the Crown and denied that the Crown had any right to the copyright of the Book or to the profits made by him from it.

(a) The applicant’s legal representation

11. The applicant did not return to the United Kingdom for the duration of these proceedings. He attempted, unsuccessfully, to obtain legal aid.

12. By letter dated 3 December 1991 to the applicant, the Legal Aid Area Office refused legal aid indicating that it appeared “unreasonable that you should receive legal aid in the particular circumstances of your case” and more specifically, “that on the information available you would derive no personal benefit from defending the proceedings”. The applicant appealed.

13. By letter dated 7 April 1992 to the applicant’s solicitors, the Legal Aid Area Office indicated that the Legal Aid Board Committee had adjourned their consideration of his appeal as they required further information in relation to the payments already made to him. The Committee noted that the applicant had not requested the Treasury Solicitor to release the monies held by the Publisher to fund his defence of the proceedings and had not applied to adjourn the proceedings pending a decision on such release.

14. By letter dated 23 April 1992 to the applicant’s solicitors, the Treasury Solicitor confirmed that the AG considered it inappropriate that the applicant’s defence be funded by the monies held by the Publisher.

15. By letter dated 6 May 1992 the applicant’s solicitors wrote to the Publisher’s solicitors requesting an admission of liability and an indication of the amount due and owing to him and demanding payment of the monies owing to him or, at least GBP 20,000, to cover legal costs. The Publisher responded, on 15 May 1992, indicating that the matter of whether and how such monies were to be paid was between the applicant and the Crown.

16. On 20 May 1992 the applicant’s sister completed a schedule detailing how the monies received from the Publisher had been spent. He had received GBP 33,650 (net) from the Publisher and earned GBP 7,800 in interest payments from 1989 to 1991. Having spent GBP 4,285 on household goods, he had given the balance to family members.

17. On 20 May 1992 his solicitors requested the Treasury Solicitor to reconsider its refusal to release the funds. The latter refused by letter of 1 July 1992 and confirmed that the release of funds would be inappropriate as he was requesting use of assets the Crown contended were its own. It was also noted that the legal aid appeal had not yet been determined.

18. On 3 July 1992 his solicitors informed the Legal Aid Area Office how the royalty payments to date had been spent and about the refusal of the Treasury Solicitor and the Publisher to release the monies to him. By letter dated 27 July 1992 from Legal Aid Area Office the applicant was informed that the Area Committee had rejected his appeal. It appeared to that Committee unreasonable that he should be granted representation (section 15(3)(a) of the Legal Aid Act 1998): since the litigation was known to him, not later than 28 June 1991, he had voluntarily divested himself of funds under his control and direction to the amount of at least GBP 14,285, it being noted that almost GBP 10,000 of that sum was a gift to a third party. The applicant claims that he had given approximately GBP 20,000 to his children before 28 June 1991 and that only GBP 14,000 had been spent thereafter (most of which he had given to his son). The balance remaining (GBP 4,165) was insufficient to fund his litigation.

19. By letter dated 12 August 1992 his solicitors informed the Treasury Solicitor that he would apply to the Court for an order that the AG consent to the release of the relevant monies to fund his defence. On 18 February 1993 the High Court dismissed the application finding that it had no jurisdiction to make an injunction against the Crown. The matter could be revisited if the Publisher was joined as a third party as the court had jurisdiction to make a mandatory injunction against the Publisher. An order for the costs of the application was made against the applicant.

20. The applicant then joined the Publisher as a third party to the proceedings and the Publisher did not oppose the release of funds. However, on 22 June 1994 the High Court again rejected his application for the release of the monies. The Crown’s claim was prima facie a strong one. Many litigants presented their cases themselves and the court was able to ensure that there is a fair trial. By being a fugitive from justice, the applicant had put himself in a position where he could not appear in person. Nevertheless, it was considered that the lack of legal representation would not deny him a fair trial. It was also noted that, by this time, he had received in the region of $11,000 for a German television documentary which could contribute to his legal costs. A further order for costs was made against him.

21. On 12 August 1994 his solicitors applied and were granted leave to cease to act for the applicant. They could not continue to act on a pro bono basis and two costs’ orders had been made against the applicant to date.

22. Given that the applicant would not be attending to represent himself and on the initiative of the AG, on 25 July 1995 the High Court appointed a Queen’s Counsel and a junior counsel to act as amici curiae in the case. The Crown was also represented by Queen’s Counsel and by junior counsel. The applicant was not present or further represented before the High Court.

(b) A.G. v. Blake and Jonathan Cape (third party) [1996] 3 All ER 903

23. On 19 April 1996 the judgment of the High Court, delivered by Sir Richard Scott V.-C., rejected the AG’s application.

24. As to the applicant’s representation, the High Court noted that his solicitors had withdrawn, although it had not been informed of the reasons for this. As to the amici curiae, the High Court noted that:

“Their role ... has not been to represent the interests of the [applicant]. They are not counsel for the [applicant]. Their role is to assist me in evaluating the submissions made to me by counsel for the [AG] and to draw my attention to the legal principles and authorities which might seem in argument to oppose the grant of the relief sought by the [AG].”

25. As to whether, in writing and authorising publication of the Book, the applicant was in breach of the duties he owed to the Crown, it was noted that the AG had not contended that the applicant had committed any breach of his duty of confidence: the information relating to the SIS in the Book was, by 1989, no longer confidential.

26. The basis of the action was an alleged breach of fiduciary duty which arose by virtue of the relationship of trust between the applicant and his former employer. In this respect, the High Court found that the fiduciary duties as formulated by the AG were too wide to be acceptable. It was in no doubt that a former member of the SIS owed to the Crown a lifelong duty of non-disclosure of confidential information, whether that duty was a contractual one (express or implied) or was an equitable one derived from the relationship of trust between employee and employer. However, any non-disclosure duty imposed by law would not go further than was reasonably necessary to protect the interests of the relevant service and would not therefore prevent publication of material that had already become public knowledge or could be seen to be trivial.

27. In interpreting the nature and breadth of such a duty, the State’s Convention (in particular, Article 10) obligations should be borne in mind. In this respect, a duty of non-disclosure of information already in the public domain would not constitute an interference necessary in a democratic society in the interests of national security. The High Court noted that, not only did the AG not dispute that the information disclosed was no longer confidential, but there was no evidence of an assessment by, or evidence from, the Crown that the disclosures might or had been, nevertheless, harmful to national security.

28. As to the statutory duty contained in section 1(1)(a) of the 1989 Act, the High Court found that that section applied to the applicant. The offence was established regardless of whether the information was confidential and whether its disclosure was harmful to national interests. It was clear that the applicant’s submission of the manuscript to the Publisher “constituted a disclosure of information which was in his possession by virtue of his work with the SIS and that he thereby committed an offence under subsection (1)”. However, the AG had not made out a claim for a breach of statutory duty, probably because such a finding would not lead to any of the financial remedies sought by the AG. Criminal penalties were provided for in the 1989 Act and “established principles of statutory construction” precluded civil law remedies being added to the statutory remedies.

29. The High Court distinguished the United States’ Supreme Court finding (in Snepp v. the United States (1980) 444 U.S. 507) of a breach of a fiduciary duty leading to a constructive trust of profits by the publication of a former CIA agent of a book about CIA activities in South Vietnam. He had breached an express contractual obligation to submit manuscripts for approval prior to publication. While the High Court felt that such a solution could be imposed compatibly with Article 10 of the Convention, the applicant’s contract did not include an express prior-approval term, and such a specific condition could not be implied.

30. The High Court therefore rejected the AG’s claim of a continuing breach of fiduciary duty by the applicant. It concluded:

“The pleadings and the evidence do not ... disclose any breach of duty on the part of the [applicant] on which the relief claimed can be founded. I do not accept that, as a former member of the security intelligence agency, he owed the Crown a continuing duty ‘not to use his position as a former servant of the Crown so as to generate a profit or benefit for himself’ or a continuing duty ‘not to use any information imparted to him in his capacity as a servant of the Crown so as to generate such a profit or benefit:’ ...

The Crown has not ... either pleaded or established by evidence any misuse by the [applicant] of his position as a former member of the SIS or of information imparted to him in that capacity. This last conclusion may seem strange in view of the defendant’s status as a self-confessed traitor. The conclusion is, however, a consequence of the Crown’s attempt to establish a case in what, in my judgment, is far too broad a statement of the duty owed by ex-members of intelligence and security agencies and on the Crown’’s decision, the rightness of which I do not question, not to base its case on the misuse of secret or confidential information or to allege that information damaging to the national interest had been disclosed.”

31. It was not therefore necessary to decide the question of whether the Crown could claim remedies for a breach of fiduciary duty. However, the High Court indicated that if such a duty had been established, the writing and submission for publication of the Book would have been a breach of such a duty, in which case the High Court would have had no difficulty in finding that the wrongdoer would, in equity, be required to hold the fruits of his wrongdoing for the Crown to whom the duty had been owed.

The Crown appealed.

3. The Court of Appeal

(a) the applicant’s legal representation

32. The Legal Aid Area Office refused legal aid for the appeal by letter dated 30 May 1996 stating that the applicant had not shown reasonable grounds for taking, defending or being a party to proceedings. In particular, he had not made any comment on the grounds of appeal and it was not therefore possible to determine his likely prospects of success. His solicitors appealed this refusal and submitted thirty-two pages of reasoned argument in support of the legal aid appeal. The Legal Aid Area Office, by letter dated 25 June 1996, confirmed the rejection of his appeal noting that the Committee considered that it would be unreasonable to grant legal aid to enable him to continue to pursue a claim so long as he remained “a fugitive from justice already meted out to you”.

33. His solicitors again applied for the release of the monies to fund his litigation which application was rejected by the Court of Appeal.

34. The applicant was not represented or present before the Court of Appeal and the Publisher took no part in the proceedings. The AG was represented by the Solicitor-General, Queen’s Counsel and two junior counsel, with a Queen’s Counsel and one junior counsel appearing as amici curiae. The latter’s written submissions to the Court of Appeal began by noting:

“Subject to the leave of the Court, the role of the Amicus in the present appeal will be to ensure that all relevant arguments which [the applicant] could have advanced in opposition to the appeal are before the Court; and to make independent submissions to assist the Court in relation to the wider implications of the issues raised.”

35. The Court of Appeal later noted that during the appeal before it counsel appearing as amici curiae had “deployed before this court all the arguments which the [applicant] might have wished to present to the court if he had been present”.

(b) The proceedings

36. The proceedings opened on 6 and 7 October 1997. Counsel acting as amici curiae suggested a possible public law remedy and the court also considered that the AG might have a private law restitutionary remedy against the applicant. The proceedings were therefore adjourned (until 1 December 1997) to allow submissions on two issues. In the first place, whether alternative remedies might be available in public law to prevent the applicant from profiting from the alleged breach of section 1(1) of the 1989 Act by the submission of the manuscript to the Publisher and, in particular, whether it would be open to the AG in his role as guardian of the public interest to seek an injunction to prevent the applicant from receiving any sums due to him and whether the AG wished to seek such an injunction in the present case. Secondly, whether there was an alternative basis for restitutionary remedies for breach of contract in private law, either in respect of the profits of crime or in respect of the applicant’s breach of his contractual undertaking signed in 1944.

37. The AG was then granted leave to amend its statement of claim. The AG added a claim that the applicant was subject to section 2(1) of the 1911 Act and, from 1 March 1990, to section (1) of the 1989 Act. The AG also referred to the undertaking signed by the applicant in 1944 arguing that it had been signed in consideration of the Crown permitting the applicant to pursue his employment and on the basis that the applicant owed at all material times a contractual duty to the Crown to comply with the said undertaking. However, the AG decided that he did not want to advance argument on the restitutionary damages before the Court of Appeal, but wished to keep the matter open before a higher court. Arrangements were made for the applicant to be sent the amended statement of claim. He did not respond.

(c) A.G. v. Blake (Jonathan Cape Ltd third Party) [1998] 1 All ER 833

38. On 16 December 1997 Lord Woolf M.R. delivered the court’s judgment dismissing the private law appeal but allowing the appeal on a new public law issue. He adopted the High Court’s description of the Book, finding that:

“if the [applicant] had not been a notorious spy who had also dramatically escaped from prison, royalties of this order would never have been paid to him for his autobiography.”

39. As to the AG’s first private law claim (a breach of a life long fiduciary duty arising from his employment with the SIS), Lord Woolf M.R. found that an employment relationship gave rise to many kinds of fiduciary duties. The duty of trust and confidence, the core obligation being loyalty, did not exist after the termination of the relationship without an express term to the contrary. A fiduciary duty of confidentiality was different and arose from the imparting of confidential information from one person to another. It arose therefore independently of the employment relationship, it therefore survived its termination but lasted only as long as the relevant information remained confidential. The court considered that:

“Quite apart from the fact that equity does not intervene when it would serve no practical purpose to do so, an injunction restraining publication in these circumstances would be an unjustifiable restraint of trade and an unwarranted interference with freedom of speech going far beyond what is necessary in a democratic society to protect the national interest.”

40. As to the second private law matter (breach of contract), Lord Woolf M.R. found that by submitting the manuscript for publication, without having obtained prior clearance, the applicant committed a clear breach of his express undertaking which he signed in 1944 and it was a breach of contract which prima facie entitled the Crown to an injunction and damages. The obligation could not be stigmatised as an unlawful restraint of trade, since it did not exceed what was rendered unlawful by section 1(1) of the 1989 Act. However, the AG had not sought an injunction to prevent publication and could not establish any loss consequent on this breach of contract. Damages would therefore be nominal.

41. Although the AG had decided, despite the court’s invitation, not to argue that the Crown had a claim in restitutionary damages for breach of contract (a third private law issue), Lord Woolf M.R. gave his view on this third private law matter, accepting that it would be obiter and, since he did not have the benefit of argument, necessarily tentative.

42. The general and undisputed rule was that damages for breach of contract were compensatory and not restitutionary: damages were measured by the plaintiff’s loss and not by the defendant’s gain. Referring to various academic works and judicial comment, Lord Woolf M.R. noted that it was disputed whether that was an absolute rule and that there were signs that the traditional view that the rule admitted of no exceptions might not survive for long. Indeed, the rule already admitted of some exceptions and, further, if the Court was unable to award restitutionary damages for breach of contract, then the law of contract was seriously defective as it would mean that in many situations the plaintiff would be deprived of an effective remedy due to a failure to attach a value to the plaintiff’s legitimate interest in having the contract performed. In Lord Woolf M.R.’s opinion, the time had come to accept the view that the law was sufficiently mature to recognise a restitutionary claim for profits made from a breach of contract in appropriate circumstances. The question was therefore in what circumstances such damages should be made available.

43. He suggested two particular circumstances: in the first place, the case of “skimped performance” (where the defendant did not provide all of the contracted services and for which he had charged the plaintiff) and, secondly, where the defendant obtained profit by doing the very thing which he contracted not to do. This latter case covered the applicant’s position exactly. He had promised not to disclose official information and he earned his profits by doing exactly what he had contracted not to do. However, in the absence of a claim for substantial damages for breach of contract, Lord Woolf M.R. found himself bound to dismiss any such private law claim.

44. The fourth possible basis for damages was the Crown’s public law claim. It was noted that, in amending his pleadings, the AG was seeking relief given his historic role as guardian of the public interest:

“Its source in some instances is derived from statute. However, in relation to other functions, the role is an inherent part of his ancient office. It is the inherent power flowing from his office which enables the [AG] either to bring proceedings ex-officio himself or to consent to the use of his name, so as to enable proceedings to be brought by another party clothed with his authority in what are known as relator proceedings for the protection of the public interest in the civil courts. The proceedings may be proceedings to enforce a duty which a public body, such as a local authority, owes to the public or the proceedings may be to vindicate the criminal law. In connection with the criminal law, the [AG] historically has had, and still has, both statutory and inherent powers of great importance involving the enforcement of the criminal law, which involve him having to make decisions of a highly sensitive nature. He has the overall responsibility for the enforcement of the criminal law.”

45. The need to adopt a conservative approach to the scope of the AG’s powers was a reflection of the reluctance of the civil courts to become involved in criminal proceedings. While it was desirable, where practicable, for proceedings about criminal offences to be confined to the criminal courts, there were situations where the criminal courts were powerless to act, in which case, the inherent power of the AG was extremely valuable and should not be artificially confined.

46. However, the power was considered to extend to preventing the criminal law being flouted and being brought into disrepute. Lord Woolf M.R. agreed that section 1 of the 1989 Act applied to the applicant: from 1944 until 4 May 1961 he was a member of the SIS, the manuscript of the Book contained information relating to security or intelligence which was in his possession by virtue of his membership of the SIS and he disclosed the information without lawful authority when he submitted it to his publisher. Criminal penalties were prescribed for such an offence and conviction could be followed by a confiscation order (under the Criminal Justice Act 1988, as amended by the Proceeds of Crime Act 1995) thereby depriving the applicant of the proceeds of his crime.

47. The public policy of preventing a criminal retaining profits directly derived from his crime had been recognised by statute (Drug Trafficking Offences Act 1986 and the Criminal Justice Act 1988 as amended by the Proceeds of Crime Act 1995) and even before that by the courts by the grant of injunctions to freeze the suspected proceeds of crime prior to conviction for that criminal offence. Lord Woolf M.R. went on:

“In the legislation providing for court orders to confiscate the proceeds of crime Parliament recognised the public interest in promoting a policy of preventing a person from retaining property obtained by him as a result of, or in connection with, the commission of a criminal offence. The fact that the statutory machinery cannot be applied in the circumstances of this case, where the defendant has not been and, in all probability, will never be put on trial for his offence, does not detract from force of the policy in the context of the [AG’s] right, as guardian of the public interest, to bring proceedings in the civil courts to enforce that policy.

For the respondent to receive the balance of the royalties would amount to the law being flouted in a different way. However, the consequence for the reputation of the criminal justice system would be the same. The ordinary member of the public would be shocked if the position was that the courts were powerless to prevent the respondent profiting from his criminal conduct.”

48. Accordingly, Lord Woolf M.R. granted an injunction restraining the applicant from receiving (or from authorising any person to receive on his behalf) any payment or other benefit resulting from or in connection with the exploitation of the Book in any form or of any information therein relating to security and intelligence which is or had been in his possession by virtue of his position as a member of SIS. The injunction determined only what would not happen to the money and not what could be done with it. There was nothing therefore to prevent an application to vary the order to allow its disposal in a manner not contrary to the public interest.

49. On 24 January 1998 the applicant’s solicitors acting on a pro bono basis lodged skeleton appeal arguments to the Court of Appeal and the latter Court gave leave to appeal on 22 April 1998.

4. The House or Lords

(a) The applicant’s legal representation and costs’ matters

50. The applicant claims that it took several months for him to raise the GBP 1,500 necessary to lodge his appeal and several more months to convince the House of Lords to waive the security for costs’ requirement. The expenses (not including legal costs) of preparing the hearing bundles for the House of Lords amounted to GBP 2,709. He did not apply for legal aid given the reasons for the prior refusals and the House of Lords later agreed that he would not have obtained legal aid. Nevertheless, his solicitor and junior counsel represented him on a pro bono basis. The Crown was represented by two Queen’s Counsel and two junior counsel.

(b) The proceedings

51. The appeal hearing was fixed for 7-9 March 2000. Although he accepted that the restitutionary damages’ issue raised points of general interest, the AG confined the appeal to the public law injunction.

By letter dated 14 February 2000 to the parties, the House of Lords indicated that it wished to hear argument at the hearing on the matter of restitutionary damages for breach of contract. Both parties prepared written submissions on the point. However, according to the applicant, the account of profits’ point was not raised in oral submissions until the last day of the hearing, when Lord Hobhouse stated that an account might have been available if the Crown had not had notice of the publication of the Book. After considering the matter over lunch, Lord Hobhouse indicated that he did not wish to pursue the point.

(c) A.G. v. Blake (Jonathan Cape Ltd, third Party) [2000] 4 All ER 385

52. The main judgment was delivered on 27 July 2000 by Lord Nicholls, with whom Lords Goff and Browne-Wilkinson concurred. Lord Steyn delivered a separate judgment and Lord Hobhouse dissented.

Lord Nicholls noted at the outset that:

“Plainly, had [the applicant] not been a infamous spy who had also dramatically escaped from prison, his autobiography would not have commanded payments of this order.”

53. Turning to the operation of restitutionary principles, Lord Nicholls noted that, while there was a surprising dearth of judicial decision, there was consensus between academic writers that the possibility should exist but disagreement as to the circumstances in which it should arise.

54. He reviewed the jurisprudence on non-compensatory remedies. He started with interferences with property rights. He reiterated the general principle that if someone uses another person’s property without permission, the owner of the property can recover in damages the price that a reasonable person would have paid for the right of user, even if the property owner has not suffered any loss.

55. He then noted that in respect of the equitable wrongs of passing off, infringement of trade marks, copyrights and patents and breach of confidence, one of the standard remedies is an account of profits. He pointed out that a similar remedy is available for the tort of conversion. A person who has wrongfully converted another person’s goods may be ordered to pay the proceeds of the conversion to the owner of the goods.

56. He went on to mention breach of fiduciary duty, where the court routinely orders an account of profits in order to ensure that fiduciaries are financially disinterested in carrying out their duties.

57. He also mentioned the jurisdiction to award damages under section 2 of the Chancery Amendment Act 1858, also known as Lord Cairns’ Act, which still survives although the original act has now been repealed. According to this jurisdiction, the courts can, instead of awarding an injunction, award damages. As with violations of a property right, the level of damages is measured by reference to the benefits wrongfully obtained by the defendant.

58. Lastly, Lord Nicholls looked at the law in relation to breach of contract. He began by saying:

“[T]he rule of the common law is that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same position as if the contract had been performed (see Robinson v Harman (1848) 1 Exch 850 at 855...). Leaving aside the anomalous exception of punitive damages, damages are compensatory. That is axiomatic.”

59. However, he went on to say that there are some situations, where an award of damages, assessed by reference to loss, will not compensate a claimant adequately and where the court, as a result, will make orders for specific performance and injunctions. He pointed out, however, that these remedies were discretionary and were sometimes refused on the grounds that they were oppressive. He cited Wrotham Park Estate Co Ltd v Parkside Homes Ltd ([1974] 2 All ER 321) as an example of this: for social and economic reasons, the court had refused to make a mandatory order for the demolition of houses built on land burdened with a restrictive covenant and damages under the jurisdiction originating from Lords Cairns’ Act. Even though the plaintiffs in that case had suffered no loss, the High Court awarded them 5% of the developer’s anticipated profit, this being the amount of money which could reasonably have been demanded for a relaxation of the covenant. In so doing, the High Court had applied, by analogy, the cases mentioned above concerning the assessment of damages when a defendant has invaded another’s property rights but without diminishing the value of the property.

60. Lord Nicholls approved this approach and added:

“[I]t is not easy to see why, as between the parties to a contract, a violation of a party’s contractual rights should attract a lesser degree of remedy than a violation of his property rights...”

61. He then turned to the judgment of the Court of Appeal in Surrey CC v Bredero Homes Ltd ([1993] 3 All ER 705) where a developer breached a covenant by building more houses than he had agreed to do. The local authority brought a claim for damages but, as they had suffered no loss, they were awarded nominal damages of 2 GBP. Lord Nicholls said that he preferred the approach adopted in the Wrotham Park case. He said:

“The Wrotham Park case, therefore, still shines, rather as a solitary beacon, showing that in contract as well as tort damages are not always narrowly confined to recoupment of financial loss. In a suitable case damages for breach of contract may be measured by the benefit gained by the wrongdoer from the breach. The defendant must make a reasonable payment in respect of the benefit he has gained. In the present case the Crown seeks to go further. The claim is for all the profits of Blake’s book which the publisher has not yet paid him. This raises the question whether an account of profits can ever be given as a remedy for breach of contract. The researches of counsel have been unable to discover any case where the court has made such an order on a claim for breach of contract.”

62. He then cited Tito v Waddell (No. 2) ([1977] Ch. 106, 332), where the Court said that, as a matter of fundamental principle, the question of damages was not one of making the defendant disgorge his gains, but one of compensating the plaintiff and Occidental Worldwide Investment Corporation v. Skibs A/S Avanti [1976] 1 Lloyd’s Rep. 293, 337, where the High Court summarily rejected a claim for an account of profits after the defendants had withdrawn ships on a rising market.

63. However, he balanced those cases with a “light sprinkling of cases” (including Lake v. Bayliss [1974] 1 W.L.R. 1073, Reid-Newfoundland Co. v. Anglo-American Telegraph Co. Ltd. [1912] A.C. 555 and British Motor Trade Association v. Gilbert [1951] 2 All E.R. 641) where courts had made orders which had the same effect as an order for an account of profits but where they had attached a different label. He said:

“These cases illustrate that circumstances do arise when the just response to a breach of contract is that the wrongdoer should not be permitted to retain any profit from the breach. In these cases the courts have reached the desired result by straining existing concepts. Professor Peter Birks has deplored the "failure of jurisprudence when the law is forced into this kind of abusive instrumentalism": see ‘Profits of Breach of Contract’ (1993) 109 L.Q.R. 518, 520. Some years ago Professor Dawson suggested there is no inherent reason why the technique of equity courts in land contracts should not be more widely employed, not by granting remedies as the by-product of a phantom ‘trust’ created by the contract, but as an alternative form of money judgment remedy. That well known ailment of lawyers, a hardening of the categories, ought not to be an obstacle: see ‘Restitution or Damages’ (1959) 20 Ohio S.L.J. 175.”

64. He concluded that there was no reason in principle why the courts must in all circumstances rule out an account of profits as a remedy for breach of contract. He said that the authorities encouraged him to reach this conclusion and went on to say:

“The law recognises that damages are not always a sufficient remedy for breach of contract. This is the foundation of the court’s jurisdiction to grant the remedies of specific performance and injunction. Even when awarding damages, the law does not adhere slavishly to the concept of compensation for financially measurable loss. When the circumstances require, damages are measured by reference to the benefit obtained by the wrongdoer. This applies to interference with property rights. Recently, the like approach has been adopted to breach of contract. Further, in certain circumstances an account of profits is ordered in preference to an award of damages. Sometimes the injured party is given the choice: either compensatory damages or an account of the wrongdoer’s profits. Breach of confidence is an instance of this. If confidential information is wrongfully divulged in breach of a non-disclosure agreement, it would be nothing short of sophistry to say that an account of profits may be ordered in respect of the equitable wrong but not in respect of the breach of contract which governs the relationship between the parties. With the established authorities going thus far, I consider it would be only a modest step for the law to recognise openly that, exceptionally, an account of profits may be the most appropriate remedy for breach of contract. It is not as though this step would contradict some recognised principle applied consistently throughout the law to the grant or withholding of the remedy of an account of profits. No such principle is discernible.”

65. He said that it would only be in exceptional circumstances, where other remedies were inadequate, that courts would order an account of profits. He declined to lay down any fixed rules but said:

“The court will have regard to all the circumstances, including the subject matter of the contract, the purpose of the contractual provision which has been breached, the circumstances in which the breach occurred, the consequences of the breach and the circumstances in which relief is being sought. A useful general guide, although not exhaustive, is whether the plaintiff had a legitimate interest in preventing the defendant’s profit-making activity and, hence, in depriving him of his profit.

It would be difficult, and unwise, to attempt to be more specific.”

66. Lord Nicholls applied those principles to the case before him. He noted the exceptional nature of the case, the applicant’s employment in the SIS, his subsequent spying history, that “in the present case disclosure was also a criminal offence under the Official Secrets Acts” and the broad basis of the ban contained in section 1 of the 1989 Act as it related to secret service personnel. However, because of the undertaking signed by the applicant in 1944, it was not necessary to decide the claim (raised for the first time before the House of Lords) that that statutory ban was so wide as to infringe Article 10 of the Convention. He went on:

“When [the applicant] joined the SIS, [he] expressly agreed in writing that he would not disclose official information, during or after his service, in book form or otherwise. He was employed on that basis. That was the basis on which he acquired official information. The Crown had and has a legitimate interest in preventing [the applicant] profiting from the disclosure of official information, whether classified or not, while a member of the service and thereafter. Neither he, nor any other member of the service, should have a financial incentive to break his undertaking. It is of paramount importance that members of the service should have complete confidence in all their dealings with each other, and that those recruited as informers should have the like confidence. Undermining the willingness of prospective informers to co-operate with the services, or undermining the morale and trust between members of the services when engaged on secret and dangerous operations, would jeopardise the effectiveness of the service. An absolute rule against disclosure, visible to all, makes good sense.

In considering what would be a just response to a breach of [the applicant’s] undertaking the court has to take these considerations into account. The undertaking, if not a fiduciary obligation, was closely akin to a fiduciary obligation, where an account of profits is a standard remedy in the event of breach. Had the information which Blake has now disclosed still been confidential, an account of profits would have been ordered, almost as a matter of course. In the special circumstances of the intelligence services, the same conclusion should follow even though the information is no longer confidential. That would be a just response to the breach. I am reinforced in this view by noting that most of the profits from the book derive indirectly from the extremely serious and damaging breaches of the same undertaking committed by [the applicant] in the 1950s. As already mentioned, but for his notoriety as an infamous spy his autobiography would not have commanded royalties of the magnitude Jonathan Cape agreed to pay.”

67. Lord Nicholls noted that a similar conclusion, requiring the contract-breaker to disgorge his profits, had been reached in the “strikingly similar” case of Snepp v. United States (cited above). The Supreme Court in that case had considered that a remedy which required Snepp “to disgorge the benefits of his faithlessness”, was swift and sure, tailored to deter those who would place sensitive information at risk and, since the remedy reached only funds attributable to the breach, it could not saddle the former agent with exemplary damages out of all proportion to his gain. In order to achieve this result the Supreme Court “imposed” a constructive trust on Snepp’s profits. Lord Nicholls commented that affording the AG the remedy of an account of profits was a different means to the same end.

68. As to the form of order necessary, Lord Nicholls noted that the AG’s entitlement to an account of profits did not confer on the Crown any proprietary interest in the debt due to the applicant from the Publisher. The Crown was entitled, on the taking of the account, to a money judgment which could then be enforced by attachment of the debt in the usual way. Given that the Publisher who held the monies wished to deduct its legal expenses in defending the third party proceedings, the appropriate form of order was a declaration that the AG was entitled to be paid a sum equal to whatever amount was due and owing to the applicant under the publishing agreement of 4 May 1989. The injunction would remain in force until the Publisher made payment to the AG.

69. The public law claim did not therefore call for decision. However Lord Nicholls noted that, while the order of the Court of Appeal was intended to freeze the monies until further order, its effect was confiscatory as it deprived the applicant of the monies indefinitely. Parliament had laid down the cases where confiscation could be made in the proceeds of crime legislation and the courts had no power to make such an order outside of those cases, the common law not being able to remedy any perceived deficiencies in the statutory code.

70. Lord Steyn also dismissed the appeal, his separate judgment explaining, inter alia, why the courts did not have the power to effectively confiscate the proceeds of crime outside of the ambit of the relevant legislation.

71. Lord Hobhouse, in his dissenting judgment, noted that:

“It is accepted that, by delivering the manuscript to [the Publisher], [the applicant] committed an offence under the 1911 Act (or its successor, the 1989 Act) and broke the contractual undertaking which he had given in 1944. It is also accepted that in 1989 and 1990, had it chosen to do so, the Crown could have applied for an injunction to restrain the publication of the [Book] and would probably have been successful. Had the Court declined to exercise its discretion not to grant an injunction at that time, one or more of the remedies alternative to an injunction could have been considered and, if thought appropriate, adopted. The present litigation has only come about because the Crown chose not to take that course at that time.”

72. He considered the contents of the Book to be “unremarkable”: in so far as it related to his SIS work, the information was not confidential by 1989 and it was not alleged that the publication of the information would be damaging. The size of the royalties was, he remarked, “attributable to his notoriety as an infamous spy” and he agreed that a public law remedy was not sustainable.

73. However, he disagreed that a private law claim for restitutionary damages could be sustained. While the conclusion of the majority depended on the view that there was a gap in the existing law required to be filled by a new remedy, he noted that even the applicant had accepted that the Crown would have had a good arguable case for a prior injunction which would “quite probably” have stopped the publication of the Book in the first place. Other remedies being impractical (pursuing criminal charges against the applicant) or not possible, the Crown was left with a public law claim for an injunction against the applicant or a private law restitutionary remedy in breach of contract, neither of which should have been applied in the case.

74. In granting the latter remedy, the majority had applied principles of law which were only appropriate where propietary interests were involved. While the applicant had made money, he had not done so to the financial detriment of the Crown. As to the public law injunction, he agreed with the majority of the House of Lords: the injunction had been granted in aid of preserving a power later to confiscate the money, the AG did not have the power to make such an application as there was no common law power to confiscate, and even if there was one, the field was by then fully occupied by the relevant proceeds of crime legislation.

B. Relevant domestic law

1. Official Secrets

(a) Official Secrets Act 1911 (“the 1911 Act”)

75. Section 1(1) of the 1911 Act is entitled “Penalties for Spying” and reads, in so far as relevant, as follows:

“If any person for any purpose prejudicial to the safety or interests of the State: ...

(c) Obtains or communicates to any other person any sketch, plan, model, article, or note, or other documents or information which is calculated to be or might be or is intended to be directly or indirectly useful to an enemy;

he shall be guilty of felony, and shall be liable to penal servitude for any term not less than three years and not exceeding seven years.”

76. Section 1(2) of the 1911 Act provides, in so far as relevant, as follows:

“On a prosecution under this section, it shall not be necessary to show that the accused person was guilty of any particular act tending to show a purpose prejudicial to the safety or interests of the State, and, notwithstanding that no such act is proved against him, he may be convicted if, from the circumstances of the case, or his conduct, or his known character as proved, it appears that his purpose was a purpose prejudicial to the safety or interests of the State; and if any sketch, plan, model, article, note, document, or information relating to or used in any prohibited place within the meaning of this Act, or anything in such a place, is made, obtained, or communicated by any person other than a person acting under lawful authority, it shall be deemed to have been made, obtained, or communicated for a purpose prejudicial to the safety or interests of the State unless the contrary is proved.”

77. Section 2 of the 1911 Act read as follows:

“If any person having in his possession or control any sketch, place, model, article, note, document, or information which relates to or is used in a prohibited place or anything in such a place, or which has been made or obtained in contravention of this Act, or which has been entrusted in confidence to him by any person holding office under His Majesty or which he has obtained owing to his position as a person who holds or has held officer under His Majesty, or as a person who holds or has held a contract made on behalf of His Majesty, or as a person who is or has been employed under a person who hold or has held such a contract,-

(a) communicates the sketch, place, model, article, note, document, or information to any person, other than a person to whom he is authorised to communicate it, or a person to whom it is in the interest of the State his duty to communicate it, or

(b) retains the sketch, plan, model, article, note, or document in his possession or control when he has no right to retain it or when it is contrary to his duty to retain it:

that person shall be guilty of a misdemeanour.”

78. Section 2(3) of the 1911 Act provides that a person guilty of a misdemeanour shall be liable to imprisonment for a term not exceeding two years, or to a fine, or to both imprisonment and a fine.

(b) Official Secrets Act 1989 (“the 1989 Act”)

79. The 1989 Act came into force on 1 March 1990. Its long title reads as follows:

“An Act to replace section 2 of the Official Secrets Act 1911 by provisions protecting more limited classes of official information”.

80 Section 1(1) of the 1989 Act makes it an offence for all members and former members of the security services to disclose any information which relates to security or intelligence. In particular, it provides as follows:

“A person who is or has been -

(a) a member of the security and intelligence services; or

(b) a person notified that he is subject to the provisions of this subsection,

is guilty of an offence if without lawful authority he discloses any information, document or other article relating to security or intelligence which is or has been in his possession by virtue of his position as a member of any of those services or in the course of his work while the notification is or was in force.

(2) The reference in subsection (1) above to disclosing information relating to security or intelligence includes a reference to making any statement which purports to be a disclosure of such information or is intended to be taken by those to whom it is addressed as being such a disclosure.

(3) A person who is or has been a Crown servant or government contractor is guilty of an offence if without lawful authority he makes a damaging disclosure of any information, document or other article relating to security or intelligence which is or has been in his possession by virtue of his position as such but otherwise than as mentioned in subsection (1) above.

(4) For the purposes of subsection (3) above a disclosure is damaging if -

(a) it causes damage to the work of, or of any part of, the security and intelligence services; or

(b) it is of information or a document or other article which is such that its unauthorised disclosure would be likely to cause such damage or which falls within a class or description of information, documents or articles the unauthorised disclosure of which would be likely to have that effect.

(5) It is a defence for a person charged with an offence under this section to prove that at the time of the alleged offence he did not know, and had no reasonable cause to believe, that the information, document or article in question related to security or intelligence or, in the case of an offence under subsection (3), that the disclosure would be damaging within the meaning of that subsection.”

81. The House of Lords held in R v Shayler ([2002] 2 WLR 754) that the offence set out in section 1 of the 1989 Act was not subject to any implied “public interest” defence.

2. Case-law on remedies for breach of contract

(a) Restitutionary remedies

82. As a general rule, the purpose of remedies for breach of contract is to compensate the claimant for their loss, not to make defendants disgorge their gains (see, for example, the above-cited cases of Tito v Waddell (No 2) and Occidental Worldwide). More recently, Lord Hoffmann stated in the leading judgment of the House of Lords in Co-operative Insurance Ltd v Argyll Stores (Holdings) Ltd ([1997] 3 All ER 297 at 305):

“The purpose of the law of contract is not to punish wrongdoing but to satisfy the expectations of the party entitled to performance. A remedy which enables him to secure, in money terms, more than the performance due to him is unjust.”

83. However, in Wrotham Park Estate Co Ltd v Parkside Homes Ltd ([1974] 2 All ER 321) the claimant recovered damages for breach of contract where reference was made to the defendant’s gain rather than the claimant’s loss. This case was reconsidered by the Court of Appeal in Surrey County Council v Bredero ([1993] 3 All ER 705). Dillon LJ started by reiterating the general rule as to damages for breach of contract:

“[T]he remedy at common law for a breach of contract is an award of damages, and damages at common law are intended to compensate the victim for his loss, not to transfer to the victim if he has suffered no loss the benefit which the wrongdoer has gained by his breach of contract. Thus it is stated in Chitty on Contracts, 26th ed. (1989), vol. 1. p. 1116, para. 1771:

"Damages for a breach of contract committed by the defendant are a compensation to the plaintiff for the damage, loss or injury he has suffered through that breach."

Similarly, Viscount Haldane L.C. in British Westinghouse Electric and Manufacturing Co. Ltd. v. Underground Electric Railways Co. of London Ltd. [1912] A.C. 673, 689, said: "The fundamental basis is thus compensation for pecuniary loss naturally flowing from the breach; . . ." Lord Wilberforce in Johnson v. Agnew [1980] A.C. 367, 400, said: "The general principle for the assessment of damages is compensatory . . ."”

84. Dillon LJ then distinguished the Wrotham Park case on the basis that it turned on the jurisdiction under Lord Cairns’ Act. He said that the High Court in the Wrotham Park case must have decided that Lord Cairns’ Act effected a substantive change in the way that damages are assessed. He concluded that, as the Bredero case did not concern damages under Lord Cairns’ Act, but rather damages at common law, the reasoning in the Wrotham Park case did not apply and damages must be merely nominal.

85. Steyn LJ gave the second judgment. He accepted that, in some circumstances, it was legitimate for an award of damages for breach of contract to deprive the defendant of the benefit he gained by the breach of contract, as opposed to merely compensating the claimant for his loss. He said that the problem was how far to extend that protection. He approved the Wrotham Park case but refused to extend it to the Bredero case. He said:

“The case does not involve any invasion of the plaintiffs’ property interests even in the broadest sense of that word, nor is it closely analogous to the Wrotham Park position. I would therefore rule that no restitutionary remedy is available and there is certainly no other remedy available.”

(b) Account of profits

86. There were cases, prior to the present domestic proceedings, where the domestic courts had made orders similar in effect to an account of profits (for example, Lake v. Bayliss ([1974] 1 W.L.R. 1073), Reid-Newfoundland Co. v. Anglo-American Telegraph Co. Ltd. ([1912] A.C. 555) and British Motor Trade Association v. Gilbert ([1951] 2 All E.R. 641)).

87. The first two cases could be described as property right cases. In the Lake v. Bayliss case the defendant promised to sell certain land to the plaintiff but, in breach of contract, sold it to another buyer. The court held that, because of his contract with the plaintiff, the defendant was holding the land on trust for the plaintiff. As a result, he was required to surrender the profits on the second sale to the plaintiff. In the Reid-Newfoundland Co. v. Anglo-American Telegraph Co. Ltd case the defendant breached a contract not to use a telegraph wire, owned and maintained by the claimants, for commercial purposes. The Privy Council held that the defendant was liable to account as a trustee for the profits it wrongfully made from using the wire.

88. In the British Motor Trade Association v. Gilbert case the defendant bought a car from the claimant who was a lawful car dealer. The Government at the time was sponsoring a scheme whereby dealers sold cars at significantly less than their black market value. It was a requirement of this scheme that the purchaser (in this case the defendant) covenanted with the dealer not to sell the car to anyone else within two years of the original sale. The defendant breached the covenant by selling the car on the black market. The measure of damages that the court awarded was the difference between the black market value of the car and the price that the claimant would have paid if the defendant had sold the car to him in accordance with the covenant. Although this was, in form, an assessment of the claimant’s expectation loss, it was, as the court pointed out, somewhat anomalous as the claimant could not lawfully realise the black market value of the car. However, it had the effect of stripping the defendant of his profit and thereby ensuring that car purchasers had no incentive to breach their covenants by selling their cars on the black market.

COMPLAINTS

A. The applicant complained under Article 6 § 1 and 3(c) about the lack of legal aid and of adequate legal representation.

B. He also complained under Article 6 § 3(a) and (b) that the basis of the Crown’s case shifted between 1990 and 2000 and, under Article 6 § 3(d), that he was unable to call witnesses or to have them examined. He maintained that the State imposed on him, in violation of Article 7, a novel penalty not in existence when he submitted the manuscript to the publisher.

C. He further complained under Article 6 § 1 that the proceedings exceeded a reasonable period of time.

D. The applicant considered that the statements of the AG and of certain judges that he was guilty of a criminal offence violated Article 6 § 2.

E. He maintained that the order for an account of profits violated his rights under Article 10.

F. He also referred to the undertaking of confidentiality he signed in 1944 as violating his Article 10 rights.

G. In addition, he complained that the Official Secrets Acts of 1911 and 1989 violated his Article 10 rights and, under Article 14, that section 1 of the 1989 Act discriminates as regards expression by members of the intelligence and other Government services.

H. Finally, he maintained that the order for an account of profits violated his rights under Article 1 of Protocol No. 1.

THE LAW

A. Article 6 §§ 1 and 3(c) - legal aid and legal representation

89. The applicant complained under Article 6 § 1 about the lack of legal aid and the fact that he did not have legal representation before the High Court or the Court of Appeal. This was tantamount to a denial of access to court and/or of equality of arms and/or of adversarial process. He further argued that the proceedings were criminal so that the lack of legal aid also violated Article 6 § 3(c) of the Convention. Article 6, in so far as relevant, provides that:

“1. In the determination of his civil rights and obligations or of any criminal charge against him, everyone is entitled to a fair and public hearing...

3. Everyone charged with a criminal offence has the following minimum rights:...

(c) to defend himself in person or through legal assistance of his own choosing or, if he has not sufficient means to pay for legal assistance, to be given it free when the interests of justice so require...”

1. Applicability of Article 6

(a) The parties’ submissions

90. The applicant’s primary submission was that, from the moment the public law claim was introduced in the Court of Appeal, the proceedings involved the determination of a criminal charge under the 1989 Act, according to the three Engel criteria (Engel and Others v. the Netherlands, judgment of 8 June 1976, Series A no. 22, § 82).

91. As to the domestic classification of the proceedings, he argued that, from the moment the AG amended his claim in the Court of Appeal to introduce a public law element, those proceedings took on a criminal character and were, at least, of a hybrid nature in domestic law. He pointed, in particular, to the fact that the public law claim was based on the AG’s assertion that the applicant had committed a criminal offence. The Court of Appeal had to make a finding on that point, otherwise they would not have had jurisdiction to deal with the public law claim. He submitted that it was immaterial that the public law claim did not form the basis of the House of Lords’ decision as the point was still in issue before the House of Lords.

92. The offence was, in addition, criminal in nature (namely, a breach of the 1989 Act). The pursuit in civil proceedings of matters which could have been prosecuted in the criminal courts allowed this Court to find that those proceedings involved the determination of a criminal charge (Deweer v. Belgium, judgment of 27 February 1980, Series A no. 35; Bendenoun v. France, judgment of 24 February 1994, Series A no. 284; Georgiou v. the United Kingdom, decision of 16 May 2000, unreported, and Janosevic v. Sweden, judgment of 23 July 2002, no. 34619/97, ECHR 2002-). He accepted that the House of Lords eventually based its judgment on private law grounds: however that could not retrospectively affect the criminal nature of the offence in question (Allenet de Ribemont v. France, judgment of 10 February 1995, Series A no. 308, and Heaney and McGuinness v. Ireland, no. 34720/97, ECHR 2000-XII).

93. As to the penalty, the Court of Appeal compared the proposed injunction to penalties which could be imposed under the Criminal Justice Act 1988 and the Proceeds of Crime Act 1995 and described the order it made as “a lesser penalty” than a confiscation order under that legislation. The penalty of the Court of Appeal was almost twice that imposed in the above-cited Bendenoun case. Indeed, in Minelli v. Switzerland (judgment of 25 March 1983, Series A no. 62) Article 6 was found to have been violated because a financial costs’ penalty was imposed on an individual where no criminal proceedings had been concluded.

94. In the alternative, the applicant submitted that the proceedings constituted a determination of his civil rights and obligations.

95. In response, the Government accepted that the proceedings constituted a determination of his civil rights and obligations but denied that they were determinative of any criminal charge.

(b) The Court’s assessment

96. The starting-point for the assessment of the applicability of the criminal aspect of Article 6 of the Convention is the criteria outlined in Engel and Others (cited above, §§ 82-83):

“82. ...[I]t is first necessary to know whether the provision(s) defining the offence charged belong, according to the legal system of the respondent State, to criminal law, disciplinary law or both concurrently. This however provides no more than a starting point. The indications so afforded have only a formal and relative value and must be examined in the light of the common denominator of the respective legislation of the various Contracting States.

The very nature of the offence is a factor of greater import. ...

However, supervision by the Court does not stop there. Such supervision would generally prove to be illusory if it did not also take into consideration the degree of severity of the penalty that the person concerned risks incurring. In a society subscribing to the rule of law, there belong to the ‘criminal’ sphere deprivations of liberty liable to be imposed as a punishment, except those which by their nature, duration or manner of execution cannot be appreciably detrimental. ...

83. It is on the basis of these criteria that the Court will ascertain whether some or all of the applicants were the subject of a ‘criminal charge’ within the meaning of Article 6 § 1.”

97. As to the domestic classification, the Court notes that the first two instances were held in exclusively civil courts: the High Court and the Civil Division of the Court of Appeal. It further recalls that, although a new claim was introduced before the House of Lords, that claim (for breach of contract) was, as the applicant admitted, a private law claim. The Court considers it clear that the causes of action were classified as civil in domestic law. However, that classification is of only formal or relative value.

98. Secondly and as to the nature of the offence, the applicant alleged that the proceedings in question involved the determination of a charge under section 1 of the 1989 Act. However, no such charges were ever brought against the applicant. It is true, that in the course of the proceedings the AG, the Court of Appeal and the House of Lords made statements that the applicant was guilty of the said offence (see paragraphs 46 and 66 above). However, although such statements of guilt in civil proceedings may give rise to an issue under Article 6 § 2 when they are sufficiently closely linked to criminal proceedings (see below), they will not of themselves transform the nature of civil proceedings, so that they become criminal (see Hammern v. Norway, no. 30287/96, § 42-46, 11 February 2003). The fact remains that the ultimate decision of the House of Lords to order an account of profits against the applicant was based on his breach of contract (see paragraph 66 above), a cause of action clearly civil in character.

99. Thirdly and as regards the severity of the penalty in this case, the Court recalls that an account of profits is a standard remedy in civil proceedings such as breach of confidence and breach of fiduciary duty (Relevant domestic Law and Practice above). It was limited to preventing the applicant obtaining the remaining royalties due to him following the publication of his book rather than a fine requiring him to disburse monies. There was, in addition, no potential penalty of detention and no possibility of his being imprisoned in default of payment. In such circumstances, the Court does not consider that the present penalty renders criminal the action against the applicant.

100. In the light of all of the above considerations, the Court concludes that Article 6 is only applicable under its civil head.

2. Compliance with Article 6 § 1 of the Convention

(a) The parties’ submissions

101. The applicant submitted that the refusal of legal aid, the lack of legal representation before the High Court and the Court of Appeal and the lack of full representation before the House of Lords resulted in his being denied access to court and/or equality of arms and/or an adversarial process. He maintained that he complied with the normal criteria for legal aid and alternative funding was available (the injuncted monies) and the refusal of both options was unjustifiable and consequently arbitrary.

102. The domestic courts themselves considered the appointment of an amicus curiae to be necessary since “important issues of legal principle were raised by the relief sought in the action”. The legal costs of the amici curiae probably far exceeded the relatively small sum held by the Publisher and the cost of legal aid. The High Court judge did not know why he was not legally represented, despite the fact that it had overall responsibility for ensuring the fair conduct of the proceedings (Granger v. the United Kingdom, judgment of 28 March 1990, Series A no. 174). The amici curiae were not there to represent him so the High Court’s comment, that the amici counsel had made all arguments that the applicant would have liked to make, could not be sustained.

103. In addition, the “interests of justice” required his legal representation. The proceedings were taken by the Crown in a novel attempt to obtain a remedy against him in equity; they were complex and the basis of the courts’ orders changed several times throughout; the freezing of monies due to him left him unrepresented in proceedings the very purpose of which was to determine whether the State was entitled to so control his funds and the freezing of his funds thereby effectively prejudged the outcome of the proceedings; once the Court of Appeal and House of Lords proceedings concerned a criminal charge the need for representation became stronger; the applicant was exposed, by the refusal of legal aid, to costs’ orders against him; the Crown was represented before the High Court and the Court of Appeal by leading counsel whereas he was unrepresented; and the case did not concern proceedings taken by an individual where the State had to assess whether legal aid would be an appropriate use of public funds – rather it concerned proceedings to deprive him of funds to which he would otherwise have been entitled.

104. In response, the Government submitted that the issues in the case were legal not factual and that, as a result, it was sufficient for him to be represented by lawyers who argued for a certain legal position. It was not necessary for those lawyers to take instructions from the applicant. Secondly, they argued that the amici curiae before the Court of Appeal did all that a lawyer could have done for him in presenting all the arguments that he could have made. Lastly, the applicant had been represented by solicitors from his defence until just before the hearing in the High Court and by experienced solicitors and counsel before the House of Lords, which was the crucial stage.

(b) The Court’s assessment

105. The Court recalls that Article 6 § 1 may sometimes compel the State to provide for the assistance of a lawyer when such assistance proves indispensable for an effective access to court either because legal representation is rendered compulsory, as is done by the domestic law of certain Contracting States for various types of litigation, or by reason of the complexity of the procedure or of the case (Steel and Morris v. the United Kingdom, no. 68416/01, § 61, ECHR 2005‑...). The fact of having had the benefit of legal representation at key stages of the proceedings is an important factor (Airey v Ireland, judgment of 9 October 1979, Series A no. 32, § 26 and McVicar v. the United Kingdom, judgment of 7 May 2002, §§ 50 and 60).

106. The Court accepts that the proceedings in the present case were novel and complex, that the applicant was not present and was unrepresented for parts of the proceedings and that the basis for the AG’s claim and the courts’ orders changed several times throughout the proceedings.

107. However, the Court observes that the applicant’s defence before the High Court was drafted by his solicitors. Those solicitors then made a detailed submission (concerning the appeal to the Court of Appeal) to the legal aid office. Furthermore, the appointment of two experienced counsel as amici curiae was a significant safeguard of the applicant’s interests before the High Court and the Court of Appeal. Although, these amici did not represent the applicant, it was part of their brief to ensure that all relevant arguments the applicant could have made were before the High Court and the Court of Appeal. Indeed the Court of Appeal expressly found that the amici had deployed all arguments the applicant could have wished to make. His solicitors then lodged the grounds of appeal from the Court of Appeal. The applicant was then represented by a solicitor and junior counsel before the House of Lords, which was the crucial part of the proceedings.

108. In addition, while criminal proceedings in absentia require legal representation (Poitrimol v. France, judgment of 23 November 1993, Series A no. 277-A), the voluntary absence from civil proceedings of an applicant due to his being a fugitive from justice cannot accord a right to legal representation or aid in such civil proceedings.

109. Moreover, the applicant did not dispute that he voluntarily disposed (though gifts to his children) of approximately GBP 30,000 of the Publisher’s first payment. Nor does he dispute that he received USD 11,000 from a German television station.

110. Finally, that the legal costs of the amici exceeded the foreseeable cost of legal aid or the royalties held by the Publisher was, even if true, not relevant. The essential Convention issue is whether his defence of the case required representation and not how the State chose to allocate public funds.

111. For all these reasons, the Court does not consider that the refusal of legal aid or the absence of legal representation at certain stages of the proceedings rendered them unfair or prevented the applicant from presenting an effective defence. The consequent costs order against him as the unsuccessful party is not therefore incompatible with Article 6 (see, for example, Independent News and Media and Independent Newspapers Ireland Limited v. Ireland, no. 55120/00, § 131, ECHR 2005‑...).

This complaint must be rejected as manifestly ill-founded within the meaning of Article 35 § 3 of the Convention.

B. Article 6 § 3(a), (b) and (d) together with Article 7

112. The applicant also complained under Article 6 § 3(a) and (b) that the basis for the Crown’s case shifted between 1990 and 2000 and that he was unable to call witnesses or to have them examined contrary to Article 6 § 3 (d). He further argued under Article 7 that the State imposed on him, as an alternative to existing criminal remedies, a penalty which would not have been imposed had he been convicted of the alleged offence in the normal way. This was a novel remedy not in existence when he submitted his manuscript to the Publisher.

113. The Court notes that these complaints are predicated on the assumption that the proceedings involved the determination of a criminal charge or offence within the meaning of Articles 6 and 7 of the Convention. However, and for the reasons detailed above, the impugned proceedings did not concern the determination of a criminal charge against the applicant. These complaints must be declared incompatible ratione materiae, within the meaning of Article 35 § 3 and therefore inadmissible in application of Article 35 § 4 of the Convention.

C. Article 6 § 1 - length of the proceedings

114. The applicant maintained that the proceedings, which lasted 9 years and 2 months, exceeded the “reasonable time” requirement of Article 6 § 1 of the Convention.

115. The Government argued that much of the delay was caused by his fruitless attempts to seek legal aid. They pointed out that the case involved three instances and that the courts have busy schedules.

The applicant argued that the delays were mainly attributable to the State (and, in particular, to its resistance to his legal aid applications). The fact that he used all the procedures available to assist his defence should not be held against him (Ledonne v. Italy (no. 1), no. 35742/97, 12 May 1999). In any event, that those delays were the responsibility of the Government.

116. The Court finds that serious issues of fact and law arise under this aspect of the applicant’s complaint which should be examined on the merits. This part of the application is not manifestly ill-founded within the meaning of Article 35 § 3 of the Convention and no other grounds for declaring it inadmissible have been established.

D. Article 6 § 2 of the Convention

117. The applicant complained under this provision about statements of the AG and of certain judges, including Lord Woolf in the Court of Appeal and Lord Nicholls in the House of Lords (see paragraphs 46 and 66 above) that he was guilty of a criminal offence (under section 1(1) of the Official Secrets Act 1989) when he had never been so convicted (the above-cited Allenet de Ribemont and Minelli judgments). Article 6 § 2 provides as follows:

“Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law.”

1. The parties’ submissions

118. The Government argued that none of the rationales of the judgments in Allenet de Ribemont and Minelli applied in this case: the statements of guilt did not put at risk any future trial (because there was no prospect of such a trial ever occurring) and did not do any damage to the applicant’s reputation (because he was already a self-confessed traitor). In addition, the principle in Allenet de Ribemont should not apply when there was a legitimate legal purpose in considering whether an offence had been committed. They took as an analogy the case of civil proceedings following a road traffic accident, where it might be necessary to consider whether the elements of a criminal offence had been committed. Lastly, the factual ingredients constituting the offence under section 1(1) were accepted by the applicant in the domestic proceedings: it was common ground domestically that he had disclosed, without authority, information that came into his possession as a member of the intelligence services.

119. The applicant reiterated that it was not permissible under Article 6 § 2 for courts in civil proceedings to make statements imputing criminal liability, where there had not been any conviction (Y v. Norway, no. 56568/00, ECHR 2003‑II (extracts).

2. The Court’s assessment

120. In Zolmann v. the United Kingdom ((dec.), no. 62902/00, unpublished) the Court summarised the relevant case-law as follows:

“The presumption of innocence enshrined in paragraph 2 of the Article 6 is one of the elements of the fair criminal trial that is required by paragraph 1 (see Allenet de Ribemont, ... § 35). It prohibits the premature expression by the tribunal itself of the opinion that the person charged with the criminal offence is guilty before he has been so proved according to law (see Minelli v. Switzerland, ..., where the Assize Court hearing the criminal case found the prosecution time-barred but continued nonetheless to decide whether, if it had continued, the applicant would probably have been found guilty for the purposes of costs orders). It also covers statements made by other public officials about pending criminal investigations which encourage the public to believe the suspect guilty and prejudge the assessment of the facts by the competent judicial authority (Allenet de Ribemont, § 41, where remarks were made by a Minister and police superintendent to the press naming without qualification the applicant, arrested that day, as an accomplice in murder).

Article 6 § 2 may also be applicable where the criminal proceedings proper have terminated in an acquittal and other courts issue decisions voicing the continued existence of suspicion regarding the accused’s innocence or otherwise casting doubt on the correctness of the acquittal (see, for example, Sekanina v. Austria, judgment of 25 August 1993, Series A no. 266-A, § 30; Hammern v. Norway, ... § 48, and O. v. Norway, no. 29327/95, ECHR 2003-..., § 40 (concerning the acquitted accused’s application for costs and compensation for pecuniary damage respectively); Y. v. Norway, ... § 46 (concerning proceedings brought by the alleged victim of the crime for compensation from the acquitted accused).

The subsequent procedure must however be linked with the issue of criminal responsibility in such a manner as to bring the proceedings within the scope of Article 6 § 2. In Sekanina (cited above, § 22) the Court noted that Austrian legislation and practice linked the two questions - the criminal responsibility of the accused and the right to compensation - to such a degree that the decision on the latter issue could be regarded as a consequence and, to some extent, the concomitant of the decision on the former (see also Hammern, cited above, § 46, where the compensation claim not only followed the criminal proceedings in time but were tied to those proceedings in legislation and practice). Similarly, in Y. v. Norway (cited above, §§ 43-46) the reasoning and language used by the civil court created a clear link between the criminal case and the compensation proceedings (see, mutatis mutandis, Ringvold v. Norway, no. 34964/97, ECHR 2003-..., where Article 6 § 2 was not applicable as the compensation proceedings could not be regarded as a consequence, or concomitant of the criminal proceedings).”

121. In the Zolmann case itself, the applicants complained of a statement made by a Member of Parliament (“MP”) in the House of Commons in which he accused the applicants of exporting diamonds from Africa in breach of UN sanctions. The Court noted that:

“At the time that [the MP] made his statement in the House of Commons, it is not apparent therefore that there was any pending or intended criminal investigation about a prosecutable offence within the United Kingdom, of which his statements might be regarded as prejudging the outcome.”

122. Although certain criminal investigations had been made in other countries in relation to those applicants, there was no close link between the statement made by the MP and any significant criminal procedural steps taken overseas which might be regarded as sufficient to render the applicants “charged with a criminal offence” for the purposes of Article 6 § 2 of the Convention. The Court concluded in Zolmann as follows:

“Article 6 § 2, in its relevant aspect, is aimed at preventing the undermining of a fair criminal trial by prejudicial statements made in close connection with those proceedings. Where no such proceedings are, or have been in existence, statements attributing criminal or other reprehensible conduct are relevant rather to considerations of protection against defamation and adequate access to court to determine civil rights and raising potential issues under Articles 8 and 6 of the Convention.”

123. In the present case, the Court notes that criminal proceedings for breach of the 1989 Act were never brought against the applicant. Just as in the Zolmann case, such proceedings were neither pending nor intended at the time when the AG, the Court of Appeal and the House of Lords made the impugned statements. Furthermore, as the Court of Appeal and House of Lords both pointed out, there was no realistic prospect of such proceedings ever being brought. The applicant was outside the UK’s jurisdiction from the moment when the proceedings commenced and there was no realistic prospect of his ever returning.

124. Hence, just as in the Zolmann case, the impugned statements could not be said to have cast doubt on any previous criminal proceedings nor to have prejudged any future criminal proceedings. As a result, the Court concludes that Article 6 § 2 of the Convention was not applicable. This part of the application is therefore incompatible ratione materiae with the provisions of the Convention, within the meaning of Article 35 § 3, and therefore inadmissible in application of Article 35 § 4 of the Convention.

E. Article 10 and the account of profits

125. The applicant further complained under Article 10 that the order for an account of profits was an interference with his right to freedom of expression which was neither prescribed by law nor necessary in a democratic society. Article 10 provides, in so far as material:

“1. Everyone has the right to freedom of expression....

2. The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security ..., for the prevention of disorder or crime, ...[or] for preventing the disclosure of information received in confidence...”

1. Waiver

126. The Government argued that the applicant had waived his right to publish material obtained through his secret service employment by signing the undertaking of confidentiality (Rommelfanger v Germany, Decisions and Reports (DR) 62, p. 151; Vereiging Rechtiwinkels Utrecht v Netherlands DR 26, p. 200 at 203; and Håkansson and Sturesson v. Sweden, judgment of 21 February 1990, Series A no. 171‑A). The applicant considered that it was not possible to waive the right to freedom of expression because it would run contrary to the public interest.

127. The Court recalls that a waiver of a right guaranteed by the Convention – in so far as it is permissible – must not run counter to any important public interest, must be established in an unequivocal manner and requires minimum guarantees commensurate to the waiver’s importance (Håkansson and Sturesson judgment, cited above at § 66 and Pfeifer and Plankl v. Austria judgment of 25 February 1992, Series A No. 227, § 37).

128. The Court considers that it is not necessary to determine whether or not it would ever be permissible for individuals to be able to waive their right to freedom of expression because, in any case, any waiver was not sufficiently unequivocal. The applicant made an undertaking in 1944 not to reveal information obtained as part of his employment. The Court does not consider that, in so doing, he can be said to have unequivocally waived his right to complain, under a Convention that had not yet been drafted, about any “penalties” that he might suffer, no matter how severe, arising from an infringement of that undertaking.

2. Interference

129. The Government argued that there was no interference with the applicant’s rights under Article 10 because he was not prevented from publishing the Book and because he was only deprived of part of his royalties (90,000 GBP out of 150,000 GBP).

130. The applicant maintained that, although he had expressed himself, the account of profits was clearly intended by the House of Lords to have “a chilling effect” on others comparable to the confiscation of material (Müller and Others v. Switzerland, judgment of 24 May 1988, Series A no. 133) or to damages in a defamation case (Tolstoy Miloslavsky v. the United Kingdom, judgment of 13 July 1995, Series A no. 316-B) or to dismissal in an employment case (Vogt v. Germany, judgment of 26 September 1995, Series A no. 323).

131. The Court recalls that the penalty imposed on an individual can, of itself, constitute an interference with an applicant’s right to freedom of expression (the above-cited Tolstoy judgment and, for example, Skałka v. Poland, no. 43425/98, § 41, 27 May 2003) even if that penalty did not strictly speaking prevent the individual from expressing himself (for example, Lingens v. Austria, judgment of 8 July 1986, Series A no. 103, §§ 35 and 44 and Vogt v. Germany, judgment of 26 September 1995, Series A no. 323, § 44). In the present case, although the authorities did not prevent the publication of the Book, they did obtain an order of the House of Lords depriving the applicant of most of his royalties (those still unpaid in the sum of GBP 90,000). The Court considers that this clearly amounted to an interference with his right to freedom of expression which requires justification under Article 10 § 2 of the Convention.

3. “Prescribed by law”

(a) The parties’ submissions

132. The applicant maintained that the order for an account of profits was not prescribed by law.

In the first place, he could not have foreseen in 1989, almost 30 years after his dismissal when he submitted the manuscript to the Publisher, that he would be under an absolute obligation not to disclose information which was neither confidential nor damaging.

Secondly, and as demonstrated by the proceedings, the remedy of an account of profits for breach of contract was neither foreseeable nor foreseen, even by the distinguished lawyers who argued the case for the Crown: no claim was made for breach of contract when proceedings commenced in 1991; when the matter came to the Court of Appeal it was the court itself that suggested that the Crown might have a private law claim to restitutionary damages for breach of contract; even in the House of Lords the claim for breach of contract was not advanced on the initiative of the Attorney General. Furthermore, the House of Lords recognised in its judgment that the remedy was novel. Moreover, it relied on academic writings and cases that post-dated the signing of the undertaking in 1944.

133. The Government argued that it was foreseeable that the domestic courts might “fashion” a remedy to prevent the applicant from breaching his undertaking, an acceptable level of foreseeability. They argued that the case was closely akin to a fiduciary obligation case where an account of profits would have been ordered as a matter of course and they pointed to the case of Snepp v United States (cited above) where the US Supreme Court reached a virtually identical conclusion based on virtually identical facts. They concluded that the development in the law was only modest.

134. In his first reply submitted on 1 August 2003, the applicant reiterated that the remedy was not foreseeable: it was not sufficient to be able to predict that a remedy might be “fashioned” because Article 10 § 2 required a greater degree of certainty than that. He also raised a new argument: that it was unforeseeable, at the time he made his contract with the publishers, that he would be held to have contractual obligations to the Crown. He accepted that this point had not been taken in domestic proceedings. However, he argued that this was not his fault: the issue of contractual obligations was not raised until the Court of Appeal; the amici did not raise it before the Court of Appeal, either because the Attorney General was not pursuing the private law claim or because their terms of appointment did not permit it; the applicant’s representatives did not raise it before the House of Lords because they did not have the time or facilities to conduct the relevant historical legal research into the contractual nature of the applicant’s relationship to the Crown.

135. In their reply to this new argument, the Government contended that there was nothing surprising in the applicant’s owing contractual obligations by reason of the undertaking he signed. Contractual obligations are created by an agreement freely entered into for which consideration is given. There was no dispute that the undertaking was freely entered into. There was also consideration supporting the contractual obligations: the applicant would not have been employed by the intelligence service if he had refused to sign the undertaking. The Government accepted that certain aspects of the relationship between Crown servants and the Crown were not traditionally analysed as contractual. However, they pointed out that this did not mean that there could not be any contractual obligations between Crown servants and the Crown. Finally, they contended that if there were anything in the point, it could and should have been raised before the domestic courts.

In his second reply submitted on 18 December 2003, the applicant submitted that no contractual obligations arose as a result of the undertaking because the Crown had not intended to create legal relations. In support of this submission he relied on the Franks Committee Report of 1972 which concluded that the action of “signing the Official Secrets Act” was devoid of legal significance.

(b) The Court’s assessment

136. The applicant has raised two complaints in respect to foreseeability: first, that it was unforeseeable that he would be considered to be in a contractual relationship with the Crown; and secondly, that it was unforeseeable that an account of profits would be awarded as a remedy for breach of contract.

(i) Article 35 § 1

137. The Court recalls that under Article 35 of the Convention, normal recourse should be had by an applicant to remedies which are available and sufficient to afford redress in respect of the breaches alleged.

The Court observes that the first complaint was not raised before the domestic courts. The Court further observes that the applicant was represented before the House of Lords by solicitors and counsel. The applicant has not provided any adequate explanation of why this complaint was not raised at this stage: his representatives had time and resources enough to prepare the other aspects of his case. In the circumstances, the Court considers that the applicant has failed to exhaust domestic remedies in respect of this complaint, as required by Article 35 § 1. Accordingly, the said complaint must be rejected pursuant to Article 35 § 4 of the Convention.

(ii) Article 35 §§ 3 and 4

138. As to the second complaint concerning foreseeability, the Court recalls the two requirements that flow from the expression “prescribed by law” (Sunday Times v. the United Kingdom (no. 1), judgment of 26 April 1979, Series A no. 30, §§ 47 and 49). The law (including the common law) must be adequately accessible as the individual must be able to have an indication that is adequate in the circumstances of the legal rules applicable to a given case. The law must also be formulated with sufficient precision to enable the individual to regulate his conduct: he must be able - if need be with appropriate advice - to foresee to a degree that is reasonable in the circumstances, the consequences which a given action may entail. Those consequences need not be foreseeable with absolute certainty: experience shows this to be unattainable. Whilst certainty is highly desirable, it may bring in its train excessive rigidity and the law must be able to keep pace with changing circumstances. Accordingly, many laws are inevitably couched in terms which, to a greater or lesser extent, are vague and whose interpretation and application are questions of practice.

139. The Court will also take into account, in assessing foreseeability, the general approach of domestic courts to similar matters (Open Door and Dublin Well Woman v. Ireland, judgment of 29 October 1992, Series A no. 246‑A, § 60 where the Court took into account the “high threshold of protection of the unborn provided under Irish law generally”).

140. The Court notes, on the one hand, that there are numerous authorities for the proposition that damages for breach of contract are compensatory (Tito v Waddell (No. 2) [1977] 3 AER 129, Occidental Worldwide Investment Corp v Skibs etc [1976] 1 Lloyd’s Rep 293 at 337, Surrey CC v Bredero Homes Ltd [1993] 3 AER 705 per Dillon LJ, Co-operative Insurance Ltd v Argyll Stores (Holdings) Ltd [1997] 3 AER 297 at 305). As Lord Nicholls himself accepted, the order made by the House of Lords in the present case was had no direct precedent – no court had ever ordered an account of profits as a remedy for breach of contract. Lord Nicholls was only able to point to one case where damages for breach of contract were related in any way to the defendant’s gain as opposed to the claimant’s loss (Wrotham Park Estate Co Ltd v Parkside Homes Ltd, cited above – see paragraph 59 above), a case not obviously analogous to the present one. Indeed, it was interpreted by the High Court in Tito v Waddell and by Steyn LJ in Surrey CC v Bredero (both cited above) as a case of invasion of property rights, where courts frequently award damages that relate to the gain of the wrongdoer (see paragraphs 62 and 85 above).

141. On the other hand, the Court recalls that the fact that there is limited precedent is not, of itself, decisive (the Sunday Times v. the United Kingdom, cited above, at § 52). In the United Kingdom, as in other Convention States, the progressive development of the law through judicial law-making is a well entrenched and necessary part of legal tradition. The “prescribed by law” aspect of Article 10 cannot be read as outlawing the gradual clarification through the common law of the remedies available for breach of contract (mutatis mutandis, S.W. v. the United Kingdom, judgment of 22 November 1995, Series A no. 335‑B, § 36). It was not therefore to be excluded that the House of Lords would develop the existing jurisprudence so as to address an exceptional case.

142. The Court considers that this was clearly such an exceptional case. Ordinarily there may not be a compelling public interest in preventing contract breakers from profiting from their breach so long as the other party has been compensated for loss. However, in the present case there was a clear and strong public interest in preventing the applicant from profiting from his breach of contract and thereby profiting from his crimes. In this latter respect, Lord Nicholls noted that had the applicant not been an infamous spy (his 1961 convictions) who had dramatically escaped from prison (in 1966), the Book would not have commanded the royalties it did (see paragraph 66 above).

143. Indeed, the domestic courts have always afforded great importance to the protection of the secrecy of the security services (see the domestic judgments described in Observer and Guardian v. the United Kingdom, judgment of 26 November 1991, Series A no. 216).

144. The Court further notes that in other exceptional cases where there was a clear public interest in preventing the contract breaker in profiting from the breach of contract, the domestic courts found ways of doing so albeit through means different to the ones employed in the present case (see paragraphs 86 to 88 above and in particular British Motor Trade Association v Gilbert, cited above; see also the analogous US case of Snepp v US, also cited above).

145. In light of these considerations, the Court considers that an order for an account of profits for breach of contract against the present applicant was a reasonably foreseeable development of the common law consistent with the “foreseeability” requirement of Article 10 of the Convention.

4. Legitimate aim

146. The applicant accepted that the interference pursued the legitimate aims of national security, supporting the interests of the Crown as employers (the breach of the confidentiality undertaking) and preventing criminals profiting from their crimes (his 1961 convictions and subsequent escape from prison in 1966, being the explanation for the large royalties, see paragraph 141 above). The Court finds no reason to differ from this view.

5. Necessary in a democratic society

(a) The parties’ submissions

147. The applicant argued that an absolute rule against disclosure was disproportionate. The AG conceded before the High Court that the Book did not damage the public interest and no such evidence or allegation was put before the courts thereafter. Lord Nicholls’ statement that such an absolute rule “made good sense” did not imply that the publication caused such damage as he had not made that assessment with Article 10 in mind. Since the rule against disclosure was absolute and broad, it applied regardless of function, rank and the lapse of time, whether the information was already in the public domain or was never confidential and regardless of the context. Retired Ministers were not subject to the same absolute duty (Attorney General v. Jonathan Cape Ltd [1976] Q.B. 752) and there had been numerous publications by former Prime Ministers and other senior Government figures. Other options were available to the AG: memoirs had been published by other members of the security and service intelligence with the Crown’s authorisation. He did not seek such authorisation as none of the information was confidential.

148. He further submitted that the remedy of an account of profits was also not justifiable to advance national security and the interests of the Crown as employers. It might have been less stringent than an absolute ban on publication, but it was just as arbitrary: there was no attempt to assess and, no evidence before the House of Lords concerning, the proportion of the royalties attributable to his notoriety, books about the secret and intelligence services being popular in their own right.

149. Neither was the remedy of an account of profits necessary to pursue the aim of preventing criminals from profiting from their crimes. The proper means of doing this was the subject of long debate in the United Kingdom which turned mainly around proceeds of crime legislation. Otherwise, the United Kingdom had in place a number of elaborate systems of self-regulation designed to promote proper standards in the exercise of freedom of expression. These included codes regulating the press (Press Complaints Commission – “PCC”) and broadcasters (the Independent Television Commission, the Broadcasting Standards Commission, the Radio Authority and the BBC’s Producers Guidelines) which enjoyed statutory recognition under the Human Rights Act 1998 (section 12(4)) and the Data Protection Act (section 32(3)).

150. Referring to the Code of the PCC and the provisions concerning payments to criminals, the PCC had, in such cases, found, in the first place, that it was for Parliament to establish the legal regime defining the extent to which criminals should be prevented from profiting from their crimes. Secondly, it considered it unrealistic to require all convicted persons to be barred from publication in perpetuity and, thirdly, it recognised the importance of freedom of expression and of the public’s right to know. In this later “public interest” respect, the PCC considered that the principle was that it was wrong to glorify a crime but it was not necessarily wrong to write about it as there was a public interest in knowing why a criminal embarked on criminal conduct and about his subsequent attitude or, for example, learning about the workings of an organisation responsible for deaths. As to payment, the PCC had considered (the applicant citing particular cases) that where there was a public interest in disclosure, it was in practice necessary for a newspaper to make payments to secure the rights.

151. The applicant argued that it was in the public interest to learn how a man, who had fought for his country in the Korean war, converted to the cause of communism, what he had to say about how and why he embarked on criminal conduct, how he was discovered and what conduct has been held by a court to merit such exceptional punishment. That this information be published was all the more important in this case as his trial in 1961 had been in camera and he had pleaded guilty so that the public had little information. Accordingly, the restriction should take account of the circumstances of each case so that the public interest in restricting a criminal receiving or retaining payment must be shown in the circumstances to outweigh the public’s interest in the above-noted information, as was the case for the PCC.

152. The applicant went on to point out that, on the contrary, the House of Lords gave no weight at all to the countervailing public interest in information, although the High Court and Court of Appeal had done so. The former gave detailed consideration to the absence of any public interest sufficient to override the applicant’s Article 10 rights and Lords Woolf M.R. noted that equity did not intervene when it served no practical purpose and that an injunction restraining publication would be an “unwarranted interference with freedom of speech going far beyond what is necessary in a democratic society to protect the national interest”. The private law remedies suggested by the House of Lords were incompatible with Article 10 for the same reasons the other proposed private law remedies were considered incompatible by the High Court and the Court of Appeal. Rather the applicant suggested that Lord Hobhouse explained the position correctly in his dissenting opinion.

153. The Government argue that the interference was proportionate. They said that it must have been justified to prevent deliberate and cynical contract breakers from profiting from their breach. They relied on the case of Times Newspapers Ltd and Andrew Neill v. the United Kingdom, no. 14644/89, Commission decision of 8 October 1991, in which Times Newspapers was ordered to make an account of profits after publishing information from Peter Wright’s book, Spycatcher, in breach of confidence. The Commission in that case found that the interference was relatively minor and justified by the need to sanction the applicant’s breach of confidence.

(b) The Court’s assessment

154. The Court reiterates the fundamental principles established by its case-law on Article 10, as set out, for example, in the case of Chauvy and Others v. France, no. 64915/01, §§62-65, ECHR 2004‑...):

“Freedom of expression constitutes one of the essential foundations of a democratic society and one of the basic conditions for its progress and each individual’s self-fulfilment. Subject to paragraph 2 of Article 10, it is applicable not only to “information” or “ideas” that are favourably received or regarded as inoffensive or as a matter of indifference, but also to those that offend, shock or disturb. Such are the demands of that pluralism, tolerance and broadmindedness without which there is no “democratic society”. As set forth in Article 10, this freedom is subject to exceptions, which must, however, be construed strictly, and the need for any restrictions must be established convincingly.

The adjective “necessary”, within the meaning of Article 10 § 2, implies the existence of a “pressing social need”. The Contracting States have a certain margin of appreciation in assessing whether such a need exists, but it goes hand in hand with a European supervision, embracing both the legislation and the decisions applying it, even those given by an independent court. The Court is therefore empowered to give the final ruling on whether a “restriction” is reconcilable with freedom of expression as protected by Article 10.

When exercising its supervisory jurisdiction, the Court’s task is not to substitute its own view for that of the relevant national authorities but rather to review under Article 11 the decisions they delivered in the exercise of their discretion. This does not mean that the supervision is limited to ascertaining whether the respondent State exercised its discretion reasonably, carefully or in good faith; what the Court has to do is to look at the interference complained of in the light of the case as a whole and determine whether it was “proportionate to the legitimate aim pursued” and whether the reasons adduced by the national authorities to justify it are “relevant and sufficient”.”

155. In the present case, the Court notes, on the one hand, that the Book did not contain information which remained confidential in 1990.

156. On the other hand, it recalls that, as the Government pointed out, the interference with expression was relatively minor. It did not consist of a prior restraint or any other prevention of the actual expression by the applicant: the authorities allowed the Book to be published, sold and distributed without restriction. The present case can therefore be distinguished from the Observer and Guardian case, cited above and the Sunday Times v. the United Kingdom (no. 2) case, judgment of 26 November 1991, Series A no. 217, where the applicants were prevented by injunction from serialising the book when it had already been published in the US. Any public interest in hearing the applicant’s information, on which the applicant relied, remained unaffected.

157. Secondly, the Court notes, while the final basis for making an order for an account of profits was the applicant’s breach of contract (i.e. breach of the undertaking of confidentiality), that interference was closely connected to the applicant’s serious criminal past. As noted at paragraph 141 above, the domestic courts found that he would not have been able to command such high royalties had he not been an infamous spy. The source of much, if not all, of the monies, which were the subject of the impugned order, was therefore the applicant’s undisputed and serious criminal past.

158. Thirdly, the Court considers the applicant’s argument about the “chilling effect” of section 1 of the 1989 Act to be misconceived. The House of Lords, as noted above, did not rely on this provision in making the order for an account of profits but rather on the clear and express contractual undertaking of confidentiality he had given in 1944 and breached thereafter. The relevant “chilling effect” in the present case is therefore a warning that members or ex-members of the SIS who publish books in breach of their undertaking of confidentiality may be deprived of the profits of their books, even if the subject matter is no longer confidential, particularly if those profits derive from the notoriety and seriousness of the author’s criminal past.

159. Finally, the Court has had regard to the special duties and responsibilities on members of the secret services to ensure that their conduct does not undermine the confidence active members may have in their present and future security (mutatis mutandis, Hadjianastassiou v. Greece, judgment of 16 December 1992, Series A no. 252, § 49).

160. In light of the above, the Court finds that the interference with the applicant’s freedom of expression in the instant case cannot be said to have been disproportionate to the legitimate aims pursued. Accordingly, his complaint under Article 10 is manifestly ill-founded within the meaning of Article 35 § 3 of the Convention and must be declared inadmissible in application of Article 35 § 4 of the Convention.

F. Article 10 and the undertaking of confidentiality

161. The applicant also maintained that the undertaking of confidentiality signed in 1944 violated Article 10 of the Convention. In so far as he complained about the effect of the undertaking (namely, the eventual order for an account for the profits), that complaint has been examined above. In so far as he was complaining about being required to sign the undertaking in 1944, this complaint must be declared incompatible ratione temporis with the provisions of the Convention within the meaning of Article 35 § 3.

These complaints are therefore also inadmissible in application of Article 35 § 4 of the Convention.

G. Article 10 alone and in conjunction with Article 14: the Official Secrets Acts 1911 and 1989

162. In addition, the applicant complained that these Acts violated his right under Article 10 of the Convention and, further, that section 1 of the 1989 Act discriminated between members of the intelligence and other Government services, contrary to Article 14 of the Convention.

163. The Court notes that the applicant has not demonstrated how he could claim to be a victim of either of these Acts. The Acts did not prevent him writing or publishing the Book and the House of Lords expressly did not base its decision to order an account of profits on violations of any provisions of these Acts (see paragraph 66 above). As a result, these complaints are incompatible ratione personae with the provisions of the Convention within the meaning of Article 35 § 3, and therefore inadmissible in application of Article 35 § 4 of the Convention.

H. Article 1 of Protocol No. 1 and the account of profits

164. Finally, the applicant argued that the order for an account of profits was an interference with his right to peaceful enjoyment of his possessions (Article 1 of Protocol No. 1) which was not provided by law or by the general principles of international law and/or was not in the public interest. Article 1 of Protocol 1 provides, in so far as relevant:

“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”

1. The parties’ submissions

165. The applicant submitted that the debt due to him from Jonathan Cape constituted a ‘possession’ within the meaning of Article 1 of Protocol 1. He argued that the effect of the House of Lords’ order for an account of profits was to render the said debt worthless. As a result, he argued that there had been a de facto deprivation of his property. In the alternative, he argued that the order of the House of Lords amounted to a control of use of his property.

166. He submitted that, in either case, there was an interference with his peaceful enjoyment of his possessions. He further submitted that the said interference was not lawful. He referred to his arguments submitted under Article 10 in relation to lawfulness (see § 132). In addition, he pointed out that the amici curiae had accepted in submissions of 5 November 1997 submitted to the Court of Appeal, that no one could have foreseen, even with the best advice in 1990, the development of the common law proposed by the AG. He referred to a lecture delivered by Professor Gareth Jones who criticised the judgment of the House of Lords and indicated that that court had “created” a novel common law action which was counter to principle and precedent and which would unsettle commercial expectations. He relied also on the above-cited cases of Co-operative Insurance Society Ltd v Argyll (Holdings) Ltd and Surrey County Council v Bredero. He further referred to the dissenting judgment of Lord Hobhouse and to the changing bases for the claim throughout the proceedings concluding that none of the eminent lawyers who argued the case for the Crown foresaw the eventual outcome as a possibility.

He considered that the House of Lords created and applied the law in an arbitrary manner solely because of its determination to strip him of the royalty payments and did so without hearing submissions by counsel for either party. The fact that the state tried to fill the lacuna by passing the Proceeds of Crime Acts 1995 and 2002 underlined how the House of Lords’ interference was not prescribed by law.

167. He submitted that, even if the interference was in accordance with the law, it was not in the public interest. If the Crown could not object to the publication of the Book, there was no reason to deprive him of the proceeds. He reiterated his arguments under Article 10 as to the public interest in the subject matter of the Book (see § 151).

In addition, he submitted that the deprivation of his property was not in accordance with the general principles of international law. He was a non-national because his mother was a Dutch citizen and his father a Turkish Jewish citizen, who only acquired British nationality in the context of serving for the British army during the war. As a result, his father’s British nationality may not have been passed on to him. Furthermore, in February 1967 he was granted Soviet citizenship. He is currently a citizen of the Russian Federation and he does not hold a British passport. As a non-national, he should have had the benefit of the public international law requirement of prompt, appropriate and effective compensation for the taking of property belonging to non-nationals. In any event, he submitted that, even if he was a national, he should have been entitled to compensation for the deprivation of his property.

He further submitted that the aim of the impugned order was to ensure that former members of the security services could not profit from writing about their activities, when no damage resulted from the disclosure, when publication could not be prevented, when the former member was no longer under a fiduciary duty not to disclose, and when such disclosure was alleged to have constituted a criminal offence (even where no conviction has occurred). He maintained that this was not a legitimate aim.

Finally, he argued that the interference with his peaceful enjoyment of his possessions was not proportionate. Again, he relied on the arguments made in this context under Article 10 (see § 147-152). In addition, he relied on the fact that, unlike the Crown, he was not allowed to direct that the money go to charity. He claimed that the order was based on proprietary principles when the necessary proprietary rights were absent. He submitted that it was punitive and reflected the House of Lords’ assertion that he was guilty of an offence under section 1 of the 1989 Act despite never having been so convicted. Furthermore, he referred to his arguments under Article 6 and argued that he had not been given a reasonable opportunity to put his case to the authorities. Finally, he claimed that he had had to bear an ‘individual and excessive burden’.

168. The Government accepted that the debt owed by Jonathan Cape was a possession within the meaning of Article 1 of Protocol 1. However, they submitted that the case should be analysed as a control of use case. They submitted that, in any event, there could be no question of compensation being a necessary constituent in the striking of a fair balance.

As for the public interest, they argued that the State should be afforded a wide margin of appreciation. The test was whether the State’s judgment was manifestly without reasonable foundation. The judgment of the House of Lords could not be said to cross this threshold. As for lawfulness, they relied on their submissions under Article 10 (see § 133).

They asserted that the applicant was a British national with a British passport. Thus, general principles of international law were not applicable. In any event, requiring a person to account for profits obtained as a result of a breach of an undertaking breached no such general principle. The applicant’s argument, that he should be compensated for the order of the House of Lords, was absurd as it would require compensation to be paid every time an order for an account of profits was made.

169. In his first reply, the applicant reiterated that the case should properly be considered as a deprivation case and that the interference was not lawful. As to his citizenship, he reasserted that he was a Russian citizen and that there was considerable doubt as to whether he was ever a British citizen. Even if he was a British citizen at the time of his contract with Jonathan Cape, he was also a Russian citizen at the same time. As a result, he should be able to rely on his Russian citizenship for the purposes of Article 1 of Protocol 1. The order of the House of Lords deprived him of property and, as a result, he should be compensated.

170. In response, the Government argued that the applicant was a British national because at one time he had held a British passport and because, since then, he had not renounced his nationality or been deprived of it. His acquisition of Russian citizenship did not affect his British citizenship.

171. In his second reply, the applicant disputed that the holding of a British passport was conclusive of British citizenship. In any case, he argued that, even if he was of dual nationality, the United Kingdom were not entitled to treat him as a British national at the time of the interference in question because he was on Russian territory.

2. The Court’s assessment

172. The Court recalls that an order of a domestic court, consequent upon civil proceedings, requiring one party to the proceedings to pay the other party cannot be equated to a deprivation of property, within the meaning of the first paragraph of Article 1 of Protocol No. 1, even if the successful party was a public authority (see, mutatis mutandis, Porter v. the United Kingdom (dec.), no. 15814/02, ECHR).

173. It follows that, even if the impugned order may be considered to constitute an interference with the applicant’s property rights, it did not constitute a deprivation of property within the meaning of the said paragraph. As a result, the “general principles of international law” (relied on by the applicant) do not require separate examination (see Bosphorus Hava Yolları Turizm ve Ticaret Anonim Şirketi (Bosphorus Airways) v. Ireland [GC], no. 45036/98, § 142, ECHR 2005‑...).

174. As to the applicant’s other arguments under Article 1 of Protocol No. 1, the Court refers to its findings above. In particular, the Court has found that, apart from the “reasonable time” aspect of Article 6 of the Convention (to be examined on the merits, see paragraph 116 above), the proceedings leading up to the said order complied with Article 6 (§§ 89-111) and the said order was compatible with the applicant’s rights under Article 10 of the Convention (§§125-160). For essentially the same reasons, the Court considers that there is no indication of a breach of Article 1 of Protocol No. 1 (see, mutatis mutandis, Pitkevich v. Russia (dec.), no. 47936/99, ECHR).

It follows that this part of the application is manifestly ill-founded and must be rejected in accordance with Article 35 §§ 3 and 4 of the Convention.

For these reasons, the Court unanimously

Decides to declare admissible the applicant’s complaint in relation to the length of proceedings.

Decides to declare the remainder of the application inadmissible.

Françoise Elens-PassosJosep Casadevall
Deputy RegistrarPresident

Full & Egal Universal Law Academy