Summary

• Confidentiality Agreements set clear rules for handling sensitive commercial information in corporate transactions.
• A recent High Court decision confirmed that a director can be personally liable for misuse of confidential information; liability does not depend on the director knowing that the information is confidential.
• Careful drafting of Confidentiality Agreements reduces risk and clarifies scope and duties for companies, directors, and advisers.
• To further reduce the risk of breaching a Confidentiality Agreement, employees should receive training on the proper treatment of intellectual property and confidential information, especially in cases where the IP or information is being sent out to third parties.

Confidentiality disputes rarely reach court, but when they do, the judgments must be taken seriously. In Kieran Corrigan & Co Ltd v OneE Group Ltd and others [2025] EWHC 2759 (Ch), the High Court, at retrial, examined whether a director had misused confidential information drawn from a specialist tax mitigation structure. The director had signed off on a new tax scheme, created by his company’s employees, that shared key elements with the claimant’s proprietary work.

The ruling matters to anyone involved in a deal in which one party shares confidential information. In the case of Kieran Corrigan & Co the background situation was a possible joint venture between the claimant and defendant. However, Confidentiality Agreements are also used in M&A deals, R&D projects, and when seeking investment.

What Is a Confidentiality Agreement?
A Confidentiality Agreement (also known as a Non-Disclosure Agreement) places contractual limits on how parties use and share information. These agreements often appear in corporate transactions, technical collaborations, and early negotiations. The terms of a Confidentiality Agreement state the information being protected, identify who may see it, and fix clear boundaries on use.

Confidential information includes any commercially sensitive material not already in the public domain. It can take the form of tax models, pricing strategies, software code, customer data, research, or business plans (this list is not exhaustive).

In M&As and joint ventures, Confidentiality Agreements serve as the framework for parties to exchange sensitive material and assess the value and risks of a potential deal.

Kieran Corrigan & Co Ltd v OneE Group Ltd and others

In its 18 October 2024 judgment ([2024] EWCA Civ 1233, the Court of Appeal upheld Mr Jonathan Hilliard KC (acting as deputy judge of the High Court), finding that the defendant director was not liable for breach of confidence. However, a retrial was ordered due to new evidence suggesting the director knew more than he had initially disclosed.

The facts of the case were as follows: Kieran Corrigan & Co Ltd issued proceedings against OneE Group Ltd, two of its employees, and one of its directors for misuse of confidential information, along with other causes of action.

Both companies work in tax planning. Kieran Corrigan & Co had created a new tax-saving product and explored a possible joint venture with OneE Group. During a meeting attended by employees and the director, Kieran Corrigan & Co shared details of its planned product. The discussion ended without an agreement.

Later, OneE Group launched its own tax saving product. Its process aligned closely with the information shared by Kieran Corrigan & Co. At the liability trial, the High Court held that the product was not developed independently. The court found that it relied on confidential information disclosed at the meeting, placing responsibility for the breach of confidence on OneE Group and the two employees.

At the retrial, Mr Jonathan Hilliard KC reviewed the director’s involvement in depth. Evidence showed he had taken part in commercial discussions, examined the scheme’s key tax features, and approved the final tax saving product. The court held it would be “extremely surprising” if he had not understood the essential structure of the scheme, particularly given his senior role. His approval had accounted for those features and was critical to the scheme’s development. This amounted to the misuse of the claimant’s confidential information.

The argument that liability requires the director to know that the information belonged to the claimant was also rejected. Once someone receives information in circumstances importing an obligation of confidence, they must not misuse it. The duty exists whether or not the person appreciates that the information originates from the claimant.

On the facts, the director did know the scheme incorporated confidential elements. The court held him jointly liable with the company and also liable for unlawful means conspiracy. The judgment confirms that personal responsibility remains central in breach of confidence claims.

Case comment

Kieran Corrigan & Co Ltd v OneE Group Ltd and others highlights that company directors must understand that obligations of confidence attach to individuals as well as companies. To prevent breaches, employee training on the duties associated with handling confidential information is essential.

It is also vital that a Commercial Law Solicitor precisely drafts Confidentiality Agreements. Many dispute cases cross my desk that could have been avoided had the agreement defined what constituted confidential information with care and clearly defined the scope of any use of that information.

Finally, really think about the type and depth of confidential information that needs to be disclosed during initial scope meetings and negotiations, especially if the proposed deal is with a competitor. Talk with your trusted legal advisor about what information you need to share and what you can keep safely locked away within the cocoon of your organisation.

FAQs
What is a confidentiality agreement?
It is a contract that restricts the use and disclosure of sensitive information shared between parties.

How does confidentiality protect parties in joint ventures and M&A deals?
It allows them to exchange commercially sensitive material while reducing the risk of leaks or misuse.

Why can a director be personally liable for breach of confidence?
Because the duty of confidence applies to individuals who receive and use protected information, regardless of corporate structure.

What are the common drafting mistakes?
Unclear definitions, broad exclusions, weak duration clauses, and vague limits on use.

How can companies minimise the risk of disputes over confidential information?
By drafting precise agreements, training employees on their duties when using confidential information, and controlling access to confidential material.

To find out more about our contract drafting and dispute resolution services, please email us at info@43legal.com or phone 0121 249 2400.

The content of this article is for general information only.  It is not, and should not be taken as, legal advice.  If you require any further information in relation to this article, please contact 43Legal.

Melissa Danks is the founder of 43Legal. She has over 20 years’ experience as a solicitor working within the legal sector dealing with issues relating to risk management, dispute resolution, and advising in-house counsel in SMEs and large companies. Melissa has extensive expertise in providing practical, valuable, modern legal advice on large commercial projects, joint ventures, data protection and GDPR compliance, franchises, and commercial contracts. She has worked with stakeholders in multiple market sectors, including IT, legal, manufacturing, retail, hospitality, logistics and construction. When not providing legal advice and growing her law firm, Melissa spends her time running, walking in the countryside, reading and enjoying downtime with close friends and family.