There has rightly been much publicity recently in the housing, legal and indeed wider press about the recent Norwich Pharmacal order obtained by the Royal Borough of Kensington & Chelsea (“RBKC”). As RBKC’s own press release explained:
“In a major victory against social housing tenancy fraud, Kensington and Chelsea Council has worked with Airbnb to unlock critical information that can be used in future legal action or criminal proceedings against alleged fraudsters.
The collaboration will see Airbnb Payments UK share payments data with the Council for two estates in North Kensington to help crack down on illegal short-term lets.
The data sharing, which will take place under a court order due to GDPR requirements, will provide the Council with payment evidence of social housing properties identified as being potentially listed as holiday and short-term lets. This will allow the Council to take enforcement steps having obtained the evidence.
The order was agreed by Airbnb and Kensington and Chelsea as part of the Council’s efforts to crackdown on the number of illegally sublet Council-owned properties, as the Council aims to free up homes for individuals and families on the housing waiting list.”
I wrote about the issue of short-term lets and sub-letting 3 years ago on this blog.
What are Norwich Pharmacal orders?
In EUI Ltd v UK Vodaphone  EWCA Civ 1771 Lord Justice Baker explained Norwich Pharmacal orders and when they can be applied for:
“1. This is an appeal against a judge’s refusal to order disclosure of information under the principle in Norwich Pharmacal v Customs and Excise Commissioners  AC 133.
2. The principle was summarised by Lord Reid at page 173:
“if through no fault of his own a person gets mixed up in the tortious acts of others so as to facilitate their wrong-doing he may incur no personal liability but he comes under a duty to assist the person who has been wronged by giving him full information and disclosing the identity of the wrongdoers. I do not think that it matters whether he became so mixed up by voluntary action on his part or because it was his duty to do what he did. It may be that if this causes him expense the person seeking the information ought to reimburse him. But justice requires that he should co-operate in righting the wrong if he unwittingly facilitated its perpetration.”
3. In Mitsui & Co Ld. v Nexen Petroleum UK Ltd  EWHC 625 (Ch),  2 All ER 511, Lightman J at paragraph 21 summarised the components of the principle in these terms:
“The three conditions to be satisfied for the court to exercise the power to order Norwich Pharmacal relief are:
i) a wrong must have been carried out, or arguably carried out, by an ultimate wrongdoer;
ii) there must be the need for an order to enable action to be brought against the ultimate wrongdoer; and
iii) the person against whom the order is sought must: (a) be mixed up in so as to have facilitated the wrongdoing; and (b) be able or likely to be able to provide the information necessary to enable the ultimate wrongdoer to be sued.”
4. The power to order disclosure in such circumstances does not extend, however, to “mere witnesses”. This limit on the jurisdiction was recognised by Lord Reid in Norwich Pharmacal at page 174:
“But that does not mean, as the appellants contend, that discovery will be ordered against anyone who can give information as to the identity of a wrongdoer. There is absolutely no authority for that. A person injured in a road accident might know that a bystander had taken the number of the car which ran him down and have no other means of tracing the driver. Or a person might know that a particular person is in possession of a libellous letter which he has good reason to believe defames him but the author of which he cannot discover. I am satisfied that it would not be proper in either case to order discovery in order that the person who has suffered damage might be able to find and sue the wrongdoer. Neither authority, principle nor public policy would justify that.”
5. The crucial question, therefore, is whether the defendant to the claim for information is more than a “mere witness” or “bystander”. In Various Claimants v News Group Newspapers Ltd (No.2)  EWHC 2119 (Ch),  Ch 400, Mann J observed (at paragraph 52) that participation or facilitation was not the sole test. He continued:
“It is true that the traditional formulation of the test is in such terms, but that is because those are the usual circumstances in which someone becomes something beyond a mere witness. On the facts of the cases where orders were made, the respondent was usually in that position. In my view the answer to the question lies in recognising that what the cases are doing is contrasting two things – the mere witness on the one hand, and the person who is not a mere witness on the other. On the cases the latter class is generally described in terms of participation/facilitation, as though that were the opposite of being a mere witness. But the real analysis lies in appreciating that the courts are holding not that those factors are indeed the other side of a dichotomy, but that those factors prevent the respondent from being a mere witness. Once that is recognised then it becomes relevant to consider whether there are other facts, short of participation/facilitation, which could prevent a person from being a mere witness.”
The question (paragraph 54) was therefore whether the defendant
“is a mere witness (or metaphorical bystander) or whether its engagement with the wrong is such as to make it more than a mere witness and therefore susceptible to the court’s jurisdiction to order Norwich Pharmacal disclosure.”
6. The distinction can be illustrated by the decision in Norwich Pharmacal itself. An order for disclosure was made against the Commissioners of Customs and Excise to obtain the names and addresses of importers of a chemical compound which, it was thought, was being brought into this country in breach of patents. Lord Reid explained why an order for disclosure was justified in law in these terms (at page 174):
“From the moment when they enter the port until the time when the consignee obtains clearance and removes the goods, they are under the control of the Customs in the sense that the Customs authorities can prevent their movement or specify the places where they are to be put, and in the event of their having any suspicions they have full powers to examine or test the goods. When they are satis?ed and the appropriate duty has been paid the consignee or his agent is authorised to remove the goods. No doubt the respondents are never in possession of the goods, but they do have considerable control of them during the period from entry into the port until removal by the consignee. And the goods cannot get into the hands of the consignee until the respondents have taken a number of steps and have released them.”
Similarly in Various Claimants v News Group Newspapers Ltd (No.2), in which the claimants were seeking to bring proceedings against the proprietor of a national newspaper for phone hacking, an order was made against the Metropolitan Police for disclosure of information relating to the hacking which they had acquired in the course of an investigation.” (Emphasis added in bold)
The solicitors advising RBKC, Pinsent Masons, have not only explained their role in this important case but have also helpfully provided an excellent and comprehensive updated guide on obtaining Norwich Pharmacal orders.