Personal and Proprietary Remedies for Breach of Confidence: Nearer to Breach of Fiduciary Duty or Breach of Contract?

Abstract

The operation of the remedies for breach of the equitable duty of confidence are confused, largely because of a recent tendency to treat the action as a tort, with a consequent lack of emphasis of the equitable origins of the action for breach of confidence. This paper places the action and the available remedies in its equitable context. It surveys the operation of the pecuniary remedies which are available, with particular reference to negotiating damages and breach of confidence. Principles are identified to determine when each remedy should be available, including two fundamental principles of but for causation and conscience. The paper also considers whether profits made from breach of confidence should be held on constructive trust. Whilst it is argued that it is now time to recognise a principled remedial constructive trust in English law, the role of such a trust as a remedy for breach of confidence is likely to be very limited.

Keywords: Breach of confidence, personal, proprietary, remedy, negotiating damages, account of profits, remedial constructive trust

JEL Classification: K11, K12, K13