WHEN PERSONAL PHONES BECOME DISCLOSURE TARGETS: LESSONS FROM A RECENT ENGLISH HIGH COURT DECISION
The case of Lloyds Developments Limited (in administration) v Accor Hotel Services UK Limited and Ors [2026] EWHC 1522 (TCC) concerned an application to compel two former directors to provide access to their mobile phones for the purpose of carrying out a disclosure exercise. The Court’s decision is a useful reminder that where company business has been conducted through personal devices, the use of those devices will not, without more, prevent inspection.
Background. The underlying dispute arose out of a failed hotel development project. Lloyds’ case was that it had secured funding on the basis of a hotel design approved by Accor, but that Accor later sought changes to the design on allegedly fraudulent grounds. Lloyds claimed that the resulting redesigns caused delay, increased costs, funding difficulties and, ultimately, the abandonment of the project. Lloyds claimed in excess of £180 million against Accor in deceit: see [5] of the judgment.
Accor denied the claim. Its position was that it had not given binding approval to the original design, that any changes were not induced by fraud, and that the project failed for reasons unrelated to Accor: see [6] of the judgment.
Accor also alleged that Lloyds’ former directors had misrepresented the true cost of the project to investors and misappropriated funders’ money: see [6] of the judgment.
The disclosure issue. In the disclosure process, Lloyds had represented that relevant WhatsApp messages, iMessages and SMS messages existed on the mobile phones of its former directors, Mr Singh and Mr Diamond. The relevant phones were treated as data sources for disclosure: see [9] of the judgment.
However, Lloyds did not give disclosure from those phones in the manner required (see [10] of the judgment). A series of orders followed. The relevant order required Lloyds to procure that the directors provide their mobile phones and other devices to an Independent Reviewer, so that relevant messages between the directors could be identified and reviewed: see [11] – [18] of the judgment.
The directors resisted giving access to the said devices. They argued that their phones contained vast amounts of private, confidential and legally privileged materials, and personal data: see [21] of the judgment.
The Court rejected those arguments.
The common law right. Under common law, it is an incident of the principal-agent relationship that a principal is entitled to require the agent to produce documents relating to the principal’s affairs: see [27] – [28] of the judgment. Relevantly, we set out [28] of the Judgment below as it shows that an argument based on “inseparability of irrelevant material” would not be a basis to decline inspection:
“In Yasuda v Orion Marine Insurance [1995] Q.B. 174, Colman J held that the claimant had the right to inspect records and databases held by the claimant’s underwriting agencies following termination of the parties’ agreements both under the common law as a consequence of the relationship of principal and agent and that the obligations arising from that relationship were not displaced by the contractual rights and obligations save where expressly limited or excluded. The judge held that both the contractual right and the co-existing common law right to inspection survived termination, and inspection was ordered (see from 187D). Relevantly, in the context of arguments raised in this case, Colman J also held that: “It is not open to the defendants to rely on the inseparability of irrelevant material as a basis for declining to permit inspection, extraction and copying of relevant material”, cited with approval by the Master of the Rolls in Phones 4U (In Administration) v EE Ltd and Others [2022] 1 All England 239 at [29].” (emphasis added in bold)
The Court found that the directors had used their phones for communications about Lloyds’ business: see [38] of the judgment. Accordingly, the Court held that Lloyds had established their common law right to the information contained on the phone.
Significantly, in coming to that decision, the Court considered what weight should be given to the right to privacy, where the phone contains both work-related and personal materials. The Court observed that, in such situations, it would seek to balance those interests and find a workable solution, that is both reasonable and proportionate: see [29] and [37] – [39] of the judgment.
On the facts of this case, the Court held that ordering the access to the mobile phone would not be disproportionate, given the safeguards that were in place: see [38] to [40] of the judgment, and in particular [40] of the judgment where the Court stated “Delivery up remains proportionate notwithstanding the unpredictability of outcome.”
The contractual right. Lloyds had entered into a funding agreement with the directors: see [16(4)(b)] of the judgment.
And to paraphrase, under the agreement, the directors were obliged to comply with all orders of the Court, including disclosing all documents that may be disclosed pursuant to a Court order and providing all reasonable assistance in conducting the proceedings: see [43] of the judgment.
Significantly, the Court observed that the obligation to provide reasonable assistance was “broad and fettered”. As a result, the obligation to provide phones fell within the broadly framed wording of the clause: [48] of the judgment.
What is relevant to note is this observation by the Court: “Had the parties intended that obligation would not include the provision of the phones, one would have expected that to be made clear.”
Accordingly, Lloyds had both a common law and contractual right to require access to the phones.
Key takeaway. Nowadays, it is not unusual for one to access, and send out, official work correspondence and communication via personal devices.
However, as made clear in this judgment, just because your personal device may contain private, confidential, or even privileged, material, may not always prevent a court from making an order that the said personal device be inspected, provided that reasonable safeguards are in place. And as the case has made clear, inspection may even extend to former agents of the company (albeit turning on the facts of the case).
So, on practical level, consider again before you send out official work communications or correspondence via your personal device.
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