THE ANTON PILLER ORDER 2 DECADES LATER: THE BALANCING ACT GOES ON

• Author: PETER NG LEE TONG
• Date: 01 December 1997
• Published date: 01 December 1997
• Citation: (1997) 9 SAcLJ 170

INTRODUCTION

In December 1975 the English Court of Appeal handed down its decision in Anton Piller KG v Manufacturing Processes Ltd1. Since then, much water has flowed under the bridge. During this period the boundaries of the Anton Piller order have progressively been extended. Also, what was envisaged by the Court of Appeal to be a remedy that would be available only in extreme cases has since become nearly common-place with courts readily granting applications for such orders. This in turn led to the nearly inevitable rise of abuses by some of those litigants granted such orders with the resultant “clamp-down” by the courts. And so the saga continues.

As a common-law remedy the Anton Piller order has gone through considerable changes and one wonders whether the original judges of the Court of Appeal who pioneered the grant of the order in Anton Piller KG v Manufacturing Processes Ltd. would ever have envisaged the way the order has since developed.

In view of the draconian nature of the order, the Court of Appeal in Anton Piller was particularly concerned to see that restrictions be placed on the circumstances under which Anton Piller orders are granted and safeguards imposed to protect the interests of defendants.

This paper will consider the issue of the continuing conflict between the demands on courts to ensure that the restrictions are adequate whilst not being overly restrictive and the continuing conflict between ensuring adequate safeguards against defendants’ rights being abused and the practical operation of Anton Piller orders. Given the ever increasing number of court cases dealing with Anton Piller orders and the ever increasing number of articles and books written on the order2 this paper must of necessity be restricted to these two issues rather than attempting to review the entire area of law and its development.

The two issues considered are at different stages of the operation of Anton Piller order, the first being at the stage of application for the grant of an Anton Piller order and the latter being at the stage of service of the order.

In considering these two issues the original order of the court in Anton Piller will be revisited and the two recent instances of the courts’“clamp-down”, namely Columbia Picture Industries v Robinson3 and Universal Thermosensors v Hibben4 will be examined in conjunction with the subsequent practice directions issued by courts in various countries in response to Universal Thermosensors. In particular, this paper will consider the continued attempts at balancing the interest of both parties to a dispute in what is essentially a high risk high stake environment where Anton Piller orders are concerned. This paper will also consider some difficulties arising from the restrictions and safeguards imposed in these latest court decisions and practice directions.

Experience in the past 22 years signals that improper issue of Anton Piller orders coupled with voracious and abusive procedures employed in executing them has caused excessive violations of defendants’ rights. Unless this powerful and exceptional form of relief is regulated by legislation or constrained by appellate courts, there is the risk that this very useful weapon could fall into disrepute.

Amongst other things, unscrupulous plaintiffs with the assistance of their solicitors can exploit the procedure to drag out the defendant’s case and to gain access to the defendant’s confidential trade and commercial information, or simply to carry out fishing expeditions. This paper will look at the safeguards imposed by the courts to prevent further abuses.

NATURE OF THE ORDER

The order’s name is derived from Anton Piller KG v Manufacturing Processes. The purpose of the order is to prevent a defendant interfering with discovery and frustrating trial, by destroying documents or evidence, such as copies of the plaintiff’s products, which might show his wrongdoing.

The Anton Piller order along with the Mareva injunction have been described as the “nuclear” weapons in the litigation arsenal5. Whilst this may describe to some extent the decisive effect of its use, it may be more accurate to compare these two weapons to the hypothetical situation of the Japanese having the atom bomb and using it at Pearl Harbour. In other words, not only is the use of these two weapons decisive but, as has been pointed out6 the key to these two weapons is the element of surprise which the order offers by virtue of it being obtained ex parte.

Whilst the use of a nuclear weapon may well decide the outcome of a case (unless the weapon has been improperly obtained or used) being surprised by its use (indeed even by the fact of its existence) serves only to increase the chances of not just capitulation but capitulation at an early stage of the case. This is supported by the fact that most cases are settled without going to trial7 and that the first case involving an Anton Piller order that went to full trial was Columbia Picture Industries Inc. v Robinson which was well over 10 years after the order was first granted.

The Anton Piller order permits the plaintiff to demand entry to the defendant’s premises, business or residence to search them, and to remove for a short time documents or other items which might form evidence in his or her action or proposed action against the defendant. Generally the order will provide that it must be served by an independent solicitor in the company of the plaintiff’s solicitor. The plaintiff’s solicitor then executes the order, supervised by the independent solicitor. Alternatively, the order may provide for service and execution by the plaintiff’s own solicitor without supervision8.

Anton Piller orders may be granted in the same order as a Mareva injunction and the court may also grant other ancillary orders at the same time e.g. an order restraining the defendant from leaving the jurisdiction9.

The three principal areas in which Anton Piller orders are used are:

1. a. infringement of Intellectual Property rights

   b. anti-competition cases

   c. matrimonial proceedings

This list is non-exhaustive. But doubt has now been thrown on whether Anton Piller orders should be restricted to Intellectual Property cases only by the development of the doctrine of self-incrimination10.

THE UNIQUE FEATURES OF ANTON PILLER ORDERS

In granting the order, the Court of Appeal in Anton Piller made it clear that such orders were to be the exception rather than the rule. According to Lord Denning such orders “should only be made where it is essential that the plaintiff should have inspection so that justice can be done between the parties”11.

Ormrod LJ added that such an order “is at the extremity of this Court’s powers. Such orders, therefore, will rarely be made, and only when there is no alternative way of ensuring that justice is done to the applicant”12.

Thus, the first of the three unique features of Anton Piller orders as enunciated by the Court of Appeal in Anton Piller is the fact that such orders may only be made in extraordinary circumstances where there is no other way of ensuring that justice can be done. Unfortunately, the Court of Appeal, in identifying this unique feature, passed up the opportunity to say what would make a case exceptional with the consequence that 20 years later we still have no guidelines to aid us in deciding whether any particular case does or does not fall within the term “exceptional”.

The second unique “and perhaps, the mostsignificant”13feature is that the orders purported to cover inspection and removal of documents and other property and they are mandatory in form and are designed for immediate execution.

Scott J has gone on to say in Bhimji v Chatwani14 that:

“[I]t is fundamental to the theory of Anton Piller type orders that a civil court in civil proceedings has no power to give one citizen the right to enter a house or premises of another citizen. These orders are in personam orders directed to the defendants. The defendants are ordered to allow entry and to allow search. The plaintiff’s right and their solicitors’ right to enter and search is derived, on this theory of the law, from the defendant’s permission given to them to do so. It is not derived from the power of the court to confer the right. The court does not have that power.”

One of the important safeguards an innocent defendant has is to apply to discharge an order on the ground that it was wrongly granted. But the fact remains that setting aside the Anton Piller order cannot undo what has already been done since it is impossible in practice to reverse the physical effects once it has been executed15.

The third unique feature is that these orders are made on an ex-parte application, thus ensuring the element of surprise for the plaintiff.

A. THE CIRCUMSTANCES UNDER WHICH AN ANTON PILLER ORDER MAY LEGITIMATELY BE SOUGHT.

The essential pre-conditions for a grant of an Anton Piller order

As Anton Piller orders are a form of ex parte injunction, the requirements for grant of an ex parte injunction are equally applicable so that, for instance, the applicant must show that he or she has a cause of action subsisting at the time of the application16.

In allowing the plaintiff’s appeal and granting the order in Anton Piller KG v Manufacturing Processes the Court of Appeal set several “essential pre-conditions” (per Ormrod LJ) for making an Anton Piller order. According to Ormrod LJ there must be three “essential preconditions”17. These are:

1. a. there must be an extremely strong prima facie case;

2. b. the damage, potential or actual, must be very serious for the applicant; and

3. c. there must be clear evidence that the defendants have in their possession incriminating documents or things, and that there is a real possibility that they may destroy such material before any application inter partes can be made.

According to Dockray and Laddie18 Lord...