In Data (Protection) we “Trust”?

It’s confidential. These words provide great comfort when sensitive issues are being discussed particularly with a lawyer or indeed a medical professional. However, a recent decision handed down by the Court of Appeal calls into jeopardy the information which can now be made available to third parties. Albeit that the decision  in Dawson-Damer v Taylor Wessing LLP [2017] EWCA 74 relates to English Law, this could, in future, have wider reaching implications for Scots Law.

In the Dawson-Damer case, it was decided that beneficiaries may use the subject access request procedure contained in section 7 of the Data Protection Act 1998 to circumvent the well-established principle that trustees will not normally be ordered to reveal details of their confidential decision-making to beneficiaries. It is worth noting that, as well as UK-resident trustees, the UK-based solicitors of non-resident trustees are susceptible to a subject access request.

The Data Protection Act is designed to protect EU citizens’ privacy with respect to the processing, use and exchange of personal data. It is regarded as protecting fundamental privacy rights conferred by EU law. It provides a right of access by people to their personal data held by “data controllers” by issuing written subject access requests.

If the data controller does not comply with the special access request, then under the Data Protection Act, the courts have a general discretion to order compliance if satisfied that the data controller has failed to comply.

In Dawson-Damer, Ashley Dawson-Damer is the beneficiary of a Bahamian-law discretionary trust. She and her two adult children served subject access requests on Taylor Wessing. Taylor Wessing is the English solicitor to the Bahamian trustee of the Trust. Taylor Wessing declined to provide the information requested in the subject access requests, relying on the legal professional privilege exemption. The judge at first instance agreed that not only was it disproportionate to expect Taylor Wessing to search its files to establish whether there was any non legal professional privilege material on this, but that Taylor Wessing was entitled to rely on the legal professional privilege exemption to refuse to provide any information which was protected from disclosure in the Bahamas. However, the decision was appealed and subsequently reversed.

Implications

For trustees and practitioners alike, this decision is somewhat unsettling. Whereas a trustee’s reasons for making a decision and the documents on which that decision is based would previously have been protected from disclosure, it appears that there is nothing to prevent a beneficiary serving a subject access request on a trustee or its solicitor and enforcing compliance without reference to that principle. With similar cases before the Court of Appeal which may yet provide further clarification on the application of subject access requests in the context of trust disputes, there are other potential issues which might arise. For example, where the personal data being sought by one beneficiary is impractical or impossible to separate from another beneficiary’s personal data (even with redaction) and the latter does not consent to disclosure. What happens then?

All, however, is not lost. First, when responding to a subject access request, the data which has to be disclosed is limited in scope; it must be the data subject’s “personal data” within the meaning of the Act. There is no specific obligation to provide the document in which that data resides nor any other data contained in that document.

Secondly, data held on non-electronic files is only “data” within the meaning of the Act if it is structured so as to allow easy access to information specific to the data subject. Provided information is not collated on file by reference to individual beneficiaries or the paper files for a particular matter are not specific to a particular beneficiary, the paper records are likely to fall outside the scope of the subject access request. Therefore, it is electronic data processing which will likely be the concern. However, in this era of paperless offices, remote access and email, this cannot realistically be avoided.

Finally, the Court of Appeal in Dawson-Damer did not make any findings about privilege in specific documents and any further dispute about these will have to be adjudicated by the Chancery Division, to which the case has now been remitted.

So how should a legal adviser faced with a subject access request respond and how much information should it provide to discharge its statutory obligation? The Court of Appeal has made clear that some sort of search will usually be necessary and that evidence will be needed where any reliance is placed on the legal professional privilege exemption. Therefore, firms should give thought to how they will, in practice, search their electronic files and communications in order to produce the necessary data. In many cases, this may be an expensive exercise.

Dawson-Damer is an important decision which is undoubtedly helpful for beneficiaries seeking information about a trust’s affairs. Trustees need to prepare themselves for the greater possibility of subject access requests being utilised by beneficiaries. Given the potential costs involved when faced with subject access requests, careful consideration should be given to how best to respond to a subject access request, both in terms of finding and collating personal data and also whether any exceptions under the Data Protection Act might be relevant.

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For More Information Contact:
Laura King
Mobile: 07841 920 095
Direct Dial: 0131 516 5359
Email:lking@gilsongray.co.uk

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For More Information Contact:
Ailidh Ballantyne
Direct Dial: 0141 530 2037
Email:aballantyne@gilsongray.co.uk

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The information and opinions contained in this blog are for information only. They are not intended to constitute advice and should not be relied upon or considered as a replacement for advice. Before acting on any of the information contained in this blog, please seek specific advice from Gilson Gray.