Equifax plc v Smeaton  EWCA Civ 108;  BPIR 231
(Court of Appeal, Tomlinson, Davis LJJ and Sir Robin Jacob, 20 February 2013)
S sought damages under the Data Protection Act 1998 for breach of the data protection principles and/or negligence at common law, on the basis that Equifax included in his credit file that he was subject to a bankruptcy order, which was inaccurate in two respects, ignoring the facts that for a period the bankruptcy order was subject to a stay pending appeal and that thereafter the bankruptcy order had been rescinded. The judge directed the hearing of the following issues: (1) did Equifax breach any duty to S under the Data Protection Act 1998; (2) did Equifax owe S a duty of care at common law and if so what was its content; and (3) if there was a breach did it cause S to be unable to obtain funding on behalf of his company. His Honour Judge Thornton QC (sitting as a judge of the High Court) ( EWHC 2322 (QB);  BPIR 888 determined the issues in favour of S. The Court of Appeal allowed Equifax's appeal. The judge's conclusion that it was inescapable that the credit applications were refused on the sole ground of S's bankruptcy entry on his credit file was incomprehensible and wholly unsustainable. The judge's conclusion was not simply against the weight of the evidence, it was actually contradicted by the evidence of the rejection letters themselves. It would not have been a reasonably foreseeable consequence of Equifax's alleged breach of duty that a consumer such as S would (a) not be provided with any information about his credit file or take any steps to investigate his credit file for several years, and (b) upon discovering that his file contained inaccurate bankruptcy data, suffer severe shock and, in consequence, become homeless, suffer a mental breakdown, and become unable to make any renewed application for credit. These consequences, even upon the assumption that they could be shown to be causally related to the breach of duty, were far too remote from that breach to give rise to liability under either the Data Protection Act 1998 or at law. The judge was in error in concluding that a credit reference agency assumed a responsibility to every member of the public simply by choosing to operate that type of business. Applying the traditional three-fold test of foreseeability, proximity and whether it was fair, just and reasonable to impose a duty, there were compelling reasons which demonstrated conclusively why it was inappropriate to superimpose on whatever was the statutory duty a co-extensive duty of care in tort.
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