Lloyds Developments v Accor Hotel Services: directors ordered to hand over phones despite deleted message uncertainty

If you use your personal phone for company business, you may one day be required to hand it over, even if what you are looking for has probably been deleted. That is the practical upshot of Mr Justice Constable's judgement in Lloyds Developments Limited (in administration) v Accor Hotel Services UK Limited [2026] EWHC 1522 (TCC), a case which also doubles as a masterclass in how not to conduct high-value commercial litigation.

The underlying dispute involves a £180 million deceit claim by Lloyds Developments, now in administration, against Accor, the hotel group, arising from a hotel development project that ultimately collapsed. Accor's counter-narrative is that the project failed because of chronic underfunding and misappropriation of investors' money by the company's own directors, Rishipal Singh and Richard Diamond. With allegations of dishonesty flying in both directions and a trial set for November 2026, the question of whether those directors' personal mobile phones would be examined by an independent reviewer had already consumed years of satellite litigation and at least 55 court orders before this hearing.

The directors' position rested on two arguments. The first was practicality: a digital forensics expert concluded that deleted WhatsApp messages on iPhones are often technically unrecoverable and that recovery outcomes are "frequently nil". If the messages are probably gone, why impose the disruption and privacy intrusion of handing over a personal device? The second was privacy: the phones contained years of personal, confidential and potentially privileged material belonging to third parties, and forcing production was said to be disproportionate given what was likely to be found.

Constable J dispatched both arguments without much difficulty, and his reasoning on each point carries weight beyond this particular dispute.

On the question of recoverability, the judge noted that the forensic expert's language, that recovery is "often" or "frequently" unsuccessful, is equally consistent with success being "often" or "frequently" achieved. An unpredictable outcome is not the same as an improbable one, and the court is not required to treat uncertainty as a reason to abandon the exercise, particularly in a case where dishonesty is alleged. There was also a pointed observation that deleted messages may be more revealing, not less, than those the directors had been content to leave visible when submitting their phones for earlier, self-supervised disclosure exercises. The court was not prepared to treat a controlled and incomplete prior review as substantial compliance with its orders.

On privacy, the safeguards built into the process were decisive. The phones would go to an independent reviewer, not to the opposing party or its lawyers. Only material identified as responsive to the agreed disclosure parameters would ultimately be produced. The Court of Appeal had already considered and rejected the privacy objection when refusing permission to appeal an earlier order. Nothing in the new expert evidence changed that analysis.

The more durable point in the judgement concerns the common law right of a principal to inspect documents held by a former agent. The principle, established in Fairstar Heavy Transport v Adkins [2013] and Yasuda v Orion Marine Insurance [1995], is that this right extends to electronically stored material and survives the termination of the agency relationship. Importantly, as Colman J confirmed in Yasuda, the directors could not resist inspection simply because relevant material was mixed with irrelevant personal content. That principle predates smartphones but maps onto them with uncomfortable precision for anyone who has ever taken a work call on a personal device.

Constable J was also blunt about the litigation conduct that had made the application necessary. The case, he noted, has been bedevilled by delays, repeated non-compliance with disclosure obligations and a failure by the parties to co-operate in any manner consistent with modern litigation expectations. Costs were reduced by 20% across the board for both successful parties on account of duplication that better co-operation would have avoided. The directors were ordered to pay 80% of costs to both Lloyds and Accor, with Lloyds carrying a joint and several liability for Accor's costs should the directors fail to pay.

The message is straightforward. Use a personal phone for work, expect it to follow the work.