In Samsung Semiconductor Europe Ltd (SSEL) v Docherty the Outer House of the Court of Session held that an employee owed a fiduciary duty to his employer and should account for the secret profit he made in ensuring that his employer did business with another company, DKV, in which he secretly held a 50% shareholding. It did not matter that there was no detriment to the employer.

Mr Docherty was employed by SSEL as a quality assurance manager. Unknown to SSEL, Mr Docherty secretly held a 50% shareholding in a company which provided SSEL with engineering support and quality control services, called DK Verification Ltd (DKV).

For several years, Mr Docherty ensured that SSEL continued to do business with DKV, providing misleading information about DKV’s competitors to ensure that SSEL did not move its business elsewhere. When it discovered Mr Docherty’s financial interest in DKV, SSEL issued proceedings against Mr Docherty seeking an account of profits made by him from his dealings with, or interest in, DKV.

The Court held that Mr Docherty did owe SSEL a fiduciary duty, there was a potential conflict between that duty and his interest in DKV, and Mr Docherty was therefore liable to pay to SSEL an amount equal to all the monies he had received from his interest in DKV. Mr Docherty was therefore ordered to account for the full €340,808.92 he received from DKV by way of salary, share of profit and payment for shares.