Civil/Commercial Litigation (Lawsuits)/A Question For Morgan Smith



Firstly, thank you very much for offering to answer my question. It is very much appreciated!!

My question is about a Non-Disclosure Agreement and the consequences of somebody breaking one.

My question is this: If a business asks a freelance worker to sign a NDA, and that person later breaks it - what penalty could that person face? And what is the maximum penalty/punishment that person can face? (The confidential information being computer files from business clients, and presuming the person lives in the UK and is a UK citizen.)

Also, I imagine it is very difficult to prove that a person broke a NDA when the confidential information being shared is computer files - am I right? And indeed, I imagine it would be even more difficult to prove that somebody intentionally broke a NDA (and that it wasnít as a result of some other reason for which that cannot be blamed).

Also, when asking a worker from a different country to sign a NDA, can you use the same NDA document as the one that you use for home nation workers? For example, would I need to change anything in the NDA form that I give to UK workers when working with US workers? Also, when giving a NDA to someone who runs their own business, who passes on work to his workers (who are possibly employees of the business, though possibly not) - is that NDA still valid and effective? By this I mean, if the business owner that I send the NDA to, gives my work to his workers - can he get out of the NDA by claiming that it was one of his workers that broke the agreement and not him?

Thank you,

Peter Hughes

ANSWER: Hello Peter Hughes,

Before I respond further to your question, I must make clear that I do not represent you, and cannot give you individual particularized legal advice. No attorney client relationship is created by this email. For legal advice, you should hire your own attorney, and follow their advice. My role with AllExperts is limited to providing general information and suggestions for educational or general knowledge purposes. Before you take any action, consult with your own attorney.

A general theory for fairly calculating damages for a breach of contract case is to try to put the nonbreaching party in the position they'd be if the contract hadn't been broken.  Sometimes it is understandably difficult to prove the dollar amount of damages with any certainty, so there is a lot of risk and randomness at the trial.  Often, to eliminate that problem, drafters of contracts include a liquidated damages clause that specifies in advance what the parties agree the damages for a breach or each is worth.  So, I suggest that you read the NDA carefully, and look for a provision therein that sets forth what the amount of damages would be in the event of a breach.

I do not practice international law, and leave you to advice from others regarding contract enforcement and drafting among parties from different countries.  I suggest that you confer with an attorney licensed to practice in your area to help you prepare, amend or reject contracts depending on your needs and expectations.

I hope this helps, good luck to you.

Morgan Smith
Minneapolis, Minnesota
Conciliation Court * Civil Litigation * Forfeitures * Construction * Family Law

---------- FOLLOW-UP ----------


Thank you very much for your quick reply. It is very much appreciated!!

I have a few follow up questions, I hope thatís okay with you.

I understand that for some of the below questions you may not be able to answer them because they involve UK law, though I would still like to hear your views from a US system perspective because the two systems are very similar. Also, for all of the below questions, if you cannot provide me with a straight answer, please try to provide me with a rough idea/approximation.

Firstly, is it ever possible for a person to get jail time for breaking a NDA, under either the UK or US system? And if so, how long can that jail time be?

In terms of money damages for breaking a NDA when no liquidated damages clause exists, what sort of amount of money are we looking at?

Also, when it comes to money damages (for whatever the reason they have to be paid), what happens if the individual cannot afford to pay them? If, for example, an individual is ordered to pay £1 million in damages, how would this ever get paid? This question applies to a) the UK system and b) the US system.

Lastly, I have a completely different question for you. Which is, can you tell me what can me the consequences of a UK based freelancer breaking a clause in a contract which states "You will not sub-contract out work given to you." when the business involved is a) a UK based business and b) a US based business? And, what is the general or typical penalty for this wrongdoing? And what would be the maximum penalty? Is a jail sentence possible?

I am sorry for all these questions, but you are helping me greatly!!

Thank you,

Peter Hughes

Hello again Peter,

The same rules in my original message apply to this follow up.

To my knowledge, the penalties for breaking a contract are civil.  The only exception I can imagine might be if you sign a contract with the government pertaining to national security secrets, and then the violation of that contract may carry criminal penalties that could include jaul time.

I cannot render an opinion about hypothetical damages with no information about the circumstances, and recommend that you speak with an attorney licensed to practice in your area about the possible outcome of contemplated litigation.

When a judgment is entered for damages, it is an official statement from the government that the debt is owed.  A judgment alone does not make the money change hands, and obviously if the debtor has no money then the debtor cannot pay.  In the U.S., a debtor can get relief from the courts with a bankruptcy and likely discharge a debt.  The burden of executing a judgment is on the judgment creditor, and typical actions in furtherance thereof are wage garnishments, bank levies, a lien on real property, etc.

I have no knowledge of UK law and cannot render a guess about specific applications of that kind of law.  Generally, I abide my earlier observations that the penalty for violating a contract is a civil matter, and does not include jail unless your country still has debtors prisons, which I highly doubt.

I hope this helps, good luck to you.

Morgan Smith
Minneapolis, Minnesota
Conciliation Court * Civil Litigation * Forfeitures * Construction * Family Law  

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Morgan Smith


Civil litigation (contract claims, landlord-tenant actions, forfeiture suits, residential construction defect matters), Family law (divorce, custody modifications, child support modifications, and pre-nuptial agreement), new business start-ups, civil forfeiture, asset forfeiture. Please do not submit your question as Private. It is my policy not to answer Private questions from members of the public here on AllExperts; I reserve that function to my private clients. Although AllExperts permits me to change your questions from Private to Public, it is my policy not to do that. I encourage you to resubmit your question as a public question. Your public question has the potential to help others with similar concerns. I suggest that you use a pretend name and otherwise alter sensitive facts that make you inclined to treat your question as Private, and submit your question to me Publicly.


I've been practicing law in the State of Minnesota since 1995. I've worked in skyscraper firms, and now my own small firm in Minneapolis. Past answers from my earlier participation on AllExperts is posted at:

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