High Court dismisses claim against council over hard drive containing password to £600m bitcoin wallet dumped at landfill site

The High Court has dismissed a claim against Newport City Council concerning the ownership of a hard drive containing the password to a Bitcoin wallet worth more than £600m that was said to have been left in error at a landfill site, after finding "no reasonable grounds for bringing the case".

Handing down a summary judgment on an application from the council to strike out the claim, in Howells v Newport City Council [2025] EWHC 22 (Ch) (09 January 2025), His Honour Judge Keyser KC, sitting as a Deputy High Court judge, said the claim would have no realistic prospect of succeeding if it went to trial.

The then-partner of the claimant, James Howells, is said to have mistakenly discarded in August 2013 the 2.5-inch laptop hard drive containing the private and public key addresses necessary to access his Bitcoin funds.

As of today (10 January), 8,000 Bitcoin is worth £617,196,902.

Howells said he misidentified the hard drive and placed it in a bin liner during a clear-out, leading to his partner disposing of the bag at the Newport Household Waste and Recycling Centre (NHWRC).

Over the last ten years, he has repeatedly requested access to the landfill in a bid to retrieve the hard drive, offering to contribute 10% of the Bitcoin's value to the Newport community if it is successfully recovered.

However, the council asserts that it is the legal owner of the hard drive as it was deposited at the landfill.

Responding to his claim lodged in May 2024, the council mainly relied on the provisions of s. 14 (6) of the Control of Pollution Act 1974, which states: "Anything delivered to the authority by another person in the course of using the facilities shall belong to the authority and may be dealt with accordingly."

The council later applied for an order striking out the claim in June 2024.

The particulars of claim raised three heads of claim:

1. A proprietary restitutionary claim
2. An equitable proprietary claim
3. A claim for declarations that the claimant is the legal owner of the hard drive and all tangible and intangible property on it, together with either (a) an order for delivery up of the hard drive or (b) damages for its wrongful retention.

Judge Keyser said the only relevant issues in this case concerned the ownership of, and rights of access to, the hard drive.

The law of England and Wales has historically recognised two different kinds of personal property: things in possession (tangible property), and things in action (intangible property).

Describing the terms, the judge said: "Things in possession are physical things, and things in action are rights that have existence only as being enforceable within a legal system (such as debts that one is owed, or intellectual property rights).

"It is now generally recognised that cryptocurrency, such as Bitcoin, is also property, although it does not fit within what the law recognises as tangible or intangible property; as such, it is commonly said to constitute, or to be within, a 'third category' of personal property."

On this point, the judge said the only thing that went into the landfill was the hard drive.

He added: "The particulars of claim seek a declaration that the claimant is the legal owner of both the tangible and the intangible property of and in the hard drive. The tangible property is simply the hard drive, which is what went into the landfill.

"Paragraph 58 of the particulars of claim identifies the intangible property on the hard drive as the bitcoin, and in his oral submissions Mr Armstrong KC ended up contending that the bitcoin were 'on' the hard drive.

"That is plainly wrong. Bitcoin are not tangible property and cannot be on the hard drive or in the landfill. Bitcoin are also not intangible property (on this, see the helpful discussion in the Law Commission's Digital Assets: Final report, at paragraphs 3.52 to 3.54), and neither intangible property nor property within the third category has physical location."

James Goudie KC, who represented the council, meanwhile accepted "unequivocally" that the council did not own the bitcoin.

The council instead argued that it owns the hard drive and that the claimant has no right to have it or to gain access to it.

HHJ Keyser KC further concluded that what is on the hard drive "is at most a digital record of the private key", not the private key itself.

A private key is a code provided to the claimant to enable him to operate his cryptocurrency account.

On this point, he said: "What was delivered to the landfill was the hard drive. The defendant's simple contention is this: it is the claimant's case that the hard drive was delivered to the site by 'another person', namely his partner at the time; she delivered it 'in the course of using the facilities'; and, in those circumstances, the hard drive belongs to the defendant and the claimant is not entitled to it.

"In my judgment, the defendant's argument is correct and provides a complete answer to the claim."

The judge also tackled further claims from the claimant, including a submission that section 14(6)(c) of the Control of Pollution Act says that anything so delivered shall belong to the authority "but does not say that it shall cease to belong to its former owner".

As a result, the claimant argued that it does not preclude the possibility that existing property rights might be preserved, or that a thing might 'belong' to a number of individuals concurrently.

However, the judge dismissed this point too, stating that: "any qualification of the words ‘shall belong to the authority’ would be contrary to the point of the provision; therefore it makes no sense to introduce such a qualification into the interpretation of the words."

Thirdly, it was submitted that it was arguable that the words "in the course of using the facilities" in section 14(6)(c) do not apply to someone, such as the claimant's partner at the time, who disposes of items without the owner's consent.

The judge dismissed this point as well, finding that he did not regard it to be arguable.

Concluding, he wrote: "For the reasons given above, I consider that the particulars of claim do not show any reasonable grounds for bringing this case.

"I also consider that the claim would have no realistic prospect of succeeding if it went to trial and that there is no other compelling reason why it should be disposed of at trial. It follows that it is open to me to strike out the claim under CPR Part 3 or to give summary judgment for the defendant under CPR Part 24. The latter course seems preferable. There will be judgment for the defendant and the claim will be dismissed."

Adam Carey