Former Royal Navy captain David Axon who has lost his High Court privacy claim against the Ministry of Defence. Picture: Anthony Devlin/PA Wire

David Axon sued the MoD for substantial damages after one of its employees with access to information up to “top secret” level sold details about him to a journalist at the Sun for £5,000.

The career naval officer left his ship, HMS Somerset, in December 2004 - four days before an article appeared in the Sun - after an equal opportunities investigation made adverse findings against him and concluded his position on board was “untenable”.

MoD employee Bettina Jordan-Barber later pleaded guilty to conspiracy to commit misconduct in public office and was jailed for 12 months.

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But a judge has rejected Mr Axon’s claim that he was entitled to compensation from the MoD because it was vicariously liable for her breach of confidence, misuse of private information and a breach of his Article 8 privacy rights under the European Convention on Human Rights.

Mr Justice Nicol, sitting in London, ruled that Mr Axon, who now faces a large legal costs bill unless there is a successful appeal, “did not have a reasonable expectation of privacy” over the information leaked to the Sun.

The judge said there was no doubt that Ms Jordan-Barber owed a duty to preserve the confidentiality of information she received in the course of her work.

“However, that was a duty which she owed to either the Crown or the MoD. It was not a duty which she owed to (Mr Axon).”

Mr Axon was appointed commanding officer of HMS Somerset, a Type 23 frigate, in June 2003 with a crew of about 185.

In May the following year, the ship was deployed to the Gulf for a six-month operational tour off the coast of Iraq. Towards the end of that deployment complaints of bullying reached top RN officers.

At the equal opportunities investigation (EOI), Mr Axon said he was devastated that officers considered his behaviour to be bullying as he had never set out intentionally to belittle or bully anyone.

He later accepted that the investigation had rendered his position very difficult and, with the best interests of the ship firmly in mind, did not oppose the application for his removal.

Mr Axon told Mr Justice Nicol at the hearing of his damages claim: “I accept that I bullied my officers, to my eternal shame.”

The effect on his reputation of the allegations becoming public had caused problems with finding employment.

Mr Axon added: “It was humiliating and embarrassing to realise I had let my officers down and my ship down. The impact on me at the time was dramatic, I admit, but for me the real damage was the impact on my ship’s company.”

He argued that the EOI was intended to remain confidential and private and it was a matter “of great regret” that the process, to which he had fully subscribed and which resulted in a five-year censure on his personnel record, was subverted by a breach of his confidence.

But the judge rejected all his grounds of claim against the MoD.

A News UK spokeswoman said: “The judge found that this claimant did not have any reasonable expectation of privacy in what The Sun published about him.