A sacked milkman was paid £40,000 by a rival Wolverhampton dairy to steal confidential documents from his former bosses in a bid to cream off their customers, it emerged today.

Johal Dairies then offered up to three months’ free milk to JN Dairies’ clients in a bid to pinch their business – but now face a legal bill estimated at £1m after a High Court verdict.

Both firms compete to supply independent supermarkets and shops throughout the Black Country and Birmingham.

Johal Dairies was found to have acted unlawfully by paying driver Gurbir Singh – an illegal immigant -to steal commercially sensitive data which it then used to undercut its rival. Singh was dismissed by JN Dairies on November 8 because he could not prove his legal status in the UK, the trial at Birmingham’s Civil Justice Centre heard.

Two days later he sneaked into the firm’s Millfields Road distributon centre in Wolverhampton and stole all the delivery invoices, which detailed the amounts of milk, bread and other items, and crucially the prices, it was supplying its customers.

He then passed the files to Surbjit Johal, also known as Jitty Johal, a director of Johal Dairies, as part of a pre-arranged plan. Johal denied the accusations but customers testified that they had been offered cheap or free milk by the firm.

Yesterday, Judge David Cooke rejected Johal’s evidence as “highly unconvincing” and “implausible” and found against the company and Singh.

A further hearing is due to take place in July when the judge will determine what sanctions are to be imposed on Johal Dairies.