Open justice versus confidentiality - which wins?

19 December 2019. Published by Simon Hart, Partner, Head of Banking & Financial Markets Disputes and Emma West, Senior Associate

Court proceedings can expose the most sensitive details of an individual's personal and financial affairs. However, the principle of open justice requires that the public is given sufficient information about proceedings so that they can understand and scrutinise the decisions courts make.

Accordingly, the starting point is that court hearings take place in public and certain documents filed in those proceedings are available to all. If the court is persuaded that there is information which should be kept confidential to the parties, a recent Court of Appeal decision(1) has confirmed that the court will do the minimum necessary to protect this information in order to uphold the principle of open justice.

Court hearings- the key battleground

Court hearings usually take place in public, unless the court considers that exceptional grounds exist such that it is both necessary and proportionate to hold a private hearing. A private hearing can only be attended by the judge, the parties and their representatives, without any press or other members of the public present.

One of the grounds on which a hearing may be held in private is if publicity would defeat the object of the hearing. For example, the first hearing at which a freezing injunction may be ordered is likely to take place in private if there is concern that the subject of the injunction will remove assets from the jurisdiction if it learns about the proposed court proceedings.

Where there are orders in related foreign proceedings protecting the confidentiality of information disclosed in those proceedings, the English court may be persuaded to make an order that hearings be in private in order to uphold the confidentiality restrictions in place in the foreign proceedings and enable the information from foreign proceedings to be used in the English court.

However, in the ordinary course, a hearing is unlikely to be held in private just because the discussion of certain matters in open court may cause reputational damage to one of the parties, or the disclosure of sensitive business information. Even if one of the exceptional grounds exists, the court will consider if the parties' concerns can be addressed by less drastic measures, such as an order preventing the reporting of any confidential information inadvertently disclosed during a hearing. If a hearing is held in private, a court may still choose to give its judgment in public, meaning that parties must make sure that any sensitive information is redacted from the judgment.

Court documents - a fine balancing act

Once all defendants have acknowledged service or filed a defence, a hearing has been listed, or the court has determined the claim, anyone can obtain from the court file copies of statements of case and any judgments or orders made by the court. They can also make an application to obtain copies of any other documents filed by the parties or referred to in court hearings (whether or not a judge has been asked to read these in advance). This includes witness statements, expert reports and correspondence with the court.

The Supreme Court(2) has recently stressed that parties seeking such documents need to make a specific request explaining why access to these documents will advance the open justice principle; the court will not entertain a fishing expedition. The court will then weigh up open justice against any risk of harm to interests such as those of minor children. The final factor in the balancing exercise is how practical and proportionate it would be to disclose particular documents.

If a party is particularly concerned about the content of documents filed in proceedings, it can apply to court to restrict non-parties' access to such documents. The court starts from the presumption that a non-party should be able to obtain un-redacted documents from the file, so good reasons (such as the potential disclosure of minor children's financial interests) are required to persuade it to do otherwise.

It also pays to be clever about the documents which are filed at court in the first place. If the proceedings are compromised the signed settlement agreement should not itself be filed with the court. Instead, the order disposing of the proceedings can simply refer to the fact of its existence. This stops third parties finding out, for example, how much one party agreed to pay to settle the claim.

Anonymity - tipping the balance in favour of privacy?

Whether the hearing takes place in public or private, anonymity can be used to remove the names of parties from orders and transcripts and, in appropriate circumstances, other identifying features of the parties such as the nature of their business. It can be useful where the names of parties are well known and likely to attract press attention, so the case of Smith v Jones, could be referred to as A v B.

Anonymity can tip the balance in favour of the protection of confidential information where a public hearing is held. In one case, the parties had concerns about the effect that prematurely learning about the extent of family wealth in trusts would have on the child beneficiaries(3) , and sought a private hearing. Rather than acceding to the parties' request, the court made an order anonymising sensitive information, as it considered that this adequately addressed the parties' concerns about confidentiality.

In all cases the court will carefully assess any anonymity restrictions sought by the parties. In a recent case that concerned an application to vary trusts, the Court of Appeal(4) did not order the full extent of anonymity requested by the parties. Instead of anonymising the name of all parties and details of the trust, it simply anonymised the details of minor children, on the basis that they were the only individuals' interests the court was obliged to protect.

So, which wins?

Open justice will usually trump confidentiality unless very good reasons can be shown to depart from this principle. The court will then carefully balance the competing interests to ensure that open justice is only eroded to the minimum extent necessary to protect the relevant interests. Concerns about confidentiality should be addressed at the outset of proceedings and parties should consider carefully the matters which they refer to in court documents if no confidentiality restrictions are in place.

The most effective way to ensure confidentiality wins may be to avoid court proceedings altogether. If there are sensitive issues at stake, parties could agree to an alternative dispute resolution mechanism, such as mediation, before these issues are aired at a court hearing. Parties entering into a commercial relationship can agree that any disputes between them will be submitted to arbitration, which is usually confidential between the parties.

(1) MN v OP [2019] EWCA Civ 679
(2) Cape Intermediate Holdings Ltd v Dring [2019] UKSC 38
(3) V v T and another [2014] EWHC 3432
(4) MN v OP [2019] EWCA Civ 679

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