| ARBITRATION — Practice —Confidentiality in national and international arbitration — Claimant in English arbitration seeking disclosure of documents for use in court proceedings overseas — Exceptions to confidentiality in arbitration proceedings — Whether disclosure in interests of justice
Emmott v Michael Wilson & Partners Ltd [2008] EWCA Civ 184; WLR (D) 82
CA: Carnwath, Thomas and Lawrence Collins LJJ: 12 March 2008
The interests of justice required an English court to ensure as far as possible that parties to London arbitrations should not seek to use the cloak of confidentiality with a view to misleading foreign courts particularly where the cases being presented in the foreign courts raised essentially the same or similar allegations and were proceeding in parallel.
The Court of Appeal so held dismissing the appeal of the defendant, Michael Wilson & Partners Ltd, from the orders of Flaux J made on the application of the claimant, John Forster Emmott, on 23 November and 4 December 2007 in which he authorised the disclosure, for the purposes of proceedings in New South Wales and the British Virgin Islands, of documents generated in an English arbitration between the parties. The judge directed disclosure of certain pleadings and a skeleton argument in the interests of justice so that overseas courts would not be misled where the cases that were being advanced in the various proceedings were essentially raising the same or similar allegations.
LAWRENCE COLLINS LJ said that, applying Ali Shipping Corpn v Shipyard Trogir [1999] 1 WLR 314 , the judge had accepted that the material to be disclosed was in principle confidential, subject to two possible exceptions. The first was where disclosure was reasonably necessary for the protection of the legitimate interests of an arbitrating party, or to defend a claim or counterclaim brought by the third party. The second was the exception of public interest. The conduct of arbitration was private. That was implicit in the agreement to arbitrate. That did not mean that the arbitration was private for all purposes. Today there was an increasing trend for the privacy of arbitrations to be protected. That was illustrated by CPR Pt 62. But it was clear from Department of Economics, Policy and Development of the City of Moscow v Bankers Trust Co [2005] QB 207 that that policy might have to give way to the public interest. Consequently even under the modern law since the Arbitration Act 1996 there would still be cases where the details of an arbitral dispute might become public. But case law over the last 20 years established that there was an obligation, implied by law and arising out of the nature of arbitration, on both parties not to disclose or use for any other purpose any documents prepared for and used in the arbitration, or disclosed or produced in the course of the arbitration, or transcripts or notes of the evidence in the arbitration or the award, and not to disclose in any other way what evidence had been given by any witness in the arbitration. The obligation was not limited to commercially confidential information in the traditional sense. This was in reality a substantive rule of arbitration law reached through the device of an implied term. That approach had led to difficulties of formulation and reliance (perhaps, over-reliance) on the banking principles in Tournier v National Provincial and Union Bank of England [1924] 1 KB 461. The application to arbitration of the principles of banking confidentiality culminated in the judgment of Potter LJ in Ali Shipping Corpn v Shipyard Trogir [1999] 1 WLR 314 who formulated a series of exceptions closely modelled on the Tournier case. In the present case, the interests of justice required disclosure. The interests of justice were not confined to the interests of justice in England. The international dimension of the present cases demanded a broader view. The concentration in the present judgment on the limits of confidentiality in arbitration should not obscure the fact that the overwhelming majority of arbitrations in England were conducted in private and with complete confidentiality.
THOMAS and CARNWATH LJJ delivered concurring judgments.
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