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Brief Counsel

Open justice may be open season, but not here - not yet

18 April 2012

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The easier public access to court documents given under High Court Rules issued in 2009 has been reinforced by recent court decisions, here and in England.

That is good news for the media and good news for “follow on” damages claimants.  But it may be bad news for applicants for leniency from the Commerce Commission. 

Schenker

In February this year, Justice Asher declined a request by the freight-forwarding company Schenker to access Court records compiled expressly for Commerce Commission proceedings against various airline companies (Commerce Commission v Air New Zealand Limited & Ors [2012] NZHC 271). 

Schenker sought access to the documents in order to assess whether it could have claims (here or elsewhere) against the airline companies.  The records involved a large amount of confidential information, including about non-parties (some of which also opposed release).  Producing redacted versions of that information would have been a substantial burden on the parties.

Justice Asher stated that the 2009 reforms did not mean that there was now a presumption in favour of disclosure but rather that open justice, and the freedom to seek, receive and impart information were principles to be balanced against other considerations, such as the fair administration of justice and the protection of confidentiality interests.

The problem for Schenker was that the latter considerations were strong and Schenker’s need for the information was not so strong.  But context is everything and it is possible that an application by the media might have been treated more favourably. 

Justice Asher drew a distinction between the interests of the media (which engage the open justice principle), and the interests of private parties (which engage the principles of freedom of expression).

The Guardian

Such was the experience of the Guardian newspaper in a decision in early April from the England and Wales Court of Appeal (Guardian News and Media Ltd, R (on the application of) v City of Westminster Magistrates’ Court [2012] EWCA Civ 420).

The Guardian sought access to information from extradition proceedings brought by the US Government against two individuals alleged to have been involved in the bribery of Nigerian officials by a subsidiary company of Halliburton.
Guardian reporters could not attend the entire trial and so sought copies of documents which had been referred to in Court.  The first instance judge declined this application but access was allowed on appeal.

The Court of Appeal’s decision was complimentary of the New Zealand Law Commission review which led to our 2009 amendments and also quoted liberally from our Supreme Court’s decision in Rogers v Television New Zealand Limited [2007] NZSC 91.

Lord Justice Toulson adopted the opposite starting point from Justice Asher (acknowledging that in doing so he was breaking new ground). 

He thought that the Courts should assist rather than impede an application for access, unless some strong contrary argument could be made.  His Lordship considered that where access was sought for a proper journalistic process, the case for allowing it would be particularly strong.  A fact-specific proportionality assessment would be required but the countervailing risks would especially relate to vulnerable litigants, such as children, and the elderly and infirm (agreeing with our Law Commission on this point).

National Grid Electricity Transmission (NGET)

Across the lane, and the very next day, Justice Roth in the Chancery division issued a judgment in a claim brought by NGET against 23 companies which had been involved in a cartel regarding the supply of gas insulated switchgear (National Grid Electricity Transmission Plc v ABB Ltd & ors [2012] EWHC 869 (Ch)). 

After the cartel was exposed by the European Commission, NGET made a “follow-on” damages claim for losses it had suffered as a result of the cartel’s overcharging.  NGET sought disclosure of documents from the defendants, but some of the defendants had been leniency applicants to the European Commission.  NGET thought it should be able to see the leniency materials.

The Commission was concerned to ensure that any disclosure was proportionate to ensure that future applicants would not be deterred by the risk of subsequent disclosure.  The Court agreed, but said that proportionality should be assessed in simple terms of whether the information is available from other sources, and its relevance to the proceeding.

Justice Roth dismissed the notion that leniency applicants had legitimate expectations that their statements would be protected from disclosure.  Leniency, and even immunity, applications provided no immunity from subsequent civil suit.

In the result, the Court decided to exercise its power to inspect the relevant materials first, and then split the difference somewhat in the result, allowing access to some materials but not others and deferring some issues for another day.

Chapman Tripp comment

Although a discovery decision, the NGET case is a variant on the open justice theme.  That a busy High Court Judge was prepared to review a substantial amount of material himself rather than take an all or nothing approach indicates that the Courts are taking the obligation of public justice very seriously.

In terms of where New Zealand sits, we would expect the Guardian decision to be influential, and that private parties with stronger claims than Schenker’s would have far better prospects of success with access applications. 

The media should also be very well positioned in these applications.  Conversely, making arrangements with the Commerce Commission for the protection of confidential leniency materials may just have become rather problematic (provided those materials are or may become relevant to a litigant).

The administrative burden on the Courts, and on parties to litigation, may increase as a result of this trend.  That is the price of transparency.

Our thanks to Justin Graham for writing this Brief Counsel. For more information, contact the lawyers featured.