When considering whether to pursue a dispute through the Courts, a key consideration – particularly for private clients – is what information could end up in the press. The general rule is that all hearings will be held in public and key documents from the claim setting out each party's position (such as the Claim Form, Particulars of Claim and Defence) will be accessible to non-parties.
Given this, if a dispute relates to sensitive information or involves damaging allegations, there is a risk that litigating in public may cause reputational damage. This was seen recently in the case of Holyoake v Candy, in which allegations made during the public hearing about the Candy brothers' business dealings and private lives became front page news. You can apply for a hearing to be held in private, although the threshold is very high. The rationale for this is that justice should be seen to be done, and that in principle, anyone, including the press, should be able to attend a hearing.
There are therefore limited grounds for applying to the Court to hold a hearing in private, including:
Where publicity would defeat the object of the hearing;
This is usually relied upon in claims where parties are seeking an injunction to refrain the publication of certain material on the basis of breach of confidence and/or defamation. In these circumstances, a private hearing is usually deemed necessary to ensure there is no further dissemination of the information/allegations the applicant is trying to protect.
Where the dispute involves confidential information (including information relating to personal financial matters) and publicity would damage that confidentiality;
There are certain types of financial proceedings which will usually be heard in private, including applications for a charging order, a third party debt order or the appointment of a receiver. This is because these matters are deemed to relate to highly personal financial information. In addition, where a company is asked to provide information about its financial stability in a security for costs application, this may also be held in private.
However, this ground will usually not extend to protecting business information, which is not deemed to be personal financial information. In the case of McKillen v Misland, the Court drew a distinction between purely personal financial matters (which are likely to be heard in private) and commercial or business financial matters, which will usually be held in public.
Where the hearing relates to an application made without notice to the other side, and it would be unjust for the hearing to be held in public.
This ground is relevant where an application is made for a freezing injunction or search order. In such cases, if the potential Defendants are informed of the hearing, they may have time to hide assets, which would defeat the object of the hearing.
In all cases, the Court will consider the facts to determine whether it is in the interests of justice to hold the hearing in private. Sitting in private is usually deemed by the Court to be a last resort, and a party should consider at an early stage whether there are other means by which to protect its reputation and/or business information while litigating. For example, parties can consider applying for an order that any confidential information is not referred to orally in a hearing, meaning it will not enter the public domain. Other options include applying for an order restricting the publication of the judgment from the case, and/or applying for directions to restrict access of non-parties to Court documents. Whether these applications will be successful will depend on the nature of the information to be protected and the circumstances of the case. These factors can be considered at an early stage, so that individuals or companies can properly assess the risk to their reputations and/or business information before deciding whether to litigate.