Clarkson Plc v Person Or Persons Unknown

Today I am granting an application by the claimant for default judgment in this action, and making a final order for an injunction prohibiting the defendant from communicating or disclosing to any third party or in any other way using certain information, designated in the order as “the Confidential Information”. The order includes a number of provisions containing derogations from open justice.

At the request of the claimant, I have dealt with the application without a hearing. I should briefly explain the basis for doing that.

Open justice is a vital principle. But not every application needs to be dealt with at a hearing. Many are not. CPR 23.8(a) allows for an application to be dealt with “on the papers” where the parties consent to the order. Rule 23.8(b) allows this to be done where the parties consent to the application being dealt with in that way. Important orders can properly be made without a hearing on this basis. In PJS v News Group Newspapers Limited, I made a final order for a non-disclosure injunction in a media case on the papers. I did so by consent, in reliance on CPR 23.8(a) and (b). The parties had not only agreed the terms of the order, they had also expressly agreed that it should be dealt with on paper. Nonetheless, I considered whether proceeding in that way was in keeping with the open justice principle. I decided that it was, provided I gave a public judgment explaining what had been done and why.

In that judgment, [2016] EWHC 2770 (QB), I said at [1]-[2] that there was no need for a hearing,

“But I am giving this public judgment, for three reasons. The first is to ensure that the principle of open justice is respected, and that the derogations from open justice that I am granting are publicly explained. As explained in the Master of the Rolls’ Practice Guidance: Interim Non-Disclosure Orders[2012] 1 WLR 1003:

“9.

Open justice is a fundamental principle. The general rule is that hearings are carried out in, and judgments and orders, are public: see Article 6(1) of the Convention, CPR 39.2 and Scott v Scott [1913] AC 417.

One exception to that general rule is provided for by CPR 23.8. Dealing with a case “on the papers” is not incompatible with the open justice principle. It is an incursion. The extent to which such an incursion should be allowed must depend on the circumstances of the particular case. The Guidance goes on:

“16.

Interim non-disclosure orders which contain derogations from the principle of open justice cannot be granted by consent of the parties. Such orders affect the Article 10 Convention rights of the public at large. Parties cannot waive or give up the rights of the public. The court’s approach is set out in [JIH v News Group Newspapers Ltd [2011] EWCA Civ 42 [2011] 1 WLR 1645]at [21].”

The same reasoning applies to final orders. Dealing with this application on the papers but with a public order and a (short) public judgment strikes an appropriate balance between the competing rights.”

The other two reasons I identified for giving a public judgment in PJS do not apply to the present case.

As PJS illustrates, the Court is not bound to deal with an application without a hearing just because the parties consent. It retains a discretion. Sometimes, as has been observed, the very fact that there is consent is a reason to hold a hearing and deal with the matter in a public court room. Equally, the absence of consent does not necessarily debar the Court from dealing with an application on the papers, without a hearing. CPR 23.8(c) gives the Court the power to proceed without a hearing where it “does not consider that a hearing would be appropriate”. It is on that basis that I dealt with this application.

It is unlikely that the Court could or would deal on the papers with an application for a final order that determines civil rights, if that way of proceeding was opposed by one of the parties. But there are cases like the present, where one party has failed to engage with the proceedings and has therefore expressed no view about the matter. It is not necessary to decide whether that involves a waiver of the party’s rights. I did not consider a hearing to be “appropriate” in this case, because it would have added to the expense of this claim without serving any sufficiently useful purpose. On the facts of this case, and this application, the open justice principle can be properly respected and compliance with Article 6 achieved without the need for a hearing. That can be done by making the order and, through this judgment, publicising the fact it has been made and the basis for making it. Indeed, a process of this kind may even represent a more practical and effective way to give effect to the open justice principle and the Convention requirement for a public judgment, than holding a hearing.

This is a claim brought against a Person or Persons Unknown and, as is quite common in such cases, the identity of the defendant(s) remains unknown. So, there is nobody defending the claim who could benefit from the advantages that a hearing often brings with it for the litigant. The case has not proceeded in secret. There have already been two public hearings, at each of which a public judgment has been given and recorded. Transcripts of those judgments are available as of right. There is little that has changed since the last hearing, at which I granted an interim order and gave a reasoned judgment explaining why. This is not a case in which there is any likelihood that a public hearing of this application would be more effective in bringing the attention of others to matters of importance than the method I am adopting. Rather the contrary. Transcripts are not created or published as a matter of course. They are not often applied for by third parties. This written judgment, by contrast, will be posted on a public website. The reality is that information about these proceedings will be more accessible, if the case is dealt with in this way, than it would be if the matter had been dealt with at a hearing.

The facts of the case, in brief, are these. The claimant is a substantial public company operating in the shipping business, with its headquarters in the City of London. The defendant(s) are one or more unknown individual(s) who gained unauthorised access to the claimant’s IT systems and obtained a considerable quantity of information. The defendant(s) then threatened to publicise that information unless a very substantial sum was paid. The case, to all appearances, is one of blackmail.

The claimant sought and obtained an interim injunction at a hearing before Teare J on 27 November 2017. The case came before me on the return date of 14 December 2017, when I was asked to and did continue the relief granted by Teare J and renewed various derogations from justice which he had granted. In the extempore judgment given on that occasion I gave rather fuller details of the factual background, and why the relief was justified.

I then gave directions as to how the matter should proceed towards a trial or, as it has proved, a default judgment. In particular, my order provided as follows:

The present application was issued on 22 February 2018. It seeks default judgment pursuant to CPR 12.3(1) on the basis that the defendant(s) have not filed an acknowledgment of service nor filed or served a Defence, together with final injunctive relief, and some extensions to the ancillary orders derogating from open justice.

This is not the first occasion on which I have entered default judgment and final injunctive relief restraining publication, in a case against persons unknown. In Brett Wilson LLP v Person(s) Unknown [2015] EWHC 2628 (QB) [2016] 4 WLR 69 I considered the jurisdiction and the approach the Court should take. I adopt the same approach in this case. I am satisfied that the claimant has taken all reasonable steps to notify the defendant(s); that the reason the defendant(s) have not appeared to respond to the claim and the application is, most likely, that they have no wish to identify themselves as the perpetrators of the apparent blackmail; that the conditions for obtaining judgment in default prescribed by CPR 12.3(1) are met; and that I am able to and should proceed to grant substantive relief on the basis of the claimant’s unchallenged particulars of claim, without the need to consider evidence.

The claimant’s case, as set out in the particulars of claim, shows a clear need to restrain the defendant(s) from carrying out the threatened disclosures, and I therefore grant the principal injunctions sought, which are in the same terms as my interim order.

The derogations from open justice that have been granted so far in this case are restrictions on access to documents, and restrictions on the provision of documents to third parties. Teare J and I directed that non-parties would have to make an application to the Court if they wished to inspect any exhibits or schedules to the statements of case, witness statements, applications and skeleton arguments that had been designated as confidential. I have been asked to and do continue those provisions, as I am satisfied that there is a good case to be made that the information in such documents is indeed confidential and should not be publicly available as of right. The hearing papers are also protected by orders in common form, based upon paragraphs 10 to 12 of the Model Order attached to the Practice Guidance. Those orders continue to be justified.

The claimant’s application for a costs order against the defendant(s) is irresistible.