Confidentiality agreements frequently play a part in the resolution of legal disputes outside the courts. The relationship between such agreements, the interests of parties to libel proceedings, and the wider public interest was considered in a decision on a strike out application given by Tugendhat J on December 15 ( EWHC 3375 QB). The application to stay or strike out was made on the basis that the Claimant’s behaviour in relation to a confidentiality clause in a settlement interfered with the Defendant’s ability to defend the claim.
The Defendant acted in its capacity as publisher of The Mail on Sunday. The Claimant, who thrust himself into the spotlight at the start of the year when he referred to the “obnoxious bigotry” of feminists, is the MP for Esher and Walton, who previously worked as chief of staff for David Davis MP when the latter was Shadow Home Secretary. During this time, a woman described in the proceedings as ‘E’ was also employed in the office, leaving in 2007 under the terms of a compromise agreement (‘the Agreement’), which imposed duties of confidentiality on her.
The claim arose out of the publication of an article headlined “Payout for Woman Who Claimed Workplace Bullying Under Raab” on January 30 2011. The article said the payout was £20,000 and it added that E could not talk about her treatment under the terms of the settlement. The Claimant’s letter of claim set out the defamatory meanings attributed to the words – that the Claimant had bullied and discriminated against ‘E’, and that the Tory party had covered this up – and the Defendant replied with a letter that was effectively a Request for Further Information.
Two extensions of time for the service of a defence (which had not been served at the date of judgment) were applied for by the Defendant, the second on the ground that E and her parents needed to be released from their obligations of confidentiality, E having made such a release by the Claimant a condition of her speaking to the Defendant. The Claimant refused to release her, and the application for an order to stay or strike out followed on October 26.
The application was accompanied by a witness statement which referred to the difficulties the Defendant faced: it stood by the truth of the article, but required information from E and her parents to justify it, which the confidentiality obligation prevented them from giving. The nature of the defence used would depend on access to this information and the Defendant cited a public interest in preventing the confidentiality obligation stopping them talking to E.
The Claimant suggested by letter that E may have acted in breach of the Compromise Agreement by giving information to the paper; she denied this, and referred to the article as an “unwarranted intrusion on my privacy”. When the Defendant cited the possibility of E assisting them, the Claimant’s solicitors wrote to her suggesting that consent from Davis and Raab would be required for her to do so, otherwise she would have unilaterally breached her obligations.
E subsequently reiterated her position – that she had had not had contact with the Defendant previously, but was prepared to speak to it if released from the Agreement, otherwise having every intention of sticking to it. Her solicitor stated that a witness statement which had been served on the Claimant should not be disclosed to the Defendant, as it was covered by the Agreement. A request for disclosure of the statement also formed part of this application.
The Defendant cited a number of authorities in support of the idea that the court can exercise its discretion to stay proceedings for as long as a fair trial is impossible, including Carpenter v Associated Newspapers Ltd (unreported, Gray J, 30 November 2001) (a witness who could have helped a newspaper plead justification was prevented from doing so by the Claimant). The Defendant also relied on the idea that, although Art 10 (2) of the Convention provides for “preventing the disclosure of information received in confidence” as a reason for restricting the right to freedom of expression, such obligations can be overridden by the public interest. There should be “no unnecessary barriers” to the use of justification (McDonald’s Corp v Steel  3 All ER 615), and a defendant should be able to enjoy “a full opportunity to make good whatever defence he has” (Basham v Gregory (unreported, 21 February 1996 CA) per Lord Bingham MR). The Defendant also sought to rely on the principle that no impediment should be placed in the way of witnesses willing to give evidence, citing Lord Judge CJ in HM Attorney-General v MGN Ltd  EWHC 2074.
The Defendant submitted that it was no longer proper for the Claimant to continue to enforce a confidentiality obligation against E while he was pursuing the action. This refusal led to an inequality of arms, and prevented the Defendant from pursuing the usual course of interviewing witnesses before deciding to plead justification.
The Claimant submitted that any obligations of confidentiality would be overridden by the public interest in the administration of justice, were justification to be pleaded, and were there an issue of fact to be resolved. He argued that the Defendant wished to avoid having to plead justification on the basis of the material available to it. He also pointed to the Defendant’s having failed to specify the defamatory meaning of the words complained of which it wished to prove true, and to the fact that it bore the burden of proof with regard to justification.
Tugendhat J held that there was no similarity between the facts of the cases cited and the instant one; here, there was no suggestion that the Agreement made in 2007 was intended to prevent the Defendant defending the claim in 2011. The Judge did not accept that there was any ‘gag’ or ban imposed on E, given the lack of evidence that confidentiality was imposed on her in the Agreement, and he emphasised her own desire not to discuss the events which led to her departure.
He identified the issue not as being one of whether the right to confidentiality could be overridden during proceedings (it could), but of timing: should the Claimant have to give up his rights before a defence is served, in order to be free to continue the claim? On the facts, he should not, as the public interest did not outweigh the rights of the parties to the Agreement to maintain confidentiality.
The Judge felt that the bigger picture was important, since the distinction between interviewing a witness and giving disclosure is a narrow one, and
“[t]here are confidential relationships to which most claimants in libel proceedings are parties, and one or more of these may be with persons who could, like E, be described as important witnesses.”
The implications of the order sought could be that claimants in the same situation as this one could not pursue their action unless they gave disclosure before defence. Tugendhat J also identified implications for the wider public in settling disputes, since if a party who wants to settle
“knows that any confidentiality agreement included in the terms of settlement is liable to be set aside if a newspaper subsequently publishes a report of the proceedings in respect of which he may wish to sue for libel, but which the newspaper cannot claim to be true on the information available to it, then that would tend to make parties less willing or able to settle disputes.”
This reluctance could even extend to newspapers themselves where they were wary of defamatory criticism from a rival publisher.
The application was dismissed, and there was no order to disclose E’s witness statement.
Firstly, the decision sheds light on the relationship between obligations of confidentiality and libel proceedings. It makes clear that there can be a public interest in overriding confidentiality, but that the right to it should not be lightly given away. The private interests of both the Claimant and the anonymous party in preserving the secrecy of the agreement did not, on these facts, give way to any such interest.
The Judge was more emphatic on the broader public interest in play – one which exists in relation to all litigants who may wish to settle disputes on terms which remain confidential. The modern focus on resolving disputes by agreement rather than litigation, and, consequently, the significance of the various forms of confidentiality required to achieve this, mean that any judgment given in this area has potentially wide ranging-repercussions. To allow newspapers to go behind confidential agreements simply in order to justify a story on the settlement of a dispute would lessen their value. This aspect of the judgment testifies to the impact on media law, and the law in general, of the ever-increasing emphasis on resolving disputes outside the courtroom.
Secondly, there is a point in the judgment about a different aspect of confidentiality in relation to the press, which is to do with the anonymity of sources. Stories, particularly in the tabloids, are often stood up by means of quotes attributed to unnamed ‘friends’ and ‘sources’, and this seems to have been the case here. The furthest the evidence went on the issue of the Defendant being prevented from advancing the Defence it wished to was the witness statement supplied by the Defendant’s solicitor, which said
“that the Article is likely to be true, based on evidence from source(s) whose identity the Defendant must keep confidential”
The Judge referred to situations in which journalists do wish to keep their sources confidential, and the fact that the law may permit them to do so, but pointed out that, here, the Claimant was not asking the Defendant to disclose its sources. Following their citation by the Claimant, the Judge referred to the criteria which should be satisfied before including a plea of justification set out in McDonald’s Corp v Steel  3 All ER 615. The third of these is that “the defendant should have reasonable evidence to support the plea”. The implication would appear to be that where a story is based on unnamed sources, a Defendant must offer evidence of why they cannot be named if it does not want to reveal them.
Gervase de Wilde is a former journalist at the Daily Telegraph and a student barrister.