Cream Holdings Limited and others (Respondents) v. Banerjee and others (Appellants)

Section 12(3) of the Human Rights Act 1998 does not impose a rigid probability test for every interim order restraining publication. The applicant’s prospects of success at trial must be sufficiently favourable to justify restraint in the particular circumstances. Ordinarily, courts should be exceedingly slow to restrain publication unless the applicant will probably succeed. A lower likelihood may suffice where disclosure could cause particularly grave harm or a short-lived order is needed for proper consideration of the application or an appeal.

This threshold is higher than the ordinary serious-question or real-prospect standard. Once it is crossed, the court must exercise its discretion with proper regard to freedom of expression and any countervailing Convention rights.

The Cream group sought an interlocutory injunction preventing its former financial controller and a newspaper publisher from using or publishing confidential information. The defendants admitted confidentiality but contended that disclosure was justified in the public interest.

Lloyd J granted an injunction after finding a real prospect that the group would obtain permanent relief. The Court of Appeal dismissed the defendants’ appeal in [2003] EWCA Civ 103, [2003] Ch 650. Simon Brown and Arden LJJ upheld the order, while Sedley LJ dissented on its application to the facts.

The defendants appealed to the House of Lords. The central questions were what degree of prospective success is required by section 12(3) of the Human Rights Act 1998, and whether the public interest in the proposed disclosure justified discharge of the injunction.

Disposition and reasoning

1. Appeal allowed unanimously. Lord Nicholls delivered the leading speech. Lord Woolf, Lord Hoffmann and Baroness Hale agreed with his reasons. Lord Scott expressly agreed with Lord Nicholls’s guidance on section 12(3) and the proposed order.

2. Per Lord Nicholls, section 12(3) of the Human Rights Act 1998 was enacted to provide stronger protection for freedom of expression at the interlocutory stage. It establishes a higher threshold than the ordinary requirement of a serious question to be tried or a real prospect of success. The latter standard therefore does not govern an application falling within section 12(3).

3. The word likely does not invariably mean more likely than not. A universal probability requirement would prevent temporary protection where a court needed time to consider an urgent application or where disclosure might cause exceptionally grave and irreversible harm. The statutory standard must retain sufficient flexibility to avoid those consequences.

4. The court must be satisfied that the applicant’s prospects of success at trial are sufficiently favourable to justify an interim restraint order in the circumstances. Ordinarily, courts should be exceedingly slow to grant restraint unless satisfied that the applicant will probably succeed. A lesser likelihood may suffice where the potential consequences of disclosure are particularly grave or a short-lived order is needed to permit proper consideration of the application or an appeal.

5. Once the threshold is crossed, the court exercises its discretion with due regard to article 10 jurisprudence and any countervailing Convention rights. This construction respects section 12(4)’s emphasis on freedom of expression without giving that right inappropriate weight over privacy or other protected rights.

6. On the facts, Lord Nicholls agreed with Sedley LJ that the principal matters intended for publication were clearly of serious public interest. Sections 43A to 43L of the Employment Rights Act 1996 provided additional protection for employees who made public-interest disclosures. They did not restrict the circumstances in which the public interest could justify publication at large.

7. Lloyd J had materially misdirected himself, and the Court of Appeal had not exercised the discretion afresh. The House therefore did so. The claimants were more likely to fail than succeed at trial and had shown no sufficient reason to apply a lower threshold. The injunction was discharged so far as it concerned information already supplied to the newspaper. By the defendants’ agreement, it otherwise remained in force.

• House of Lords: In Cream Holdings Limited and others (Respondents) v. Banerjee and others (Appellants) [2004] UKHL 44, the House unanimously allowed the appeal and discharged the injunction concerning information already supplied to the newspaper. The order otherwise remained in force by agreement.
• Court of Appeal: The defendants’ appeal was dismissed in [2003] EWCA Civ 103, [2003] Ch 650. Simon Brown and Arden LJJ upheld the order. Sedley LJ dissented on the application of the statutory threshold to the proposed publication.
• High Court: On 5 July 2002 Lloyd J granted an interlocutory injunction restraining publication, disclosure or use of the confidential information until trial.