Westwood Shipping Lines Inc & Anor v Universal Schiffahrtsgesellschaft MBH & Anor

Confidentiality attaching to arbitration materials is not lost merely because some information about the arbitration has been disclosed, or because an arbitral judgment is public. Disclosure may nevertheless be ordered where it is reasonably necessary to protect an arbitrating party’s legitimate interests or where the interests of justice require it. The court has no general discretion to lift confidentiality, but may grant leave under the recognised exceptions. Where the materials are necessary to pursue an arguable claim concerning alleged unlawful conduct, disclosure may be justified to prevent confidentiality from stifling the investigation of wrongdoing. A judgment following a private arbitration-related hearing should be public where this can be done without disclosing significant confidential information.

The claimants sought permission to use pleadings, disclosure, witness statements, expert reports, correspondence, transcripts, submissions, the award and reasons from a confidential arbitration. They intended to rely on those materials in a proposed Commercial Court claim alleging unlawful means conspiracy against parties connected with the charter arrangements and the arbitration.

The liquidator of the insolvent chartering company did not oppose an order but sought further time to investigate whether he might bring related claims. The claimants relied on alleged waiver, the public domain, and the recognised exceptions to arbitration confidentiality. The court had to determine whether it had jurisdiction, whether disclosure was otherwise authorised, whether further delay was justified, and whether its judgment should be public.

1. The Commercial Court had jurisdiction under s. 44 of the Arbitration Act 1996 to determine whether materials produced in a concluded confidential arbitration could be released for use in English proceedings. The liquidator’s jurisdiction objection therefore failed.

2. There had been no general waiver of confidentiality through the creditors’ meeting or report. Disclosure to one person or for one purpose did not necessarily waive confidentiality generally. Nor did the fact that the arbitration was referred to in a public judgment place all arbitration materials in the public domain.

3. The principles stated in Emmett v Michael Wilson [2008] Bus LR 1361 applied. The relevant exceptions included consent, an order or leave of the court, reasonable necessity for protecting an arbitrating party’s legitimate interests, and the requirements of justice. The power to grant leave did not confer a general discretion to remove confidentiality.

4. The claimants had a legitimate interest in pursuing an arguable unlawful-means-conspiracy claim, and the arbitration materials were substantially necessary to plead and pursue it. The interests of justice independently supported disclosure because confidentiality should not prevent an arguable case of unlawful conduct from being brought to light.

5. There was no sufficient reason to defer the order. The liquidator had had many months to investigate possible claims and could obtain advice promptly. The order therefore took effect immediately and covered the agreed categories of arbitration material, subject to the claimants’ reservation concerning privilege and liberty to apply regarding particular documents.

6. Although arbitration claims are ordinarily heard privately under CPR Part 62, the judgment should be public. Applying Moscow City Council v Bankers Trust [2005] QB 207, the court should give judgment in public where that could be done without disclosing significant confidential information. The judgment contained no such confidential information, and publication was also consistent with the interests of justice.

7. As to costs, the liquidator was entitled to recover only 75 per cent of his costs from the estate and was ordered personally to pay 25 per cent of the claimants’ costs.