Kea Investments Ltd v Eric John Watson

Derogations from open justice, including confidentiality restrictions, are justified only where strictly necessary to secure the proper administration of justice. They must be supported by clear and cogent evidence and limited to the minimum necessary. Contractual confidentiality is an important consideration, but it creates no automatic entitlement to private hearings or blanket restrictions. The court must conduct a fact-sensitive proportionality assessment, weighing the value of openness against the risk of harm to legitimate interests and the effective administration of justice. Restrictions appropriate for pre-trial disclosure may not be appropriate at trial or in relation to the judgment. Alternative service may be authorised where there is good reason to believe that the documents are likely to reach the defendant.

Kea sought directions in long-running proceedings concerning the final assessment of equitable compensation allegedly due from Eric Watson. The applications concerned alternative service, confidentiality restrictions over information arising from confidential settlements, and directions for the forthcoming judgment application. Fladgate LLP, an intervening party and former solicitor involved in related settled proceedings, sought similar protection for the amount and terms of its settlement, joinder for that limited purpose, and permission to appeal the refusal of wider restrictions covering the trial.

1. Alternative service. Service by email to the former solicitor’s address, with a request that the documents be forwarded to Watson, was valid. The evidence gave good reason to believe that the documents were likely to have reached him. Service by WhatsApp to a number likely still used by Watson was also authorised under CPR 6.15(2). Future documents could be served by email to the solicitor with the same forwarding request, applying CPR 6.15 and CPR 6.27.
2. Open justice and confidentiality. Open justice is fundamental. A derogation is an obligation-based determination, not an unfettered discretion. It requires exceptional circumstances, clear and cogent evidence, and a restriction no wider than strictly necessary. Confidentiality alone is insufficient. The court must undertake a fact-sensitive proportionality assessment, considering the purpose and value of openness and the risk of harm to legitimate interests, including commercial confidentiality and the administration of justice.
3. The evidence established an exceptional and real risk that unrestricted disclosure would facilitate harassment and abuse of the court process. Confidential information could therefore be disclosed only within a defined confidentiality regime involving redactions, permitted persons, designated addresses and undertakings. The order was limited to the period before the judgment application hearing. The court reserved the question of restrictions at trial and in any judgment pending a fuller assessment of what information would be necessary for public understanding.
4. Fladgate was joined under CPR 19.2(2)(b) to protect its confidential information. The same disclosure and service arrangements applied. Permission to appeal was refused because the decision concerning wider trial restrictions was a case-management decision and involved no automatic rule protecting confidential information.

Not an appeal. The judgment determined interlocutory applications in ongoing High Court proceedings.