Court allows journalist to access historic accountant’s report held by company’s solicitors

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An English Court has relied on the principle of open justice to order that an accountant’s report, referred to in a six-year-old English court judgment, should be disclosed to a journalist as the document was relevant to a proper journalistic endeavour (how a company seeking a public flotation had previously dealt with an issue of fraud within its corporate governance systems) and the document’s release was unlikely to do serious harm: Goodley v Hut Group Ltd [2021] EWHC 1193 (Comm)

Applying for documents referred to in court

This case concerns an application by a journalist working for the Guardian newspaper, Simon Goodley, for a PWC report referred to in a 2014 judgment in The Hut Group Limited v Nobahar-Cookson and Barclays Private Bank and Trust Ltd [2014] EWHC 3842.

The 2014 judgment concerned, inter alia, whether there had been fraud at The Hut Group (THG), and suggested that the discovery of fraud had played a part in THG withdrawing from a proposed listing on the London Stock Exchange in 2012. The judgment relied in part on a report written by PWC into the fraud.

In August 2020 THG announced its intention to attempt to float on the London Stock Exchange. Mr Goodley requested a copy of the PWC report as it related to alleged historic fraud. The Court confirmed that it no longer held a copy of the report; however, THG’s external lawyers confirmed that they did. THG’s lawyers refused to provide a copy.

When will the court allow access to documents?

The court has a broad power to order documents to be provided to non-parties to litigation. Lady Hale explained in 2019 that, other than where it is limited by statute, the court has inherent jurisdiction to determine what public access is required to documents or other information placed before the court in order to satisfy the principle of open justice.1 This relates to all documents placed before the court, not just to statements of case and judgments (the provision of which is provided for under the Civil Procedure Rules).

It was this inherent jurisdiction that Mr Goodley relied upon to request the provision of the PWC report.

Requesting access to court documents – a balancing act

There is a limit to this inherent jurisdiction. The court must carry out a balancing act each time it makes a decision. On the one hand there is the purpose of the open justice principle and the potential value of the information in advancing that purpose, and on the other hand any risk of harm which its disclosure may cause.

It is for the person applying for the document to show how granting access will advance the open justice principle. In turn, it is for the respondent to show that this is not the case or, in the alternative, that the production of the document could cause serious harm.

In this case, Mr Goodley argued that the report was relevant to THG’s current application for a listing on the London Stock Exchange. He argued that the report concerned THG’s earlier plans to list and how the company dealt with the findings of fraud referred to in the 2014 judgment. Mr Goodley also argued that he wanted to understand the basis for the findings in the original judgment.

THG’s lawyers primarily argued that Mr Goodley did not require the documents to further the purposes of the open justice principle, but rather for his own purposes in respect of an old and stale case.2

Court orders disclosure of accountant’s report

The court ordered that the report be produced.

The court found that the principle of open justice will be advanced by disclosure of documents to journalists in pursuit of serious journalistic endeavours. Here, the story was plainly a serious journalistic pursuit: it concerned how a company seeking a public flotation recently dealt with an issue of fraud within its corporate governance systems. THG had failed to demonstrate that it would suffer serious harm by the disclosure and that the disclosure would therefore be unjust.

Comment

We have seen a few recent cases in which non-parties have sought access to documents referred to in court. However this was slightly different in that it concerned a journalist trying to obtain from a litigant’s lawyers an accountant’s report referred to in a judgment delivered six years earlier, for the purpose of reporting on a proposed flotation, not on the proceedings in which the report was referenced.

Businesses which enter into litigation in the English courts need to be aware that documents submitted and used as part of litigation have the potential to find their way into the public domain.

This judgment may embolden journalists and the media to make more attempts to get hold of documents referred to in court.

Footnotes:

1 See Cape Intermediate Holdings Ltd v Dring [2019] UKSC 38, [34] and [41].

2 See Blair Judgment, [24].

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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