English Commercial Court rules in favour of publishing a judgment on an arbitration claim

In Mordchai Ganz v Petronz FZE & Abraham Goren [2024] EWHC 1011 (Comm), the English Commercial Court (the Court) decided to publish a non-anonymised judgment on an arbitration claim concerning challenges to an arbitration award. In doing so, the Court has provided helpful guidance on balancing party expectations of confidentiality in arbitration against the public interest in arbitration proceedings. In this case, the public interest in the transparent administration of justice outweighed the claimant's interest in confidentiality.

Background

The factual background to this case is covered in our earlier blog post here. In short, the Court addressed challenges brought under Section 67 (challenge to substantive jurisdiction) and Section 68 (serious irregularity causing substantial injustice) of the English Arbitration Act 1996 (the Act) and found that both the Share Purchase Agreement and the LCIA arbitration agreement within it were not valid and binding in the face of allegations of forgery. As a result, the tribunal had no substantive jurisdiction (the Judgment). In the current case, the Court considered an application from the second defendant, Mr. Goren, who objected to the publication of the Judgment.

Mr. Goren emphasised that he was joined to the arbitration proceedings against his will and that the Judgment covered sensitive and confidential information that may have a detrimental effect on his reputation if published.

Decision

As a starting point, the Court relied on the principles set down in City of Moscow v Bankers Trust [2004] EWCA Civ 314; [2005] QB 207, and emphasised that it must weigh the factors in favour of publicity against the desirability of preserving the confidentiality of the original arbitration and its subject matter. It accepted that a party seeking to protect evidently confidential information "must not necessarily prove positive detriment beyond the undermining of its expectation that the subject matter would be confidential". However, "the Court should…bear in mind that any judgment should be given in public where this can be done without disclosing significant confidential information", and that "arbitration is an important feature of international commercial and financial life and there is a legitimate interest in its operation and practice".

Expectation of confidentiality

Mr. Goren argued that he had an expectation of confidentiality and privacy in the arbitration, and relied in particular on Article 30 of the LCIA Rules, which contains an undertaking to keep awards and material in the arbitration confidential.

The Court did not accept this argument. Given the Court's determination that there was no arbitration agreement, Mr. Goren did not and could not rely on the fact that he entered into an arbitration agreement with an expectation that, in the event of a dispute, the parties would resort to arbitration and that, in turn, would be confidential.

The Court also commented that once Mr Goren was joined to the arbitration, he may well have had an expectation of privacy and confidentiality. However, Article 30 of the LCIA Rules would still not have prevented publication of the Judgment. Rather, "[t]he supervisory jurisdiction of the Court is an entirely separate process and the decision by the Court whether to publish its judgment involves the consideration of the relevant factors in the circumstances of the case".

Reputational damage

Mr Goren argued that publication would disclose damaging material (in particular, relating to a procurement agreement which was described as a "side issue" in the proceedings) even though he had successfully defended the claim. However, the Court gave this concern short shrift, finding that "Mr Goren's reputation may be damaged by his actions in relation to the procurement agreement…but they were his actions and that is not, in my view, a good reason in favour of withholding publication of the judgment".

The public interest in the publication of judgments

Mr. Goren further contended that the Judgment contained references to the confidential award, submissions and evidence. He argued that publication should not be allowed "because the judgment here contains everything about the underlying dispute". However, this argument was rejected on the basis that not all of the matters that were put before the tribunal were referred to in the Judgment, which only addressed key elements that were examined by the Court, but that more importantly and in any event, disclosure of confidential information was not a bar to publication. Rather, the confidentiality of the information had to be weighed against the factors militating in favour of publication.

The Court also disagreed with Mr. Goren's submission that there is no public interest in the outcome of the current case.  Against this:

1. the authorities are clear that there is a legitimate interest in the operation and practice of arbitration. Here, the case entailed issues such as the approach to a re-hearing, the use of the summary procedure in the Commercial Court guide and the issue of expert evidence in the context of case management; and
2. it had to be mindful of the broader issue of public interest, "which is the desirability of public scrutiny as a means by which confidence in the Courts can be maintained and the administration of justice made transparent".

The Court concluded that the factors in favour of the Judgment's publication outweighed the contrary considerations.

Comment

This case serves as a helpful reminder that the expectation of confidentiality in arbitration is not absolute once the parties seek the involvement of the relevant supervisory courts: any party expectation as to confidentiality will be weighed against strong public interest considerations.  In particular, the fact that the underlying arbitration may have been subject to an expressly agreed confidentiality regime will not be conclusive.

This judgment also provides useful guidance on the English Court's approach to balancing confidentiality against transparency in arbitration-related court proceedings. In this case, the finding that there was no underlying arbitration agreement appears to have been a significant factor, as it meant that there could not have been any original expectation of confidentiality. The decision also underscores the Court's willingness to publish judgments related to arbitration claims in the broader public interest, even in the face of strong objections from one of the parties concerning anticipated reputational damage.

For more information, please contact Craig Tevendale, Partner, Elizabeth Kantor, Professional Support Lawyer, Maria Popova, Associate or your usual Herbert Smith Freehills contact.

The authors would like to thank Annabelle Proepstl for her contribution to this blog post.