England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE QBEN1 97/1386/E

IN THE COURT OF APPEAL (CIVIL DIVISION) LTA 97/7148/E

(MR JUSTICE POPPLEWELL )

Royal Courts of Justice

Strand

London WC2

Thursday 12 February 1998

B e f o r e:

THE MASTER OF THE ROLLS

(LORD WOOLF)

LORD JUSTICE ALDOUS

LORD JUSTICE CHADWICK

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JOHN BARRIE HODGSON & OTHERS

Appellants

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IMPERIAL TOBACCO LIMITED

First Respondent

GALLAGHER LIMITED

Second Respondent

HERGALL (1981) LIMITED

(In liquidation) Third Respondent

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(Transcript of the handed-down judgment of

Smith Bernal Reporting Limited, 180 Fleet Street,

London EC4A 2HD

Tel: 0171 421 4040

Official Shorthand Writers to the Court)

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MR D BRENNAN QC , MR ROBIN OPPENHEIM and MR R HERMER (Instructed by Messrs Leigh Day & Co, London EC1M 4LB) appeared on behalf of the Appellants.

MR J PLAYFORD QC , MR A PRYNNE QC and MR T RILEY-SMITH (Instructed by Messrs Ashurst Morris Crisp, London, EC2A 2HA) appeared on behalf of the First Respondent.

MR J FENWICK QC , MISS J TURNER QC and MR T WEITZMAN (Instructed by Messrs Simmons & Simmons, London EC2M 2TY) appeared on behalf of the Second and Third Respondents.

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JUDGMENT

(As approved by the Court)

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©Crown Copyright

JUDGMENT

LORD WOOLF, MR: This is the judgment of the Court. The appeal

is from an interlocutory decision made by Mr Justice Popplewell on 10 October 1997 in an action which the appellants have brought against three tobacco companies. The actions are for damages for the cancer from which the plaintiffs suffer which they allege was caused by smoking cigarettes manufactured by the defendants. The appeal raises two different issues.

The two issues are:

(1) Was the judge wrong to refuse to grant an order that "the defendants be debarred from seeking any or any further order that the plaintiffs’ legal representatives be responsible for any and all of the costs of the action other than under section 51(6) of the Supreme Court Act 1981 and RSC O.62 r.11."

(2) Was the judge right to order that the directions made on 10 October 1997 and "any future directions made by the court in these actions may be released to the press, but the parties and their advisers are not to make any comments to the media in relation to this litigation without the leave of the court".

The issues on this appeal involve questions of principle which do not depend upon the facts of these particular proceedings. However, it is nonetheless desirable that we should say something as to the background of the appeal.

Background

There has been litigation against tobacco manufacturers in the United States for damages by those who allege that they have contracted diseases as a result of smoking. In July 1992 the plaintiffs’ solicitors, Leigh Day & Co, made an application for legal aid on behalf of 227 proposed plaintiffs to bring proceedings in this country. In July 1996 the Legal Aid Board decided that legal aid would not be granted.

On 12 November 1996 Leigh Day & Co issued the first writ in the actions which are the subject of this appeal. This writ was subsequently followed by four others. There are currently approximately 43 plaintiffs. On 1 July 1997 the Senior Master was told that there would not be more than 50 plaintiffs. However on the application for directions which took place before the judge on 10 October 1997 there was an application to enlarge the number.

The plaintiffs are able to bring these actions because they have entered into conditional fee agreements ("CFAs") with their legal advisers. A lawyer entering into a CFA is unable to recover the costs of representing a client unless the action is successful. If it is they can receive an uplift which is agreed of up to 100% of what would otherwise be the amount of their fees.

The plaintiffs' claims are confined to a period between about 1957 and 1971. It is contended that excess tar caused or materially contributed to the plaintiffs’ cancer. Applications have been made to the Senior Master for a judge to be formally assigned to the litigation but so far no formal assignment has been made.

However the litigation came before Popplewell J on 25 July and again on 10 October 1997 when he gave directions.

At the hearing on 25 July 1997 Mr Brian Langstaff QC, on behalf of the plaintiffs, raised the question of publicity. He said:

"My Lord, the only other matter which has occurred to us at the bar was whether your Lordship would wish to say anything as to the circulation as might be given to these directions as such, these proceedings being, as they are, in Chambers? My Lord, certainly those instructing me would wish to be able to refer to the directions, although they had no intention, may I make it plain, of making any press statement about them or the like."

The judge responded by asking:

"Well, unless anyone makes the objection I see no reason why the press should not be given a copy of these directions. Shall I take silence for consent?"

Mr Prynne QC, on behalf of Imperial Tobacco Limited, then indicated that the defendants would have no objection to the press being given a copy of the directions, as long as no comment was made about them. He added "The vice that tends to occur is when comments are made on one side which precipitate comments from the other and then litigation by media commences".

The judge made an order that the directions were to be given to the press and the press were also to be told that the judge "has ordered that neither party should make any comment on them".

While the defendants have not gone so far as to suggest that Mr Martin Day, who is the partner in the firm of the plaintiffs' solicitors who has the conduct of the action, is guilty of contempt in relation to that order, they do contend that he has acted contrary to its spirit. Accordingly the question of publicity was again raised on 10 October 1997 with the intention that the judge should make a more specific order than he had on the 25 July 1997.

From as early as the Autumn of 1996, the defendants’ solicitors have been requesting the voluntary disclosure of the CFAs. According to the Skeleton Argument of the 2nd and 3rd defendants (whose arguments are adopted by the 1st defendant) the contents of the CFAs are relevant potentially for four purposes :

“(i) Upon the conclusion of the trial and/or in the event of the abandonment or dismissal of any claim, in deciding whether the court in its discretion should order that the costs of a successful defendant be paid by someone other than the plaintiffs themselves.

(ii) In deciding whether, given the number of plaintiffs, the costs of trial and the sums likely to be recovered, and the overall prospects of success, these claims are "viable" in the sense given to that word by the Court of Appeal in the case of A.B. v John Wyeth & Brother (No. 2) ( 26 November 1993 ) 18 BNLR 38;

(iii)In deciding at an interlocutory stage of the action what directions should be made for trial in the light of the cost implications of such directions and/or what orders for costs should be made.

(iv) In assessing whether in the respective CFA each plaintiff has agreed to bear contractual liability for costs of plaintiffs where claims are discontinued or dismissed before trial. In the absence of such a contractual liability no claim for one plaintiff’s costs can be properly made by the solicitor for another plaintiff, nor can the other plaintiff include it in any claim for costs against the defendants. To do otherwise would be to offend the indemnity principle upon which Orders for Costs (subject to taxation) are founded”.

The 2nd defendants also contend that they are extremely concerned by the nature of the litigation and that they have difficulty understanding on what basis it can be reasonably brought and considered viable. However they would not wish to assert that the plaintiffs’ legal advisers should bear any liability for costs until they know the nature of the arrangements between those advisers and the plaintiffs.

From the correspondence which has taken place between the parties, it is apparent that the defendants have very much in mind that this is a case in which, in due course, they could decide to seek an order for costs making the plaintiffs’ solicitors personally liable for the defendants' costs.

Shortly before the hearing on 25 July 1997, an additional firm of solicitors, Irwin Mitchell, were instructed to bring proceedings in related cases to those being conducted by Leigh Day & Co. On 23 July 1997, Leigh Day & Co wrote to Ashurst Morris Crisp, solicitors acting on behalf of Imperial Tobacco Limited, indicating that the two firms of solicitors were joining forces with regard to pursuing the generic cases and that all the cases were being dealt with under CFAs by solicitors and counsel, but no-one apart from the legal advisers were contributing to the funding of the action and that the details of the CFAs were the same for both firms.

Prior to the 10 October 1997 hearing, the plaintiffs' solicitors had been pressing the defendants to make their position clear as to whether they were going to make an application that the plaintiffs' solicitors should pay the costs personally. On 1 October 1997 Simmons and Simmons, the solicitors to the 2nd and 3rd defendants, faxed a letter to Leigh Day & Co saying that they could not reach a substantive decision on this point until "such time as we have had sight of the conditional fee agreements. Accordingly, we shall be inviting the court to make an order to that effect on 10 October 1997. It would obviously save considerable time and cost if you disclose the conditional fee agreements in advance of that application."

On the following day Leigh Day & Co faxed a reply in which they reiterated their contention that the CFAs were covered by legal professional privilege and the plaintiffs were not prepared to waive that privilege. They went on however to summarise the information which they had provided as follows :

“(1) All the plaintiffs have signed CFAs. The success fee is 100% and this is subject to a 25% of damages cap.

(2) The legal team of Leigh Day & Co, Irwin Mitchell, Peter Maughan and counsel are all working on the case under CFAs.

(3) Disbursements in the case are being met by the three law firms, with Leigh Day & Co and Irwin Mitchell being responsible for all the generic disbursements.

(4) None of the experts is working on a “no win no fee” basis.

(5) There are no outside funders of the action. There is no insurance cover.

(6) The plaintiffs are fully aware that if their case is lost they will have to bear the defendants’ costs.

(7) The legal team are committed to taking these actions through to trial. As with any legal action, members of the plaintiffs’ legal team are entitled to withdraw from the case on giving notice.”

The costs involved in this litigation will be very substantial. There have been references to figures of £3 million and upwards. Obviously, any risk that the plaintiffs’ legal advisers might be liable for costs personally is a matter of immense concern to them. They indicate that unless they have certainty as to any liability it will not be possible for them to continue to represent the plaintiffs. It was for this reason that on 10 October 1997 the plaintiffs sought from the judge what has been referred to as the "debarring order" which is identified at the outset of this judgment. It is the plaintiffs' legal advisers’ contention that they have been independently advised by leading counsel as to the propriety of the CFA arrangements which have been made. Therefore they are entitled to know where they stand as to the costs in litigation of this kind. They wish to be free from the intimidating threat of wasted costs orders and the like without having to sacrifice the shield of privilege or be faced with satellite litigation.

We understand these concerns. We also understand the position of the defendants. They contend that it would be premature to make any application for an order against the plaintiffs' legal advisers at this stage and that it is reasonable for them to leave open their position on the question of the personal liability for costs of the plaintiffs' legal advisers. They point out that this is a case in which Leigh Day’s clients, the plaintiffs, do not have the protection of insurance in respect of any liability to which they may become subject to pay the costs of the defendants. In the absence of such insurance, it is obvious that the prospects of the defendants being able to recover other than nominal sums by way of costs from the plaintiffs are remote.

The CFA Issue

At the hearing on 10 October 1997 the judge, having heard argument, gave a judgment in which he clearly and succinctly set out his reasons for not being prepared to make the debarring order which the plaintiffs seek. He indicated that although he had not heard full argument, his initial reaction was that the plaintiffs at that stage were perfectly entitled to claim privilege for the CFA agreements as they had come into existence for the purpose of litigation in the ordinary way. In saying this he was agreeing to what he was told were the views of both the Law Society and the Bar Council. However, he went on to say that the position could be different at the end of the trial. This was on the hypothesis that the plaintiffs were unsuccessful in the action. He recognised that the rules did not cater for that situation. He thought that at that stage the court would be entitled to inquire into the propriety and legality or otherwise of the agreement so as to ensure that justice was done between the parties in relation to costs. This he considered would not be possible without seeing the agreement.

We have no doubt that the judge was right to come to the decision not to make the debarring order. To understand our reasons for this conclusion it is desirable to begin by considering the legislation which authorises CFAs. Prior to that legislation it would have been improper conduct on the part of the plaintiffs' legal advisers to enter into CFAs.

The statutory authority for CFAs is provided by the Courts and Legal Services Act 1990. Section 58(1) describes a CFA as "an agreement in writing between a person providing advocacy or litigation services and his client". The agreement must not be of a kind which is mentioned in Section 58(10) (which has no application to these proceedings). The agreement is required to provide "that that person's fees and expenses or any part of them, are to be payable only in specified circumstances" (Section 58(1)(b)). The CFA must also comply with any requirements prescribed by the Lord Chancellor (Section 58(1)(c)).

The CFA has to specify the percentage by which the amount of fees to which it applies are to be increased (Section 58(2)).

The ability to enforce a CFA is dealt with expressly by Section 58(3). This subsection states "subject to sub-section (6), a conditional fee agreement which relates to specified proceedings shall not be unenforceable by reason only of its being a conditional fee agreement".

The Lord Chancellor, who is empowered to specify the proceedings for the purposes of Section 58(3) (Section 58(4)), did so by the Conditional Fee Agreement Order 1995. Specified proceedings include actions for damages for personal injuries. Personal injuries cover any disease. In accordance with Section 58(5) the Order prescribes the maximum permitted percentage of the increase in fees as being 100%.

Section 58(8) prohibits an order for costs which is made in favour of a party including "any element which takes account of any percentage increase payable under the agreement."

Section 58(9) provides that rules of court may make provision with respect to the taxing of any costs which include fees payable under a CFA.

We should also refer to the Conditional Fee Agreements Regulations 1995, which state that an agreement will not be a CFA unless it complies with the following requirements:

"Requirements of an agreement

3. An agreement shall state -

(a) the particular proceedings or parts of them to which it relates (including whether it relates to any counterclaim, appeal or proceedings to enforce a judgment or order);

(b) the circumstances in which the legal representative's fees and expenses or part of them are payable;

(c) what, if any, payment is due-

(i) upon partial failure of the specified circumstances to occur;

(ii) irrespective of the specified circumstances occurring; and

(iii) upon termination of the agreement for any reason;

(d) the amount payable in accordance with sub-paragraphs (b) or (c) above or the method to be used to calculate the amount payable; and in particular whether or not the amount payable is limited by reference to the amount of any damages which may be recovered on behalf of the client.

Additional requirements

4. (1) The agreement shall also state that, immediately before it was entered into, the legal representative drew the client's attention to the matters specified in paragraph (2).

(2) The matters are-

(a) whether the client might be entitled to legal aid in respect of the proceedings to which the agreement relates, the conditions upon which legal aid is available and the application of those conditions to the client in respect of the proceedings;

(b) the circumstances in which the client may be liable to pay the fees and expenses of the legal representative in accordance with the agreement;

(c) the circumstances in which the client may be liable to pay the costs of any other party to the proceedings; and

(d) the circumstances in which the client may seek taxation of the fees and expenses of the legal representative and the procedure for so doing.

The information to be included in a CFA is therefore reasonably precisely prescribed and there should be no difficulty in reaching a view whether the statutory requirements have been complied with. If the statutory requirements are complied with the CFA will be valid and enforceable by the legal advisers against a client. If it materially departs from the legislative requirements it will not be enforceable and will not be a CFA which is protected by Section 58(3). If a practitioner needs assistance in complying with the legislative requirements, then the precedents which we understand are made available to their members by the Law Society could be used.

Except that a CFA enables solicitors and counsel to enter into an agreement which they would not otherwise be able to make, the existence of a CFA does not alter the relationship between the legal adviser and his client. The solicitor or counsel still owes to the client exactly the same duties that he would owe to the client if he had not entered into a CFA. A solicitor or counsel acting under a CFA remains under the same duty to his client to disregard his own interests in giving advice to the client and in performing his other responsibilities on behalf of the client. This extends to advising the client of what are the consequences to the client of the client entering into a CFA. The lawyer also still owes the same duties to the court.

As the statutory position is clear, a legal adviser should have no difficulty in making a valid CFA with a client who wishes to do this. As we have sought to make clear, the fact that there is a CFA cannot justify the legal adviser coming to any additional or collateral arrangement which would not be permissible if there was no CFA. In the course of argument the possibility was raised of the lawyer including in the CFA a provision entitling the lawyer and not the client to decide whether or not an action should be discontinued or withdrawn, perhaps upon terms of compromise. An agreement taking responsibility for this decision away from the client and giving it to the legal adviser would not have been appropriate before 1993; and it has not become appropriate in consequence of introduction of CFAs. The lawyer, as long as he puts aside any consideration of his own interests, is entitled to advise the client about commencing, continuing or compromising proceedings, but the decision must be that of the client and not of the lawyer. The lawyer has however the right, if the need should arise, to cease to act for a client under a CFA in the same way as a lawyer can cease to act in the event of there being a conventional retainer.

There is no reason why the circumstances in which a lawyer, acting under a CFA, can be made personally liable for the costs of a party other than his client should differ from those in which a lawyer who is not acting under a CFA would be so liable. Any suggestion by the defendants’ lawyers, and any concern of the plaintiffs' lawyers, that the position of the plaintiffs’ lawyers is different from that of any other legal adviser is misconceived. The existence of a CFA should make a legal advisers’ position as a matter of law no worse, so far as being ordered to pay costs is concerned, than it would be if there was no CFAs. This is unless, of course, the CFA is outside the statutory protection.

Of the four purposes identified by the defendants for which present disclosure of the contents of a CFA is said to be potentially relevant, the first three are misconceived. As to the fourth purpose, we find it difficult without having a concrete case to consider to identify why it should be of relevance to the defendants, at least until after the litigation has come to an end.

We of course recognise that it was natural that the plaintiffs' lawyers should be concerned as to their position. It is obvious that as the defendants are likely to be unable to recover costs to which they would otherwise be entitled from the plaintiffs, in the absence of any insurance, they are going to give careful consideration as to whether there is any prospect of recovering costs elsewhere and the lawyers for the plaintiffs are an obvious target. However the plaintiffs' lawyers are in no different position because they are acting under a CFA than they would be acting for a legally aided client with a nil contribution. In that case, also, the defendants would have no realistic possibility of recovering their costs from the plaintiffs and the lawyers would be an equally prominent target for an application that they pay the costs personally. Applications are not common in these circumstances and, so far as we are aware, there is no precedent for lawyers acting for a legally aided client seeking a debarring order.

Furthermore, even if it would otherwise be appropriate to grant a debarring order, any debarring order which it would be proper for a court to grant would not provide the plaintiffs' legal advisers with any practical protection. The order which the judge was asked to make and which is subject to the appeal was a qualified order. It was qualified so that it would not debar the defendants from making a wasted costs order under Section 51(6) of the SCA 1981. The plaintiffs, in accepting this qualification, recognise that legal advisers are capable of being guilty of conduct at any time which could make an application for a wasted costs order appropriate. If this were to happen it would be highly undesirable for the court to have granted what would be, in effect, advance immunity.

The parties now agree that the court has a limited additional jurisdiction to make an order for costs against legal advisers personally in circumstances in which it would not be possible to make a wasted costs order. This limited jurisdiction is only going to be relevant in a very small minority of cases.

The limited additional jurisdiction can arise under two heads. First there is the court’s inherent jurisdiction to make such an order, at least against solicitors. Mr Brennan makes three submissions about this jurisdiction which are not controversial expect in one respect. The first is that it is limited to orders against solicitors and does not extend to orders against counsel. The second is that it must be regarded as having been supplanted in circumstances falling within the statutory wasted costs jurisdiction; and the third is that it should not be exercised until after a consideration whether an order should be made under the wasted costs jurisdiction. The point which might be controversial is whether today the courts would take the view that the inherent jurisdiction is limited to orders against solicitors. This is not a point which we have considered and as it does not arise we express no opinion on it.

The second area of additional jurisdiction is that which arises under the general jurisdiction of the court as to costs contained in section 51(1) and (3) of the Supreme Court Act 1981. This is a jurisdiction which cannot arise where a legal representative is acting only in that capacity in the context of legal proceedings.

There are therefore three possible heads of jurisdiction under which a legal representative may be made liable for costs. That this is the position was made clear by the decision of this court in Tolstoy-Miloslavsky v Aldington [1996] 1 WLR 736. For the very same reason that the plaintiffs concede that the debarring order would have to be qualified in relation to the wasted cost jurisdiction, so it would also have to be qualified in respect of the further heads of jurisdiction, although they are unlikely to arise in practice. That being the position, the debarring order would be an empty vessel because it would have to be qualified so as to exclude the only grounds upon which a court could make an order. In other words it would not debar any application which could have any prospect of success.

Before leaving this part of the appeal, there is one further matter with which we should deal. That is whether the defendants are entitled to inspect the CFAs. There is no doubt that the defendants were pressing to be shown the CFAs at one stage. However, before this court the defendants have as Mr Brennan contends made a "significant retreat". The defendants now do not seek to persuade us to order inspection. In the words of Mr Fenwick QC's skeleton argument on behalf of the 2nd and 3rd defendants they do not contend "that the CFA should be disclosed now or at some future time or to put forward any positive case that persons other than (the plaintiffs) themselves should pay the costs of this litigation if it fails." In this court, Mr Brennan repeated that both The Law Society and the Bar Council regarded CFAs as being subject to professional privilege and that they would be extremely concerned if it was suggested that the position was otherwise. We have already indicated the stance which the judge adopted.

We do not consider it would be appropriate to express any concluded view on the question of whether a CFA is at any stage of proceedings subject to professional privilege. Before expressing a view, we would like to have before us a claim for privilege specifying the grounds upon which it is based. We would also like to hear the full argument that was not presented on this appeal in view of the approach now adopted by the defendants to their seeking to inspect the CFAs. We recognise that a distinction might exist between the position in relation to any advice given to a client about the advisability of entering into a CFA and the document itself. However, what follows from what we have said as to the effect of CFAs means that, absent exceptional circumstances which we cannot envisage, unless and until the other party to the proceedings makes an application for an order making the legal advisers personally liable for costs, the existence or the terms of a CFA are of no relevance to the issues in the proceedings. They are therefore on that ground not required to be disclosed. Just as in the Tolstoy-Miloslavsky case it was made clear that it is in the public interest and perfectly proper for counsel and solicitors to act without fee, so it must now be taken to be in the public interest, and should be recognised as such, for counsel and solicitors to act under a CFA. There are no grounds for treating the party who is or has been represented under a CFA differently for any other party. The same is true of their lawyers. We can conceive of situations where the means of a party can be relevant. But absent an application, properly founded and raised, putting in issue the validity or the contents of the CFA, we cannot see that its terms are of any relevance. In this case the plaintiffs have voluntarily disclosed many of the terms of the CFA which they have entered into but not the document. This they were entitled to refuse to do.

What we intend to make clear is that lawyers acting under CFA’s are at no more risk of paying costs personally than they would be if they were not so acting. In addition, whether or not CFAs are properly the subject of professional privilege, they are not normally required to be disclosed.

Before leaving this subject, we should make clear that we are not suggesting that the Court has no jurisdiction to make a debarring order. On the contrary we note the careful consideration given to the question of making debarring or “protective” or “pre-emptive” orders on an application for judicial review in the judgment of Dyson J in R v The Lord Chancellor ex parte CPAG (6.2.98) unreported. Here the difficulty is not one of jurisdiction, but anticipating a case where it would be appropriate and desirable to provide protection for legal advisers prior to the end of a case.

The Order Restricting Comment to the Media

This litigation is of considerable interest to the media. There is an understandable interest on the part of the public to know whether tobacco manufacturers could be legally responsible to those who allege they are suffering from cancer in consequence of having smoked in the past. There are those who have strong feelings about the very fact of making available tobacco products so that they can be smoked. For those who contend that tobacco companies should be liable, the courts are available to adjudicate upon the issue. When the jurisdiction of the courts is invoked, there should be no interference with the ability of the courts to do justice between the parties to the litigation. If there is interference, then at least the usual remedy is that provided by the law of contempt. This is now mainly to be found in the Contempt of Court Act 1981. The Act clearly reveals the intention of Parliament as to where the line should be drawn if there is a conflict between the interests of the administration of justice and freedom of expression.

Section 1 of that Act defines the “strict liability rule” as meaning conduct “tending to interfere with the course of justice in particular legal proceedings regardless of intent to do so”.

In relation to that strict liability a defence is provided in respect of a “fair and accurate report of legal proceedings held in public” (section 4(1)). Section 4,(2) however, authorises the court “where it appears to be necessary for avoiding a substantial risk of prejudice to the administration of justice ...... (to) order that the publication of any report of the proceedings.....be postponed for such period as the court thinks necessary”.

Section 11 is also relevant since it recognises the court’s ability “where it has power to do so” to prohibit publication of matters in connection with proceedings if it appears to the court to be necessary.

The present proceedings involve a number of plaintiffs whose individual situations attract great sympathy. The defendants are, however, entitled to have the issues involved determined by the courts without improper interference with the administration of justice. The situation is one in which it is easy to fan emotions which will make the task of the courts to resolve the complex issues involved and do justice between the parties more difficult. As Chief Justice Rehnquist pointed out in Gentile v State Bar of Nevada [1991] 500 1 U.S. 1030; 111 SCR 2720 extra-judicial statements by legal representatives can be especially unhelpful since they are likely to be received by the media as specially authoritative even if they are inaccurate. The professionalism and the sense of duty of legal advisers who conduct litigation of this nature should mean that the courts are able to rely on the legal advisers to exercise great self-restraint when making comments to the press, while at the same time recognising the need for the media to be properly informed of what is happening in the proceedings. Sensible co-operation and an absence of excessive adversarial behaviour on the part of the legal advisers of all parties is essential if multi-party litigation such as this is to be conducted in the proportionate manner which the interests of their clients and justice require.

In accord with the usual practice in the Queen’s Bench Division, interlocutory directions for the conduct of this litigation have been made in Chambers. The defendants rely on this fact in support of the orders which have been made restricting communications between legal advisers and the media. Section 67 of the Supreme Court Act 1981 recognises the practice of the court of dealing with matters in chambers as opposed to in open court. As to Section 67, the defendants rely upon the note in the 1997 Supreme Court Practice Part 2 para 527:

"The expression "in Chambers" used in this section in contrast to "in court" means in private, secret, secluded, behind closed doors, in proceedings at which only the parties and their advisers are entitled to be present and from which the public and the press are excluded unless invited to be present with the consent of the parties and the court."

This note is attributed to the editorship of Sir Jack Jacob QC and therefore justifies great respect. However, in our judgment the note does not by the use of the word "secret" accurately reflect the significance of a hearing being in chambers rather than in open court. The present position is more accurately reflected in the judgment of Mr Justice Jacob given on 21 November 1997 in Forbes v Smith & Anor (1997 F30275) when he said:

"A chambers hearing is in private, in the sense that members of the public are not given admission as of right to the courtroom. Courts sit in a chambers or an open court generally merely as a matter of administrative convenience. For example, in the Chancery Division the normal practice for urgent interlocutory cases is for the matter to be heard in open court, the application being made by way of motion. Corresponding applications in the Queen's Bench Division are normally made in chambers. There is no logic or reason why exactly the same sort of case in one Division should be in open court and, in another Division in chambers."

The views there expressed by Jacob J can be compared to those expressed more fully by Sir Jack Jacob in trenchant terms in his Hamlyn lecture as follows:

"The need for public justice, which has now been statutorily recognised is that it removes the possibility of arbitrariness in the administration of justice, so that in effect the public would have the opportunity of 'judging the judges': by sitting in public, the judges are themselves accountable and on trial. This was powerfully expressed in the great aphorism that:

'It is not merely of some importance but is of fundamental importance that justice should not only be done but should manifestly and undoubtedly be seen to be done.'

The opposite of public justice is of course the administration of justice in private and in secret, behind closed doors, hidden from the view of the public and the press and sheltered from public accountability. There are, indeed, two prevailing exceptions to the open public system of conducting civil proceedings, namely, (1) the hearing of pre-trial proceedings 'in Chambers,' at which only the parties and their advisers are entitled to be present and from which the public and the press are excluded, and (2) the hearing of proceedings or the trial or part thereof 'in Camera' where the court or the trial judge orders that the court should be closed or cleared and the public and press excluded. Both these exceptions may be necessary in matters which require protection from publicity, such as matters concerning national security, those relating to persons under disability, i.e. minors and mental patients, or those relating to secret processes and other special matters, such as hearings before the Commissioners of Inland Revenue relating to tax affairs and such like matters.

Subject to these exceptions, the principle of publicity should prevail throughout the whole range of civil proceedings. For this reason, the practice of hearing pre-trial applications in Chambers should be abrogated. The strange and perhaps indefensible contrast between the hearing of the interlocutory applications for an injunction, in open court in the Chancery Division, and in private in Chambers in the Queen's Bench Division, should be the first and immediate practice to be scrapped."

As section 12 of the Administration of Justice Act 1960 makes clear, the publication of information relating to proceedings held in private (ie chambers) is not in itself contempt except in the specific cases identified in section 12(1) (which do not apply here) unless the Court makes an order prohibiting publication “when it has power to do so” (section 12 (1) (e)). Nor is the publication of the whole or part of the order made by a court sitting in private a contempt. (Section 12(2))

The general position is that any judgment including a judgment in chambers is normally a public document. This is the position notwithstanding that under Order 63 r.4(1) of the RSC there is no right to inspect a judgment so given without leave.

A distinction has to be clearly drawn between the normal situation where a court sits in chambers and when a court sits in camera in the exceptional situations recognised in Scott v Scott [1913] A.C.417 or the court sits in chambers and the case falls in the categories specified in section 12(1) of the 1960 Act (which include issues involving children, national security, secret processes and the like). Section 12(1) also refers to the court having prohibited publication. Such proceedings are appropriately described as secret; proceedings in chambers otherwise are not appropriately so described.

Proceedings in chambers are however are always correctly described as being conducted in private. The word “chambers” is used because of its association with the judge’s room so as to distinguish a hearing in chambers from a hearing in open court. While the public in general are normally free to come into and go from a court (as long as there is capacity for them to do so) during court hearings the same is not true of chambers hearings. Other than the parties and their representatives the public need the permission of the judge to attend.

Hearings in private in chambers already make an important contribution to the administration of justice. They allow issues to be determined informally and expeditiously. They allow less strict rules as to representation to apply. They allow matters to be discussed which the parties might not wish to discuss in open court. They encourage openness. They are less intimidating to litigants which is particularly important in the case of the small claims jurisdiction. With the movement which is now taking place in relation to case management chambers hearings are likely in the future to make a greater contribution to the administration of justice than they do already. As Mr Justice Jacob correctly commented there is at present an illogical difference in practice between the Chancery and Queen’s Bench Divisions but the position will be rationalised by the new rules of court which are being drafted at present.

Surprisingly, just what can be repeated in public about what occurs in chambers is virtually free from authority. The reasons for this could be at least twofold. First, the fact the great majority of the matters dealt with in chambers are of no interest to any one except those immediately involved. Secondly, in the normal way the parties and, in particular, their legal advisers recognise that it is desirable to treat in a confidential manner what occurs in chambers, because it is in accord with the “chambers culture” which has grown up over the years and which contributes to the efficient dispatch of the work of the courts. For the majority of lawyers to treat what happens in chambers in any other way would not be in accord with proper professional behaviour.

However it remains a principle of the greatest importance that, unless there are compelling reasons for doing otherwise, which will not exist in the generality of cases, there should be public access to hearings in chambers and information available as to what occurred at such hearings. The fact that the public do not have the same right to attend hearings in chambers as those in open court and there can be in addition practical difficulties in arranging physical access does not mean that such access as is practical should not be granted. Depending on the nature of the request reasonable arrangements will normally be able to be made by a judge (of course we use this term to include Masters) to ensure that the fact that the hearing takes place in chambers does not materially interfere with the right of the public, including the media, to know and observe what happens in chambers. Sometimes the solution may be to allow one representative of the press to attend. Another solution may be to give judgement in open court so that the judge is not only able to announce the order which he is making, but is also able to give an account of the proceedings in chambers. The decision as to what to do in any particular situation to provide information for the public will be for the discretion of the judge conducting the hearing. As long as he bears in mind the importance of the principle that justice should be administered in a manner which is as open as is practical in the particular circumstances, higher courts will not interfere with the judge’s decision unless there is good reason for doing so.

With this guidance it should be possible to meet the concerns rightly emphasised by Sir Jack Jacob and at the same time retain most, if not all, the advantages provided by the informality of appearing in the judges' chambers for the disposal of interlocutory matters.

The nature of the hearing being that which is indicated, while lawyers will be expected to continue to exercise self restraint as to what is said, any order, judgment or account of the proceedings in chambers can, except in the special cases, be communicated to those who did not attend without any concern that such a communication will create any risk of the imposition of a penalty. If the court wishes to restrain such communication, then it will have to make an appropriate order, when it has the power to do so. As to those situations it is important to take account of the judgment of Lord Reading in R v Lewes Prison (Governor) ex p. Doyle [1917] 2 KB 254, 271 where he drew attention to the fact that it was impossible to enumerate all the circumstances which would justify an exception to the general rule. As the practice of the courts alters, for example because of the developments in relation to Alternative Dispute Resolution, so will the exceptions change.

In relation to hearings in chambers the position may be summarised as follows:

1. The public has no right to attend hearings in chambers because of the nature of the work transacted in chambers and because of the physical restrictions on the room available, but if requested, permission should be granted to attend when and to the extent that this is practical.

.2. What happens during the proceedings in chambers is not confidential or secret and information about what occurs in chambers and the judgment or order pronounced can, and in the case of any judgment or order should, be made available to the public when requested.

3. If members of the public who seek to attend can not be accommodated, the judge should consider adjourning the proceedings in whole or in part into open court to the extent that this is practical or allowing one or more representatives of the press to attend the hearing in chambers.

4. To disclose what occurs in chambers does not constitute a breach of confidence or amount to contempt as long as any comment which is made does not substantially prejudice the administration of justice.

5. The position summarised above does not apply to the exceptional situations identified in section 12(1) of the 1960 Act or where the court, with the power to do so, orders otherwise.

In this case the judge made his order about not communicating to the press as a result of the intervention of Mr Playford QC, who appears on behalf of the 1st defendants, just before the end of the hearing. He reminded the judge of the directions which he had made on the previous occasion and indicated that until the 7 October, as far as he was aware that direction had been adhered to. However, he then referred to an article that had appeared in the Independent Newspaper on that date and the fact that Mr Day had been giving interviews commenting about the hearing which was then about to take place. He suggested that there had been at least conduct on Mr Day's behalf which was "wholly contrary to the terms" of the previous direction or "at any rate the spirit of it". He also referred to a book which Mr Day had written. He then asked the judge to reiterate his order. The judge asked counsel as to whether he should give a blanket direction that until further order neither the parties nor their advisers were to make any comment about the progress of the proceedings? Both Mr Playford and Mr Fenwick indicated that they would welcome an order. Mr Brennan felt he should take instructions on the matter and did so over the luncheon adjournment. After the adjournment, he indicated judge that his instructing solicitors were aware of their professional responsibility to the court and in relation to issues such as contempt of court and the like but they were not ready to accept any order. Mr Brennan also made it clear that Mr Day had given other interviews which could be subsequently published. The judge then made the order which is the subject of the appeal. Leave to appeal the order was refused but we granted leave at the commencement of the hearing of this appeal. The judge was also not prepared to give leave for the judgement which he had given about the CFAs to be treated as if it had been given in open court.

Before leaving what happened at the 10 October hearing, it is right that we should make clear that the judge did not investigate, nor have we investigated, whether Mr Day had contravened the previous order about communicating with the media. We certainly make no finding that he did since that previous direction was in very narrow terms. It only referred to the parties and was limited to restraining the parties making any comment on the directions that were given on that occasion.

As we have already indicated, the normal protection of the administration of justice is to be found in the law of contempt. To rely on the law of contempt for this purpose has the disadvantage that what does or does not amount to contempt cannot be identified with precision before all the circumstances are investigated. The advantage of an order of the class made by the judge on 10 October is that the parties and their legal advisers should know, so far as this can be achieved, precisely where they stand. The advantage of relying on the law of contempt in preference to a precise order of the sort which was made is that upon an application to commit for contempt, the court is required to weigh the conflicting public interests involved. Those interests include not only the need to protect the administration of justice but also the importance of not interfering with freedom of speech and the freedom of the press. Although the order was not made against the media, if they become aware of the terms of the order and become a party to any breach of the order they are liable to be cited for contempt.

Although we therefore recognise that advantages can flow from an order of this sort, we are quite satisfied that it was wrong to make this order. While we would much prefer lawyers not to become engaged in commenting about proceedings to the press (as opposed to communicating facts), we consider that in this case the risk, if any, of the administration of justice being interfered with by communications with the press are far less than the risks which would follow from interference with the entitlement of the media to obtain information about these proceedings. We appreciate that the defendants might find what is said to the media objectionable, but we do not accept that they will be deterred from defending these proceedings because of adverse publicity which could be generated by those comments.

The problem with the order is that it achieves certainty by imposing rigidity. If it is enforced, it will mean that instead of being judged as would normally be the case under the law of contempt the plaintiffs’ legal advisers will be judged by whether they have not complied with the order. Whether there has been a failure to comply with the order will become the test for contempt instead of whether there has been unjustified interference with the administration of justice. To produce this result is wrong in principle and the order should not have been made.

What has happened since the order has been made strongly suggests that it would have been preferable to have given all the directions which were made on 10 October in open court, together with a judgment explaining why they were made, so that it would not have been necessary for the legal advisers to communicate with the media in order to explain what had happened.

In litigation of this of this sort, it is difficult if not impossible for the court to seek to prevent direct or indirect communication with the media. In our judgment in this case the court should not have attempted to do so. The best way of avoiding ill-informed comments in the media in the case of this nature when the interest of the public is high, is for the court to be as open as is possible and practicable, not only in relation to the trial but also in relation to the interlocutory proceedings which have to take place prior to that trial. The other action which can be taken to reduce the risk of trial by media and the absence of co-operation between the parties affecting the conduct of the proceedings is to ensure that as soon as is practical a timetable is laid down for bringing the case to trial as early as possible and giving any directions to the parties which are necessary in order to require them to co-operate in achieving this. The longer the trial is delayed the greater the opportunity for both sides to engage in tactical manoeuvres which have nothing to do with achieving a fair trial.

We very much hope that the parties will listen to what we have to say about the desirability of co-operation. However, the outcome of this appeal is that we refuse to make a debarring order and we quash the order restricting discussion with the media. The appeal will therefore be allowed in part.

Order: Appeal allowed in part (publicity appeal allowed, appeal as to CFA refused).

Plaintiffs to pay 25% of the costs of the appeal.

Application for certificate for three counsel refused.