England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
The Hon Mr Justice Eady
HQ09X00298

		Royal Courts of Justice Strand, London, WC2A 2LL
		19/12/2011

The Master of the Rolls:

1. This is an application for permission to appeal against a decision of Mr Justice Eady given on 17^th November 2010, which I directed should come before a three-judge court.

The background to this application

2. In January 2009, Mr Christopher Hutcheson issued proceedings, in anonymised form as WER v. REW, against Popdog Ltd, seeking to restrain Popdog from publishing or communicating certain information, relating to his private life ('the Information'). In the same month, Sir Charles Gray, sitting as an additional judge of the Queen's Bench Division, granted Mr Hutcheson an interim injunction ('the Interim Injunction') restraining Popdog from communicating the Information, whose content was summarised in a confidential schedule to the order, 'until after the conclusion of the trial of this claim or further order of this court in the meantime'.
3. Shortly thereafter, Mr Hutcheson and Popdog reached a compromise whereby they agreed, in effect, that the Interim Injunction would continue for the foreseeable future, and that Mr Hutcheson's claim against Popdog would not otherwise proceed.
4. Some time during 2010, News Group Newspapers Limited ("NGN") wished to publish the Information, and, in November 2010, they applied to the court to set aside the Interim Injunction. That application ('the Application') came before Eady J on 16 November, and, on the following day, he gave a judgment ('the first judgment').
5. As Eady J mentioned in that judgment, a party who has notice of an interim injunction is at risk of being in contempt of court if he does something which effectively flouts or undermines the injunction – see, for instance, Attorney-General v Times Newspapers Limited [1992] 1 AC 191, 223-224 and see also Attorney-General v Punch Ltd [2003] 1 AC 1046, 1066. This principle, sometimes known as 'the Spycatcher principle' (see Attorney-General v Newspaper Publishing plc [1988] Ch 333, 375 and 380), is well-established. However, Gray J decided in Jockey Club v. Buffham [2003] QB 462, paras 23-27, that, if and when a final injunction is granted in favour of a claimant, any interim injunction is discharged and replaced by the final injunction, and that a third party, even one who has notice of the final injunction, is not at risk of being in contempt of court if he acts inconsistently with the injunction.
6. In the first judgment, Eady J explained that, in his view, the effect of Mr Hutcheson and Popdog having settled their differences in the way I have summarised was that Mr Hutcheson was "sitting on an interim injunction as though it gave the permanence and security of a final injunction … but the drawback of a final injunction is that it cannot bite on third parties…. There is no ring to hold." In those circumstances, he held, NGN's application to set aside the Interim Injunction represented "an unnecessarily circuitous route", because the appropriate analysis was that the Interim Injunction had, in practice, ceased to be interim in nature once Mr Hutcheson and Popdog made their agreement, and had therefore ceased to bind third parties such as NGN. Although the Judge refused Mr Hutcheson permission to appeal against that decision, he granted interim relief to ensure that the Information was not published until the question of an appeal had been determined. He also reserved the costs of the Application.
7. As a result of this decision ('the first decision'), Mr Hutcheson immediately issued fresh proceedings against NGN (and certain other newspaper publishers), under the title KGM v. News Group Newspapers Limited, seeking an order restraining them from publishing the Information, and he immediately applied for an interim injunction to restrain publication pending trial. That application came on before Eady J on 17 November 2010, and he gave judgment ('the second judgment') on 1 December 2010, in which he decided ('the second decision') that, balancing the freedom of expression and freedom of the press relied on by NGN against Mr Hutcheson's right to privacy and not to be harassed, and taking into account section 12 of the Human Rights Act 1998, he should reject the application. Accordingly, NGN (and other newspaper publishers) were free to publish the Information, but, although he refused Mr Hutcheson permission to appeal, Eady J again gave him a protective order pending his attempt to appeal that decision. He also decided to award NGN its costs against Mr Hutcheson of both the Application and the action which he effectively disposed of on 1 December.

The issues between the parties on this application

8. Mr Hutcheson then applied for permission to appeal against the first decision and the second decision. He obtained permission to appeal against the second decision, but, on 19 July 2011, his appeal was dismissed – Hutcheson v. Newspapers Limited [2011] EWCA Civ 808.
9. The application for permission to appeal against the first decision was effectively stayed by agreement until the parties knew the outcome of the appeal against the second decision. Now that that appeal has been decided, Mr Hutcheson maintains his application for permission to appeal against the first decision. Having heard argument as to whether he should be granted such permission, we indicated that we would refuse it, and give our reasons later.
10. The primary ground upon which NGN resisted Mr Hutcheson being granted permission to appeal against the first decision was that the outcome of the appeal would be academic as between the parties. Even if the court were to conclude that Eady J ought not to have concluded that NGN was free to publish the information, despite the existence of the Interim Injunction, NGN would still be free to publish information because of the second decision (now upheld by this court) that the Article 10 rights of NGN should prevail over the Article 8 rights of Mr Hutcheson. As Miss Page QC, who appeared for NGN on this application, contended, an appellate court is very reluctant to hear an appeal when there is no subsisting live dispute between the parties.
11. On behalf of Mr Hutcheson, Mr Tomlinson QC raised two arguments as to why this court should nevertheless hear the projected appeal against the first decision. His first argument was that, even if the appeal is academic as between the parties, it would raise two points which are sufficiently important to justify an appeal being allowed to proceed. His second argument was that the projected appeal would not in fact be academic, because, if the first decision was reversed, the order for costs made in relation to the Application would be varied. I shall consider those arguments in the same order as that in which they were advanced.

The argument that the projected appeal is academic

12. The mere fact that a projected appeal may raise a point, or more than one point, of significance does not mean that it should be allowed to proceed, where there are no longer any real issues in the proceedings as between the parties. In Gawler v. Raettig [2007] EWCA Civ 1560, 2007 WL 5116827, the Court of Appeal refused permission to appeal on the ground that the issue it would raise was academic as between the parties. In his judgment, Sir Anthony Clarke MR gave helpful guidance as to the correct approach in such cases. He said at [2007] EWCA Civ 1560, para 36 that, before an appeal could proceed in those circumstances, the court must be satisfied that it would be in the public interest for the projected appeal to proceed, but he added that it would be "a very rare event, especially where the rights and duties to be considered are private and not public". Nonetheless, in the following paragraph, he emphasised that all must "depend upon the facts of the particular case" and that he did not "intend to be too prescriptive".
13. We were referred to two recent cases in this court where the appeal proceeded even though the point was academic between the parties, but in both cases it is clear that the parties other than the appellant were keen, or at least agreeable, for the appeal to proceed – see Bowman v. Fels (Bar Council and Others intervening) [2005] EWCA Civ 226, [2005] 1 WLR 3083, para 10, and Rolls-Royce plc v. Unite Union [2009] EWCA Civ 387, [2010] 1 WLR 318, para 31. And I note that, even though the respondent was content in the latter case for the appeal to proceed, Wall LJ did not find it "easy" to decide whether to allow the appeal to proceed – [2010] 1 WLR 318, para 32.
14. In the present case, NGN did not wish the projected appeal to proceed. Furthermore, NGN would be out of pocket if the appeal proceeded, because they would have to pay their own costs, and Mr Hutcheson's base costs and his ATE premium. It is true that Mr Hutcheson offered NGN an agreement that there should be no order for costs whatever the outcome of the appeal, but that would mean that NGN would be out of pocket to the extent of their own costs of the appeal whatever the outcome.
15. Both the cases and general principle seem to suggest that, save in exceptional circumstances, three requirements have to be satisfied before an appeal, which is academic as between the parties, may (and I mean 'may') be allowed to proceed: (i) the court is satisfied that the appeal would raise a point of some general importance; (ii) the respondent to the appeal agrees to it proceeding, or is at least completely indemnified on costs and is not otherwise inappropriately prejudiced; (iii) the court is satisfied that both sides of the argument will be fully and properly ventilated.
16. I accept that there would be a real prospect of requirement (i) being met if this appeal went ahead. The projected appeal would, I accept, potentially raise at least one issue of general importance, although I do not regard it as a foregone conclusion that either of the two points which have been identified would necessarily be determined on the projected appeal. In that connection, the two issues Mr Tomlinson contended would have to be considered on the projected appeal were first, the Judge's view that the Interim Injunction ceased to have interim effect once Mr Hutcheson and Popdog had effectively settled their differences, and, secondly, the correctness of the decision in Jockey Club [2003] QB 462.
17. In relation to the first issue, Mr Tomlinson argued that it cannot be right that an interim injunction ceases to bind third parties once there is an agreement between the parties to the action, but that is not, and may never be, known to third parties; his primary case was that, at least in general, so long as the court has not discharged an interim injunction, it continues to have effect not merely as between the parties to the proceedings, but also on third parties. As to the second issue, Mr Tomlinson said that Jockey Club [2003] QB 462 was wrongly decided, and that third parties are as effectively bound by a final injunction as they are by an interim injunction.
18. The first issue should now only be of limited relevance, following the publication of the Practice Guidance: Interim Non-Disclosure Orders (reflecting the views expressed in paras 2.25 and 2.32-2.36 of the Report of the Committee on Super-injunctions (Super-Injunctions, Anonymised Injunctions and Open Justice), on 20 May 2011). I have in mind especially para 36 of the Practice Guidance, which requires a party, who has an interim injunction restraining publication of information, to keep any affected non-party informed of developments in the case, and paras 37-41, which require active case management of such a case. However, I accept that there will be interim injunctions in respect of which, either because they were decided before the Practice Direction was issued or because something has gone wrong, the principle invoked by Eady J in the first judgment might be thought to apply. Accordingly, it seems to me that there is some force in the argument that the first point is of some, albeit limited, general significance.
19. As to the second issue, namely whether Jockey Club [2003] QB 462 was rightly decided, I think it is hard to argue against the proposition that that is a point of general significance, and should be decided by this court at some stage. However, it is not entirely clear, at least on the present state of the argument and evidence, how important the point may be in practice. The fact that Jockey Club [2003] QB 462 has not been challenged in this court despite having been decided some nine years ago might fairly be said to cast some doubt on the importance of the point.
20. Further, if Mr Hutcheson's projected appeal proceeded, it may well be that the Court of Appeal would not consider it necessary to determine either issue in order to dispose of the appeal. In my view, it is quite possible that the court would simply hold that, even if the Judge had been wrong in his reasoning, the Application would have succeeded, because, where parties to litigation had settled it on terms that an interim injunction remained on foot, the injunction should be discharged by the court, at least insofar as a third party was concerned, unless it could be justified as against that third party. On that basis, in the light of the second judgment (upheld in this court), there would be a strong argument for saying that the order for costs was correct, and there would be no need to consider the issues in order to resolve any appeal on costs.
21. Requirement (ii) is plainly not satisfied. Requirement (iii) appears likely to be satisfied, in that I presume that Miss Page would appear for NGN if there were an appeal.
22. In these circumstances, I do not consider that it would be right to grant permission to appeal, at least if this were purely an academic appeal.

The argument that the projected appeal could affect the costs order below

23. That leaves the argument that an appeal would not be academic because, if this court disagreed with the reasoning of Eady J in the first judgment, that would result in a more favourable outcome as far as the costs of the Application are concerned. I have several concerns about this. The first is that it is not clear how much money is involved. Mr Tomlinson suggests it might be as much as £45,000, but, on the very limited information available, it seems certain that it would be substantially less than that.
24. Secondly, it is by no means clear that Eady J awarded NGN its costs of the Application simply as a result of his reasoning in the first judgment. After all, he reserved those costs following the first judgment, and it was only following the second judgment, in which he had decided that the Information should not be protected, that he made the order for costs in favour of NGN. It seems to me quite possible that it was because of the conclusion reached in the second judgment that he decided to order Mr Hutcheson to pay NGN's costs of the Application. There is no record of the parties' argument or the Judge's reasoning on this issue, and it would be for Mr Hutcheson, as applicant for permission to appeal, to make good his implied contention that the reason why he had to pay NGN's costs of the Application was because of the first judgment, and not because of the second judgment.
25. Thirdly, I consider that it is probable that, even if Mr Hutcheson's projected appeal succeeded, this court would not, in any event, think it right to reverse the Judge's order for costs in relation to the Application. What was at stake in the war between Mr Hutcheson and NGN was whether NGN could publish the Information, and, after NGN won the first battle in this war, in the form of the first judgment, Mr Hutcheson joined battle again by issuing a claim direct against NGN, and he also lost that battle, in the form of the second judgment (upheld on appeal). It therefore seems to me that there is a powerful argument for saying that, even if it disagreed with the Judge's reasons for holding that NGN was entitled to publish the Information, notwithstanding the Interim Injunction, this court could very well nonetheless hold that the order for costs made by the Judge should stand. In other words, even if the court on the projected appeal decided that the Judge's reasons in the first judgment were wrong, it would nonetheless decide that his decision was right, and therefore that the order for costs which he made should stand.

Concluding remarks

26. In these circumstances, I reach these conclusions:

i) Subject to the issue relating to the costs of the Application, the projected appeal would be academic as between the parties, and I would refuse permission to appeal, because of the combination of two factors, namely, (a) although the two issues which it is said would be raised on the projected appeal are significant, they are not of outstanding public importance, and anyway might not actually be determined on the projected appeal, and (b) NGN opposes the grant of permission to appeal and would be significantly out of pocket on costs if the appeal went ahead;

ii) The prospect of the order that Mr Hutcheson pay the costs of the Application being varied, even if the projected appeal were to succeed, is, at best from Mr Hutcheson's point of view, very uncertain, and it would therefore be a disproportionate reason for permitting an appeal to proceed;

iii) Accordingly, I would refuse permission to appeal;

iv) It would be wrong to end this judgment without making the following points:

a) It cannot be safely assumed that the Judge's conclusion that, notwithstanding the fact that the court had not varied or discharged the Interim Injunction, publication of the Information by NGN would not represent a breach of the Spycatcher principle because of the terms of settlement between Mr Hutcheson and NGN, would be approved by this court;

b) Similarly it cannot be safely assumed that the conclusion in Jockey Club [2003] QB 462, that the the Spycatcher principle does not apply to final injunctions but only applies to interim injunctions, would be approved by this court;

c) The history of these proceedings demonstrates the importance of adhering to the terms of Practice Guidance relating to Interim Non-Disclosure Orders.

27. Because this judgment may conceivably contain guidance on the issue of academic appeals or on the issues which would have been raised if permission to appeal had been granted, it may be cited in court.

Lord Justice Etherton:

28. I agree.

Lord Justice Gross:

29. I also agree.