QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Fetter Lane, London, EC4A 1NL |
||
B e f o r e :
____________________
(1) ROBERT TCHENGUIZ | ||
(2) R20 LIMITED | ||
(3) RAWLINSON AND HUNTER TRUSTEES SA | ||
(in their capacities as trustee of the | ||
Tchenguiz Discretionary A Trust and the NS One Trust) | ||
Claimants | ||
- and - | ||
DIRECTOR OF THE SERIOUS FRAUD OFFICE | ||
Defendant |
____________________
Mr PUSHPINDER SAINI QC and Mr JAMES SEGAN (instructed by Slaughter & May) for the Defendant
____________________
Crown Copyright ©
Mr Justice Eder:
Introduction
"(1) A party to whom a document has been disclosed may use the document only for the purpose of the proceedings in which it is disclosed except where -
(a) the document has been read to or by the court, or referred to, at a hearing which has been held in public;
(b) the court gives permission; or
(c) the party who disclosed the document and the person to whom the document belongs agree."
The proposed constitution and function of the review team
The Guernsey proceedings
The SFO's position
Applicable principles
"Discovery constitutes a very serious invasion of the privacy and confidentiality of a litigant's affairs. It forms part of English legal procedure because the public interest in securing that justice is done between parties is considered to outweigh the private and public interest in the maintenance of confidentiality. But the process should not be allowed to place upon the litigant any harsher or more oppressive burden than is strictly required for the purpose of securing that justice is done."
"Many people give assistance to the police and other investigatory agencies, either voluntarily or under compulsion, without coming within the category of informers whose identity can be concealed on grounds of public interest. They will be moved or obliged to give the information because they or the law consider that the interests of justice so require. They must naturally accept that the interests of justice may in the end require the publication of the information or at any rate its disclosure to the accused for the purposes of enabling him to conduct his defence. But there seems to me no reason why the law should not encourage their assistance by offering them the assurance that, subject to these overriding requirements, their privacy and confidentiality will be respected."
"… I do not think that it is possible to overstate the importance, in the public interest, of ensuring that material which is disclosed in criminal proceedings is not used for collateral purposes."
16.1. Whether use of a document amounts to collateral use depends on the proper characterisation of the "purpose" for which the documents are "used" (§12).16.2. The grant of the permission contemplated by CPR r.31.22 is ex hypothesi one which is to be exercised to enable documents to be used for purposes other than the proceedings in which the documents have been disclosed. The fact that the documents in question are to be used for some collateral purpose cannot, of itself, be a bar to the grant of permission. Nevertheless, the burden of proof is on the applicant to show "cogent and persuasive reasons" why any particular document should be released amounting to "special circumstances" (§18).
16.3. The giving of documents to counsel to advise while maintaining confidentiality in the documents is (in ordinary circumstances) only collateral use of a "very limited nature" (§19; see also §24, §25).
16.4. To prevent any party from obtaining legal advice for whatever reason is a very drastic restriction on that party's ordinary rights. Such a restriction runs counter to the rule of law, and is potentially objectionable on that basis. A party's ordinary right to obtain legal advice should not generally be hampered by the imposition of any time constraint (§20).
16.5. There is no reason why external lawyers should not be in the same position as in-house lawyers who receive disclosure subject to separate undertakings (§11). There is a very strong desirability of any litigant being able to instruct the lawyer of his / her choice (§11). If advice of a certain nature could be provided by the applicant's existing or in-house legal team, then it is prima facie anomalous for an "external" lawyer not to be able to provide advice of the same nature; and this is a factor which points in favour of the grant of permission (§23).
RT's case in favour of the grant of permission
17.1. The application is a request for permission to pass documents to the review team for the purposes of receiving legal advice.17.2. The legal advice is directed to the making of further CPR r.31.22(1) applications in these proceedings. It is "use [of documents] … for the purpose of the proceedings in which [they were] disclosed". The Criminal Advice Judgment specifically recognises (at §13) that giving documents to a lawyer to advise may not be prohibited by CPR r.31.22(1) where "the purpose of the proposed course of action was to consider whether such … advice might assist in these proceedings". In this case, the advice will assist in these proceedings – both in the making of CPR r.31.22(1) applications and at trial.
17.3. RT has a genuine and urgent need for legal advice in relation to the relevance for Guernsey Appeal purposes of documents disclosed by the SFO in these proceedings. His need for legal advice cannot practicably be satisfied otherwise than by the instruction of a dedicated review team including individuals with detailed familiarity of the Guernsey proceedings.
17.4. Any potential prejudice identified by the SFO (whether prejudice to itself or to third parties) has been in relation to the future deployment of disclosed documents or information in open court. It cannot sensibly claim that its or third parties' interests are affected by an expansion of the legal team reviewing the SFO disclosure to include 7 additional lawyers. The review team is prepared to sign any reasonable confidentiality undertakings which may be required and will of course be bound by CPR r.31.22(1) in any event.
17.5. It would not take a 'strict logician' to deplore the unacceptable anomaly which would permit RT to instruct Lord Goldsmith QC or Catherine Newman QC for some purpose in these proceedings (e.g. appearing on a PTR or arguing this application), but would not permit RT to instruct the same people to advise on the potential relevance to the Guernsey Appeal of documents disclosed by the SFO in these proceedings. Such a position would be arbitrary, incomprehensible to the general public, and productive of real difficulty and injustice.
Discussion
The Evidence (Proceedings in Other Jurisdictions) Act 1975
21.1. The 1975 Act, which was passed in part to enable the UK to ratify the Hague Convention on the taking of evidence abroad in civil or commercial matters (the "Convention"), provides a specific mechanism by which foreign courts, including the Guernsey Court of Appeal, may seek the assistance of the English courts in obtaining documentary evidence in England which is relevant to proceedings within their jurisdiction. Section 2(2)(b) of the 1975 Act specifically provides that upon request by a foreign court, the English court can make an order requiring "… the production of documents", a power which is subject to specific limitations in section 2(4).21.2. The mechanism laid down in the 1975 Act is an exclusive one. As Lord Diplock observed in Rio Tinto Zinc Corporation v Westinghouse Electric Corporation [1978] AC 547 at 632g-633A:
"My lords, the jurisdiction and powers of the high court to make the orders that are the subject of this appeal are to be found in sections 1 and 2 of the [1975 Act], and nowhere else. ... the jurisdiction of English courts to order persons within its jurisdiction to provide oral or documentary evidence in aid of proceedings in foreign courts has always been exclusively statutory."21.3. The consequence of such exclusivity is that where foreign civil proceedings are up and running, there is no jurisdiction for the English Courts to make a Norwich Pharmacal or Bankers Trust order which would require the production of documents for use in those foreign proceedings, the only avenue available being the 1975 Act: Shlaimoun and another v Mining Technologies International Inc [2012] 1 WLR 1276 at §§19, 24 per Coulson J; R (Omar) v Foreign Secretary [2014] QB 112 at §§22-23 per Maurice Kay LJ.
21.4. The same logic applies to the exercise of the Court's discretion under CPR 31.22(1)(b). It would be wrong to exercise the power under CPR 31.22(1)(b) with a view to enabling disclosure given in English proceedings to be deployed in foreign proceedings if the foreign Court had not itself requested those documents under the 1975 Act. The Contracting States to the Convention, and Parliament, have seen fit to lay down a specific mechanism by which the Courts of a foreign jurisdiction can obtain documentary evidence located in England which is relevant to litigation in that foreign jurisdiction. That mechanism contains specific restrictions and safeguards which would ordinarily protect a person within the jurisdiction such as the SFO. It would be wrong to exercise the power in CPR 31.22(1)(b) so as to deprive the SFO of those protections simply because the SFO happens to have been sued in England by a person who has a connection with the foreign litigation in question. To do so would be inconsistent with the exclusivity stressed by Lord Diplock in Rio Tinto, and would create an incentive for proceedings to be brought in England as a vehicle for obtaining disclosure in support of foreign proceedings.
Unfairness
23.1 It is a factor of particular relevance to the exercise of the discretion under CPR 31.22(1)(b) if there is a "… particular reason for anticipating some element of injustice in the use to which the documents may be put ...": Marlwood at §45 per Rix LJ.23.2 The litigation in Guernsey involves a large number of parties, some of whom have interests aligned with RT, some of whom do not. RT is not himself a party.
23.3 The relevance of the SFO's documents to the litigation in Guernsey is unclear, but in any event the suggestion appears to be that RT should be entitled to go through the SFO's documents and choose only those documents which are perceived as furthering the interests of the parties with whom he is aligned, and then seek permission from the English Courts to adduce those documents in Guernsey.
23.4 That would cause obvious unfairness to the other parties to the litigation in Guernsey. Nor could that unfairness practically or fairly be remedied by the SFO or this Court, neither of which is involved in the Guernsey litigation, and neither of which would therefore be able to ensure that any selection of documents was representative. Further the SFO obviously cannot give access to its disclosure in these proceedings to strangers to it, namely the other parties in Guernsey. In any event, it would be wrong to cast upon the SFO or this Court the burden of working out whether a particular set of documents disclosed by the SFO in these proceedings is properly representative of the full range of such documentation which might be relevant to an issue in foreign proceedings with which neither the SFO nor the Court has any involvement.
23.5 It is no doubt precisely for that reason, amongst others, that the 1975 Act gives the power to the foreign Court to make the request for documents. That enables the foreign Court to exercise control over the scope of the request, ensuring that the documents are prima facie relevant to the proceedings before it and that the scope of the request is tailored to ensure a fair balance between the parties to the foreign litigation. It is not within the gift of the SFO or this Court to perform that exercise.
Practical considerations
25.1. The SFO is less than twelve weeks away from a twelve-week trial at which very large sums of money are at stake. The SFO and its legal team are focussing, as they are entitled and indeed bound to focus, on successfully defending these proceedings.25.2. The process of responding to an application under CPR r 31.22(1)(b) is highly burdensome. The SFO cannot simply consent – it is obliged to consult and take into account the views of numerous third parties whose interests would be engaged by the proposed collateral use of the documents containing information obtained from them during the KAU01 investigation. This duty arises for a series of reasons including (a) the duty of confidentiality, (b) the requirements of Articles 6 and 8 of the ECHR, and (c) the requirements of the equivalent articles of the EU Charter of Fundamental Rights, which must be borne in mind on each occasion on which the SFO is giving disclosure of information which amounts to personal data. These issues have been explained repeatedly to the claimants. The effect is that the SFO will be obliged, if the Court grants permission to carry out the proposed course of action to inform 80 third parties that their information is being reviewed for the purpose of potential adduction in Guernsey proceedings, and will be obliged to keep those third parties up to date as and when any further applications are made under CPR 31.22(1)(b), seeking their views on a document-specific basis as and when that is possible.
25.3. It would be quite wrong for the SFO to be distracted from its important preparations for trial, at this late stage, by such matters. The applications under CPR 31.22(1)(b) which will follow on from the general review will presumably be made as and when RT's review team decide that they are ready, having finished going through the SFO's documents. The Guernsey Court has apparently set a deadline of 8 August 2014. It would therefore appear that the SFO is expected to be able to engage in the consultation described above and then respond to the forthcoming applications during the vacation period which is of course the intense period of preparation for trial. That is not a fair or reasonable expectation. Indeed, the very reason that RT wishes to establish his review team is that his "… existing legal team … is fully engaged in preparing for these proceedings": the SFO does not have a similar luxury and cannot sensibly justify spending large sums of money on instructing a separate team of lawyers just to deal with RT's various applications in connection with Guernsey proceedings with which the SFO has no involvement.
Conclusion