Arbitration: Confidential And Private?

In a judgment that undertakes an in depth analysis of the law on the confidential and private nature of arbitration, the Court of Appeal has extended an exception to the general principle of confidentiality in arbitration by concluding that disclosure of arbitration materials in the "interests of justice" is not limited to the interests of justice in England. The court also indicated that in many cases, the question of whether an exception can be relied upon ought properly to be determined by the arbitral tribunal.

The exceptions

The arbitrating parties will generally be allowed, and may be even required, to disclose details of the arbitration where:

1. the arbitrating parties consent;

2. disclosure is necessary for the protection of the legitimate interests of an arbitrating party;

3. the court permits it; or

4. the interests of justice require it.

In Emmott v Michael Wilson Partners Ltd, the appellant, Michael Wilson Partners Ltd (MWP) had made allegations of fraud against Mr Emmott in proceedings in various jurisdictions including New South Wales and the British Virgin Islands. MWP and Mr Emmott were also engaged in arbitration in London that had included the fraud claim until MWP abandoned the claim in its amended statement of case. Mr Emmott sought an order from the court allowing him to disclose certain documents from the London arbitration in the NSW and BVI proceedings to prevent those courts being misled in relation to the fraud claim.

The court held (at first instance and on appeal) that disclosure should be permitted in the interests of justice so that the foreign courts would not be misled or potentially misled. The Court of Appeal concluded that the "interests of justice" exception was not limited to the interests of justice in England, but also extended to cases that had an international element. Therefore, if the interests of justice would be served in another jurisdiction, disclosure of the arbitration materials would be permitted.

Comment: the confidentiality concept

The Court of Appeal confirmed that the confidentiality of arbitration was an implied term of the arbitration agreement and thus an obligation of the arbitration agreement itself. It did not require the intervention of the court to be enforced.

Since confidentiality is an implied term of the arbitration agreement, the court observed that the correct forum for raising any issues in...