Reference:  EWHC 3190 (QB)
Court: High Court, Queen's Bench Division
Judge: Steyn J
Date of judgment: 22 Nov 2019
Summary: Blackmail - Harassment - Legitimate Expectation of Privacy - ECHR Article 8 - "Without Prejudice" privilege - Anonymity - Private Hearing - Practice Guidance: Interim Non-Disclosure Orders
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Appearances: Desmond Browne CBE KC - Leading Counsel (Claimant) Jonathan Barnes KC (Claimant)
Instructing Solicitors: Stephenson Harwood LLP
The parties were previously longstanding friends. A contractual dispute arose between them in respect of which the Defendant sent the Claimant a letter before action. A month later the Defendant emailed the Claimant to say that absent the Claimant honouring the disputed contract or proposing a realistic settlement he would “fully advise” a series of organisations, bodies of people and identified individuals relevant to the Claimant’s business interests of various specified matters personal to the Claimant. Two days later the Defendant followed this up with an email to four business associates of the Claimant albeit not at that stage disclosing the specified matters. The next day the Defendant sent another email to the Claimant offering to settle for £1 million or alternatively that he would “proceed with the litigation and associated course of action as advised to you”. At the same time the Defendant emailed the Claimant’s business associates again indicating that he was “postponing” acting further in the hope of reaching an agreement with the Claimant within the next seven days. Except for the original letter before action the Defendant’s correspondence was marked “without prejudice”. There had been negotiations with a view to compromising the contractual claim. However the Claimant sought and obtained urgent interim restraining relief against the Defendant making the disclosures he had threatened. At a return date hearing the Claimant sought the continuation of such relief over to the final hearing.
- Should the parties remain anonymous and the hearing be conducted in private in the light of Practice Guidance: Interim Non-Disclosure Orders  1 WLR 1003?
- Could the Claimant rely to establish his case on the correspondence marked “without prejudice”?
- Was this a prima facie case of blackmail or harassment so that in the context of the other relevant circumstances it could be said that the Claimant was likely to establish at trial that the threatened disclosures should not be allowed – applying Cream Holdings v Bannerjee  1 AC 253?
- How should any interim injunction order be framed?
- The sensitive and personal nature of the matters threatened to be disclosed in the context of an alleged case of blackmail meant that derogations from the principle of open justice were justified both to anonymise the parties and to conduct the hearing in private. A public hearing or identification of the parties in connection with the claim would frustrate the aim of the proceedings. The public interest in open justice would be satisfied in this context by the Court giving a public judgment.
- The threats in this case made under cover of without prejudice correspondence went far beyond what is proper or permissible in hard fought commercial litigation (see Ferster v Ferster  EWCA Civ 717 citing Boreh v Republic of Djibouti  EWHC 769 (Comm)). Their purpose was to obtain an immediate financial advantage for the Defendant in the form of company shares or monetary payment. They placed the Claimant under quite improper pressure and there was no attempt at the time to make any connection between the allegations which were the subject of the threats and the Defendant’s demand for settlement of his contractual claim. Accordingly the Claimant had been entitled to rely on the items marked “without prejudice”. In any event by the time of the instant hearing both parties had waived privilege in the without prejudice correspondence by agreeing to include it in the hearing bundle.
- The Claimant had shown that the Defendant’s email threats were more likely than not to be found at trial to constitute blackmail. The Defendant had made an express demand for a 5% benefit or £1 million, the threats of disclosure to a wide range of people of damaging allegations amounted to menaces and it was probable that the Court would conclude at trial that the Defendant did not believe that his threats were a proper means of reinforcing his demand for a settlement. Although the Defendant contended that his threatened allegations were true, truth is not a defence to a charge of blackmail – see LJY v Persons Unknown  EWHC 3230 (QB). The Claimant had also shown that it is more likely than not that he will establish at trial a course of conduct amounting to harassment under the Protection from Harassment Act 1997. Accordingly the Claimant had demonstrated a proper basis for restraint until a final hearing to determine the underlying merits and any appropriate permanent relief.
- Although by the time of the hearing the Defendant had offered not to “harass or blackmail” the Claimant an undertaking in such bare terms would not be satisfactory or sufficient. Rather the Defendant himself should know in clear terms what it is he is restrained from doing. Accordingly subject to an amendment to remove any objection that interim relief would affect the Defendant’s pursuit of his contractual claim the detail of the restraint would be as drafted by the Claimant.
The case will proceed to a final hearing at which the Court will resolve any disputed facts and lines of justification maintained by the Defendant. At that stage the injunction will either be made permanent or set aside. In the meantime the interim relief protects both the Claimant’s interests and the interests of justice in the Court’s processes being fair. The facts here serve to demonstrate the many forms an alleged case of blackmail might take and the flexibility available to the Court to respond with a restraining order in an appropriate case.