Business secrets up for grabs
Six months ago, it became easier for the public to obtain court documents. Now, if a dispute involves issues you’d rather keep confidential you may need to look at ways of resolving matters out of the courts. Associate Paul Gordon reports.
A change in the court rules has given the public much greater access to documents filed in the course of court proceedings. The move is intended to encourage openness in the court system and generate public confidence in judicial decision-making. The result is that anyone can now request copies of more of the documents filed since October last year.
In practice, this means a sharp-witted competitor or an enterprising journalist may at this moment be asking to see court papers in the hope of uncovering commercially useful or scandalous information.
Many commercial disputes involve the disclosure of information that the parties would prefer to keep private. Details about pricing, products, contracts, customers, financial standing or boardroom battles are just a few examples, any of which could be potentially harmful in one way or another.
Previously, it was generally only possible to obtain limited and very basic information about a claim unless you were a party to a case: now there is access to all statements of case filed at court since October 2006. There is provision for litigants to ask the court to restrict access to non-parties but is too early to know what this means as there is little guidance as to when the courts would agree to this restriction.
Paul Gordon says: “Where confidentiality is a key objective, businesses may well prefer to opt for alternative ways of resolving disputes, such as arbitration or mediation.
“Arbitration hearings, for example, are conducted in private, awards are confidential and members of the public have no right to access documents filed during the arbitration proceedings.
“With some surveys reporting that over 80 per cent of disputes referred to mediation result in a settlement it is no surprise that more and more business are choosing to mediate. Specific confidentiality clauses can be included in settlement agreements, which, again, may enhance its appeal as a preferred option.
“This change to the rules will certainly act as a further, and persuasive, reason to consider these alternative forums which offer a higher degree of confidentiality”.
Associate Paul Gordon, a specialist in dispute resolution, has acted for clients such as American Express, PizzaExpress and a number of major financial loan companies.