Cheshire East

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Proof positive? Admissibility of redacted documents

Katie Gray examines recent Court of Appeal guidance on the redaction of documents being made available to the Court.

How can a party prove its case if a key document is so highly commercially sensitive that its unredacted disclosure would put in jeopardy the commercial viability of that party?

This was the issue in Promontoria (Oak) Limited v Emanuel [2021] EWCA Civ 182, the lead case in a set of joined appeals in which Promontoria sought to enforce payment of various loans assigned to it following a deal with Clydesdale Bank. Promontoria’s business model relied on the terms of the assignments not being revealed to its competitors for fear that the information could be used to obtain competitive advantage. Accordingly, in each case Promontoria disclosed only redacted versions of the Clydesdale assignments and withheld other documents entirely. In response, the Defendants put in issue Promontoria’s title to sue on the assigned loan portfolio.

Though a similar issue had reached the Court of Appeal in Hancock v Promontoria (Chestnut) Limited [2020] EWCA Civ 907 (in which a redacted assignment was allowed into evidence), Hancock involved an application to set aside a statutory demand – thus the onus was on the debtor to prove that the debt was genuinely disputed on substantial grounds. In Emanuel, the burden of proving title to sue was Promontoria’s.

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The Defendants in Emanuel argued that (1) if a Claimant relies on a document to establish its title to sue, then the whole document should be made available to the Defendants (with safeguards in place to protect confidentiality if necessary) and (2) if the Claimant fails to produce an unredacted document, the court should refuse to admit the redacted version and hold the Claimant unable to establish title to sue. After all, it was argued, the court must construe the meaning of the assignments “as a whole”. It cannot do so if the whole document is not before the court. Moreover, there were the Defendants’ Article 6 rights to a fair trial to consider.

On the other hand, Promontoria argued that the law was as had been set out by the Court in Hancock, namely that there is no absolute rule against the admission into evidence of a redacted document, and the question of whether a Claimant had proved title to sue is a matter for the court to assess in every case on the totality of evidence before it.

The Court of Appeal found in favour of Promontoria, and gave helpful guidance as to the approach that should be taken by courts in the future. The starting point is the general rule that the entire document should be made available to the Court. Though redactions may be made, they must be kept to an absolute minimum. Perceived irrelevance of the redacted text to the issue of construction is not a good enough reason to redact – relevance is ordinarily a matter for the court. In any event, clear reasons for the redactions ought to be given by the solicitor for the redacting party.

In Emanuel, the court was not being asked to resolve a difficult question relating to the construction of the documents that effected the assignment of the loan portfolios – it was merely being asked to find that the documents validly assigned the debts to Promontoria. That question did not require disclosure of parts of the document that were irrelevant to that issue. Conversely, in a case where the court was called to resolve the meaning of an ambiguous provision, or choose between competing interpretations, clearly the whole document should be produced. In that type of case, it would be very difficult (if not impossible) to justify any redactions to the document whatsoever.

In sum: “the ultimate question is always whether it is possible for the Court to reach a safe conclusion on the effect of the document: if it cannot, it would be unfair to the other party for the Court to proceed on the basis that the document had a particular effect, but if it can, there is no reason why it should not do so, and it would be unfair on the party relying on the document to refuse to do so.”

What then is the practical effect of the decision in Emanuel? First, a party considers that there is a case for redacting a document before disclosure, it ought to make that clear to the other parties and the court at an early stage of the proceedings. Secondly, a senior solicitor acting for the redacting party must be sure to produce a detailed statement certifying the reasons for each of the redactions one by one, setting out clearly why the redacted words would be completely irrelevant to the proper construction of the document. Finally, if any other party wishes to dispute the admission of a redacted document into evidence, it should do so as soon as the redacted document is disclosed – either at a CMC or by way of an interim application. Raising the issue for the first time at trial in an attempted ambush is unlikely to go down well, and may well lead to an adverse costs order being made against that party.

It is perhaps not surprising that, where large sums of money are at stake and the Claimant is not a party to the original loan agreement, Defendants will often put in issue the Claimant’s title to sue on an assigned loan. The decision in Emanuel is welcome guidance as to the approach that the court ought to take in such a case and will serve to short circuit opportunistic and/or tactical arguments that have in the past delayed the swift resolution of cases involving commercially sensitive documents.

Katie Gray is a barrister at Tanfield Chambers.

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