CC-2023-000006 - [2025] EWHC 1439 (Comm)

Rationale and extent

I derive the following principles from Unilever plc -v- Procter & Gamble Co [2000] 1 WLR 2436 and Motorola Solutions Inc -v- Hytera Communications Group Corporation Ltd [2021] QB 744:

Exceptions to the without prejudice protection: “unambiguous impropriety”

The principal occasions on which the protection from disclosure of without prejudice communications can be lost are identified in Unilever @ p.2444D-2445G. The Defendants contend that the current case falls in the fourth category: unambiguous impropriety. Robert Walker LJ explained:

“… one party may be allowed to give evidence of what the other said or wrote in without prejudice negotiations if the exclusion of the evidence would act as a cloak for perjury, blackmail or other ‘unambiguous impropriety’ (the expression used by Hoffmann L.J. in Forster -v-. Friedland (unreported), 10 November 1992...”

Mr Holmes has relied upon Ferster -v- Ferster [2016] EWCA Civ 717. In that case,the issue was whether an email, sent in the context of a mediation, lost the protection of without prejudice privilege on the grounds that it demonstrated unambiguous impropriety. The claimant brought a petition alleging that his brothers, S and W, were pressurising him to buying their shares at an inflated price. During mediation, a mediator relayed an email from S and W that included threats of committal proceedings and criminal charges unless the claimant agreed to a higher purchase price for their shares. At first instance, Rose J held that the email had been an attempt at blackmail. It contained clear threats of criminal and civil proceedings, reputational damage, and harm to the claimant’s partner. These were intended to coerce him into paying more by way of settlement. The threats were not tied to any legitimate increase in share value and were used to gain a personal financial advantage for S and W. The impropriety was clear and not dependent on the truth of the allegations or whether the threats were carried out. The Judge held that the email was admissible, and not protected by privilege, falling into the “unambiguous impropriety” exception.

In dismissing the appeal, the Court of Appeal agreed that the threats unambiguously exceeded what was “permissible in settlement of hard fought commercial litigation” (Boreh -v- Republic of Djibouti [2015] EWHC 769 (Comm) [132] per Flaux J) and that was not necessary for the threats to fall within any formal definition of blackmail for them to be regarded as unambiguously improper: [23]-[24].

Improper threats and the use of contempt proceedings to achieve an impermissible objective

The Defendants submit that the context is important. They allege that the unambiguous impropriety arises from inappropriate threats made by the Claimant to continue with the Contempt Application in order to obtain disclosure to which they were not entitled.

It is not uncommon for contempt proceedings to be brought while there are pending civil proceedings between the same parties. Sometimes, a defendant to a contempt application alleges that the person pursuing the contempt application is using that application to apply inappropriate pressure upon him/her to settle the main litigation. On this point, the law is clear. In Integral Petroleum SA -v- Petrogat FZE (No.2) [2020] EWHC 558 (Comm) [36], Foxton J approved the following passage (§20-024) from Gee on Commercial Injunctions (6^th edition, Sweet & Maxwell, 2016) (itself derived from the Court of Appeal decision in Knox -v- D’Arcy Ltd (unreported, 19 December 1995)):

“The threat of contempt proceedings or of continuing contempt proceedings should not be made for any purpose other than securing compliance with the relevant order of the court. To use such a threat to secure a settlement is a gross abuse of process of the court and itself constitutes a contempt of court”.

Foxton J’s decision on this point was approved by the Court of Appeal in Navigator Equities Ltd -v- Deripaska [2022] 1 WLR 3656 [121]. I would note that Integral Petroleum is not an authority on the loss of without prejudice privilege. In that case, the claimant did not object to the defendants’ reliance on without prejudice communications: [45].

The current edition of Gee on Commercial Injunctions (7^th edition, Sweet & Maxwell, 2022) suggests (§20-014):

“Contempt proceedings should only be brought in the public interest, are to be advanced in the same way as a criminal prosecutor is expected to conduct criminal proceedings, and not as a private prosecution. They should not be brought so as to obtain personal gain, which is an improper purpose. These principles apply when considering whether a threat of contempt proceedings is improper and whether contempt proceedings should be struck out as an abuse of the process. Abuse of the process is not confined to where there is malice or spite”.

No authority is cited for that statement, and it is perhaps important to note the Court of Appeal’s decision, in Navigator Equities, that private applicants in civil contempt applications are not required to act “as wholly disinterested parties” [137]. Indeed, the Court of Appeal held that the motivation of the applicant in prosecuting otherwise viable contempt proceedings is irrelevant [110]:

“…where a civil contempt application (i) is made in accordance with the relevant procedural requirements; (ii) is properly arguable on the merits (by reference to the necessary constituents of a claim for contempt); and (iii) has the effect (and so at least the objective purpose) of drawing to the attention of the court to an allegedly serious contempt, then the fact that the application is motivated, whether predominantly or even exclusively, by a personal desire for revenge on the part of the applicant is not a good reason for striking out the application as an abuse of process.”

There is often a tension underlying the prosecution of a contempt application. A party who has obtained an injunction from the Court has an immediate and legitimate, private, interest in securing compliance with its terms, by contempt proceedings if required. S/he is also likely to have a direct interest in purely historic breaches of the Court’s order. There is a corresponding public interest – in upholding the rule of law – in ensuring that Court injunctions are obeyed (and disobedience punished, when necessary). But the litigant to whom the injunction has been granted is also likely to have a private interest in securing the best settlement s/he can achieve of the overall litigation.

In Integral Petroleum, Foxton J rejected the argument that the contempt application was an abuse of process. He held that the claimant had not improperly sought to force a settlement and that its actions were a legitimate response to breaches of court orders. Nevertheless, the Judge recognised that it will not always be easy to disentangle these objectives in the context of hard-fought litigation [42]:

“There is no doubt that committal proceedings are a far more frequent feature of commercial litigation now than previously, and than they were at the time that Knox was decided. Once a committal application has been issued, any settlement of the overall commercial dispute is necessarily going to have to address the position of the committal application, with most respondents being understandably concerned to ensure that the settlement ties up all matters including the contempt, and most claimants themselves wanting to draw a line under the litigation in terms of further costs and management time (in circumstances in which the continuation of the committal application will inevitably involve the claimants in the further expenditure of both). It can never be proper to seek to use a committal application as a lever to bully a respondent into a settlement. However, the practical consideration that resolving an outstanding committal application will in most cases be necessary to achieve a settlement of the commercial dispute means that the court should not jump too readily to the conclusion that references in the settlement communications to the disposal of the committal proceedings or the timing of the committal proceedings evidence an improper purpose on the claimant’s part, or involve the use of the committal proceedings as some form of improper threat.

A principal plank of the Defendants argument as to unambiguous impropriety is that the Claimant has sought to use the Contempt Application “to obtain disclosures to which they are not entitled”. However, it is important to understand that in legal settlements, it is common and acceptable for parties to negotiate for outcomes that go beyond what the Court could order if the case went to trial. For example, in a defamation case, a claimant might ask for, and obtain, a public apology as part of a settlement – even though that is a remedy the Court cannot grant.