Bank Mellat: closed material procedures and FOIA

Last week, the Supreme Court gave judgment in Bank Mellat v Her Majesty’s Treasury (no.1) [2013] UKSC 38. The Bank Mellat case involved financial restrictions imposed by HMT on the Bank under the Counter-Terrorism Act 2008 (“the 2008 Act”), on the basis that it enabled funding for Iran’s nuclear weapons programme. The High Court and Court of Appeal had both adopted a closed material procedure (“CMP”) – i.e. a procedure in which the court sits in private, and hears evidence and/or submissions without one party either being present or seeing the material – in order to consider sensitive material adduced by HMT which could not be disclosed to the Bank. They had specific statutory authority to do so under the 2008 Act. The Supreme Court did not have such authority. The  relevant questions were whether it was possible for the Supreme Court to adopt a CMP on appeal, in the absence of specific statutory provision; and if so, whether it was appropriate to do so in that particular case. The Supreme Court was faced with the difficulty of reconciling two strong but opposing interests. On the one hand, it was important that the Court should be able to see and consider any relevant material before the High Court and Court of Appeal. On the other, the Supreme Court itself in Al Rawi v Security Service [2012] 1 AC 531 had uncompromisingly set its face against any derogation from the open justice principle. The Supreme Court was divided; but the majority considered that the Court had implied authority to adopt a CMP under its powers conferred by the Constitutional Reform Act 2005, where the lower courts had themselves used a CMP. Nevertheless, the Court was uncomfortable about doing so, and expressed that discomfort in strong terms.

Bank Mellat (no.1) was not, of course, a freedom of information case. But it has important things to say for freedom of information cases. Freedom of information appeals are the classic example of cases which may require a CMP. Submissions must be made about, and evidence given on, the disputed information in the appeal. But that may involve disclosing the content of the information itself. If the party requesting the information was present, this would wholly undermine the purpose of the appeal. So the general points made about CMPs in Bank Mellat (no.1) are of obvious significance for FOIA appeals.

At [68]-[74] of the judgment in Bank Mellat (no.1), Lord Neuberger (giving the majority’s view) made the following general points about the use of closed material by or before appeal courts:

(1)    Where a judge gives an open and closed judgment, it is highly desirable that in the open judgment the judge (i) identifies every conclusion in the open judgment reached in whole or in part in the light of points made or evidence referred to in the closed judgment; and (ii) says that this is what they have done.

(2)    A judge who has relied on closed material in a closed judgment should say in the open judgment as much as can properly be said about the closed material relied on. Any party excluded from the closed hearing should know as much as possible about the court’s reasoning, and the evidence and the arguments it has received.

(3)    On an appeal against an open and closed judgment, an appellate court should only be asked to conduct a closed hearing if it is strictly necessary for fairly determining the appeal. That puts an important onus on legal representatives asking an appeal court to look at closed material. An advocate who wants a closed hearing should carefully consider whether the request should, or even can properly, be made, and advise their clients accordingly. (This would of course be relevant for appeals to the Upper Tribunal from FOIA decisions in the First-Tier Tribunal.)

(4)    If the appellate court decides that it should look at closed material, careful consideration should be given by the advocates and the court to whether it would nevertheless be possible to avoid a closed hearing, on the basis that the court can be addressed on confidential material in open court e.g. by elliptical references. This, again, is particularly relevant to the Upper Tribunal on FOIA appeals.

(5)    If the court decides that a CMP is necessary, the parties should try and agree a way of avoiding, or minimising the extent of, a closed hearing.

(6)    If there is a closed hearing, the lawyers representing the party relying on closed material should give the excluded party as much information as possible about closed documents relied on.

(7)    Appellate courts should be robust about acceding to applications to go into closed session or even to look at closed material.

The general tenor of the judgments is to deprecate any use of CMPs. As Lord Neuberger put it: “any judge, indeed anybody concerned about the dispensation of justice, must regard the prospect of a closed material procedure, whenever it is mooted and however understandable the reasons it is proposed, with distaste and concern.”

Julian Milford