Armstrong Watson v Persons Unknown

Approved Judgment

This judgment was handed down remotely at 5pm 11 th July 2023 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

THE HONOURABLE Mrs Justice Collins Rice

Introduction

The Claimant describes itself as a limited liability partnership headquartered in Carlisle which provides professional accounting, tax, financial and related services in the UK.

It has reason to believe it is the victim of a ransomware cyberattack. From the written evidence before me, on or about 28 ^th February to 6 ^th March 2023, someone, or more than one person, hacked into its IT system and obtained a quantity of its confidential electronic documents. The hacker(s) have threatened to disclose or sell the information, including on the dark web, unless a ransom is paid.

An urgent application by the Claimant, made without notice, for an interim injunction was heard, in private, on 28 ^th March 2023, by Ritchie J. The Judge handed down a public judgment ( Armstrong Watson LLP v Persons Unknown [2023] 4 WLR 41), and granted relief in the terms sought, with provision for a return date and the completion of various steps, by each party, by the dates specified.

The matter came before Linden J on the return date, 21 ^st April 2023. He proceeded in the Defendant's/Defendants' absence and considered the matter on the papers, setting out his reasons for doing so in a public judgment ( Armstrong Watson LLP v Persons Unknown [2023] EWHC 921 (KB)). The Judge was satisfied that the steps required of the Claimant, including filing and serving a claim form and particulars of claim, had duly been taken. None of the steps required of the Defendant(s) has been taken. By not complying with the Order of Ritchie J, to the timetable set or at all – including by failing to identify themselves and to deliver up and/or delete the information – the Defendant(s) were already in breach of the injunctive relief granted.

By Order of 24 ^th April 2023, Linden J continued the injunctive relief, made provision for service, and gave further directions. These included the following:

[3.] The Defendant or each of them must serve a Defence to the Particulars of Claim by 4pm on Friday 5 May 2023.

…

[5.] If the Defendant or each of them does not serve a Defence, the Claimant must take such steps as they are advised to conclude the action, including but not limited to applying for default and/or summary judgment, any such application to be issued by Friday 16 June 2023.

The timetable set at paragraph 3 of the Order already represented an extension of the time allowed for filing an acknowledgment or service or defence pursuant to Civil Procedure Rule 10.3(1)(a); the period of 14 days provided for there had expired on 20 ^th April.

By an application notice dated 15 ^th June 2023, the Claimant now seeks judgment in default of acknowledgment of service or defence, final injunctive relief, and derogations from open justice to protect the confidentiality of the case papers consistently with the substantive relief it seeks.

Procedure

Civil Procedure Rule 23.8 provides that a court may deal with an application on the papers without a hearing, if the parties agree, or otherwise ‘ if the court does not consider that a hearing would be appropriate’.

The Claimant has requested that its application be dealt with on the papers. It draws my attention to the decision to proceed on the papers taken by Warby J (as he then was) in Clarkson Plc v Person(s) Unknown [2018] EWHC 417 (QB). That judgment confirmed that open justice is a vital principle, but that not every application needs to be dealt with at a hearing and many are not. It continued:

[7] It is unlikely that the Court could or would deal on the papers with an application for a final order that determines civil rights, if that way of proceeding was opposed by one of the parties. But there are cases like the present, where one party has failed to engage with the proceedings and has therefore expressed no view about the matter. It is not necessary to decide whether that involves a waiver of the party's rights. I did not consider a hearing to be ‘appropriate’ in this case, because it would have added to the expense of this claim without serving any sufficiently useful purpose. On the facts of this case, and this application, the open justice principle can be properly respected and compliance with Article 6 [ECHR] achieved without the need for a hearing. That can be done by making the order and, through this judgment, publicising the fact it has been made and the basis for making it. Indeed, a process of this kind may even represent a more practical and effective way to give effect to the open justice principle and the Convention requirement for a public judgment, than holding a hearing.

[8] This is a claim brought against a Person or Persons Unknown and, as is quite common in such cases, the identity of the defendant(s) remains unknown. So, there is nobody defending the claim who could benefit from the advantages that a hearing often brings with it for the litigant. The case has not proceeded in secret. There have already been two public hearings, at each of which a public judgment has been given and recorded. Transcripts of those judgments are available as of right. There is little that has changed since the last hearing, at which I granted an interim order and gave a reasoned judgment explaining why. This is not a case in which there is any likelihood that a public hearing of this application would be more effective in bringing the attention of others to matters of importance than the method I am adopting. Rather the contrary. Transcripts are not created or published as a matter of course. They are not often applied for by third parties. This written judgment, by contrast, will be posted on a public website. The reality is that information about these proceedings will be more accessible, if the case is dealt with in this way, than it would be if the matter had been dealt with at a hearing.

I adopted the same approach and reasoning, on very similar facts to those of the present case, in Pendragon PLC v Person(s) Unknown [2022] EWHC 2985 (KB). I also consider the same approach and reasoning fully applicable to the facts of the present case. There have been no material developments since Linden J's Order: the Defendant(s) have continued to be entirely disengaged with these proceedings. I do not, on that basis, consider that a hearing would be appropriate. I have accepted the Claimant's invitation to proceed to consider its application on the papers.

For the purposes of section 12 of the Human Rights Act 1998, I am satisfied on the basis of the witness statement it has provided that the Claimant has taken all reasonable steps, by service as directed, to notify the Defendant(s) of its application, that they have not responded to it, and that the most likely reason they have not responded is that they have no intention of identifying themselves as the perpetrators of the apparent information blackmail, a form of expression properly abridged by law.

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