When arbitration confidentiality ends: Lessons from the MV Smart Case

The National Ports Authority, a division of Transnet, is being sued in admiralty for about USD 110 million after the bulk carrier MV Smart grounded near the entrance to the Port of Richards Bay on 19 August 2013 and was lost with her coal cargo. Parallel to the South African litigation, the shipowners previously pursued London arbitrations against the charterers and cargo interests. In those arbitrations, witness statements, expert reports, transcripts and awards were produced. Ahead of a four‑week trial set to start in mid‑July 2026, the National Ports Authority applied to compel the shipowners to produce key documents from the London arbitrations. The owners resisted, relying on arbitration confidentiality and litigation privilege and, in the alternative, asked the Court to delay any production until after the Authority had delivered its expert summaries. The charterers were joined to the application due to their confidentiality interests but did not participate on the merits.

Issues decided by the Court

• Relevance threshold
  • The Court held that a significant portion of the arbitration material is relevant to the South African action.
  • Although the charterparty dispute (for example, a safe port warranty) is not directly in issue at trial, the factual matrix around port safety, navigation, seamanship, causation and expert analysis overlaps.
  • Relevance was therefore established for witness statements, expert materials, submissions and transcripts.
• Confidentiality of foreign arbitrations
  • Confidentiality attached to the London arbitrations did not bar disclosure in South African proceedings.
  • Confidentiality is a private arrangement between arbitration parties and is not absolute.
  • It yields where a court orders disclosure for the fair adjudication of a dispute.
  • The Court emphasised that South African procedural law, the truth‑seeking function of discovery and fair‑trial rights outweigh a generalised claim to secrecy, absent a specific protectable interest.
• Privilege
  • Witness statements and expert reports that were actually deployed in the London arbitrations as evidence in chief were no longer cloaked in litigation privilege. Once exchanged with the opposing party and put before the tribunal, any privilege is effectively waived.
  • Transcripts of viva voce evidence, written submissions and awards are not privileged in themselves; they were only shielded by arbitration confidentiality, which the Court found does not defeat an otherwise lawful order for disclosure.
  • The Court distinguished truly privileged, attorney–client or trial‑preparation materials that were never put into the arbitration record; those remain protected and are not compelled.
• Correspondence
  • The Court declined a blanket order to produce all arbitration‑related correspondence, recognising that much of it would be irrelevant (for example, logistics around hearings).
  • Instead, it directed the owners to deliver a further supplementary discovery affidavit identifying relevant correspondence (excluding genuinely without‑prejudice exchanges) in line with the Court’s rulings on relevance, confidentiality and privilege.
• Timing of production
  • The owners’ alternative request to delay production until after the Authority’s expert summaries was rejected.
  • Discovery ordinarily precedes expert exchanges; giving the parties access to the existing evidentiary record promotes focused, efficient expert reporting and trial readiness.
  • No unfairness justified reversing the usual order.
• Costs and orders
  • The Court ordered the owners to produce, within fifteen days, the final arbitration submissions, witness statements, expert materials (including electronic presentations), full transcripts, written submissions, awards, and leave‑to‑appeal materials in their possession.
  • The owners must also serve a supplementary discovery affidavit on correspondence.
  • The timing‑delay counter‑application was dismissed. Costs (including two counsel) were awarded against the owners, jointly and severally.

Key takeaways

• Arbitration confidentiality is not a blanket shield. South African courts can compel disclosure of foreign‑arbitration materials where they are relevant to local litigation and necessary for a fair trial.
• Privilege is lost when evidence is deployed. Witness statements and expert reports used as evidence in arbitration generally cannot later be withheld as privileged in related court proceedings.
• Relevance remains the gatekeeper. Courts will compel core evidentiary records but will avoid over‑broad orders, using supplementary discovery to separate signal from noise.
• Discovery before experts is the norm. Attempts to postpone production until after expert summaries are out of step with ordinary practice and may be refused.
• Join those with confidentiality interests early. If third parties may assert confidentiality over arbitration materials, join them to the disclosure application to avoid satellite disputes later.

Legal implications

• Bridging arbitration and court processes
  • Parties who arbitrate abroad and litigate at home should anticipate that records from a private arbitration may be discoverable if the factual issues overlap.
  • Confidentiality clauses and implied duties cannot override a court’s power to order disclosure necessary for justice.
• Strategic case preparation
  • Where large portions of a party’s case are already captured in arbitration materials, early and full discovery streamlines expert work, narrows issues, and reduces the risk of surprise or inconsistent testimony at trial.
• Careful handling of privileged material
  • True attorney–client communications and documents created solely for litigation that were never exchanged or deployed remain protected.
  • Parties should segregate privileged, non‑deployed material from anything placed before a tribunal.
• Correspondence and curation
  • Courts will resist fishing expeditions.
  • Expect to justify the relevance of communications and to produce targeted affidavits rather than data‑dumping entire email archives.
• Cost exposure
  • Resistance based on broad claims of confidentiality or privilege may attract adverse costs orders where the core arbitration record is plainly relevant and necessary for trial.

Conclusion

The judgment is a strong affirmation that the search for truth in South African proceedings prevails over broad assertions of arbitration secrecy. If evidence has already been aired before a tribunal, it will likely be discoverable where the factual issues cross over. Parties engaged in parallel arbitration and litigation should plan for potential disclosure from the outset, preserve clear privilege boundaries, and expect discovery to inform expert exchanges.

Contact Nikita Lalla, Ricardo Pillay, Danielle Giannico, or Msizi Zungu to mitigate risks and minimise disputes.