The Better Chancery Practice Blog

Parties to minor’s settlements sometimes come to court asking for the proceedings to be confidential and sealed. The requests in my court have ranged from asking that the courtroom be cleared and the transcript sealed to asking that the judgment alone be sealed. I have generally resisted on the basis that the public has a right to know what is transpiring in the courts. The procedure I follow is described below.

The MSSC on December 6, 2012, addressed the issue in the case of Ford Motor Co. v. Ferrell, et al. You can read the decision for yourself to get a grasp of the facts. The case involved a fee dispute arising out of a personal injury settlement. Ford requested that the terms of the settlement, which had been confidential by agreement, not be disclosed in the course of the fee-dispute proceedings. 

Chancellor David Clark refused Ford Motor Company’s request to keep the settlement documents and trial proceedings sealed, based on his concern that court proceedings be transparent to the public. On appeal, Ford raised three issues: (1) Whether the settlement agreement is a public, judicial record or a private contract, which should be enforced; (2) Whether the state’s policy encouraging settlement agreements and the parties’ interest in abiding by the terms of that agreement are sufficient grounds to protect the settlement from public scrutiny; and (3) Whether there is any overriding public interest which would require disclosure of the terms of the settlement agreement.

A 5-4 majority of the supreme court, by Justice King, concluded that the terms of the agreement should be kept confidential — to an extent. Here’s what the court said, beginning in ¶32:

To continue to preserve the confidentiality of this agreement, the chancery court should seal the order approving the settlement agreement and should seal the settlement agreement itself (if it is admitted into evidence for any reason). The chancery court should also redact any mention of the settlement amount from future documents and prohibit the parties from mentioning the settlement amount in its proceedings. However, the chancery court may keep the fee-dispute trial’s transcript and proceedings open to the public, which addresses the chancellor’s concern regarding transparency in judicial proceedings.

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¶33. The chancery court abused its discretion by denying Ford’s request to preserve the settlement agreement’s confidentiality. Although the public has a right of access to public records, Mississippi law also favors the settlement of litigants’ disputes and respects confidentiality agreements when practical. The law allows courts to determine when information should be declared confidential or privileged, exempting it from the Public Records Act. Because this settlement agreement is between private parties, does not involve matters of public concern, and is not necessary to resolve the fee-dispute claim, its confidentiality should be preserved. Thus, we reverse the chancellor’s denial of Ford’s motion to preserve the confidentiality of the settlement agreement. However, the fee-dispute trial’s transcript and proceedings should remain open to the public, so we affirm the chancellor’s denial of Ford’s motion to close the proceedings. The Court remands this case to the chancery court for further proceedings consistent with this opinion.

The procedure I have followed in minor’s settlements is to require proof of the terms of the agreement via an exhibit, which I will seal on request. That way, the terms of the settlement are of record and document what I considered in determining whether the settlement is in the best interest of the minor.

I have also steadfastly refused to seal or otherwise make confidential settlement agreements with public agencies, a position which appears to be consistent with the MSSC’s in this case.

The court’s decision distinguished its holding in Williamson v. Edmonds, 880 So.2d 313-314 (Miss. 2004), in which the court ruled that a confidential agreement must be disclosed in a fee dispute because, contrary to the situation in Ford, evidence of its terms was central to resolution of the claims involved.

Tagged: confidential agreements, sealing of court files