How Fare the Winds of Change – An Update on Disclosure in Civil Litigation

14 June 2019

New Year, New Rules

On 1 January this year, the Business & Property Courts rolled out the ‘Disclosure Pilot Scheme’ (DPS). Six months on we revisit the DPS and examine how it has been approached by the Court.

The aim of the DPS is to test appetite for a more structured approach to the disclosure exercise that parties are required to undertake during litigation, including an increased emphasis on reducing costs and requiring parties to co-operate and agree the extent and scope of the disclosure  to be provided.

Is this my Problem?

The DPS applies to all proceedings existing in the Business & Property Courts from 1 January 2019. It has been confirmed to apply even where an order for disclosure had been made before that date, under the old rules, and any new proceedings from then onwards (UTB LLC v Sheffield United Ltd Blades Leisure Ltd, Re [2019]).

The answer is therefore, if you are or anticipate being involved in a case in the Business & Property Courts (the Court), yes.

First Things First

The first notable change is more stringent rules on parties’ preservation of documents. For corporate organisations in a dispute, there is now an obligation to send a written notification to all relevant employees and former employees who may hold disclosable documents. For larger organisations within group structures, this could represent a significant exercise in itself.

Legal representatives are required to confirm to the Court on service of the Particulars of Claim (for the Claimant) or Defence (for the Defendant) that the steps fully set out in the new rules have been complied with, so the requirements should be met as early as possible.

Documents

The Court has introduced a requirement for parties to provide ‘Initial Disclosure’ whenever they serve statements of case (Particulars of Claim, Defence, Reply).  In some cases this will mean providing a significant amount of documentation to other parties at the early stages of a claim. Broadly speaking, Initial Disclosure will include: (a) key documents on which the party has relied in support of the claims or defences advanced in its statement of case; and (b) key documents that are necessary to enable the other parties to understand the claim or defence they have to meet.

The Encore

Once the final statement of case has been served, the parties have 28 days to determine whether they wish to request ‘Extended Disclosure’, that is, disclosure over and above what has already what has already been disclosed until this stage.  Importantly the Court will only order this where it is appropriate in order to fairly resolve one or more of the issues which are relevant to the disclosure of documents.

If it is ordered, the parties will need to co-operate and discuss extensively in order to identify, and if necessary limit, the disclosure that is to be provided[1].  Where parties cannot agree, the court will have the final say.

If you don’t get what you want – Application for Specific Disclosure

Whereas initially there was some uncertainty as to whether it would still be possible for parties to apply for specific disclosure – that is, an application that the Court orders the disclosure of specific documents or categories of documents that have not been disclosed whether by way of Initial or Extended Disclosure – the decision in White Winston Select Asset Funds LLC v Mahon [2019] confirmed that the Court can use its general case management powers to make an equivalent order. This can either be for specific disclosure, or to ensure that a party has complied with its general disclosure obligations, including Initial or Extended Disclosure as above.

Recent decisions have demonstrated the increased judicial control over the disclosure process. For example, in Kazakhstan Kagazy plc and others v Zhunus and others [2019], the Court ordered a party to explain the basis on which documents disclosed had been selected within 2 working days. As very few documents had been disclosed, specific disclosure was ordered.  This acts as a reminder to parties to a litigation to be wary that their actions during the disclosure exercise (and indeed, throughout any litigation) may well be scrutinised by a judge, even moreso in light of the new scheme.

Finale

The onerous obligations imposed by the DPS highlights the importance of seeking clear legal advice at the outset of a potential dispute.

Although the hope is that the DPS will reduce costs overall, those anticipating and then engaging in litigation are likely to be more heavily involved in the disclosure exercise than previously was the case.

They key therefore is to ensure a plan of action is prepared at the outset, and be ready for all systems go once the timetable of deadlines begin to run.

[1] Including, for example, in completing a Disclosure Review Document’ (DRD) (viewable here https://www.judiciary.uk/wp-content/uploads/2017/11/draft-disclosure-review-document.pdf)

Sophie Besma Kasmi Author
Sophie Besma Kasmi
Associate
About the author

Tags: