Civil litigation procedure has in some important respects developed differently in the US and the UK. One of the principal differences has been the availability in the US of expansive and seemingly unlimited discovery. However, this may soon no longer be the case. In fact, there is a possibility that disclosure in the UK will become (potentially) more expansive than discovery under US courts.  This is due to the fact that amendments to the Federal Rules of Civil Procedure, coming into effect on 1 December 2015, will eliminate the discoverability of material “reasonably calculated to lead to the discovery of admissible evidence”, whereas the UK equivalent of this test - the Peruvian Guano test - is still provided for in certain specific circumstances in UK litigation.

Discovery in the US and disclosure (as it is now called) in the UK both derive from the English common law tradition, and both systems depend upon the concept of relevance. Historically, both systems embraced a wide meaning of relevance. Prior to the Civil Procedure Rules, introduced following the Woolf reforms, The test of relevance was known as the “Peruvian Guano test” from Compagnie Financiere du Pacifique v Peruvian Guano Co (1882) 11 QBD 55 per Brett LJ:

“It seem to me that every document relates to the matters in question in the action, which not only would be evidence upon any issue, but also which, it is reasonable to suppose, contains information which may – not which must – either directly or indirectly enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary. I have put the words “either directly or indirectly,” because, as it seems to me, a document can properly be said to contain information which may enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary, if it is a document which may fairly lead him to a train of inquiry, which may have either of these two consequences...”

This is known as the Peruvian Guano test.

In the US. the “broad and liberal discovery” standard was introduced in 1938, when the Federal Rules of Civil Procedure were first promulgated. Thirty-five states subsequently adopted the federal rules as their own state rules, and the standard of “broad and liberal” discovery became dominate in both federal and state courts. Under FRCP Rule 26(b)(1), parties are presumptively entitled to unearth any fact “relevant” to the case, and to do so at the expense of the other party, and the test of relevance extended to anything “reasonably calculated to lead to the discovery of admissible evidence”.

The US Amendments

The amendments to the Federal Rules of Civil Procedure will substantially narrow the scope of discovery available in US civil litigation (in federal courts and the many states that have adopted the FRCP in state courts). The key to discovery under the new rule will be proportionality, a concept  that has been an integral part of UK civil procedure since the introduction of the overriding objectives under the Civil Procedure Rules.

Under the amended Rule 26(b)(1), the scope of discovery will hinge on the concept of proportionality. The test of relevance extending to anything “reasonably calculated to lead to the discovery of admissible evidence” is to be eliminated. FRCP Rule 26(b)(1) as amended states that a party is entitled to discovery that is relevant to claims and defenses and “proportional to the needs of the case . . .” The scope of available discovery now turns on five factors, consideration of which will determine whether a discovery request is proportional to the needs of the case. These too are reminiscent of the overriding objectives under the Civil Procedure Rules in the UK. They include the importance of the issues at stake in the case and the importance of the discovery in resolving those issues, the amount in controversy, the parties’ resources, and whether the expense of the proposed discovery outweighs the likely benefit.

Under previous amendments to the FRCP, the ‘reasonably calculated’ phrase had been moved, to indicate its less prominent place in the scope of discovery. It is now being removed from FRCP Rule 26 altogether.

Disclosure in the UK

In 2000 the UK Civil Procedure Rules replaced the Peruvian Guano test with provisions for “Standard Disclosure” following a “reasonable search”, all subject to the proportionality tests contained in the overriding objectives. As Jacob LJ said in Nichia Corporation v Argos Limited [2007] EWCA Civ 741:

“It is manifest that [the Peruvian Guano test] is a much wider test than that for “standard disclosure”… What is now required is that, following only a “reasonable search” (CPR 31.7(1)), the disclosing party should, before making disclosure, consider each document to see whether it adversely affects his own or another party’s case or supports another party’s case …[under] The “standard disclosure” and associated “reasonable search” rules … [I]t is possible for a highly material document to exist which would be outside “standard disclosure” but within the Peruvian Guano test. Or such a document might be one which would not be found by a reasonable search. No doubt such cases are rare. But the rules now sacrifice the “perfect justice” solution for the more pragmatic “standard disclosure” and “reasonable search” rule, even though in the rare instance the “right” result may not be achieved.”

This sacrifice, however, has not been complete. Under the CPR. CPR 31.12 provides for the court to make an order for “specific disclosure”. Under paragraph 5.5 of Practice Direction 31A, the court may, on an application for specific disclosure, direct a party to carry out a search for (and disclose) any documents which it is reasonable to suppose may contain information which may “enable the party applying for disclosure either to advance his own case or to damage that of the party giving disclosure; or lead to a train of enquiry which has either of those consequences” (emphasis added).

This last provision in paragraph 5.5 of the Practice Direction to CPR 31 was introduced by a 2002 amendment to the CPR, and clearly reintroduces the Peruvian Guano test. There is, then, in the English Civil Procedure Rules, a fail-safe mechanism for those cases referred to by Jacob LJ in Nachia v Argos where the “standard disclosure” and “reasonable search” rules fail to achieve “perfect justice” (or maybe simply “justice”).

Indeed, in Digital (St Lucia) Ltd v Cable & Wireless plc [2008] EWHC 2522 (Ch) Morgan J expressly stated that

“an order for specific disclosure … is not confined to a case where the respondent is in breach of an obligation to give standard disclosure. The court can make an order for specific disclosure even where the respondent has properly complied with its obligations to give standard disclosure but the applicant satisfies the court that such disclosure is “inadequate” or that the case is one where something more than standard disclosure is called for”.

As matters stand, the US Federal Rules of Civil Procedure will not, as of December 2015, retain any provisions enabling parties to resort to broader and more liberal discovery and seek discovery of material “reasonably calculated to lead to the discovery of admissible evidence” if and when the need arises. It remains to be seen what, if any, fail-safe mechanism the US courts will recognise to remedy cases of injustice under the new, narrow scope for obtaining discovery.