The Rt Hon Dame Elizabeth Gloster DBE, PC has confirmed on behalf of the Disclosure Working Group that a two-year pilot of a new disclosure practice direction will begin in the Business and Property Courts on 1 January 2019. The pilot will apply to both new and existing actions unless an order for disclosure has already been made under the old rules before that date. The Civil Procedure Rules Committee (CPRC) approved the pilot with a number of changes from the draft published last year, addressing several of the concerns raised by CMS and others during the consultation process which closed on 28 February 2018.

Aim and scope

The aim of the pilot is to reduce the costs, scale and complexity of disclosure. Its scope has been somewhat reduced from the original proposal, but remains quite broad. It will apply to all claims in the Business and Property courts except:

  • Competition claims

  • Public procurement claims

  • Claims falling within the Shorter and Flexible Trials Schemes

  • Claims in the Intellectual Property and Enterprise Court

  • Admiralty claims

  • Claims falling within the fixed costs or capped costs regimes

The changes

The key changes that will be trialled in the pilot include:

  • An express duty to send “litigation hold” letters to all relevant employees

  • A new duty to refrain from producing irrelevant documents

  • A new step of “Initial Disclosure” (titled “Basic Disclosure” in last year’s draft), in which parties must disclose the documents on which they rely and which are necessary for the other party to understand the case against it at the same time as serving their statement of case, unless the case falls within one of the following exceptions:

    • The parties agree to dispense with it;
    • The court orders that it is not required; or
    • It would involve one or more of the parties disclosing more than 200 documents or 1,000 pages (up from 500 in last year’s draft)
  • A requirement for parties to specify within 28 days of service of the last statement of case whether or not they will seek additional “Extended Disclosure” from the other parties

  • A new List of Issues for Disclosure to be prepared by claimants as a basis for determining the scope of any Extended Disclosure on an issue-by-issue basis

  • A revised disclosure menu with five models:

    • Model A: “Disclosure confined to known adverse documents” (previously rather misleadingly described as “No Order for Disclosure”, now renamed to emphasise that the obligation to disclose known adverse documents will always apply)
    • Model B: “Limited Disclosure”, consisting of known adverse documents, plus Initial Disclosure to the extent this has not already taken place
    • Model C: “Request-led search-based disclosure”, consisting of known adverse documents plus documents specifically requested by another party
    • Model D: “Narrow search-based disclosure”, broadly equivalent to the old “standard disclosure” model in which a party discloses all documents that either support or are adverse to its own case or another party’s case
    • Model E: “Wide search-based disclosure”, consisting of all standard disclosure documents, plus “train of enquiry” documents that may lead to the identification of further documents for disclosure; this is to be reserved for exceptional circumstances
  • A new type of hearing known as the Disclosure Guidance Hearing in which parties can seek guidance from the court on disputed disclosure issues before or after a case management conference. Parties will normally have to be represented at such hearings by a legal representative with direct responsibility for the conduct of disclosure.

Adjustments in response to concerns raised in consultation

The new practice direction has been considerably improved as a result of the concerns raised by consultees. For instance, the exemptions from Initial Disclosure have been clarified and narrowed, and definitions of “known” and “adverse” have been added. It has also been made clear that the outcome of Disclosure Guidance Hearings should be recorded by the parties in an agreed note or, if the judge considers it appropriate, in a binding order. Finally, a procedure for monitoring the outcome of the pilot has been confirmed and will be overseen by Professor Rachael Mulheron of Queen Mary’s University of London, a well-respected figure in the civil litigation field.

However, the most crucial factor in the success of the pilot will be whether or not it succeeds in producing a cultural change amongst litigants and the judiciary. With this in mind, it is somewhat disappointing to note that the following issues raised during the consultation do not appear to have been fully addressed:

  • The provisions on sanctions for non-compliance with the new duties have not been bolstered to encourage a greater use of costs sanctions.
  • The working group has not taken the opportunity to specify that Model C should become the default model for disclosure in commercial cases, which would have brought civil litigation more closely into alignment with the approach taken in international arbitration. Although this is probably the intention behind the new regime, without making it explicit, there is a risk that judges and parties will continue to default to Model D (standard disclosure) out of familiarity.
  • Although the press announcement confirming the start date for the pilot states that the Disclosure Working Group will run a series of presentations for court users and the judiciary on the new rules, it is not clear whether these presentations will include sufficient background on the extent of the work required to conduct a standard disclosure exercise in the digital age and the ways in which advances in disclosure technology can assist this process. In our view, there is a need for a significant commitment of resources to judicial training on this topic. Without this, judges may not be sufficiently familiar with the practical implications of each disclosure model in a given case to ensure that disclosure orders are truly proportionate and cost-effective.

Preparing for the pilot

In readiness for the pilot, organisations that are regularly involved in litigation will want to review their litigation hold procedures.

Parties that have an ongoing dispute will also wish to consider what effect the pilot will have. If parties have begun to review their documents in anticipation of an order for standard disclosure, they should consider whether it is desirable to seek a formal order prior to 1 January (possibly by agreement with the other side) in order to avoid a “midstream” change in the applicable disclosure regime. Conversely, if preparations for disclosure have not yet begun, parties may wish to consider whether it would be cost-effective to ask the court to delay any order for disclosure so as to take advantage of the new rules.