Background to the Pilot
The current disclosure regime has been ripe for improvement for some time. Despite the amendments to Part 31 of the Civil Produce Rules in 2013, which saw the introduction of a menu of different disclosure options, the default position in practice still remains standard disclosure. Standard disclosure is often a costly exercise. The scale of documents that parties have to search for and review can frequently be vast. Often, parties err on the side of caution and disclose more documents than may be strictly necessary. In many cases only a small proportion of these documents are actually referred to at trial. The main driver for change is, therefore, to reduce the disproportionate time and costs associated with the current disclosure regime.
For the past 18 months a working committee (comprised of a number of judges, lawyers, experts and academics) has been working on a new disclosure procedure to replace the current regime. The proposed changes to the civil procedure rules have been published in draft, along with a guidance note. Court users, professionals and the judiciary are invited to give their comments by 28 February 2018. The final version of the proposals will then go to the Civil Procedure Rules Committee for approval in March/April 2018. Once approved there will be a two-year mandatory pilot in the Business and Property Courts in London, Bristol, Cardiff, Birmingham, Manchester, Leeds, Newcastle and Liverpool.
The proposed new rules expressly set out the parties' duties in respect of disclosure. These would include a duty to preserve documents, disclose adverse documents, act honestly in relation to the process of giving disclosure and refrain from disclosing documents that have no relevance to the matters in issue. There would also be a requirement for legal representatives to obtain written confirmation from their clients that they have taken appropriate steps to preserve documents. A party would have to then confirm this in writing to its opponent when serving its statement of case.
There is no automatic entitlement to search-based disclosure; therefore, the default position will no longer be standard disclosure. Instead parties would give "Basic Disclosure" at the same time as serving their statement of case. This is disclosure of documents that a party either relies upon and/or are necessary for their opponent to understand the case it has to meet. A party does not need to conduct a search for these documents beyond the search conducted for the purpose of obtaining legal advice or preparing its statement of case. There is no express requirement to serve documents adverse to a party's case because the working party considers the express duty (mentioned above) is adequate protection. Parties would provide Basic Disclosure in electronic form unless ordered or agreed otherwise.
If a party wishes to seek disclosure in addition, or in the alternative, to Basic Disclosure it would have to apply to the Court for "Extended Disclosure". There are five different models of Extended Disclosure proposed:
- Model A – an order that there be no, or no further, disclosure.
- Model B – an order requiring a party to give disclosure of documents which a party relies upon and/or are necessary for their opponent to understand the case it has to meet, and any documents adverse to a party's case. No search is required.
- Model C – an order requiring a party to give disclosure of a particular document or narrow class of documents relating to a particular issue in response to a request made by the other party. A reasonable and proportionate search is required.
- Model D – an order akin to standard disclosure. A reasonable and proportionate search is required.
- Model E – an order requiring a party to give disclosure of documents which are likely to support or undermine [its case] or which could lead to a train of inquiry which may then result in the identification of other documents for disclosure. Again, a reasonable and proportionate search is required.
Prior to the first case management hearing, the parties must discuss and complete a joint Disclosure Review Document (DRD). The DRD provides a mandatory framework which requires the parties to: (a) identify a list of issues for disclosure; (b) exchange proposals for Extended Disclosure; and (c) exchange information about how documents are stored, how they may be searched and reviewed, and the estimated cost of that search/review. The intention is for the DRD to encourage the parties to have a proper dialogue, with a view to reaching agreement on the scope of the disclosure they will give.
At the case management hearing the Court, having regard to the information in the DRD, should then make a decision on the appropriate Extended Disclosure model. The Court will only make an order where it is appropriate to do so, in order fairly to resolve one or more of the matters in issue. Any order must be reasonable and proportionate, and have regard to the overriding objective and other factors, such as the importance of the case, the likelihood of the existing documents having probative value and the cost of retrieval. It is possible that the Court might order different Extended Disclosure models to apply to different issues in the case.
Impact of the proposed changes
The key question is whether the new regime would have a significant impact on the disproportionate time and costs currently spent on disclosure. Parties are still likely, in practice, to push for search-based disclosure. Even if the Court refuses or limits Extended Disclosure, parties will incur time and costs following the DRD framework dealing with disputed points in court.
There is also a suggestion that the parties would not have to provide the element of their respective costs budgets dealing with disclosure until after the Court has decided what model of Extended Disclosure will apply. This makes sense, as the model ordered will have a significant impact on the scope of the disclosure exercise and the costs involved. But it is likely to add another layer of complexity to the budget process and, in some cases, may result in additional costs management hearings becoming needed.
Is a more radical approach justified? Times have moved on from the days of paper when there were few documents. The chances of locating a "smoking gun" are negligible and, arguably, not worth the disproportionate expense of a comprehensive search-based disclosure process. From that perspective, it is arguable that parties should disclose the documents upon which they rely, and which are necessary background documents, to enable their opponents to understand the case they have to meet. Any claim or defence relying on documents which are unseen when put forward is unnecessarily speculative. An additional request for documents (including adverse documents) could potentially be accommodated under the existing specific disclosure regime – the costs consequences for the loser would also discourage unmeritorious applications.
Such an approach is perhaps something for the future. In the meantime, the committee has at least come up with a number of options that would in theory allow the parties and court to tailor the disclosure process to the needs of the particular case. It will be interesting to see when and how the court applies the various models for Extended Disclosure and whether the changes can bring about a cultural change in the conduct of the parties. To work fully, the proposals depend on a large measure of cooperation between the protagonists on what is a highly contentious aspect of any litigation.