On 1 January 2019, a new disclosure pilot came into effect in the Business and Property Courts. It applies to new and existing proceedings where an order for disclosure has not already been made. Whilst this is expressly described as a “pilot”, if it is successful it will be rolled out to other courts and will be a catalyst for a wholesale change in the courts’ approach to this important litigation process.
As ever, the courts’ concern, especially with the advent of electronic communications, is that disclosure is in many cases unwieldy and disproportionate. Parties disclose reams of documents, most of which are never referred to again. There is an obvious impact on costs. What the courts wants to encourage is an early focus on the material that is truly of relevance to the determination of a claim. This is, of course, easier said than done, and many practitioners can describe cases where the important documents at trial turn out not to be those initially identified.
There are a number of key changes which are designed to bring about the changes sought.
First, there is a renewed focus on the duty of preservation right from the outset of the solicitors’ instruction and not just when focus turns to disclosure. It has always been good and proper practice to advise clients to preserve any material which may be relevant to a claim, but under the pilot, legal representatives must, within a reasonable period of being instructed, notify their clients of their obligations. They must obtain written confirmation that their clients have taken the necessary steps, which might in some cases including notifying former employees and third parties, to ask them to preserve material, including electronic material. This of course may have a wider impact, where that third party had no knowledge of the matter.
Determining what is needed before a case has matured may be challenging. The practitioner / clients may have other reasons for not notifying a third party. How should the duty be approached if there is no immediate prospect of relevant legal proceedings? Third parties approached may require comfort as to the costs they incur. When might this be recoverable? Keeping a log of the rationale for particular decisions is likely to be useful if a decision has to be justified years down the line.
Secondly, the duty extends to the legal representative as well as the clients, both in terms of any material the representative receives and also in ensuring that the clients have taken the necessary steps. As the requirement to give disclosure in proceedings includes electronic metadata (i.e. the embedded data in documents), careful steps are required, so it is important to ensure material is sent to the practitioner by a client in an appropriate form. The technical issues arising will require both expertise and resource.
The obligation to give disclosure starts as soon as any action is served. An initial disclosure list has to be filed at court listing the key documents upon which the party relies. Any documents should be provided to the opposing party in electronic form. Where there has been a pre-action protocol compliance, this is unlikely to be onerous but it may be easily overlooked. Generally it should comprise no more than 200 documents or 1,000 pages. Whilst parties can agree not to conduct initial disclosure, parties may be keen to use this process, given the potential benefit in getting an earlier chance to see certain material and thus better judge costs budgets or settlement strategy.
Prior to a (C)CMC, the parties have to file a joint Disclosure Review Document, setting out the matters in issue and their proposals for disclosure from the five alternate models. These range from seeking approval to give no further disclosure, to full train of enquiry disclosure in an appropriate case. The parties have a duty to co-operate and standard disclosure is no longer the default option. Alternative options will need to be costed. Costs sanctions may follow in appropriate cases.
The decision as to which order is to be made depends on a number of common sense factors including the nature and value of the case, the volume and nature of documentation and their likely probative value and the financial position of the parties.
There is the option of applying for a disclosure guidance hearing to seek information guidance before or after a (C)CMC.
The extent to which this pilot scheme will result in a change in approach to disclosure will depend in large part on the willingness of the legal profession to embrace this change and accept that a greater degree of creativity will be required. Those who carry out an early analysis of the evidence and really understand their client’s case are likely to be better positioned to reap the rewards that this may bring. Delaying such an exercise until just before trial or leaving it to Counsel is a recipe, even more than it ever was, for disaster.