Luka Krsljanin of 2 Temple Gardens
http://www.2tg.co.uk/people/luka-krsljanin/
This article is based on a lecture given to the PNLA at its annual conference on 19th June 2019
The Disclosure Pilot in the Business & Property Courts (the provisions of which are set out in Practice Direction 51U of the CPR) came into effect on 1st January 2019. It will apply to all claims proceeding before those Courts for a period of two years. If deemed a success, we can expect its provisions to be rolled out on a far larger scale, fundamentally changing our approach to disclosure in large commercial professional negligence cases.
The Disclosure Pilot is ambitious in its aims. It intends no less than to achieve a “culture change”, in the words of the Chancellor of the High Court, Sir Geoffrey Vos, in the first major judgment on the Pilot, Sheffield United Ltd v UTB LLC [2019] EWHC 914 (Ch) (paragraph 75). His Lordship expanded, “It operates along different lines [than CPR 31] driven by reasonableness and proportionality (see paragraph 2 of PD51U), with disclosure being directed specifically to defined issues arising in the proceedings.” (paragraph 75).
Crucially, the Chancellor’s judgment has confirmed that the Pilot applies to all cases proceeding before the Business & Property Courts, including those in which an order for standard disclosure under CPR 31 had been made. This conclusion subverted the expectation of most practitioners who, emboldened by the notes to the White Book Commentary (2019) considered that the Pilot would not apply to cases where an order for standard disclosure had been made prior to 1st January 2019: see paragraph 16 of the Chancellor’s judgment. His Lordship went on to confirm that, in line with the Pilot’s intended “culture change”, the Courts would take a strict approach to applications for further disclosure.
The Pilot is plainly intended to reduce combative skirmishes between parties on disclosure, and to avoid multiple days spent in Court arguing over such issues: see for example the judgment of Master Shurman in Canary Riverside v Circus [2019] EWHC 154 (Ch), in which the Master (dealing with an application under CPR 31) welcomed the impending arrival of the Disclosure Pilot.
In order to its achieve its aim of restricting disclosure to that which is reasonably necessary and proportionate, the Pilot introduces a number of new concepts. Critical to note are the following:
- The concept of Initial Disclosure (PD51U, paragraph 5) requires parties to provide to one another lists and copies of documents which are key documents relied upon (expressly or otherwise) in support of their cases, and which are necessary for the other party to understand the case to be met. The clear intention is to ‘front load’ the in the sense that the key documentary evidence relied upon by parties will be identified and put forward at the earliest possible stage. Initial Disclosure should include “Known Adverse Documents” (PD51U, paragraph 2.8, 2.9) but this does not mean that parties must conduct extensive early searches to identify potentially adverse documents; it is only if a party is actually aware of and has control of the harmful document that the obligation to disclose it arises.
- Parties will be required, within 28 days after service of their final statement of case, to prepare a List of Issues for Disclosure (recorded in the form of a Disclosure Review Document; PD51U, paragraph 7). The parties are encouraged to collaborate and produce a document which encapsulates the key issues on which disclosure is required. Again, the aim is to ensure that parties are identifying the central issues for disclosure at an early stage. Significantly, the Pilot scheme requires that the List of Issues for Disclosure identify the issues that are central to the case. In numerous respects, the Pilot is intended to discourage extensive and costly disclosure disputes which relate to documents of peripheral or tangential relevance. The contents of the List will be important for the future of the case: it is to be expected that the Court will be reluctant to grant applications for further disclosure of documents which do not relate to issues identified in the List.
- Collaboration between the parties is strongly encouraged by the Pilot. That process may be assisted by Disclosure Guidance Hearings, at which the parties will be able to “discuss” the disclosure requirements with the Court (PD51U, paragraph 11). These new hearings may be requested by application notice, but only where parties have made “real efforts” to resolve disagreements between themselves on disclosure. Hearings are intended to last no more than 30 minutes, and the expectation will be that, rather than making orders on disclosure, the Court will approve a short note encapsulating its guidance to the parties. These hearings can be requested before or after a CCMC, and may have tactical benefit in laying down a “Court-approved marker” in terms of what disclosure will be expected.
- Critically, there is the new concept of Extended Disclosure (PD51U, paragraphs 7 and 8). There is no presumption in favour of any form of Extended Disclosure being ordered above and beyond Initial Disclosure. Parties will need to justify Extended Disclosure. Additionally, different models of Extended Disclosure may apply to different parties. For example, it is easy to imagine that in a case where one party alleges another of fraud, the alleged fraudster will be subject to a more onerous model than the other party against whom no such allegations are levelled. There are five different models of Extended Disclosure: Models A to E. These range from a model in which a party is obliged to disclose nothing other than Known Adverse Documents (Model A) to a model in which a party “shall disclose documents which are likely to support or adversely affect its claim in relation to Issues for Disclosure or which may lead to a train of inquiry which may then result in the identification of other documents for disclosure” (Model E). Model E is only to be applied in exceptional cases, and it is clear that detailed evidence will be required for a Court to order its application at a CCMC.
Here are a few things that practitioners can bear in mind when trying to handle disclosure under the Pilot:
- A clear List of Issues for Disclosure is essential. It is suggested that in cases where an order for standard disclosure was made before 1st January 2019 (and therefore where no List of Issues for Disclosure has been prepared), a sensible step preceding any application for Extended Disclosure would be to prepare and agree a list.
- The Court will expect collaboration between the parties, and so is likely to frown on applications for Extended Disclosure which are made swiftly and without clear (and clearly evidenced) attempts to agree matters.
- Real attention will need to be paid to evidence relied upon in support of applications made in connection with Extended Disclosure. More expansive disclosure orders must be justified by clear evidence. Given the Court’s new focus on proportionality, it is essential to avoid broadbrush assertions and instead adduce specific evidence when trying to persuade a Court to order any more expansive form of disclosure. For example, an estimate of the costs and time that would be taken to effect further disclosure should be provided, supported by evidence (if possible) from a party’s e-disclosure provider, who may be able to provide evidence confirming that further disclosure can be obtained at relatively modest and proportionate cost.
- Applications for ‘specific disclosure’ will need to be focussed in their scope, and importantly should focus on documents that are of real probative value to the central issues in the case. This was clearly emphasised by the Chancellor in the Sheffield United As such, it is important that evidence in support of any application explain, by reference to the List of Issues for Disclosure, why the documents are important enough to justify further searches and reviews being conducted by the other party.
We can expect many judgments on the application of these new principles in the coming months. Amongst other things, the proper approach to “Known Adverse Documents” is likely to be the subject of contention. However, chief to success in disclosure will be a recognition of the Pilot’s core underlying aims of proportionality, focus on probative value and collaboration.
Luka Krsljanin
20th June 2019
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