Thursday, 5 March 2020

McParland & Partners Ltd & Anor v Whitehead

[2020] EWHC 298 (Ch)

This was a disclosure guidance hearing under the Disclosure Pilot where the parties sought “guidance from the court by way of a discussion with the court in advance of … a case management conference, [“CMC”] concerning the scope of Extended Disclosure”. As Sir Geoffrey Vos explained, paragraph 11(1) of PD51U provides that such a hearing can take place where (i) the parties have made real efforts to resolve disputes between them, and (ii) the absence of guidance from the court before a CMC is likely to have a material effect on the court’s ability to hold an effective CMC. The Judge took the opportunity to  clarify some aspects of the way in which the Disclosure Pilot is intended to work. Here, the issues in dispute related to “Extended Disclosure”. The Judge said that  the watchword for “Extended Disclosure” was that it was in all cases “be reasonable and proportionate having regard to the overriding objective including” certain factors, namely: 

“1) the nature and complexity of the issues in the proceedings;

2) the importance of the case, including any non-monetary relief sought;

3) the likelihood of documents existing that will have probative value in supporting or undermining a party’s claim or defence;

4) the number of documents involved;

5) the ease and expense of searching for and retrieval of any particular document (taking into account any limitations on the information available and on the likely accuracy of any costs estimates);

6) the financial position of each party; and

7) the need to ensure the case is dealt with expeditiously, fairly and at a proportionate cost.”

The Judge explained that the provisions of the Disclosure Pilot are intended to apply across a wide range of cases stretching from the highest value business cases to the lowest value ones, and from the most complex, lengthy and document intensive to the least complex cases with few relevant documents. It was critical that the type of Extended Disclosure was:

“fair, proportionate and reasonable. The Disclosure Pilot should not become a disproportionately costly exercise. This latter requirement means that the parties have to think cooperatively and constructively about their dispute and what documents will require to be produced for it to be fairly resolved. In smaller value disputes particularly, but also in higher value ones, unduly granular and complex solutions should be avoided.”

In his judgment, the Judge made a number of helpful comments about the operation of the Disclosure Protocol. He was clear that Issues for Disclosure are very different from Issues for Trial. 

“The starting point for the identification of the Issues for Disclosure will in every case be driven by the documentation that is or is likely to be in each party’s possession. It should not be a mechanical exercise of going through the pleadings to identify issues that will arise at trial for determination. Rather it is the relevance of the categories of documents in the parties’ possession to the contested issues before the court that should drive the identification of the Issues for Disclosure.”

For the Judge, the previous test under standard disclosure (whether a document supported or adversely affected a party’s “case”) was “far too general”. Here, under the Disclosure Pilot, the reviewer has defined issues against which documents can be considered. The review should be “a far more clinical exercise”. 

 

The Judge also reinforced earlier decisions about the importance of cooperation:

“It is clear that some parties to litigation in all areas of the Business and Property Courts have sought to use the Disclosure Pilot as a stick with which to beat their opponents. Such conduct is entirely unacceptable, and parties can expect to be met with immediately payable adverse costs orders if that is what has happened.

No advantage can be gained by being difficult about the agreement of Issues for Disclosure or of a DRD, and I would expect judges at all levels to be astute to call out any parties that fail properly to cooperate as the Disclosure Pilot requires.” 

In the course of his judgment, the Judge noted that the court had encouraged the parties to proceed to a privately arranged mediation as soon as disclosure had occurred. The reason for this was that both sides had agreed that it was necessary to see from disclosure whether “their suspicions” were justified before a useful mediation could take place. In the dispute here, the claimants suspected more extensive breaches by the defendant, and the defendant suspected an absence of loss of business by the claimants. 

Sir Geoffrey Vos noted that during the hearing he had made reference to Lomax v Lomax (see Issue 231) where the CA had to consider whether the court had the power to order parties to undertake an early neutral evaluation. He had also raised during the hearing the question of whether the court might also require parties to engage in mediation, something the courts cannot currently do. Nevertheless, the parties took the judicial hint, with Sir Geoffrey Vos commenting that:

“In the result, the parties fortunately agreed to a direction that a mediation is to take place in this case after disclosure as I have already indicated.” 

Back to the previous page

PDF logoClick to download PDF

Subscribe to our newsletters

If you would like to receive a digital version of our newsletters please complete the subscription form.