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ASHLEY CUKIER WRITES: A ‘WHOLESALE CULTURAL CHANGE’? - THE NEW DISCLOSURE PILOT SCHEME FOR THE BUSINESS AND PROPERTY COURTS IN ENGLAND AND WALES

The Disclosure Pilot Scheme

Following long-held concerns that courts and litigants were not availing themselves of the full ‘menu’ of disclosure options contained in CPR r.31.5(7), a Disclosure Working Group (established by the Master of the Rolls and chaired by Gloster VP) in November 2017 published a pilot Practice Direction for wider consultation.

The Pilot is the corollary to the Working Group’s conclusion that, in order to achieve long-sought improvement in the cost and proportionality of disclosure, a “wholesale cultural change” would be required, which change could only be achieved “by the widespread promulgation of a completely new rule and guidelines […] a change in professional attitudes and a shift towards more pro-active case management by judges”

‘Basic’ Disclosure vs. ‘Extended’ Disclosure

Under the Pilot Scheme draft Practice Direction, save where the parties agree to dispense with the general approach (and subject to a number of other exceptions), parties are expected to give “Basic Disclosure”. This is to be limited to those documents upon which the party relies and which are necessary for the other party or parties to understand the case put against them.

Where a party wishes to seek disclosure of documents in addition to, or as an alternative to, Basic Disclosure, the party must request “Extended Disclosure”. This is to take a number of possible forms. Per the Pilot Scheme Practice Direction:
  • Model A is no disclosure.
  • Model B requires disclosure of the documents on which a party relies. It is similar to basic disclosure with the important distinction that it requires adverse documents in the hands of the disclosing party to be provided.
  • Model C adds to Model B a facility for each party to request from the other any specific disclosure it requires with a requirement to carry out a search and to produce adverse documents.
  • What was “standard disclosure”, requiring a reasonable search for documents that support or adversely affect either side’s case, will now be ‘Model D’. Where Model D is proposed the Court will require to be satisfied that (taken with any further directions: see (vi) below) the model is reasonable and proportionate and appropriate in order fairly to resolve the issue(s).
  • Model E should be exceptional. It extends the reasonable search required for Model D to documents that may lead to a train of enquiry that may support or adversely affect either side’s case on the issue(s).
  • In an appropriate case the Court should be prepared to give more detailed directions in relation to Models D and E, so as to direct where searches should be undertaken, and whether, for example, sampling should be used. The parties may convene a Disclosure Guidance Hearing which will be informal, short and generally attended by the lawyers with conduct of the disclosure process.
  • A bespoke Model (outside A to E) may be ordered in an individual case, but this will be exceptional.

In order to apply for Extended Disclosure, parties will first be expected to have completed a Disclosure Review Document (“DRD”). Any application for Extended Disclosure must specify which of the disclosure models the party is seeking. The DRD is intended to (i) facilitate the exchange of information and provide a vehicle for discussions around the initial scoping of a disclosure exercise; (ii) help the parties agree a sensible and cost-effective approach to disclosure; and (iii) provide the court with the information it needs to make appropriate case management decisions.

Consultation

The first stated intention of the DRD is particularly welcome. Too often, under the existing Disclosure rules, the scope and breadth of ‘standard’ disclosure is not dealt with in any (or any sufficient) detail in advance of the CCMC (and costs-budgeting), the result of which is often a series time-consuming and expensive arguments about the disclosure that has (or has not) been provided, many months into a case.

Less clear is the explanation, in the press announcement for the consultation, as to the ‘yardstick’ by which applications for Extended Disclosure are to be tested under the Pilot. The press announcement states that “the fundamental yardstick” for the parties and the court, throughout, should be “what is appropriate in order fairly to resolve the issues in the case”, with reference to the recognised test of reasonableness and proportionality, as well as the overriding objective. If the principles governing appropriateness remain essentially unchanged, it will be interesting to see, under the Pilot, how – and how frequently – courts favour a model other than Model D (formerly standard disclosure’), in circumstances where the old model has been deemed unreasonable and disproportionate (so as to engender the Pilot).

Last week, the Law Society published its response to the Pilot, expressing inter alia the concern that many of the perceived issues relating to disclosure may only exist in high-value litigation, and suggesting that the Pilot apply only to complex cases over £500,000 in value. Concerns were also expressed about the additional court time and judicial resource that is likely to be required if courts are to grapple, at an early stage, with issues arising from the DRD discussion and the choice of Extended Disclosure ‘model’.

The proposed scheme is expected to be submitted to the Civil Procedure Rules Committee for review and approval in March or April 2018, after which the Pilot will be published and will commence. Practitioners will no doubt watch the evolution – and wider implementation – of the Pilot with interest.

Ashley Cukier is a commercial barrister whose practice encompasses a wide range of commercial litigation and arbitration, civil fraud, company, insolvency and sports law matters.
Posted: 21.03.2018 at 10:28
Tags:  Comments  Articles  Investigations  Dispute Resolution
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