After much consultation and industry fanfare, the new Disclosure Pilot Scheme (the Pilot) was introduced for qualifying cases in the Business and Property Courts from 1 January 2019. The Pilot seeks to balance the benefits of the traditionally broad English disclosure system with the cost and complexity of dealing with the vast swathes of electronic documents generated by modern businesses – a concern that had the potential, in the view of parties and practitioners, to impact on the pre-eminence of the English justice system as a forum for resolving international disputes. Three months into the two-year Pilot, this article explores some of the key changes and how they are working out in practice.
Changes in culture and technological competence
One of the objectives of the Pilot has been a cultural change among parties and their advisers in the way disclosure is handled. Reflecting the spirit of the overriding objective, which requires parties to assist the court in dealing with cases justly and at proportionate cost, the Pilot deals specifically with these objectives in the context of disclosure.
The express duties in the Pilot on parties to litigation - to preserve documents, disclose adverse documents, comply with disclosure orders, undertake a responsible and conscientious search for documents, act honestly and avoid document dumping - are mirrored by duties on their legal advisers to advise and assist them to ensure their compliance. Further, there is an 'expectation' that parties cooperate with their opponents to agree and/or assist the court in determining the scope of disclosure, and a general duty on legal representatives to cooperate with each other in the conduct of disclosure. The duties are bolstered by new procedural requirements such as the Certificate of Compliance, in which legal advisers must proactively certify they advised their clients of their duties.
The Pilot makes specific provision for the use of technology in order to improve efficiency and proportionality. Many parties already employ sophisticated AI and e-disclosure review and analysis technologies but the Pilot imposes specific duties on legal advisers to consider them. This extends to the use of technology assisted review (where an analysis of a limited number of documents is extrapolated to a wider data set) for large volumes of documents. Practitioners need to achieve a minimum level of technological competence if they are to ensure compliance with the obligations set out in the Pilot.
Preservation of documents
The Pilot provides for parties to take specific and detailed steps to comply with their document preservation obligations, which must be certified with their Statements of Case.
In many cases, businesses already have procedures in place to suspend document deletion processes and notify relevant employees of the need to preserve documents. However, the express requirement in the Pilot to notify relevant former employees can lead to complications, in particular in large organisations with frequent staff turnover or when the possible claim remains confidential and the party is concerned about disclosing details externally. Although that requirement is a qualified duty to take 'reasonable steps' there are various factors to be balanced and the new rule requires careful consideration on a case by case basis.
Known adverse documents
A key aim of the Pilot was to move away from standard disclosure as the default. It provides for a default entitlement to Initial Disclosure of key documents with the Statements of Case but there is no automatic entitlement to Extended Disclosure, which the parties must request and the court must order. This does not release the parties from the requirement to produce documents which are adverse to their case: the new regime is subject to an overriding duty to disclose 'known adverse documents'.
'Known adverse documents' are adverse documents which are not privileged, of which a party is aware without undertaking any further searches. There may be scope for parties to avoid searching to uncover critical evidence where Extended Disclosure is either not requested, or the court orders Models A (adverse documents only) or B (akin to Initial Disclosure but with no page or document limits). It is unclear at this stage whether this will encourage parties to request the search-based disclosure Models C (issue-based), D (broadly equivalent to standard disclosure) and E (broader 'train-of-enquiry' documents).
Procedure – cooperation and information sharing
Reflecting the Pilot’s focus on cooperation, parties who request Extended Disclosure Models must comply with a series of deadlines, following the statements of case, to seek to agree a List of Issues for Disclosure and the Extended Disclosure Models, if any, that are to apply to their case. If Models C – E are sought, the parties’ position(s) is/are recorded in the Disclosure Review Document. The DRD replaces the existing Disclosure Report and EDQ, becoming the key document at the CCMC covering all aspects of disclosure including available data, custodians and historic searches undertaken, and accompanied by cost estimates for the requested Models.
While the parties are required to cooperate in agreeing the DRD, there is considerable scope for disagreement and complexity in the various negotiations. This may increase costs at the outset, but these could be set off against later savings if it results in a more streamlined disclosure process.
So far, court decisions have focused on providing guidance in light of the lack of transitional arrangements for cases which began prior to 1 January 2019 (for example, the recent case of White Winston v Mahon [2019]). It is clear that parties to such cases should cooperate to comply so far as possible with the Pilot, although these issues decline in importance as the 'transitional' cases fall away. Further decisions and changes to the Pilot are anticipated, so practitioners should stay abreast with developments.
Richard Bacon and Oliver Shipway are senior associates at Eversheds Sutherland (International) LLP
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