SQE 1 - Dispute Resolution (Disclosure)

What is disclosure and inspection?

Disclosure is the process in which a party informs another party that they possess a particular document/

Parties are under a duty to search for documents, and the duty to disclose is limited to the document's which are in the party's control.

Inspection refers to the right of the other party to read and receive copies of a document that has been disclosed.

What is best practice for solicitors advising clients about their duty to disclose?

Solicitors should advise clients about their disclosure duty at the start during the case analysis of a claim.

What is a case for the purpose of disclosure?

Case refers to any issues in dispute in a claim.

What is a document?

A document is anything in which information of any description is recorded. This is deliberately defined vey widely and could include:

- an email

- a USB stick

- a photograph

- a video

- any information held on a hard frive

What is duty to search?

All parties are under a duty to make a reasonable search for all documents required under the appropriate basis for disclosure. Reasonable search means giving consideration to issues such as the overall number of documents involved, the nature and complexity of the proceedings, how significant an individual document will actually be in the context of the proceedings overall, and the ease and expense of finding any particular document The extent of the search can be limited by party, but only where it can be justified.

Questions to ask when determining whether a document needs to be disclosed?

1. What is a party obliged to disclose

2. Is the document within the party's control;

3. Does the party have an ability to prevent another party from inspecting the document (i.e. privilege)

What is a party obliged to disclose?

- Determining if a document needs to be disclosed

It is up to the court to determine which documents need to be disclosed. However, the general position is that a party must disclose documents on which:

- they intend to rely that adversely affect their own case,

- adversely effect the the other party's case

- support another party's case

- required to be disclosed under the relevant Practice Direction

This is known as standard disclosure/disclosure on a standard basis

- if the courts require the standard disclosure then it will be specified in the directions order (given at the initial stage of case management)

What is standard disclosure?

The most common type of disclosure and is the default position unless the court orders otherwise.

What are the only types of documents that need to be disclosed under standard disclosure?

Only documents that need to form part of the disclosure are those which are relevant to the matters of the dispute. Therefore, there is no requirement to disclose documents relating to elements of the disputes that have already been agreed by the parties.

Denise commences proceedings against Johnny for recovery of money that she paid towards the renovation of the house. She argues that she paid in cash for all of the renovations between January 2016 and January 2019. Johnny defends the claim on the basis that he paid for at least 75% of the work. The court orders her to undertake disclosure on the standard basis. Having conducted a reason search, Denise finds a receipt from a builder which shows that the builder received cash from the property owner, accompanied by the signature of both the builder and Johnny.

Does she need to disclose this?

Yes, disclosure on the standard basis includes disclosing any document adversely affects the party's case (here it could demonstrate payments were made for renovations and that Johnny was involved). If Denise failed to disclose this document, she would be in breach of that order.

Does the courts always have to follow standard direction?

No, the basis for disclosure in legal proceedings depends on the matter type and the track to which a matter is allocated. The court may order disclosure to occur on a basis different from the standard direction, depending on the specific requirements of the case.

What is the court's approach to disclosure in: small claims track?

The standard direction is that each party shall, at least 14 days before the date of the final hearing , file and serve on every other party copies of all documents (including expert report) on which they intend to rely at that hearing. Whilst the court has the scope/discretion to depart from this approach if they see fit, this is rare.

What is the court's approach to disclosure in: fast track?

The standard order is that disclosure will take place on the standard basis in line with the suggested fast-track timetable for directions laid out in Practice Direction 28.

What is the court's approach to disclosure in: multi-track?

SPLIT INTO MULTIPLE FLASHCARDS

This is where the court are most likely to depart from standard disclosure. This is because of the complexity and high-value of the cases, this means that the volume of documents needs to be carefully controlled to allow the courts to only consider the relevant ones to the dispute.

The court can make the following alternative disclosure orders:

- an order dispensing with disclosure

- an order that a party discloses the documents on which it relies, and at the same time request any specific disclosures it requires from any other party.

- an order which directs that the disclosure is given by each party on an issue-by-issue basis (where the overall litigation is so expansive that the areas in dispute need to be compartmentalised)

- any other order in relation to disclose that the courts consider appropriate

What is a specific disclosure?

This is where the disclosure of specific documents or classes of documents is specified in the court order.

What is a dispensing of disclosure order?

- Multi-track alternative

In some cases, the court might decide that no disclosure of documents is needed. This means the parties don't have to provide any documents to each other. For instance, if two friends have a small dispute over a minor loan, the court might say they don't need to show any paperwork.

What is a disclosure of Documents You Rely On and Request for Specific Disclosures?

- Multi-track alternative

This order means that each party has to share the documents they're going to use to support their case. If one party wants specific documents from the other party, they can ask for them. For example, in a contract dispute, if one side claims the contract was breached, they'd have to show the contract and ask for any emails related to the breach.

What is an issue-by-issue basis disclosure?

- Multi-track alternative

When a case is very complex with many different arguments, the court might order that disclosure happens one issue at a time. For example, in a large medical malpractice case, they might first look at the doctor's qualifications, then move on to the treatment provided, and so on.

What is any other order in relation to disclose that the courts consider appropriate?

- Multi-track alternative

This is a catch-all that allows the court to make a unique decision about disclosure based on the specific needs of the case. For instance, in a patent dispute where the invention is highly technical, the court might order the parties to disclose relevant scientific research.

How and when does the court go about determining what type of disclosure order they will make?

-The Judge will decide the order they wish to make, usually at the first case management conference.

- Any decision by the court will be guided by the overriding objective (ie what is necessary to deal with the case justly and at proportionate costs)

Is the document within the party's control?

- Determining if a document needs to be disclosed

Second question to ask.

A party only needs to disclose a document that is in their control.

Under CPR 31.8, a document is in a party's control if:

- it it or was in the physical possession of the party

-the party had or has had the right to inspect the document

- the party has or has had the right to inspect or take a copy of the document

What must a party do if they are asked to disclose a document they no longer have possession over?

The document will still need to be disclosed (inspection is the stage where the other party receives a copy) however, a detailed explanation of how the document was lost must be included on the disclosure form.

Does the party have the ability to prevent another party from inspecting the document?

- Determining if a document needs to be disclosed

CPR 31 sets out that a party to whom the document has been disclosed has the right to inspect it. This is the general position unless an exception applies.

Main exception is whether a document is privileged.

What is privilege?

If a document is privileged, then even though the opposing party will be aware of the existence of the document (it will still need to be disclosed), they are prevented from inspecting or seeing it.

What are the three types of privilege?

1. Legal advice privilege

2. Litigation privilege

3. WIthout prejudice privilege

What is legal advice privilege?

This protects confidential communications between a legal representative and their client, but not communications with third parties (ie between legal representatives and an instructed expert). This is widely applied and does not need to be in relation to litigation that is either commenced or is being contemplated.

In order to benefit from this privilege, the dominant purpose of the communication must be the seeking and receiving of legal advice. This means that general advice given (eg about the litigation process) will not be privileged, but a letter specifically advising a client on the merits of their claim would be.

What is litigation privilege?

This protects confidential communication between a legal representative, a client and a third party, or between a client and third party directly.

A third party can be an expert, a witness or any other party consulted in connection with the litigation. This is narrower than legal advice privilege as the document must have been created for the sole or dominant purpose of obtaining information or advice in connection with the litigation itself, which either existed or was reasonably contemplated at the time the document was created.

What is without prejudice privilege?

This applies to documents that are typically written in the course of negotiations to settle with another party. Without prejudice communications are used generally where a party is seeking to make an offer during the course of litigation proceedings and it does not want to be seen by the court. The communications itself is generally marked 'without prejudice', however this isn't a requirement. To establish whether the document benefits from without prejudice privilege, the substance of it must be looked at.

- Is it a genuine offer to settle on sensible terms by a party open to settlement?

- If so, the document is likely to be protected by without prejudice irrespective of there being a mark.

Can a party waive privilege on a document during proceedings?

Yes, the party withholding privilege can choose to waive it if they believe the document would benefit their case. They can do this by writing to the opposing party, stating they are not relying on privilege for that document, and inviting inspection.

Why would a party choose to waive privilege?

A party may waive privilege if they believe the document could strengthen their case, and they want to share it with the opposing party during proceedings.

What is waive?

This is where a party does not rely upon, insist upon or use their right. So if a party waives privilege, they will allow the other party to inspect the document in question.

How does a party waive privilege on a document?

To waive privilege, a party should write to the opposing party, indicating that they are not relying on privilege for the document in question and inviting the other party to inspect it if they wish.

Once it has been established whether a document is disclosable, then need to determine how to go about disclosing it to the opposing party.

What is the disclosure and inspection process?

This is the procedure that a party must follow:

-Once a reasonable search has been carried out and the relevant documents have been identified, the party will prepare a number list of these documents using form N265

- The list must also contain a disclosure statement, signed by the party, confirming the extent of the search made to locate documents and certifying that they understand their duty of disclosure

- The N265 form must then be served on the other party by the deadline set out in the directions order

- Upon receipt of the other party's N265 form, the opposition must prepare a written notice informing the party of the documents that they wish to inspect from the list. The party must allow inspection within seven days of receiving that notice.

What are the three types of orders in relation to disclosure?

1. Specific disclosure

2. Pre-action disclosure

3. Non-party disclosure

What is electronic disclosure?

SPLIT

Electronic disclosure (e-disclosure) means any document that is in electronic form, and includes those from: servers, computer systems and hard drives.

Due to the sheer volume of potential electronic documents that can be relevant to a claim, the CPR specifically requires parties to agree between them how the volume of electronic disclosures can be limited for instance, with reference to specific keywords, agreeing specified categories of documents to be disclosed, and the manner in which these documents will be inspected by the other party.

What does the court require a party to whom a specific disclosure is made against?

If the court grants an order for specific disclosure, they will require the party against whom the order is made to do one of the following:

- disclose specific documents or classes of documents covered in the order (this would be where the party who has identified that a particular document or documents exists that fall within the extent of the disclosure required and wish the court to specifically order the other party to disclose those documents)

- carry out an additional search

- disclose any document located as a result of that search

If a party has an order for specific disclosure made against them, they must comply with it within the relevant timescales set out in the order.

Pre-action disclosure

SPLIT

Under Practice Direction on Pre-Action Conduct and Protocols (PDPACP), parties should share information however prior to the claim being commenced there is no fixed duty on either party to disclose documents on the standard basis, resulting in parties picking and choosing which documents to disclose and which benefit their claim most, which they couldn't do after the proceedings have been issued.

Therefore, where a party feels that a component is deliberately withholding a document that could have a material impact on the chances of the matter being settled by negotiation, or whether the claim is suitable for being issued, an application for pre-action disclosure is useful.

Essentially, it is an application that asks the court to make an order requiring a party to disclose a particular document or class of document before proceedings have been issued/

How can a party make an application for pre-action disclosure?

They must submit an N244 form and attach a witness statement that outlines:

- both the respondent and applicant are likely to be parties to anticipated proceedings

- the document or class of documents that the applicant would like to be disclosed

- that if proceedings have already been started, the responded would be under a duty to disclose the document or documents in question

- that the disclosure prior to proceedings being commenced is desirable as it will save costs assist with the dispute being resolved without proceedings, or is likely to enable the parties to dispose fairly of the anticipated proceeding (therefore emphasis is that documents must be capable of assisting the parties to avoid court)

Non-party disclosure

- GENERATE QUESTION AND SPLIT

An application for non-party disclosure i appropriate where proceedings have been issued, disclosure has taken place, and a party has said that they are no longer in possession fo a relevant document but they know that somebody who is not a party to proceedings is in possession of it,

An application for non-party disclosure can be made using form N244 and an accompanying witness statement that explains:

- the documents are likely to support the case of the applicant or adversely affect the case of one of the other parties to proceedings

- disclosure is necessary in order to dispose fairly of the claim or to save costs.

Specific disclosure

- GENERATE QUESTION AND SPLIT

There are circumstances that arise where a party may need to ask the court to intervene on a specific matter regarding disclosure. This is generally because they feel that the opposing party has not searched extensively as their duty requires. If this is the case, the party who is dissatisfied should frist write to the other party setting out their reasons for beleiving that the search has not been carried out as thorougly as required, and including what they would like to be done to rectify matters. If the issue is not rectified, the party is entitled to apply to the court, using form N244 and an accompanying witness statement for specific disclosure.

When do e-disclosures typically arise?

SPLIT

Typically arise more in multi-track claims between commercial entities where there is a huge volume of potentially relevant documents to disclose. The court will deal specifically with the limitations or boundaries that the parties have agreed at the case management conference, and will either make an order that specifies those limitations or boundaries, where appropriate, or list the matter for a separate hearing, where the courts feel the e-disclosure requires more careful consideration.