The disclosure pilot: one year on

The 2-year disclosure pilot has now been in operation for just over a year. The half way point of the pilot, coupled with some important recent guidance given by the Chancellor, Sir Geoffrey Vos, provide an opportunity to consider how the pilot has been operating and what lessons have been learned from its first year.

The pilot was introduced at the start of 2019 following the report of a working group chaired by Gloster LJ. It was not intended as a mere gloss on the old rules but as an attempt to effect a culture change with the concepts of reasonableness and proportionality at its heart. 

The pilot applies to all cases progressing through the Business and Property Courts, whether or not they had been the subject of previous case management. After some initial uncertainty, it was quickly established (in UTB LLC v Sheffield United Ltd [2019] Bus LR 1500) that the pilot would govern applications in cases where disclosure had already been ordered (and given) under the old rules.

There are three key elements to the rules established under the pilot:

• The provision of “Initial Disclosure”
• The joint preparation by the parties of a “Disclosure Review Document”; and
• The giving of “extended disclosure” by reference to one of five disclosure models.

Initial disclosure

The first of these elements, Initial Disclosure, appears to have generated the least controversy, comment or judicial consideration. The absence of judicial consideration is perhaps unsurprising: initial disclosure is provided by the parties on an effectively unilateral basis when they serve their statements of claim. By the time the case reaches Court, matters will have moved on to consideration of extended disclosure and a debate over initial disclosure is unlikely to be helpful. Initial disclosure is in any case designed to be a straightforward exercise and so there ought to be relatively little difficulty in fulfilling the obligation to provide it.

The Disclosure Review Document

The requirement for the parties jointly to prepare the “Disclosure Review Document” (“the DRD”) is far more onerous. The DRD contains two main elements: first, a list of issues for disclosure; secondly, a description of how each party plans to discharge its disclosure obligations. The rules of the pilot require the parties to agree the DRD in advance of the first Case Management Conference. Often, important elements of it are not agreed and are the subject of argument at the CMC.

The list of issues for disclosure

The list of issues for disclosure is the starting point for determining the disclosure model which should be adopted for each issue.

Paragraph 7.3 of PD51U describes the “issues for disclosure” as being “those key issues in dispute, which the parties consider will need to be determined by the court with some reference to contemporaneous documents in order for there to be a fair resolution of the proceedings”. The List of Issues for Disclosure should, according to paragraph 7.4 of PD51U provide “a fair and balanced summary of the key areas of dispute identified by the parties’ statements of case and in respect of which it is likely that one or other of the parties will be seeking Extended Disclosure”.

In practice, the List of Issues for Disclosure is often prepared using the list of issues for the case as a whole as its basis, with the purely legal issues (generally) removed. Parties anxious to ensure that disclosure is properly given by their opponent are often reluctant for issues to be removed from the list out of concern that they will receive less by way of disclosure as a consequence. Often, the need to agree the List of Issues for Disclosure means that more rather than fewer of the issues in the case will be identified as being Issues for Disclosure.

The latest guidance given by Sir Geoffrey Vos in McParland v Whitehead [2020] EWHC 298 suggests that a very different approach is required. He suggested that legal issues and any factual issues capable of being fairly resolved from the documents available on initial disclosure should be removed from the List of Issues for Disclosure. He even went as far as to suggest that an agreement by the parties to adopt disclosure model A for one issue demonstrated that the issue did not need to be on the List of Issues for Disclosure at all. He also indicated that the list of issues for disclosure should be pitched at a fairly high level of generality. In McParland itself, the parties had prepared a list of (at least) 16 issues. Vos C narrowed the list to three broadly stated issues (one of which equated to five of the issues agreed between the parties). He said that the Issues for Disclosure “do not need to be detailed or complicated”.

Preparing a List of Issues of Disclosure at a high level of generality inevitably moves the focus away from tailoring the level of disclosure to the requirements of each issue in a case: fixing disclosure by reference to 3 issues will probably be less tailored than doing so by reference to 16 issues. 

One of the practical problems with a detailed List of Issues for Disclosure is that the exercise required to identify relevant material from a pool of documents differs little regardless of whether disclosure models C, D or E applies. If the work required will be the same for any search-based disclosure model, there is little to be gained by differentiating between the approach to different issues, where those issues will all require consideration of the same underlying pool of documents.  The advantage of a List of Issues for Disclosure pitched at the a high-level of generality outlined by Vos C is that it permits a connection to be drawn between the issues that have been identified and the documents held by the parties. There is little benefit to identifying a detailed series of issues for disclosure if the disclosure required on each issue will be drawn from a single pool of documents held by each party, which ought to be searched once only (or not at all).  As the Pilot rules emphasise at paragraph 8.3 of PD51U, “the court will rarely require different Models for the same set of documents”. 

Although the tailoring of extended disclosure to the issues in the claim was one of the objectives of the pilot, as outlined in the report of the working group that led to the pilot’s introduction, the practicalities of that approach seem to be driving the court towards requiring the parties to paint with a broader brush than many litigants have initially adopted.

In my experience, adopting the approach outlined by Vos C will require a radical change to the way lists of issues for disclosure have generally been prepared. They are often drafted at an early stage of the engagement between the parties regarding how disclosure should be conducted.  As such, the list is prepared without reference to how each party’s documents are held. Once agreed, the List of Issues for Disclosure tends to be fixed. 

In theory, a better approach might be to prepare an outline list of issues which evolves over time as it becomes clear to each party how their own and their opponent’s documents are held. As the distinct pools of documents held by each party emerge, the list can be finalised, with issues being merged or drawn out as necessary, to reflect the relationship between the issues in the case and the way in which the documents to be disclosed are held. The disclosure model for each issue can then be informed by the disclosure requirements for each issue (and each pool of documents) that has been identified. Whatever the theoretical attractions of that approach, whether it can be achieved in practice in the context of hard fought litigation is a very different question.

Section 2 of the DRD

As the DRD is intended as a document which should be agreed between the parties, the second element of the DRD effectively forces both parties to state and commit to a position on the conduct of both their own and their opponent’s disclosure. It is perhaps unsurprising that such an exercise generates significant disputes. Parties are routinely distrustful of how their opponent will approach disclosure and fear (often with good reason) that their opponent will seek a means to restrict disclosure of unhelpful documents or minimise work on a part of the case that their opponent regards as unimportant but which they regard as critical. Against that context, expecting the parties to reach agreement on how disclosure should be conducted may be hoping for too much.

In the past, such disagreements were often raised in correspondence in advance of a CMC but were often left unresolved and only occasionally returned to after disclosure had been given. The requirement for the parties to prepare and agree a DRD now leads to many arguments over the detail of how disclosure should be conducted being brought to the Court at the first CMC. The preparation of the DRD is often a controversial exercise which requires the intervention of the Court before the document can be finalised.

Nonetheless, the rules themselves and the guidance recently given by Vos C in McParland v Whitehead, both emphasise the importance of co-operation between the parties. Vos C said that “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”.

What does such cooperation require and how best should parties seeking to agree a DRD avoid an allegation of non-cooperation being used against them as a “stick with which to beat” them? Co-operation almost certainly requires (however unwelcome some litigants will find it) a degree of openness from each party about the documents that they have and how they are held. What is less clear is how much further the duty to cooperate goes on matters such as the scope of the searches to be conducted. Is it uncooperative to refuse to agree to something demanded by your opponent (even if you regard your opponent’s request as unreasonable)? Is it uncooperative to insist on demands which you yourself believe are reasonable but which your opponent (unreasonably) resists? Or is it just uncooperative to persist with a bad point (or a point which the Court later decides is a bad one)? Against the context of the parties being under an obligation to reach agreement on a series of almost inevitably contentious points, it is difficult to answer these questions and there is currently little practical guidance from the Court. 

Where are we now?

Vos C said in McParland v Whitehead that “the Disclosure Pilot must not be used as an opportunity for litigation advantage”, yet parties will inevitably continue to do just that (as with any aspect of litigation procedure) and no doubt the complaint of non-cooperation will often be raised in argument when parties cannot agree on the approach to disclosure.

A different approach from litigants to the List of Issues for Disclosure and the preparation of the DRD would require significant trust and cooperation between the parties. A list of issues of the kind envisaged by Vos C in McParland and an agreed DRD could be achieved through an iterative process by which the parties discuss the documents that they have available, and link those documents to the issues in the case and the extent to which disclosure is required. That approach could only work if both parties adopt a similar approach, if both are prepared to commit to a high degree of work towards agreeing the approach to disclosure, and with a high degree of trust and openness between the parties.

While the theory of such an approach is easy to understand, the reality is almost inevitably different. Litigating parties rarely approach each other with trust and openness: litigants often do not want to be open about how they hold their documents, and do not trust what their opponent says about the documents that they hold. It may be easy for a neutral judge to set out guidelines as to how parties ought to approach matters in an objectively sensible manner. But litigation is not conducted from the perspective of judicial neutrality, but depends instead on the parties engaging with each other from what are often positions of mutual distrust and suspicion. 

In such a litigious environment, the nature of the DRD has almost inevitably made the parties’ preparations for disclosure more contentious than was previously the case and has encouraged arguments to be pursued when previously they have not been. If the intention of the Disclosure Pilot is to reduce the burden of disclosure and to make it a much less contentious matter that is not to be used “as an opportunity for litigation advantage”, the DRD (in particular, the requirement for it to be agreed) seems ill-suited to achieving that end. This is certainly an area where further consideration may be needed as to how the pilot operates.

Another concern is cost. The degree of preparation for disclosure that is required by the pilot is substantial. That preparatory work inevitably has a cost attached to it. It is far from clear that the cost of the process is outweighed by savings when disclosure is eventually provided. On the contrary, in most cases, it is far from clear that the disclosure ultimately given under the pilot differs very significantly from the disclosure that would have been given under CPR Part 31.

On both fronts, if the pilot is to bring about the change of culture which is intended, substantial changes from litigants (and their advisors), and no doubt further encouragement from the court, will be needed for that to come about.