Flashcards in LG6 Deck (72):
Disclosure is the process by which the parties are required to disclose to each other the documents in their possession, custody or control which are material to the issues in the claim.
Small Claims Track = documents relied upon
Fast Track = standard disclosure
Multi-track usually = menu disclosure
CPR, r. 31.6: standard disclosure covers:
• Documents relied upon
• Documents adversely affecting own case
• Documents adversely affecting another’s case
• Documents supporting another’s case
• Documents required to be disclosed under a Practice Direction (eg. PD Pre-action Conduct or PD 31B on electronic documents)
Broadly, these categories cover documents which will be relevant to the issues in the case. The issues are defined by the statements of case. Note:
• Rule 31.6 does not use the words “relevant to the issues”, and the above bullet points are technically wider
• Rule 31.6 does not cover documents merely relevant to credit:
Favour Easy Management Ltd v Wu  1 WLR 1803
Not included in this are “train of inquiry” documents
Compagnie Financiere v Peruvian Guano Co (1882) 11 QBD 55:
“Train of inquiry” documents are those that may lead to the discovery of other documents supporting or adversely affecting either party
More Precise: Cases covered by Standard Disclosure
This applies to:
(i) Most fast track claims (CPR, r. 31.5(1)(a)), unless the court orders otherwise
(ii) Most personal injuries claims on the multi-track (r. 31.5(2))
(iii) Other multi-track claims if the court decides to make a direction for standard disclosure (r. 31.5(7)(e))
Procedure on standard disclosure
(a) Disclosure by list of documents
Form N265: APA Civil Fig 31.1, pp 336-338
Divided into 3 sections (p 338)
• Documents party is prepared to disclose to the other side
• Documents protected by privilege
• Documents no longer available
Procedure on standard disclosure 2
• By personal attendance
• By requesting photocopies (on undertaking to pay reasonable copying costs)
• In electronic format. Documents should be disclosed in their “native format”
• If electronic documents are best accessed using technology not readily available to the other side, by making available reasonable additional inspection facilities to enable them to have the necessary access
CPR, r. 31.4: “document” means anything in which information of any description is recorded
The definition of “documents” in r. 31.4 extends to electronic documents, including "deleted" documents, and things like CCTV recordings and photographs. The definition also covers additional information stored and associated with electronic documents, which is often not readily accessible, known as metadata (PD 31B, para 5(7)).
QUESTION 2 Standard Disclosure
In a fast track claim the court makes an order for "standard disclosure". What documents does such an order require the party against whom it is made to disclose?
QUESTION 3 Locating documents
What efforts must a party make in order to locate disclosable documents?
Possession, custody or control
Disclosure obligations apply to documents which are or have been in a party’s "control" (CPR r. 31.8(1)). A party has control over documents (r. 31.8(2)):
(a) in his physical possession;
(b) if he has a right to possession;
(c) if he has a right to inspect or take copies.
This is wide. It will cover not only documents that a party actually has, but also ones they are entitled to call for from someone else.
For example, the Access to Health Records Act 1990 means that a party has “control” of their GP notes, even if the party has never seen them. This applies to GP notes in this country. It depends on local legislation whether the same applies to GP notes in another country:
Favour Easy Management Ltd v Wu  1 WLR 1803
Reasonable Search CPR, r. 31.7
Parties have a duty to make a reasonable and proportionate search
Any limits on their searches have to be set out in their list of documents
Factors in deciding how wide a search is required
Include (r. 31.7(2)):
• Number of documents
• Nature and complexity of the litigation
• Ease and expense of retrieval
• Likely significance of the documents
• Also (PD 31B): Availability of the information from other sources
Need for a disclosure statement CPR, r. 31.10(6)
- signed by the party (note the words “…made by the party…”)
- rather than its solicitor or some close associate
Global Torch Ltd v Apex Global Management (No 2)  1 WLR 4495 (SCt)
• A disclosure statement is not a mere technicality
• If there are joint Claimants or Defendants, each must sign a disclosure statement
Menu Option Disclosure
Cases covered by menu option disclosure
This applies to:
(i) Most multi-track claims (CPR, r. 31.5(2)), unless the court orders otherwise
(ii) But not to personal injuries claims on the multi-track (r. 31.5(2))
(ii) Fast track claims and personal injuries claims if the court decides to make a direction for menu option disclosure (rr. 31.5(1)(a) and 31.5(2))
Menu Disclosure procedure
• Filing Defence
• Notice of proposed allocation (CPR r. 26.3(1(a)(ii))
If the proposed allocation is to the multi-track the notice of proposed allocation will:
• Give a date (not less than 28 days) for filing directions questionnaires
• Probably ask for disclosure reports
Before the Case Management Conference
Case management conferences are not compulsory on the multi-track, but they are common. They will be dispensed with if:
• The parties agree directions (APA Civil para 29.04) and the court agrees with the proposed directions; or
• The court feels it has enough information (from the filed directions questionnaires) to make directions without a CMC
But if there is going to be a CMC:
Stage 1 Disclosure Report
Stage 1: Disclosure report APA Civil para 31.23
For the form, see APA Civil Fig 31.2, p 343.
Not less than 14 days before the first CMC each party must file and serve a disclosure report (CPR r. 31.5(3)). This
• describes the relevant documents
• describes where they are
• details storage of electronic documents
• estimates cost of giving disclosure
• includes a proposal for the most suitable disclosure direction
• verified by a statement of truth
Stage 2: Agreeing disclosure directions APA Civil para 31.24
Not less than 7 days before the first CMC the parties must:
• meet or telephone each other to discuss and seek to agree a proposal for disclosure
• which must meet the overriding objective of dealing with the case justly and at proportionate cost (CPR r. 31.5(5))
• any agreed proposal must be filed at court
• court may approve the proposal without a hearing (CPR r. 31.5(6))
Stage 3: CMC menu disclosure directions APA Civil para 31.25
If disclosure directions are not made without a hearing, at the CMC the court has the following options (CPR r. 31.5(7)):
(a) an order dispensing with disclosure;
(b) an order that a party disclose the documents on which it relies, and at the same time request any specific disclosure it requires from any other party;
(c) an order that directs, where practicable, the disclosure to be given by each party on an issue by issue basis;
(d) an order that each party disclose any documents which it is reasonable to suppose may contain information which enables that party to advance its own case or to damage that of any other party, or which leads to an enquiry which has either of those consequences;
(e) an order that a party give standard disclosure;
(f) any other order in relation to disclosure that the court considers appropriate.
PD 31B, para 7
As soon as litigation is contemplated, the parties’ legal representatives must notify their clients of the need to preserve disclosable documents. The documents to be preserved include Electronic Documents which would otherwise be deleted in accordance with a document retention policy or otherwise deleted in the ordinary course of business.
Refusal to Disclose
Duty to cease acting and return Instructions (Code of Conduct guidance gC13).
Party may not rely on undisclosed documents without court permission, r. 31.21.
Ultimately the court can strike out the defaulting party's statement of case as a sanction: Global Torch Ltd v Apex Global Management (No 2).
Will have a Civil Advocacy exercise on this in Pemberton (Civil Advocacy SGS 5)
Technically two types of order
CPR, r. 31.12(1):
"The court may make an order for specific disclosure or specific inspection."
Nature of specific disclosure
CPR, r. 31.12(2):
An order for specific disclosure is an order that a party must do one or more of the following things –
(a) disclose documents or classes of documents specified in the order;
(b) carry out a search to the extent stated in the order;
(c) disclose any documents located as a result of that search.
Nature of specific inspection
CPR, r. 31.12(3):
An order for specific inspection is an order that a party permit inspection of a document referred to in rule 31.3(2).
[r. 31.3(2) covers documents which a party refuses to allow to be inspected on the grounds of proportionality].
Timing WB 126.96.36.199
• At any stage of the proceedings
• Typically at a CMC
• As soon as apparent it is necessary or desirable (PD 23A, para 2.7)
Factors PD 31A, para 5.4 & WB 31.12.2
• Court takes into account all the circumstances of the case
• Where the documents sought should have been disclosed under an order for disclosure, specific disclosure will usually be given
• Overriding objective
• Relevance of the documents
• How important they are likely to be, e.g., if the case is likely to turn on them
• Whether the documents are necessary for the just disposal of the claim
• Lateness in applying (WB 188.8.131.52)
Mention of documents
Parties are under a duty to disclose documents mentioned in their statements of case, witness statements, experts’ reports: CPR, r. 31.14
Rubin v Expandable Ltd  1 WLR 1099
A document is “mentioned in” a witness statement (etc) if it is specifically mentioned or directly alluded to. A witness statement saying “he wrote to me” without specifically saying when or exhibiting the letter makes a “direct allusion” to the letter.
However, just because r. 31.14 is engaged does not prevent the party who “mentioned” the document claiming privilege over it (see LGS 6).
The party receiving inadvertently disclosed documents can only use them with the court's permission (CPR r. 31.20).
The solicitor receiving the documents:
The solicitor receiving the documents:
• owes no duty of care to the party giving disclosure
• generally can assume the documents have been disclosed deliberately, and that the solicitor acting for the other side has authority to disclose
• but if they realise an obvious mistake has been made, they should stop reading the documents, and send them back
The party making the inadvertent disclosure may:
• consider seeking an injunction, see WB at 31.20.1; and 31.3.27
• an injunction is usually to restrain use of the documents
• where the solicitor receiving / retaining the documents was previously acting for the party to whom the documents belong, the injunction may restrain the solicitor from acting for the other side
An injunction may be granted:
• where disclosure was obtained by fraud
• where the solicitor receiving the documents realises there has been an obvious mistake
• whether there is an obvious mistake is viewed objectively
• the court has to balance the public interest in supporting LPP with the public interest in the due administration of justice
CPR, r. 31.22
After disclosure, documents still belong to the original party. There is an implied undertaking not to use them for any collateral purpose, eg:
• By showing them to the media
• Talking about them outside the litigation
• Showing them to a competitor
Effect is that disclosed documents can only be used for the present litigation.
Home Office v Harman  1 AC 280
Crest Homes v Marks  AC 829
Lilly Icos v Pfizer  1 WLR 2253
The implied undertaking ends if and when the documents are used in open court. At that stage they become public documents.
It also ends if the party who gave disclosure agrees.
However, the court may re-impose the undertaking even after use in open court.
There are 4 types of privilege:
• legal professional privilege
• without prejudice privilege
• privilege against self-incrimination
• public interest immunity
The syllabus only covers LPP and WP.
• must be "disclosed" to the other side in the sense they feature in part 2 of the list of documents
• are privileged from inspection. It means the other side do not see them
• privilege may be "waived"
Legal Professional Privilege
This arises in two situations. Namely:
• legal advice privilege
• litigation privilege
Legal Advice Privilege
Covers confidential communications between lawyer & client for giving or receiving legal advice, whether or not litigation is contemplated. The elements are therefore:
• confidential communication
• between legal representative and client
• for giving or receiving legal advice
Lawyer and client
Alfred Crompton v Commissioners of Customs and Excise  AC 405
• Covers in-house lawyers as well as lawyers in private practice
Three Rivers DC v Bank of England (No. 6)  1 AC 610
This privilege protects communications seeking or giving “legal advice”, covering:
• telling the client the law
• advice on what should prudently and sensibly be done in the relevant legal context
• presentational advice on evidence to be placed before a private inquiry
Imerman v Tchenguiz  EWHC 2902 (QB)
A lawyer’s underlining or highlighting on documents is not privileged, except in the unlikely event that this will reveal the trend of advice being given.
Copies of documents WB 31.3.6, 31.3.12 & 31.3.14
The cases on this are not all consistent, and some of the older authorities can't be trusted. The principles are:
• A document that was not privileged when it was made does not generally become privileged by enclosing it when seeking legal advice
• The notion that there might be a privileged copy of a non-privileged document is not now the law (Lubrizol v Esso Petroleum Co (No 4)  FSR 64)
• However, if a compilation of non-privileged documents by a lawyer will give away the trend of advice given, the compilation (but not the individual documents) will be privileged (Lyell v Kennedy (1884) LR 27 ChD 1)
Note CPR, r. 31.9, the need to disclose modified versions of copies.
This covers confidential communications between a client or lawyer & 3rd parties where the dominant purpose is to use the document or its contents in order to obtain legal advice or to help in the conduct of litigation which was at the time at least reasonably in prospect. The elements are therefore:
• confidential communication
• between third party and either the lawyer or the client
• dominant purpose
• to use the document or its contents
• to obtain legal advice or to help in litigation
• litigation must be pending or reasonably in prospect
Experts reports for use in litigation
Witness statements prepared for litigation
Solicitors' correspondence with witnesses and experts
Solicitors' correspondence seeking evidence
Drafts of court documents
Note: documents not privileged when made, but which are sent to a lawyer for the purpose of litigation, do not by doing so become privileged.
What if there are two purposes behind drawing up a document, such as:
(a) using it to help in the conduct of contemplated litigation; and
(b) using it to identify the cause of (say) an accident to assist in accident prevention
Waugh v BRB  AC 521
In these circumstances the document is only privileged if the dominant purpose of the person who commissioned the document is to use it in contemplated or pending litigation.
“Dominant purpose” means that the document is only protected if there was a “clear paramountcy” in the intention to seek legal advice as opposed to any other reasons for drawing up the document
Without prejudice privilege applies to genuine attempts to negotiate a settlement of a dispute where the parties contemplate, or might reasonably have contemplated, litigation if they cannot agree (Framlington Group Ltd v Barnetson  IRLR 598, CA).
Rush and Tompkins
Rush & Tompkins v Greater London Council  AC 1280
The policy is to encourage parties to settle their differences rather than resorting to litigation, and so the privilege prevents either side from making use of admissions etc made in the course of negotiations without both sides’ consent.
• Once a document is privileged, it is always privileged (subject to both sides’ consent)
• Use of the words “Without Prejudice” is a helpful indicator
• Omitting the words is not fatal (Chocoladefabiken v Nestle  RPC 287)
• Simply asserting a party’s rights does not amount to “negotiating” for the purposes of without prejudice (Buckinghamshire County Council v Moran  Ch 623)
• If the parties settle the claim, without prejudice correspondence can be used to prove they settled if one party then disputes the settlement (Walker v Wilsher (1889) 23 QBD 335)
• Without prejudice communications can be used to interpret the terms of a negotiated settlement (Oceanbulk Shipping v TMT Asia Ltd  1 AC 662)
• The privilege does not apply if the rule is being unequivocally abused (Unilever v Proctor & Gamble  1 WLR 2436)
Confidential Documents WB 31.3.6 & 31.6.2
Confidentiality on its own is not enough to protect a document.
However, the court may protect the document where inspection is not necessary for disposing fairly of the proceedings.
Measures that can be taken include:
• redacting the document
• holding the hearing in private
QUESTION 4 Privilege
Courtney Powell has brought proceedings against Household Insurance plc (“HIP”) after HIP refused to pay a subsidence claim on Courtney’s home insurance policy. HIP allege that the subsidence was caused by the roots of two tall trees in Courtney’s garden, and say that Courtney should have arranged for them to be felled. Before proceedings were issued Courtney’s solicitors retained Sheila Goddard, a chartered surveyor, to advise on the cause of the subsidence. Sheila produced:
(1) a full report on her findings; and
(2) a scale plan of Courtney’s house, gardens and the positions of the two trees.
For each of the documents on pp 28 to 32 of the Workbook decide:
(1) Whether it is privileged;
(2) If so, on what basis;
(3) If not, why not.
Then determine into which section each document should be placed in the list of documents.
Waiver of privilege
o privilege is that of the client
o not the lawyers
• “Without prejudice”: joint privilege of both parties
Inadvertent, Ignorant and Risky Waiver
Brennan v Sunderland City Council  ICR 479
This is usually obvious. Often done by enclosing a copy of what would have been a privileged document to the other side, such as when exchanging witness statements.
Implied Waiver APA Civil para 31.65
Implied waiver of privilege in the papers in the solicitor’s file by the client suing their former solicitors for professional negligence
The public interest importance attached to legal advice privilege is such that something more than a reference to the effect of the advice is needed before any question of waiver can arise. The underlying principle is that of fairness. There will be a waiver only if it would be unfair to allow the party making the disclosure not to reveal the whole of the relevant information because it may lead to the court or other parties having only a partial, and potentially misleading, impression of the material.
Re D (a child)  4 All ER 434,
The mother of the child in interim care proceedings made two witness statements. In the first she said she had not seen the child's father injuring the child in any way. In the second she said it was the father who had injured the child. She explained the change of stance by referring in her second witness statement to various meetings with her solicitor and barrister, and setting out parts of what was discussed in those meetings.
Held: The mother had waived privilege in all the meetings with her solicitor and barrister over a 5-week period leading up to the second witness statement. The references to the meetings with her lawyers were more than 'glancing references', which would not have amounted to a waiver, but had gone further and disclosed the nature of the advice she had received.
Privilege was waived by the mother:
• despite the fact her witness statement was drafted by her solicitor; and
• despite the fact that neither she nor her solicitor realised that the material in her second witness statement amounted to a waiver of privilege.
Waiver by Disclosure in the Litigation
Mac Hotels Ltd v Rider Levett Bucknall UK Ltd  EWHC 767 (TCC)
Jackson v Marley Davenport Ltd 2004
Waiver of privilege through deployment of the privileged material in litigation has two elements:
(a) a clear reference to the existence of the privileged communications; and
(b) reliance on the privileged material for the purpose of making a particular point. If the reference to the privileged material is no more than mere narrative there is no waiver. If the content of the privileged material is used to support a point which the party deploying the material wishes to make, there will be a waiver of the privilege.
Jackson v Marley Davenport Ltd  1 WLR 2926
Disclosure of final version of an expert’s report does not amount to waiver of privilege over earlier drafts of the report
QUESTION 5 Waiver of Privilege
As seen in Question 4, Sheila, the chartered surveyor, produced both a report (WBK p 28) and a scale plan (not reproduced, but which shows the exact positions of all relevant features). In pre-action negotiations Courtney’s solicitors disclosed Sheila’s scale plan to HIP’s solicitors, but not Sheila’s report.
Advise Courtney on whether this affects the status of Sheila's report. See the White Book 31.3.12 and 31.3.27.
Disclosure of Part of a Document
• Disclosure of part of a single document waives privilege in the whole
• Unless the document is severable
• Are the report and the plan severable?
Waiver as a condition for use of Expert report
Great Atlantic Insurance Co v Home Insurance Co  2 All ER 485
Is the report “an entirely different subject-matter” from the plan?
Same principle applies where one of a number of related documents is disclosed.
Waiver as a Condition for use of Expert Report
Edwards-Tubb v JD Wetherspoon plc  1 WLR 1373
C obtained a report from Expert 1, using the pre-action protocol system of asking D if D objected to any of the experts on a list, then instructing Expert 1, who was not objected to by D. C received Expert 1’s report, and decided not to use Expert 1. C needed an expert, so having rejected Expert 1's report, instructed Expert 2 and later sought to rely on the report from Expert 2.
Where a party seeks to change experts, even where Expert 1 was only involved at the pre-action protocol stage, the court would usually order that permission to call Expert 2 would be conditional on disclosure of Expert 1’s report.
Norwich Pharmacal Orders
WB paras 31.18.2-31.18.8
A Norwich Pharmacal order is typically addressed to someone who is not going to be a party to subsequent proceedings, but which requires them to disclose information that will be helpful to C in bringing effective proceedings against the real defendants.
• These orders derive from the ancient equitable jurisdiction of the Court.
• They are therefore discretionary.
• Typically they are sought before the main proceedings are brought.
Flight Experience Ltd (“FEL”) runs a business hiring light aircraft from an aerodrome in Hampshire to amateur pilots. Last year an aircraft from FEL’s fleet repeatedly flew at hedge-top level over the farm owned by Georgina Barrett, causing her cattle to stampede which resulted in damage to fences and farm equipment, and injuries to a number of the animals (which had to be destroyed). Neither the police nor the Civil Aviation Authority is prepared to take action against the culprit and so far all attempts by Georgina to persuade FEL or the authorities to identify the pilot have failed.
Advise Georgina on how she can obtain the necessary information from FEL to commence proceedings against the pilot.
Norwich Pharmacal Order
To discover the name of the defendant
Norwich Pharmacal v Customs & Excise  AC 133
Or to find information relevant to proceedings
R (Mohamed) v Secretary of State for Foreign and Commonwealth Affairs (No. 1)  1 WLR 2579 (unaffected by the appeal)
Information was alleged to be relevant to whether the applicant had been tortured by the security services
Principles: WB 31.8.4
Norwich Pharmacal orders are available if the following are satisfied:
(a) a wrong must have been carried out, or arguably carried out, by a wrongdoer
(b) there must be a need for an order. This is also known as having a "sufficient interest" or that it is "just and convenient" to make the order. Either that the order is required to enable proceedings to be brought, or that disclosure is required to discipline an employee, or to set the record straight
(c) the respondent is someone who became “mixed up” in the wrongdoing
(d) who has facilitated its commission
(e) who is able or likely to be able to provide the information
(f) the court has a discretion whether to make the order
British Steel v Granada Television
Re Norwich Pharmacal Order
British Steel v Granada Television  AC 1096
Lord Reid in Norwich Pharmacal talked about someone who “through no fault of his own” got mixed up in wrongdoing. In this case the alleged facilitator was also a tortfeasor. Just made it worse, and the order was made.
Ashworth Hospital v MGN Ltd  1 WLR 515, CA;  1 WLR 2033, HL
The newspaper was ordered to disclose the identity of the person supplying it with details from the health records of one of the Moors murderers, who was on hunger strike. Obviously, the employee who leaked the details was guilty of a gross breach of duty as an employee of the hospital.
• Not restricted to tort claims. Here it was breach of confidence / contract
• Interrelation with Contempt of Court Act, s. 10 (journalists’ sources)
“No court may require a person, nor is any person guilty of contempt of court for refusing to disclose, the source of information contained in a publication for which he is responsible, unless it be established to the satisfaction of the court that disclosure is necessary in the interests of justice or national security or for the prevention of disorder or crime.”
• Interrelation with ECHR art. 10 (freedom of expression)
• An intention to sack or discipline a “mole” is a "sufficient interest” (requirement (b) above)
Norwich Pharmacal orders are regarded as relief of last resort, so will not be made if the information is available through other means: WB 31.18.6.
Mere witness rule WB 31.18.7
Contrast a “mere witness” – no order will be made against such a person
Ricci v Chow  3 All ER 534
Claimant alleged the Seychellois National Movement’s journal defamed him. He could identify the secretary of the Movement, but none of those who published the journal.
Held. The secretary was under no Norwich Pharmacal duty as there was no facilitation.
Usually issue a (Part 8) claim form against the facilitator
And make interim application
Loose v Williamson  1 WLR 639: Can apply without notice if urgent
Usually payable by the claimant, but may be recovered against the wrongdoer in the main proceedings if foreseeable.
WB 31.16.3-31.16.5 (much of this is out-of-date due to Smith v SS Energy)
APA Civil paras 45.18-45.26 integrate the new principles and is a better source.
CPR, r. 31.16 gives effect to SCA 1981, s. 33(2) and CCA 1984, s. 52(2), and enables the court to make an order for disclosure before proceedings are started.
The right time to give disclosure is a combination of:
• Before starting proceedings as part of the relevant Pre-action Protocol. This usually involves limited numbers of documents, and is a matter of reasonable good practice. It is not backed by any court order having immediate effect. Non-compliance may be punished later if proceedings are in fact started
• During proceedings, in the form of standard disclosure or menu disclosure, usually through lists of documents.
Right time for disclosure
Given the above, most parties should wait for the normal times for disclosing documents. Making an application to force the other side to disclose documents before the claim form is issued will add to the costs of the litigation. Pre-action disclosure orders are therefore somewhat unusual.
Sometimes there are good reasons for having fairly full disclosure before proceedings start. Typically this will be in cases where the important documents are in the possession of the proposed Defendant, and having access to those documents is regarded as important for:
(a) Deciding whether to sue at all
(b) Being able to plead a sensible case in the Particulars of Claim
Typical cases covered
The most common type of case where these orders are used is in clinical disputes (medical negligence). Often the proposed Claimant needs full disclosure of his or her medical records so that an expert can consider the hospital records etc and advise whether there is an arguable case against the hospital. Also, without the medical notes it is almost impossible to plead a coherent and sustainable case against the hospital. Even in clinical disputes, pre-action disclosure ought to be unnecessary. GPs and hospitals are under a duty to disclose to a patient their on medical notes under the Access to Health Records Act, as well as under the Clinical Disputes pre-action protocol. Unfortunately, there are occasions where hospitals etc for one reason or another fail to comply, and the orders discussed here can be used to force them to disclose.
There is no restriction on the categories of case where pre-action disclosure orders may be sought. They are increasingly used in technical commercial litigation.
Advise Lucy, who is a shareholder in Grantham Turbines Limited ("GTL"). When GTL was about to be incorporated Lucy, Margaret, Neville and Oliver, who were to become the original shareholders of GTL, entered into a Shareholders' Agreement under which the shareholders were to have pre-emption rights in the event of any shareholder seeking to sell their shares. Pre-emption rights entitle the other shareholders to buy any shares that are about to be sold, usually for the purpose of preventing new people buying themselves into the company against the wishes of the other shareholders.
Lucy has heard that Neville may have entered into a contract to sell his shares to Thelma. Neville has not offered the shares to the existing shareholders under the pre-emption clause. In pre-action correspondence Neville has said that all that he is transferring is the beneficial interest in his shares, so the pre-emption clause is not engaged. Lucy is unconvinced that Neville is only transferring the beneficial interest, and also takes the view, that even if that is the case, a transfer of the beneficial interest engages the pre-emption clause in any event.
Before commencing proceedings against Neville, Lucy would like to be sure of what has happened, and would like copies of all the documents relating to Neville's arrangement with Thelma over the shares. Neville has refused a request for these documents.
Two-stage test WB 31.16.4 first para
Smith v SS Energy & Climate Change  1 WLR 2283
(1) Court considers whether the jurisdictional conditions are satisfied.
(2) If they are, the court exercises its discretion whether to make the order
Conditions (CPR, r. 31.16(3)):
Applicant likely to be a party to future proceedings
Respondent likely to be a party
SCA 1981 s 33(2)?
If proceedings were started, the documents sought would be within the respondent’s standard disclosure obligations
Advance disclosure desirable for either:
- disposing of the claim fairly
- assisting to resolve the dispute without proceedings
- saving costs
SCA 1981, s. 33(2) also says it is necessary that the documents:
are likely to be or to have been in the other side's possession, custody or power; and
are relevant to an issue in the claim
Black v Sumitomo Corp  1 WLR 1569
• “Likely” means “may well” (but probably no longer relevant)
Merits of the proposed claim
None of the jurisdictional conditions impose a merits test. This is irrelevant at stage 1.
Discretion (stage 2)
• degree to which the documents sought are likely to support the proposed claim
• whether the documents are "train of inquiry" documents
• merits may be taken into account at the second stage. The question is whether the applicant has shown some reason to believe they have suffered some compensatable injury
Also, WB para 31.16.4:
• the nature of the injury or loss complained of
• the clarity and identification of the issues raised by the applicant
• the nature of the documents requested
• the relevance of pre-action protocol inquiries
• applicant's opportunity to make his case without pre-action disclosure
Issue (pre-action) application notice
Written evidence in support (witness statement)
On notice to the proposed defendant (3 clear days)
Disclosure against Non-parties WB 31.17.1-31.17.4
Documents in the possession of a non-party
The general position is that if relevant documents are in the possession of a non-party, either you:
• ask them nicely to provide the documents for use in the litigation; or
• require them to produce them at trial under a witness summons
Waiting until trial can be inconvenient. You can force the non-party to provide documents between starting proceedings and the trial under CPR, r. 31.17.
Disclosure against non parties
Two-stage test WB 184.108.40.206
(1) Court considers whether the jurisdictional conditions are satisfied.
(2) If they are, the court exercises its discretion whether to make the order
Conditions for non-party disclosure under CPR r. 31.17 / SCA 1981 s. 34:
Conditions for non-party disclosure under CPR r. 31.17 / SCA 1981 s. 34:
Likely that documents are in the respondent’s possession, custody or power
Re Howglen Ltd  1 All ER 376 decided that
• The documents sought must be specifically identified
• The documents must exist
• If either condition is not satisfied, the application will be refused
Documents must be likely to support applicant / adversely affect another party
i.e. must be relevant
Clark v Ardington Electrical Services (2001) LTL 4/4/2001
• Check relevance against the statements of case
Disclosure must be necessary to dispose of claim fairly or to save costs
Three Rivers DC v Bank of England (No 4)  1 WLR 210
“Likely” means “may well”
Discretion WB 31.17.4
• whether the documents are available from another source
• whether non-party disclosure will add to the costs
Main proceedings must have been issued
Application notice (N244)
On notice (3 clear days)
Costs of applications under SCA 1981 ss. 33, 34
This applies to applications for:
(a) Pre-action disclosure under SCA 1981 s. 33 or CCA 1984, s. 52; and
(b) Non-party disclosure under SCA 1981 s. 34 or CCA 1984, s. 53.
Costs are normally paid by the applicant.