UK judge believes lawyers need more training on electronic disclosure
December 1, 2011 |
Out – Law.com reports a speech by Lord Justice Jackson where he said the costs implications of incorrect electronic disclosure or inappropriate disclosure orders were potentially “huge”. He was an author of a report on the cost of litigation.
“[Consultants] understand their own software systems, but it is the solicitors and counsel involved who best understand the case… Disclosure is not an activity which can be outsourced in its entirety to external consultants. No existing software programme is capable of achieving standard discovery,” he said.
Electronic disclosure, or e-disclosure, is the process of identifying, preserving, collecting, filtering, reviewing and disclosing electronically stored information. This can include information stored on personal computers, mobile phones and memory sticks; as well as email, documents and calendar files.
In the UK rules electronic disclosure in civil cases were introduced by practice direction to the Civil Procedure Rules (CPR) in October 2010. In any case where documents relevant to a case are stored electronically, the parties must consider and discuss how disclosure should be carried out at an early stage. All relevant documents must be preserved from the time when court action was first contemplated.
As part of his civil costs review, Jackson recommended that courts choose from a menu of possible disclosure options to be set out in the CPR for large commercial claims, or other cases in which the costs of disclosure were likely to be disproportionate. Personal injury and clinical negligence claims should however be excluded from this rule.
A new rule has now been agreed to implement this ‘menu option’, which will come into force at the same time as the other Costs Review reforms. However, the working party which drafted the rule decided against including a clause that would have required the solicitor or other person responsible for carrying out the disclosure process from being present at the first case management conference.
1. INTRODUCTION
1.1 The text of this lecture is being distributed at the start of this conference. The paragraphs of this lecture are numbered for ease of reference during any discussion which may follow my presentation.
1.2 Terms of reference. It will be recalled that my terms of reference for the Costs Review included a requirement to: “Establish the effect case management procedures have on costs and consider whether changes in process and/or procedure could bring about more proportionate costs.”
1.3 Role in implementation. I have subsequently been asked to take a proactive role2 in relation to the implementation of the Costs Review recommendations, following their endorsement by the Judicial Executive Board and their broad acceptance by the Government. This role includes (a) assisting with the drafting of rule amendments and (b) helping to explain the forthcoming reforms to court users.
1.4 Current reform programme. Some recommendations in the Civil Litigation Costs Review Final Report (“FR”) require primary legislation. The necessary Bill is now before Parliament. If approved by Parliament, it may come into force in October 2012 or perhaps somewhat later. Other recommendations in the FR require rule changes, rather than primary legislation. It is intended that these rule changes will come into force on the same date as the Act. The rule amendments are currently being drafted, then presented to the Rule Committee for approval and then held in escrow until the “big bang” date.
1.5 It is not possible to address the entire reform programme in a single lecture. I am therefore choosing specific topics to focus on in individual lectures. I have chosen disclosure as the subject for today’s lecture, because disclosure of documents is one of the drivers of high costs in construction litigation.
2. COSTS REVIEW RECOMMENDATIONS RE DISCLOSURE
2.1 Relevant chapters in Final Report. Disclosure of documents is dealt with in relation to large commercial actions in chapter 273 and more generally in chapter 37.
2.2 The problem. Even in medium sized actions where all the documents are in paper form, disclosure can be a major exercise which generates disproportionate costs. It can also result in a formidable bundle, most of which is never looked at during the trial. In larger actions where the relevant documents are electronic, the problem is multiplied many times over. That problem is accentuated because relatively few solicitors and even fewer barristers really understand how to undertake e-disclosure in an effective way.
2.3 Recommendations in the Final Report. Two recommendations are made at the end of chapter 37, which become recommendations 77 and 78 in the list at the end of the report:
“(i) E-disclosure as a topic should form a substantial part of (a) CPD for solicitors and barristers who will have to deal with e-disclosure in practice and (b) the training of judges who will have to deal with e-disclosure on the bench.
(ii) A new CPR rule 31.5A should be drafted to adopt the menu option in relation to (a) large commercial and similar claims and (b) any case where the costs of standard disclosure are likely to be disproportionate. Personal injury claims and clinical negligence claims should be excluded from the provisions of rule 31.5A.”
2.4 A first draft of the menu option rule was set out in FR chapter 37. This rule sets out a menu of possible disclosure orders from which the court should choose, without a specific steer towards standard disclosure.
2.5 E-disclosure practice direction. At the time of the Costs Review there was no practice direction governing the disclosure of electronic documents. However, such a practice direction was in draft and it was anticipated that it would be adopted by the Rule Committee after suitable amendment. Accordingly paragraph 2.5 of chapter 37 stated: “In my view, the substance of this practice direction is excellent and it makes appropriate provision for e-disclosure. On the assumption that this practice direction will be approved in substantially its present form by the Rule Committee, I do not make any recommendation for procedural reform in relation to e-disclosure.”
3. ELECTRONIC DISCLOSURE
3.1 Practice Direction 31B. After some amendments had been made by the Rule Committee, the proposed practice direction on electronic disclosure was duly introduced in October 2010. Practice Direction 31B (“PD31B”) is entitled “Disclosure of Electronic Documents”. It provides that in any case where relevant documentation is stored electronically, at an early stage the parties must consider and discuss how disclosure should be carried out. All relevant electronic documents should have been preserved from the time when litigation was first contemplated. The electronic documents questionnaire annexed to PD 31B is an extremely useful tool for a party investigating what electronic material it possesses. It is also an extremely convenient vehicle for exchanging information with other parties before the first case management conference.
3.2 Use of consultants. Many firms of consultants offer their services in this field. They understand their own software systems, but it is the solicitors and counsel involved who best understand the case. Close and continuing liaison between the legal team and any consultants employed is essential. Disclosure is not an activity which can be outsourced in its entirety to external consultants. No existing software programme is capable of achieving standard discovery.
3.3 It should be borne in mind that some custodians (senior employees, decision makers etc) are more important than others and their inboxes etc may require much closer scrutiny. The original file structure should be retained when electronic material is being investigated or collated.
3.4 E-disclosure training. Effective training in e-disclosure for judges, counsel and solicitors is essential if PD31B is going to be operated effectively. Such training can be delivered by practitioners who are IT literate and have detailed experience of dealing with e-disclosure successfully at the coalface. They can explain the pitfalls to avoid, the techniques for de-duplication, the new tools which are available etc etc. I attended such a lecture4 recently at a Continuing Professional Development (“CPD”) day for practitioners. This event illustrated the benefits of a training session dedicated to the nuts and bolts of searching and disclosing electronic material.
3.5 Commercial Court judges have already undertaken e-disclosure training. The Judicial College will provide training in e-disclosure for civil judges next year. I hope that providers of CPD will provide similar training for all solicitors and counsel who have to deal with e-disclosure issues at case management conferences. If electronic disclosure is tackled in the wrong way or if inappropriate orders are made by the court, huge sums of costs will be thrown away.
4. IMPLEMENTATION OF MENU OPTION
4.1 New Zealand. Interestingly New Zealand is ahead of us here. The New Zealand Rule Committee has recently adopted a variant of the menu option. New Zealand’s High Court Amendment Rules (No. 2) 2011 will come into force on 1st January 2012. These rules provide that in any substantial case the court will not automatically order standard discovery. Instead it will choose between a range of options, including no discovery, standard discovery and “tailored discovery”.
4.2 Rule amendments adopted in England and Wales. In 2010 the Rule Committee set up a sub-committee chaired by Mr Justice Coulson to prepare the necessary ruleamendments to implement the menu option. After considerable debate within both the sub-committee and the Rule Committee the following rule amendment has now been approved and is being held in escrow. Instead of adding a new rule 31.5A (as originally proposed in the FR), the existing rule 31.5 will be re-written.
4.3 New rule 31.5. With effect from the general implementation date, rule 31.5 will be amended to read as follows:
“31.5
(1) In all claims to which rule 31.5(2) does not apply:
(a) An order to give disclosure is an order to give standard disclosure unless the court directs otherwise.
(b) The court may dispense with or limit standard disclosure.
(c) The parties may agree in writing to dispense with or to limit standard disclosure.
(2) Unless the court otherwise orders, the rules at (3)-(6) below apply to all multi track claims, other than those which include a claim for personal injuries. (3)(a) Not less than 14 days before the first case management conference each party must file and serve a report verified by a statement of truth, which:
(i) describes briefly what documents exist or may exist that are or may be relevant to the matters in issue in the case;
(ii) describes where and with whom those documents are or may be located (and in the case of electronic documents how the same are stored; in cases where the Electronic Documents Questionnaire has been exchanged, the Questionnaire should be filed with the report);
(iii) estimates the broad range of costs that could be involved in giving standard disclosure in the case, including the costs of searching for and disclosing any electronically stored documents;
(iv) states which of the directions under (4) or (5) below are to be sought.
(b) Not less than 7 days before the first case management conference, and on any other occasion as the court may direct, the parties must, at a meeting or by telephone, discuss and seek to agree a proposal in relation to disclosure that meets the overriding objective.
(c) If –
(i) the parties agree proposals for the scope of disclosure; and
(ii) the court considers that the proposals are appropriate in all the circumstances; the court may approve them without a hearing and give directions in the terms proposed.
(4) At the first or any subsequent case management conference, the court shall decide, having regard to the overriding objective and the need to limit disclosure to that which is necessary to deal with the case justly, which of the following orders to make in relation to disclosure:
inappropriate costs orders may be made with drastic costs consequences for the client. I also express the hope that those who deliver professional training will draw attention to this duty.
4.6 Decision made at the first case management conference. The order made at the first CMC concerning disclosure will have a profound impact on the future course of the case and also upon the final costs of the litigation. Therefore this issue merits careful thought and analysis when the parties initially and the court ultimately are making their selection from the menu of possible disclosure orders.
4.7 One possible order under sub-para (f) – the key to the warehouse. One possible order which could be made under rule 31.5 (4) (f) is that each side (after removing privileged documents) should simply hand over the “key to the warehouse”. In other words, each party hands over all its documents and the other side can choose which ones it wishes to use. This means that each party devotes its resources to selecting what it regards as helpful from other side’s store of documents. That is the opposite of standard disclosure, which requires each party to examine its own documents and (in effect) to pick out the ones that it thinks will help the other side. I am aware of one recent case in which a “key to the warehouse” order was made by the Technology and Construction Court.
4.8 If an order is made as set out in the previous paragraph, it may be appropriate to include a provision along the following lines: “Any disclosure of privileged documents shall not amount to waiver of privilege in the documents concerned.”
5. COMBINING THE MENU OPTION WITH PRACTICE DIRECTION 31B
5.1 Big bang date. The new rule 31.5 will come into force at the same time as the other Costs Review reforms. As from that date the menu option will have to be operated in conjunction with PD 31B.
5.2 The two provisions will fit neatly together. Rule 31.5 (6) provides for the rule and the practice direction to be operated together. Paragraphs 8 to 18 of PD 31B complement rule 31.5 (3). The completion and exchange of e-disclosure questionnaires will assist the parties in complying with their obligations under rule
31.5 (3). The information resulting from this exercise will enable both the parties and the court to select from the menu the most appropriate disclosure order for the circumstances of the particular case.
5.3 The wider picture. The new disclosure rule is part of a package of case management reforms which will be coming into force on big bang date. Some of these reforms have been explained in earlier lectures in the present series. See in particular lecture 4 on expert evidence5 and lecture 5 on case management.6 All lectures in this series can be found on the Judiciary website. One theme which runs through the reforms is that the first case management conference should be a real event at which the court takes hold of the case and gives directions which will focus the factual evidence, the expert evidence and the disclosed documents on the real issues between the parties.
