The Importance Of Disclosure

Advice regarding Disclosure following Provimi France SAS v Stour Bay Co Ltd [2022] EWHC 218

The case of Provimi France SAS v Stour Bay Co Ltd [2022] EWHC 218 has recently been heard in the Commercial Court and has led to some points for clients and their solicitors to note regarding the rules around disclosure.

Disclosure is the stage of proceedings in which parties release all documents they hold in relation to the dispute to the other party for inspection.

The Court urged practitioners to fully explain disclosure duties, including that of document retention, to clients unfamiliar with English disclosure rules specifically. However, it also begs consideration of explaining disclosure to any client to avoid the loss of key documents.

The Facts

The case concerned the purchase of animal feed that was then said to be not fit for purpose. The claimants, who were based in France, sought damages for a breach of contract of sale.

The defendant complained that there was a substantial gap in the claimant’s disclosure. Documents that had been held on Outlook, which pre-dated 2016, had all been deleted in line with an applicable document retention policy of the claimant company. Due to this policy, the Claimants had deleted key evidence in relation to the purchase of the feed.

The Issues

Although litigation did not commence until October 2019, both parties were aware of the probability of proceedings as early 2015. It is from this point that, pursuant to the Civil Procedure Rules (“CPR”), both parties were required to preserve documents within their control.

Deletion had taken place notwithstanding the obligation under Practice Direction 51U para.3.1, which requires a party:

“who knows that it is or may become party to proceedings to take reasonable steps to preserve documents within its control, imposing an obligation on legal representatives to take reasonable steps to advise a party to comply with its Disclosure Duties.”

It seems that the failure to retain the documents arose from a misunderstanding on the part of the claimants’in house lawyer, and their subsequent failure to understand advice given by the claimant’s English law firm. The Claimant’s in house solicitor was “unfamiliar with the procedure in common law jurisdictions” (at [32]) and did not understand the type of documents that should be retained.

Implications for practice – what should be retained and when?

This case highlighted the importance of ensuring that the nature of disclosure obligations under the CPR are properly explained to parties who are unfamiliar with the approach to disclosure in England and Wales. The deputy judge stated that:

“[33] It may well be that an instruction simply to retain relevant documents, without explaining or ensuring that the client understands exactly what ‘relevant’ means, is not enough.”

The Commercial Court found that a solicitor must do more than give a simple instruction to their client to retain documents and must clearly explain which documents are relevant and how to ensure they are not deleted or destroyed.

In that case, here are some points that should be considered around the type of documents to be preserved:

• A “document” may take any form including but not limited to paper or electronic;
• it may be held by computer or on portable devices such as memory sticks or mobile phones or within databases;
• it includes e-mail and other electronic communications such as text messages, webmail, social media and voicemail, audio or visual recordings. (Practice Direction 51u, 2.5)
• the term “document” extends to information that is stored on servers and back-up systems and electronic information that has been ‘deleted’. (Practice Direction 51u, 2.6)
• It also extends to metadata, and other embedded data which is not typically visible on screen or a print out (Practice Direction 51u, 2.6)
• Disclosure extends to “adverse” documents – meaning a document that contradicts or materially damages the disclosing party’s version of events on an issue in dispute, or supports the contention or version of events of an opposing party on an issue in dispute. You cannot just disclose material that is beneficial to your case – you must disclose everything.

Knowing the type of “document” that should be preserved extends far beyond paper files or email chains, there are practical steps clients can take to ensure they are complying with their obligations contained in section 3.1. It is extremely important to be aware that this duty applies as soon as the party knows they may become party to proceedings. Therefore:

• As soon as you are aware of proceedings, there should be a general preservation policy of documents, as these will later be searched for disclosable items. To achieve this, a firm’s document retention policy may need to be suspended to ensure that relevant documents are not deleted or destroyed;
• Keep in mind what is meant by the term relevant and which documents may fall into that definition. As per the section above the definition is far reaching and applies to both supportive and damaging documents to your case.; and
• Lastly, ensure that this advice is acted upon as soon as litigation appears possible to ensure compliance with the duty under section 3.1.

Our Dispute Resolution experts will be able to help you with any concerns that you may have in regards to disclosure issues in court and will assist and guide you through the entire legal process. Call us for free today on 0808 291 2273 or get in touch online.