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The Disclosure Pilot Scheme and the uptake of Disclosure Guidance Hearings

Posted on 02 August 2019

The exchange of documents relevant to a dispute by the parties to it, known as disclosure, is a cornerstone of litigation in England and in many other (often common law) jurisdictions around the world.

However, in the modern, digital, world, the quantity of documents and data produced by companies and individuals alike has grown, and will continue to grow, at a phenomenal pace. As a result, one of the biggest challenges facing those involved in dispute resolution is balancing the need for parties to locate and disclose relevant documents with the cost and effort of doing so. What is a reasonable search? Over which devices? And what costs for such searches are proportionate to the issues at hand?

On one hand, litigating parties' ability to test each other's positions through disclosure is central to the just resolution of disputes. On the other, the sheer number of documents produced on a daily basis means that even very low value claims can potentially require millions of documents to be collected, collated and reviewed in order for disclosure to be given, at great (and often disproportionate) expense to the parties. This is particularly the case where parties, under the guise of complying with their disclosure obligations, "dump" huge volumes of documents on their opponents in a bid to overwhelm them.

In an effort to rebalance the scales, the English Business & Property Courts are currently trialling a new approach to disclosure, known as the "Disclosure Pilot Scheme", or "DPS". The hope is that the proposed changes in the Pilot Scheme will remedy some of the concerns around modern disclosure, and in doing so enable the English courts to maintain their global reputation as a leading and innovative, high quality forum for the resolution of legal disputes.

A particularly interesting aspect of the DPS is the introduction of Disclosure Guidance Hearings. Although called "hearings", the Practice Direction to the DPS makes clear that they are intended to be a "a discussion with the Court" in circumstances where "the parties have made real efforts to resolve disputes between them" but nevertheless require "guidance from the court" in order to "hold an effective case management conference… or… carry out the court's case management directions effectively".

The Practice Direction further indicates that these hearings should take no more than 30 minutes, and, perhaps more interestingly, states that "the court will generally expect a legal representative with direct responsibility for the conduct of disclosure to be the person who participates on behalf of each party". This clearly indicates the intention that these "hearings" should be informal and practically focused, especially as (in most cases) it will be the parties' solicitors, not counsel, who are responsible for their disclosure, and therefore will be expected to participate in the hearing.

Disclosure Guidance Hearings therefore represent a novel and interesting development in English litigation and the approach to disclosure, providing as they do the opportunity to get input from a Judge on the potentially key issue of disclosure in a (relatively) informal setting, without the costs and delay of instructing counsel. However, despite this, in the first six months of the Disclosure Pilot Scheme there seems to have been relatively little uptake of the opportunities provided by Disclosure Guidance Hearings. This was emphasised in the recent case of Vannin Capital PCC v RBOS Shareholders Action Group Ltd and others [2019] EWHC 1617 (Ch), in which the Judge criticised the parties for the fact that "there [had] been no attempt by either party in this case to seek guidance from the court in accordance with the [Disclosure Guidance Hearing] procedure… in advance of making formal applications to the court."

The Judge went on to comment that "Lengthy skeleton arguments have been filed on both sides in respect of these applications and detailed submissions have been made which took more than half a day of court time. This approach seems to me to be both undesirable and contrary to the spirit of the Disclosure Pilot which requires the parties to cooperate so as to promote the reliable, efficient and cost-effective conduct of disclosure… Had such guidance been sought and obtained, some of the issues arising on this hearing might well have fallen away, thereby saving time and costs."

It remains to be seen whether Disclosure Guidance Hearings will become more widely used during the remaining eighteen months of the Disclosure Pilot Scheme - or beyond, given that the regime is likely to be extended when the Pilot ends. However, it is clear that the Courts are keen for parties to embrace this new approach, and adopt a more informal, less adversarial, approach to resolving issues around disclosure. This appears to represent a significant departure from the existing approach to litigation. However, parties that embrace it, and Disclosure Guidance Hearings in particular, may find that there are significant opportunities to be found. It may also be that in the future the Courts will look to impose costs consequences on parties that do not seek guidance from the Court before launching applications. It will be interesting to see how this develops over the coming months.

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