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High Court issues reminder to parties to co-operate over document disclosure

The High Court has ordered a company to manually review a substantial number of documents, after a dispute arose over its disclosure process ahead of litigation.15 Feb 2018

The court heard how Triumph, an aerospace business, had made a "unilateral decision" to depart from the disclosure process previously agreed with Primus International, who it is suing for breaches of warranty following Triumph's acquisition of the business. Given its decision, for which Triumph was unable to provide sufficient justification, the court ordered the parties to agree a methodology by which a sample of the disputed document set would be manually searched.

Commercial litigation expert Andrew Herring of Pinsent Masons, the law firm behind, said that the case was "a useful reminder of the obligations to act co-operatively when completing disclosure".

"If you explain your proposed method of the search for potentially relevant documents in your electronic documents questionnaire, you cannot then unilaterally depart from this method at a later date without running a significant risk of being challenged by the other side," he said. "In the event of such a challenge, you must be able to provide detailed explanations for the change of approach."

"What is required is a transparent and independently verifiable process. Therefore, keeping a contemporaneous audit trail of how disclosure was conducted is important to deal with any challenges by the other side. The consequence of the court finding that the disclosure process is 'inadequate' is potentially being ordered to do it again," he said.

A document search based on keywords agreed between Triumph and Primus had turned up around 450,000 documents. An electronic documents questionnaire (EDQ) provided by Triumph indicated that all of the documents responsive to the keyword searches would be "manually reviewed", and made no reference to computer assisted review (CAR).

During disclosure, it became apparent that after reviewing around 230,000 of the 450,000 documents, Triumph decided not to search the balance of 220,000 documents which had been deemed less of a priority following CAR. Instead, Triumph said that it had sampled 1% of those documents using a CAR technique which revealed that only 0.38% of the remaining documents would be relevant. It therefore concluded that further searches would be disproportionate.

Court rules do not require 'perfect' disclosure of every relevant document. They do, however, emphasise the need for discussion and agreement between the parties at the outset. The use of CAR, as set out by Master Matthews in a 2016 case, is welcomed where this is reasonable and proportionate, particularly where the manual searching of huge numbers of electronic documents would be a lengthy and expensive process.

While ruling that it was "sensible and proportionate" for Triumph to take certain steps to reduce the amount of data collected without necessarily agreeing these with Primus in advance, Mr Justice Coulson ruled that the same could not be said of the company's approach to the outstanding 220,000 documents. Triumph's actions were "not what they said they would do in the EDQ". The company was unable to provide sufficient detail of how the CAR was set up or operated, and there was no explanation of precisely how the sampling exercise which produced the 0.38% predictive figure was carried out.

"There is always a risk, as [previous case law] makes plain, that a unilateral decision will be carefully scrutinised by the court at a later date, and a different course may be ordered," the judge said. "That will be more likely if the evidence as to what was done remains vague."

The judge also had concerns about the "sheer volume" of people involved in the CAR process. It was "not apparent that there was any overseeing senior lawyer, and certainly not one undertaking [a leading role]", he said.

"In all those circumstances, therefore, I agree that both the CAR exercise, and the sampling exercise that it produced, cannot be described as transparent, and cannot be said to be independently verifiable," he said.

Taking into account the low percentage arrived at by the sampling exercise, which could not be said to be "reliable", the judge ruled it was "reasonable and proportionate" to order "some form of manual search".

Corporate litigation expert Andrew Herring said that the judge's comments about the number of people involved in the CAR process were also relevant to his decision.

"If you are using CAR software, such a predictive coding, a single senior lawyer must educate the software," he said. "Using a junior lawyer or a team of junior lawyers comes at serious risk of being challenged."