Pre-action disclosure: what is it and can you get it from an overseas party?

A recent case, Ebert v Ferrari, reminds us of the utility of pre-action disclosure but also the difficulties obtaining it from an overseas party.

A party contemplating English litigation may need to see documents held by the potential defendant before it can formulate its claim.

This is most likely to be the case where there is an asymmetry of information between the potential claimant and the potential defendant – for example, a customer wishing to bring a claim against its bank, in circumstances where the bank holds all the relevant documents.

There are various routes in England and Wales by which the documents can be obtained from a potential defendant before litigation is started:

• As a starting point, the English court rules strongly encourage parties to exchange key information and documents between themselves on a voluntary basis before proceedings begin.  However, there is no way to enforce those rules in advance of proceedings being commenced, and a party may choose not to comply with them.
• Relevant documents can also sometimes be obtained by making a request for them under data protection legislation, although the data protection regime is not designed to be used in this way and can therefore be an ineffective route to obtaining what is needed.  
• That leaves the route that is the subject of this article: making an application to the English courts for an order for pre-action disclosure - i.e., for disclosure of documents by one party to another before any proceedings are on foot.

What is the legal test?

The bar for obtaining an order for pre-action disclosure is high. The applicant must show that:

• they and the potential defendant are likely to be parties to subsequent proceedings;
• if those proceedings were to reach the disclosure stage, the disclosure the court would order would include the documents sought at the pre-action stage; and
• the pre-action disclosure is desirable to:

• • dispose fairly of the anticipated proceedings;
  • assist the dispute to be resolved without proceedings; or
  • save costs.

Even if all these elements are present, the court retains a discretion to decline/ grant the pre-action disclosure. When exercising that discretion, the court will take into account a wide range of factors, including whether the documents sought can be obtained by another route, whether the applicant can formulate its claim without them, the strength of that claim, and whether the disclosure requests made are focused and proportionate or whether they instead represent a “fishing expedition”.

In short, to obtain pre-action disclosure, an applicant will need to show that there is a positive, practical litigation benefit in obtaining documents now rather than later.  Perhaps it will be able to set out its case more clearly if it has advance sight of the documents, lessening the need to amend its pleadings down the track. Or perhaps seeing the documents will enable productive settlement discussions to take place earlier than would otherwise be the case. The applicant will also have to ensure that its requests for documents are appropriately focused, as the courts will reject vague or overly broad requests that give the impression of a fishing expedition.

What are the cost implications?

The general rule is that the party seeking the order for pre-action disclosure must pay both its own and the other party’s costs of the application. It must also pay the other party’s costs of complying with the order.  Applying for pre-action disclosure can therefore potentially be pricey for the applicant.

What if the potential defendant is outside England and Wales?

In most circumstances, it will not be possible to obtain an order for pre-action disclosure against a potential defendant located outside England and Wales.  A recent case, Ebert v Ferrari, confirms that such an order can only be obtained if there is evidence that the overseas party holds documents within England and Wales.  

Ebert makes clear that, if a party is located outside England and Wales, and there is no evidence that it holds documents within England and Wales, then it will be inappropriate for the English courts to order that party to give pre-action disclosure.  Doing so would trespass on the right of the party’s local court to determine whether the party should provide the documents for the purposes of the anticipated English litigation.

Instead, the correct route for obtaining the documents will be to ask the English courts to send a letter of request to the local court, asking that court to exercise its own powers to obtain the documents from the party and to transmit them to the English courts.  This process will be the subject of a further blog in due course.

If you would like to further discuss the utility of pre-action disclosure and how to request it from an overseas party when litigating in English courts, do not hesitate to get in touch with our team. 

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