Disclosure and Inspection — SQE1 FLK1 Dispute Resolution

Your client runs a building company, defending a £90,000 claim over a refurbishment that went wrong. He hands you the file, then says this. The email where our foreman admits we skipped the damp-proofing, that one stays out. I am not signing anything that includes it. Your pleaded defence says the work was done properly. Does the email go in the list of documents? It does.

It goes in precisely because it hurts you. That is the whole idea. And if he will not have it, you advise him hard, and then you stop acting. This is Disclosure and Inspection, where a solicitor's duty to the court meets a client who does not want to hear it. Keep our builder in mind. We are coming back for him.

Here is the route. What standard disclosure covers, and the limb that catches people. Then how far you must search, and what counts as being in your control. Then the disclosure statement, and the duty that never switches off. Then the orders you can ask for, before proceedings and against strangers. Then privilege, the big scoring area. And last, inspection, waiver, and the different regime in the Business and Property Courts.

Start with what disclosure is for. Each side shows the other the documents it holds about the case. Trials are not meant to be won by surprise. Both sides see the evidence early, which sharpens settlement. Get it wrong and the case can collapse.

Standard disclosure has four limbs, and you should be able to say them cold. CPR 31.6. The documents on which you rely. The documents which adversely affect your own case. The documents which adversely affect another party's case. And the documents which support another party's case.

Limb one is easy. The contract you say was breached, the photographs of the damage, the repair invoice. You want those in, because you want to use them at trial. Hold them back and the rule bites anyway: under CPR 31.21 you may not rely at trial on a document you failed to disclose, unless the court gives permission.

Limb two is where people stumble, and it is our builder's email. The document that hurts you. The email admitting fault, the note showing your client was wrong. You must disclose it. That duty is owed to the court, and a client cannot instruct it away.

And the definition of a document is wide. Anything in which information of any description is recorded. Photographs, invoices, text messages, voicemails, metadata. Even a copy can count separately: a director who scribbles on his photocopy, telling colleagues not to mention the service history, has made that copy disclosable in its own right.

How far must you look? Only so far as is reasonable. CPR 31.7. Four factors decide it. The number of documents involved. The nature and complexity of the proceedings. The ease and expense of retrieving any particular document. And the significance of any document likely to be found.

So take a £60,000 contract claim where the defendant holds two archive warehouses and around 500,000 electronic documents, and restoring the warehouses would cost more than the claim is worth. Must it search everything? No. But there is a price for limiting the search. If you do not search a category because it would be unreasonable, you must say so in the disclosure statement, and identify the category you left out.

Disclosure reaches documents which are or have been in your control, and control has three limbs. The document is or was in your physical possession. Or you have or had a right to possession of it. Or you have or had a right to inspect it or take copies. That third limb catches more than people expect.

A man deposits a painting with an auction house, on terms letting him inspect and copy the auction house file whenever he likes. That file is in his control, and he must disclose it, though it sits in someone else's store.

The list goes out with a disclosure statement. Under CPR 31.10 it must certify that the party understands the duty and has carried it out, and set out the extent of the search. Certifying alone is not enough. Where did you look, and what did you leave out.

And the duty does not stop when lists are exchanged. Under CPR 31.11 it continues until the proceedings are concluded, and if a document comes to your notice at any time you must notify every other party immediately. A tenant who finds a rent book in a cupboard three months after disclosure discloses it at once. No permission needed.

Suppose the other side's list looks thin. Four thousand documents and not one internal email, in a case where the disclosed documents themselves refer to exchanges between the directors. Write first. If that fails, apply for specific disclosure under CPR 31.12. The court can order a party to disclose documents or classes of document, and to search to the extent the order specifies.

What the court will not do is fund a fishing expedition. Be specific, or be refused.

Sometimes you need documents before you can decide whether to sue at all. Parents wondering whether a birth injury claim exists cannot tell without the hospital's midwifery and monitoring records. CPR 31.16 lets a prospective claimant apply. Four conditions. The respondent is likely to be a party. The applicant is likely to be a party. Standard disclosure would have covered the documents. And disclosure now is desirable to dispose of the claim fairly, to resolve it without proceedings, or to save costs.

Note what likely means here. Not more probable than not. The courts have read it as may well, which is a lower bar than it sounds.

And when the documents sit with a stranger to the litigation, a bank, an employer, a regulator, CPR 31.17 lets the court order disclosure by a non-party. The test is tighter. The documents must be likely to support your case or adversely affect another party's, and disclosure must be necessary to dispose of the claim fairly or to save costs. The non-party gets notice, and as a rule you pay its costs.

Before any of that, there is preservation. Once litigation is reasonably contemplated you must stop destroying things. A software company facing a £500,000 letter before claim, whose policy deletes email automatically after six months and overwrites backup tapes every 90 days, must suspend that policy now. Not when a claim form arrives. Now.

Now privilege, which is where the marks are. Privilege is a right to withhold a document from inspection even though it is relevant. It is not confidentiality. Board minutes are confidential and disclosable. A letter of advice from your solicitor is privileged.

Legal advice privilege first. It protects confidential communications between lawyer and client for the purpose of giving or obtaining legal advice, and it covers an in-house lawyer exactly as it covers a firm. But for a company, who is the client?

Not everyone who works there. Take Three Rivers v Bank of England, number five. The Bank had given documents to an inquiry, and the question was whether legal advice privilege covered communications between the Bank's lawyers and its employees. The Court of Appeal held it did not. Privilege protects the lawyer and the client, and employees not authorised to instruct the lawyers are not the client. They are a source of information, like any other witness.

That is a trap with teeth. Hold on to it, because you are going to meet it again in a few minutes.

Litigation privilege is wider, and it is the one that reaches third parties. Confidential communications between lawyer or client and a third party, made for the dominant purpose of litigation which is pending, existing or reasonably contemplated. So a solicitor instructing a consultant surgeon, where the trust has refused to accept fault and a claim looks inevitable, is protected. Every draft of that report, and the correspondence about it.

Two phrases carry the weight. Dominant purpose. And reasonably contemplated, which does not require a claim form to have been issued.

Then without prejudice. A communication which is a genuine attempt to settle a dispute cannot be put before the court on the merits. The heading helps, but it is the content that decides. And the protection belongs to both parties jointly, so one of them cannot give it up alone.

Add four words and everything changes. Without prejudice save as to costs. The offer stays hidden while liability and quantum are fought, and comes out once judgment has been given, when costs are argued. Offer to settle at £25,000, get refused, win £32,000 at trial, and that letter is powerful material for saying the trial should never have happened.

And the rule is not a licence. It does not cover unambiguous impropriety. Sit in a settlement meeting and threaten to report the other side to HMRC unless they pay you off, and the judge will hear about it. Blackmail is the paradigm case.

Last of the four, common interest privilege. Two defendants facing the same allegations, separately represented, can share counsel's advice and draft defences in confidence without waiving privilege against the claimant. No written agreement is needed.

Waiver. Privilege can be given up, and once given up it cannot be recalled. The rule that catches people is that you cannot waive selectively. Deploy one helpful email from your solicitor about the meaning of a disputed clause, and the three unhelpful emails on the same clause go with it. Waiver runs to the issue, not to the document you chose.

Inspection next, and here is a number worth having. Disclosure and inspection are different stages. You list the documents. The other side then gives written notice of a wish to inspect, and you must permit inspection not more than seven days after you receive that notice. Notice received on 4 June means inspection by 11 June.

Two things you may hold back from inspection. If a category would be disproportionate to inspect, you still disclose it in the list. But you must state in the disclosure statement that inspection will not be permitted on that ground. And if you claim privilege, you must say so in writing in the list and give the grounds. The bare word privileged is not compliance.

Where the ground is not stated, the other side can apply for the court to decide whether the claim to withhold stands up. The court is the judge of privilege, not the party asserting it.

You may also redact. Parts of a document which are both irrelevant and confidential can be blanked out, provided the redactions are apparent and the basis explained. The board minute about the contract in dispute is inspected. The paragraphs about a possible acquisition are not.

And if privilege is handed over by mistake? Under CPR 31.20 the party who has inspected it may use it, or its contents, only with the permission of the court. Where the mistake would have been obvious to a reasonable solicitor, permission will almost never come. Stop reading, notify the sender, give it back. If the mistake was yours, move fast, because delay counts against you.

Finally, what you may do with what you receive. Under CPR 31.22 a disclosed document may be used only for the purposes of the proceedings in which it was disclosed. Not for a journalist. Not for your next claim against the parent company. The exceptions are narrow. The document was read to or by the court at a public hearing, or the court gives permission, or the disclosing party and the owner agree.

Breach of that restriction is a contempt of court.

One more, and it is the thing candidates miss. Everything so far is CPR Part 31, which runs in the County Court and the ordinary multi-track. In the Business and Property Courts it does not. There, Practice Direction 57AD governs, permanently since 1 October 2022.

The shape is different. Parties give Initial Disclosure of the key documents they rely on with their statements of case. Beyond that, nobody is entitled to anything as of right. The court may order Extended Disclosure, issue by issue, choosing from five models. Model A, known adverse documents only. Model B, limited. Model C, request-led. Model D, narrow search-based, the nearest thing to old standard disclosure. Model E, wide, and ordered only exceptionally.

The parties work up the Issues for Disclosure and their proposed models in a jointly completed Disclosure Review Document. And one duty runs underneath all five. Known adverse documents, the ones you actually know about without searching, must be disclosed whatever model is ordered. A finance director sitting on an email chain admitting his own company caused the losses does not get to keep it because Model A was ordered.

A word on how SQE1 tests this. You will not be asked to recite rule numbers, and you will meet almost no case names. You get a scenario and five answers. So learn what each rule does, not where it lives.

If you keep only three pegs, keep these. The adverse document limb, because no client instruction can override it. Dominant purpose, because that is what turns a communication with a third party into litigation privilege. And Three Rivers, where the client of a company is only those authorised to seek and receive the advice.

Four traps. One. Disclosure and inspection are not the same thing. A document can be disclosed and still withheld from inspection, on privilege or on proportionality. Conflate them and you will answer half the question.

Two. Confidentiality is not privilege. Board minutes, internal emails between executives, commercially sensitive accounts: all confidential, all disclosable. Privilege needs a lawyer and legal advice, or a dominant litigation purpose.

Three. Suppressing an adverse document does not merely lose you the point. The disclosure statement served with the list becomes false, the statement of case can be struck out, and contempt proceedings can follow.

Four. Do not reach for non-party disclosure when the document is already within your opponent's control. A right to inspect it or take copies is control, whoever is holding the file.

Quick check, and you were warned this one was coming back. A company's in-house lawyer is asked by the board whether the company may lawfully terminate a supply contract. No dispute has arisen and nothing has been threatened. The lawyer emails the operations director for the factual background, and he replies with it. Under the company's standing rules, only the board and the general counsel may instruct lawyers.

Is the director's reply protected by legal advice privilege? Three answers. One: yes, it is a confidential communication made so that legal advice could be given. Two: yes, the company is the client and the director was acting in its business. Three: no, the operations director is not the client for that privilege. Pause here if you want a moment.

The answer is three. Legal advice privilege protects communications between the lawyer and the client, and for a company the client is only those authorised to seek and receive the advice on its behalf. Here, the board and the general counsel. The operations director is a source of information, so his reply is disclosable. And litigation privilege cannot rescue it, because nothing was in prospect when he wrote.

Why the others fail. Option one names two things that are necessary but not sufficient. Confidence and a legal purpose are required, and so is the identity of the sender. Option two is right that the company is the client, and wrong about what that means: a corporate client acts through the people authorised to instruct.

Five things to take away. One: standard disclosure has four limbs, and the one that decides questions is the document which adversely affects your own case. Our builder's email goes in the list, and if he will not have it, you cease to act. Two: the search need only be reasonable, but a category you choose not to search must be named in the disclosure statement.

Three: control includes a right to inspect or copy, even where the file sits with someone else. Four: legal advice privilege needs the client, litigation privilege needs the dominant purpose, and without prejudice needs a genuine attempt to settle. Five: inspection follows within seven days of written notice, and a disclosed document may be used only in the proceedings in which it was disclosed. Next time, Trial Preparation.

Practise this topic with exam-style questions at sqe1prep.co.uk. This episode is for education and exam revision only, not legal advice, and we are not affiliated with or endorsed by the SRA or Kaplan.