Disclosure of documents: What does the law say?

Disclosure of documents
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At the beginning of a construction dispute, parties often have difficulties getting hold of the documents needed to formulate or defend the claim. The recent UK decision in Balfour Beatty v Broadway Malyan demonstrates the problems with using court procedures to try to obtain such documents. By Theresa Mohammed and Emma Thompson.

Construction disputes often commence with a request for disclosure of a raft of project documents by the prospective claimant, sometimes even before details of the claim have been provided. More often than not, the claimants invoke the contractual provisions with threats to resort to provisions of the Civil Procedure Rules (CPR) relating to pre-action disclosure if the contract is not complied with.  

The nature of construction projects and claims is no doubt one of the key reasons why construction parties in particular seem to lack the documents which would support their position. Projects last for years and defects often do not manifest themselves until some years after the works have finished.

Documents may not be centrally stored or organised to allow prompt retrieval. Even fundamental documents can be lost and despite parties having obligations to prepare and provide documents, sometimes they are reluctant to provide these, particularly when a dispute is on the horizon.

When a dispute arises and parties seek legal advice, the first questions are always requests for contemporaneous documents which may be in the possession of other parties or consultants. Consolidation of firms and novation or assignment of contracts can also lead to less than ideal documentation retention and storage. 

If asking the other parties and invoking the contract is unsuccessful, the claimant may then approach the court requesting pre-action disclosure. Such applications have a number of significant hurdles to overcome and many fail. The reasons include:

  • the request was too wide and more akin to a ‘fishing expedition’;
  • the request was made too early – before the pre-action protocol procedure had been followed;
  • the request may impede or frustrate a contractually agreed expert determination mechanism;
  • the court had no jurisdiction because the claim was governed by an arbitration agreement; and
  • the request was unlikely to assist resolution of the dispute or save costs.

 All of the above reflect the court’s desire to avoid disproportionate disclosure requests and to uphold the parties’ contractual bargains. They also reflect the problems that particularly befall construction disputes, namely a significant lack of the basic documentation needed to formulate a complex claim.

Obtaining documentation

The Balfour Beatty v Broadway Malyan case (see box) is another in a long line of construction disputes seeking to get hold of documents to help with preparing the claim. The reported cases have illustrated on many occasions that the pre-action disclosure and early specific disclosure provisions are not appropriate for this scenario.

“Consolidation of construction firms and novation or assignment of contracts can lead to less than ideal documentation retention and storage.”

The reasons why such documentation is not available may relate to the length of the project and the time that has passed since completion, but there may also be questions to be asked about how the contractual obligations to prepare and provide documents are working in practice. Is the problem caused by parties not complying with these obligations or the other party not enforcing its obligations to receive documents because it is busy with other issues on the project?

The issue may be more fundamental. Are the contractual provisions fit for purpose? Do they need to be redrafted to ensure that parties get what they need? Not only will it benefit a developer or owner trying to put together a claim for defective workmanship, but likewise a contractor on the receiving end of such a claim. If the documents are available, it is likely to result in a significant saving in litigation costs, not to mention time.

Key disclosure considerations to bear in mind with PD 57AD

Since the introduction of the Technology and Construction Court’s (TCC’s) pilot scheme for disclosure, PD 51U, there has been a rollout of a later practice direction on disclosure, namely PD 57AD. There are several key considerations to bear in mind when contemplating the disclosure process as detailed in PD 57AD.

From the outset of a dispute, parties have an obligation to preserve documents in their control which may be relevant to any issues within the proceedings. Parties ought to bear in mind that their duty of disclosure is ongoing and will continue until a settlement is reached or a final judgement is entered by the courts.

Should a party be unable to produce a document, because it no longer exists or cannot be found, the disclosing party has a duty to ensure that the document and its whereabouts are particularised in sufficient detail. 

While the full obligations and procedural requirements of PD 57AD have not been explored in this article, parties to disputes should ensure they get up to speed with the new rules. Failure to comply with the disclosure duties could result in an order for extended disclosure, adverse costs or, in extreme cases, a finding of contempt of court. Familiarity with the rules will ultimately put parties in a good position to bring or defend a claim – as, after all, being prepared is better than cure. 

Theresa Mohammed is a partner and Emma Thompson an associate at Watson Farley & Williams.

Disclosure of documents: Balfour Beatty v Broadway Malyan

This recent case threw a spotlight on the complications of documentation disclosure in construction disputes as well as the new disclosure regime.

The recent decision in Balfour Beatty Regional Construction Limited (formerly Mansell Construction Services Limited) v Broadway Malyan Limited [2022] EWHC 2022 (TCC) has highlighted all these issues, as well as further complications presented by the new disclosure regime which has been introduced for the Business and Property Courts, which include the Technology and Construction Court (TCC).    

The dispute arose out of the construction of a complex known as the Hive, which was owned by Hive Bethnal Green Limited (HGBL). The developer was JG Colts, which entered into a JCT Design and Build Contract (2005 edition) with Mansell Construction Services. Broadway Malayan (BM) was appointed architect.

BM’s appointment was novated to Mansell, which was then acquired by Balfour Beatty (BB). HGBL issued but did not serve a claim form against BB. Those proceedings are currently stayed pending the pre-action protocol steps being taken.

BB wrote to BM, passing on some of the allegations from HBGL and asking for a significant amount of documentation in respect of BB including all work products such as drawings, designs, specifications, the original appointment, site inspection records, fire strategy report and final inspection letter to the developer/employer. BM did not provide the documentation and so BB applied to the court.  

BB’s application was based on almost everything that could be relied on:

  • Civil Procedure Rules (CPR) Part 31;
  • CPR PD 51U paragraph 31.12;
  • contractual obligations or proprietary rights to the documents;
  • relationship of principal and agent;
  • RIBA Professional Code of Conduct, Principle 2, paragraph 5.3; and
  • statutory remedy of delivery up in section 3 of the Torts (Interference with Goods) Act 1977.
The decision

The court declined to consider the contractual disclosure obligations on the basis that it would involve making a final determination as to the interpretation of the contract. That would be inappropriate where there was not even a pleaded case and at a time when summary judgement was not available.

It also rejected CPR Part 31 as a basis because the claim fell under the new disclosure regime in PD 51U. The application failed under the provisions in PD 51U because it disapplied the provision in CPR 31.12 for specific disclosure and the sole basis of the court’s power to grant early specific disclosure was the general 
case management powers in CPR 3.1(2)(m). 

The court refused to exercise its discretion to order early specific disclosure. Almost every party could make a case for early disclosure that something significant and important would be achieved to promote settlement. That would run contrary to the intentions of the disclosure regime and so there must be something outside the usual run for early disclosure to be ordered.

Further, the Pre-Action Protocol is designed to help the parties understand the issues between them before proceedings are commenced, so it would rarely make sense for pre-action disclosure to be ordered before that pre-action process had been embarked upon.

The requests were said to be focused but, in reality, they potentially encompassed a wide range of documents. BB had overstated the difficulties of identifying the issues without disclosure and those difficulties were not unusual in cases where claims are brought years after completion of the works. BB was seeking to shift the burden of finding relevant documentation onto BM, the prospective defendant, with only the most general idea of what to search for. That also ran contrary to the PD 51U disclosure scheme.

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