Landis + Gyr Ltd. v Scaleo Chip ET

Pre-action disclosure may be ordered where the parties are likely to be parties to subsequent proceedings, the documents would fall within standard disclosure, and early disclosure has a real prospect of fairly disposing of the proceedings, assisting settlement or saving costs. The jurisdictional threshold is distinct from the court’s broad discretion. The court should assess the application in a practical, broad way and should avoid deciding complex and debatable issues concerning the merits, forum or possible stays unless the claim is plainly hopeless or non-justiciable. Disclosure may be desirable even where a claimant could plead an arguable case, particularly where the documents are central to identifying and quantifying the claim.

Landis + Gyr Limited sought pre-action disclosure from Scaleo Chip ET under CPR 31.16 in contemplation of a contractual claim for a share of cost savings or damages for failure to procure them. The parties were already litigating in France under the same contract. Scaleo argued that any English proceedings would be stayed or declined under Article 22 of the Amended Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters 1968, and that Landis + Gyr had sufficient material to issue proceedings without disclosure.

The central issues were whether the requirements of CPR 31.16 were met and whether disclosure was desirable in the circumstances.

1. Jurisdiction. The requirements that both parties were likely to be parties to subsequent proceedings were satisfied. The documents appeared likely to fall within standard disclosure if proceedings were issued.
2. The court adopted the two-stage approach explained by Rix LJ in Black v Sumitomo [2003] 3 AER 643. First, there had to be a real prospect that early disclosure would fairly dispose of the anticipated proceedings, assist resolution without proceedings or save costs. If that threshold was met, the court had to exercise its broad discretion on all the facts.
3. The French and proposed English proceedings were not necessarily related for Article 22 purposes merely because they involved the same parties and contract. The French claim concerned an additional price for goods supplied. The proposed English claim concerned cost savings. Since the cost-savings issue had not been raised as a set-off or cross-claim in France, the risk of irreconcilable judgments was insufficiently established. The Article 22 arguments were complex and debatable and were not a material reason to refuse disclosure.
4. Following Total v Edmonds [2007] EWCA Civ 50, the court should take a broad, practical view of a CPR 31.16 application. It should not investigate complex and debatable defences, questions of forum or possible stays unless the claim was plainly hopeless or non-justiciable.
5. There was a real prospect that early disclosure would save costs and assist settlement. The documents were wholly within Scaleo’s control and central to establishing whether cost savings existed and their amount. The fact that Landis + Gyr could plead an arguable claim without disclosure was not decisive; disclosure would enable a focused and meaningful pleading.
6. The application was therefore granted. The court would hear further submissions on particular documents or classes of documents, including relevance and proportionality.

First-instance application for pre-action disclosure. No appellate history was stated in the judgment.