AON Ltd. v JCT Reinsurance Brokers Ltd. & Ors

Pre-action or interlocutory disclosure may be ordered in an appropriate case, but it is an exceptional remedy. The court must exercise its discretion consistently with the overriding objective and require disclosure that is focused, necessary and proportionate.

A claimant is not entitled to use such an order to discover whether it has a case, or to obtain what is effectively standard disclosure before pleading. The normal accusatorial basis of civil litigation should not be replaced by an inquisitorial investigation merely because the claimant has established a good arguable case. The court must balance the risks of injustice, consider whether damages and existing injunctive relief are adequate, and assess the likely effect on costs and the protection of the claimant’s business.

The claimant alleged that the first and second defendants had procured the departure of 16 senior employees and had misused confidential information. Earlier without-notice relief had preserved evidence, restrained breaches of duty and protected confidential information. On the return-date proceedings, the claimant sought continuation of a wide disclosure order requiring the defendants to provide affidavits concerning recruitment, client solicitation and confidential information.

The defendants argued that the order was excessive, onerous and equivalent to standard disclosure in an unpleaded action. The central issue was whether the court should exercise its statutory and procedural powers to continue this exceptional form of disclosure pending trial.

1. The application was refused. The proposed disclosure order was discharged and was not continued to trial.
2. Section 37 of the Supreme Court Act 1981 conferred a broad power to grant interim injunctions where just and convenient. CPR 25(3) confirmed that the listed interim remedies were not exhaustive. CPR 31.16 and CPR 18 provided relevant procedural analogies, but any order had to remain focused, necessary and proportionate.
3. The court accepted that disclosure of this general type could be ordered in an appropriate case, but regarded it as exceptional rather than routine. The claimant already possessed sufficient witness evidence and documents to plead a case. It was therefore impermissible to require the defendants to investigate and reveal everything that might have been wrongful before the claimant had formulated its allegations.
4. The proposed order was excessively wide. It required extensive enquiries, affidavit verification and disclosure of all relevant documents, and effectively imposed standard disclosure in a case that had not yet been pleaded. That approach was inconsistent with the normal accusatorial basis of litigation and risked increasing, rather than saving, costs.
5. The court also considered the adequacy of damages, the commercial steps available to protect employees and clients, and the need to police the existing injunctions. Damages might be difficult to quantify but were not shown to be inadequate. Existing relief appeared sufficient, and further breaches were not a lively or likely risk.
6. The discretion was therefore not exercised in favour of continuation. The defendants’ remaining objections and the wording of other parts of the proposed order were left aside or treated as agreed.

First-instance decision. No appellate history is stated in the judgment.