Phaestos Ltd & Anor v Ho

Parties who have had ample time to address electronic disclosure should ordinarily comply with the court’s timetable. A voluntary change of solicitors at a late stage, undertaken with knowledge of outstanding disclosure issues, is not ordinarily a sufficient reason for further indulgence. The court may determine the remaining issues where the parties have substantially narrowed their disagreement and an effective agenda is available. Where relevant documents are said to be held on a related company’s server outside the claimants’ control, the objection should be supported by clear evidence explaining the position and why disclosure cannot be secured. Unreasonable attempts to defer a case-management decision, particularly where they threaten the trial timetable, may justify an indemnity costs order.

The claimants, Phaestos Limited and Mindimaxnox LLP, sought further time to agree the scope and protocol for electronic disclosure. The proceedings had been ongoing for several years. Earlier directions required the parties to respond to disclosure proposals, seek agreement, and complete disclosure by dates intended to protect a January 2013 trial.

Following substantial discussions and partial agreement, the claimants’ solicitors changed from Bird & Bird to Herbert Smith shortly before the hearing. The claimants sought an adjournment to consider the disclosure exercise, including issues concerning data held in other jurisdictions, documents associated with Ms Ambrosiadou, and the scope of searches. The central issue was whether the court should defer resolution or make the electronic disclosure orders immediately.

1. Application for further time refused. The court had a sufficient basis to determine the outstanding electronic disclosure issues. The parties had substantially agreed the form of the order, and the remaining matters were sufficiently defined for resolution by the court.
2. The claimants had long known that the court intended to resolve the outstanding disclosure issues. Their voluntary change of solicitors, made with knowledge that matters remained unresolved, did not justify postponement. The continued retention of Bird & Bird, who had detailed knowledge of the disclosure exercise, further weakened the case for an adjournment.
3. The potential scale of the disclosure exercise and the late reliance on data-privacy issues did not provide good reasons for delay. Nor did the issue concerning emails held on an IKOS AM Limited server. If the claimants maintained that those emails were outside their possession or control, the objection had to be supported by a clear witness statement explaining the position and why relevant documents could not be disclosed.
4. The court made the electronic disclosure order in the amended form proposed during the hearing. Where disclosure of Ms Ambrosiadou’s relevant emails was declined, a witness statement from her, and possibly others, was to be filed and served by 26 March 2012 explaining the position.
5. The claimants’ application had caused wasted time and threatened the timetable fixed for disclosure and trial. The costs of the application were therefore payable by the claimants on the indemnity basis.