Tchenguiz & Anor v Grant Thornton UK LLP & Ors

The collateral-use restrictions governing disclosed documents and witness statements give “use” a wide meaning. Reviewing, reading, copying, showing or extracting information from material may constitute use. A benign purpose, practical necessity or an obligation to give disclosure in later proceedings does not prevent the restrictions from applying.

The rules imply permission only for activity necessary to determine whether an express exception applies, or to seek permission, agreement or consent. They do not impliedly permit a review undertaken to decide whether material should support other proceedings. The court may nevertheless authorise such use after considering its purpose, circumstances and appropriate case-management protections.

The claimants brought substantial conspiracy claims arising in the wider context of litigation following the collapse of Kaupthing Bank. The defendants possessed documents and witness statements obtained in other proceedings. Some of that material was likely to be relevant, but it remained subject to the collateral-use protections in Rules 31.22 and 32.12 of the Civil Procedure Rules 1998.

The defendants proposed to review the material for relevance, list relevant material for disclosure, provide it for inspection, and permit the parties to inspect it before deciding whether to rely upon it. They sought declarations that these steps were not collateral use or, alternatively, permission to take them. The central issues were the breadth of “use”, the extent of any implied permission, and whether express permission should be granted.

1. Declarations refused; permission granted. Steps comprising review for relevance, listing for disclosure, provision for inspection and inspection in the current proceedings were capable of being collateral uses. The court therefore refused declarations that those steps fell outside Rules 31.22 and 32.12 of the Civil Procedure Rules 1998. It nevertheless permitted all four steps on the evidence, in the circumstances and subject to the proposed forward case-management arrangements.

2. The words of the rules governed the issue, particularly because breach could have serious consequences and might be treated as contempt. “Use” and “purpose” are separate concepts. The rules restrict use for a purpose other than the proceedings in which the document was disclosed or the witness statement served. A benign, practical or otherwise unobjectionable purpose does not prevent an activity from being use. Such considerations instead bear upon permission, agreement or consent.

3. “Use” has a wide meaning. It includes reading, copying or showing a document, using information contained in it, and referring to the document or its characteristics, including its provenance. A review of protected material may therefore itself be use. Treating review as outside the restriction would permit intrusive reviews for commercial or other collateral purposes. An obligation to give disclosure in later proceedings affects the circumstances and purpose of the activity, but does not alter its character as use.

4. The rules impliedly permit only the limited activity necessary to determine whether material was used at a public hearing, to seek the court’s permission, or to seek the required agreement or consent. That permission does not extend to reviewing a body of documents to decide whether any should be relied upon or otherwise actively used in other proceedings.

5. A review undertaken to advise whether other proceedings were possible or could be further informed is collateral use and requires permission or agreement, unless the public-hearing exception applies. By contrast, a review genuinely undertaken for the original litigation does not retrospectively become collateral merely because it reveals material relevant to other proceedings. Any further collateral step requires authority, although use necessary to seek that authority is impliedly permitted.