Kelly & Anor v Baker & Anor

For disclosure under Practice Direction 51U, Model E extended disclosure is exceptional. Serious allegations, high value, or the parties’ ability to bear the cost do not, without more, justify it. The request must be linked to specific issues and supported by a clear explanation of the proposed train of inquiry. A broad search for communications is disproportionate and may amount to a fishing expedition.

Whether documents are within a party’s control is a question of fact. A director of a separate company does not necessarily control that company’s documents for personal litigation. Contractual access rights do not amount to control where access is qualified, limited, or subject to safeguards.

The claim arose from a 2017 management buy-out. The claimants alleged that the defendants had assumed fiduciary duties in relation to the sale and sought disclosure concerning their roles, the restructuring, and the transaction.

At a case management conference, the court determined the scope of the disclosure issues, the appropriate model of extended disclosure, and an application concerning data held on servers now belonging to a group company. The claimants sought Model E disclosure and declarations that the defendants controlled the server data, alternatively an order requiring them to request access.

1. Disclosure issues. The issue concerning the defendants’ roles in the claimants’ business and affairs was limited to 2013–2017, reflecting the first meeting with Metric and the transaction. Searches were also ordered for the aborted sale period, 1 July 2006 to December 2008. A 14-year period of Model D or Model E disclosure would be disproportionate.
2. Model E. Under Practice Direction 51U, Model E is exceptional. Allegations of fraud, the value or importance of the claim, and the parties’ financial resources were insufficient. The application did not identify sufficiently specific classes of documents, issues, or trains of inquiry. A search of all communications with parties involved in the transaction would be excessive and disproportionate. Model D disclosure was ordered, without Narrative Documents.
3. Control of server data. Control was a question of fact. Mr Braid was one of six directors of a separate group company and was seeking access in his personal capacity. The company’s separate legal representation and conditional willingness to provide documents did not establish that he could access the servers for the purposes of the litigation. The position was not artificial.
4. Mr Baker retained certain contractual rights of access, but those rights were limited to reasonable endeavours, excluded privileged documents, and did not provide a right to obtain the entire servers. They therefore did not constitute control. The alternative request for an order requiring access had already been made and would serve no purpose.

The claimants’ application was refused.