Terre Neuve SARL & Ors v Yewdale Limited & Ors

An order transferring the disclosure exercise to an independent provider is an exceptional and intrusive remedy. It should be made only where proportionate to the claimant’s interest in obtaining relevant documents. Relevant considerations include the purpose and importance of the disclosure, alternative means of addressing evidential deficiencies, the extent of any prior review, the degree of intrusion, the strength and breadth of the alleged failure, and cost.

At the pre-trial stage, the court should generally avoid making definitive findings that a party’s disclosure evidence is untruthful. Targeted orders may be appropriate where particular sources have not been reviewed or documents appear incomplete. An unless order may debar a party from advancing a positive defence while leaving the claimant to prove its case.

The claim concerned alleged misappropriation of substantial payments made under a tax-optimisation scheme. The claimants brought contractual, delictual and unjust-enrichment claims under Swiss and French law against Yewdale and individual defendants.

The claimants applied for extensive disclosure relief, including imaging of electronic devices and accounts by an independent e-disclosure provider, review by independent counsel, direct production of documents, and unless orders. They alleged wholesale failures in disclosure, incomplete searches, withheld documents and concerns about document authenticity.

The central issues were whether the court had jurisdiction to make the orders sought, whether such relief was proportionate, what targeted disclosure should be ordered, and whether non-compliance should prevent the relevant defendants from advancing a positive defence.

1. The court had inherent jurisdiction to make an order requiring documents or electronic sources to be provided to an independent e-disclosure provider and reviewed within a controlled framework. Such an order is necessarily intrusive and should not be treated as an ordinary response to complaints about disclosure.

2. Proportionality required consideration of the purpose of the disclosure, the significance of the documents, alternative means of addressing the evidential issue, whether the material had been reviewed, the degree of intrusion, the strength and breadth of the alleged disclosure failure, and the likely cost. The court also had to recognise that, before trial, it may be unable to determine whether a party’s statements about its searches were truthful. Adverse inferences could address deficiencies where the documents were sought for adjudication of the claim.

3. The broad order sought against all defendants was refused. The court instead made targeted orders. Yewdale had to provide, or account for, the relevant CD and USBs, complete bank statements and incomplete documents. Mr El Maleh had to provide or account for specified archive material and USBs. Certain business email accounts and French-proceedings USBs were to be processed by an independent provider, with responsive documents subject to independent review. Disclosure of material obtained from the French proceedings was stayed pending further consideration of French law.

4. Orders were refused in relation to personal devices and accounts where there was no sufficient evidence of relevant business material and the intrusion would be substantial. Targeted evidence concerning Ms Sasson’s inheritance was considered sufficient to address the only disclosure issue concerning her.

5. The orders against Yewdale and Mr El Maleh were made as unless orders. Non-compliance would debar the defaulting party from advancing a positive defence, but would not relieve the claimants of proving their case or the court of matters requiring its own consideration. The claimants were to fund the e-disclosure exercise initially, with costs reserved.