Disclosure obligations: whether documents are in a litigant’s “control”

31 January 2012

Disclosure, as every solicitor knows, is a vitally important stage in proceedings, and we have our own duties to ensure that clients are aware of and comply with their obligations. Documents held by third parties can often be determinative and fall within the litigant’s duty of disclosure if they comply with CRP 31.6 and CPR 31.8 and are within the litigant’s “control”. In North Shore Ventures Ltd –v- Anstead Holding Inc [2012] EWCA Civ 11, the Court of Appeal examined the true nature of the relationship between a third party trustee and litigant for the purposes of deciding whether documents were in the litigant’s “control” for the purposes of disclosure.

As the decision demonstrates, the Court will take a factual approach to determining whether documents are in a party’s control.

In North Shore a Claimant sought from a judgment debtor disclosure of documents which were held by and related to the administration of a trust into which the debtor had transferred all of their assets and of which the debtor and their family were beneficiaries. The Court had ordered that the debtor be examined under CRP 71.2 (to provide information of his means and further information needed to enforce the judgement debt) and, upon discovery of the transfer of the debtor’s assets, the Claimant sought an order under CPR 71.2(6) for the debtor to produce documents. The Court made such order which was appealed by the debtor on the grounds that the documents were outside the debtor’s control (even if the debtor were able to obtain them).

The Court of Appeal held that whilst there was no definition of “control” in CPR 71.2, the same term was used in CPR 31.8 which provides:

“(1) A party’s duty to disclose documents is limited to documents which are or have been in his control.

“(2) For this purpose a party has or has had a document in his control if - (a) it is or was in his physical possession; (b) he has or has had a right to possession of it; or, (c) he has or has had the right to inspect or take copies of it.”

The Court of Appeal upheld the Judge’s order, holding that in deciding whether a document is in a party’s control, a Judge is entitled to draw upon the material before him to determine the true nature of the relationship between the third party and the litigant. In North Shore, there was sufficient evidence to conclude that the trust had been established to put the debtor’s assets beyond the reach of creditors and the debtor was the trustees’ “puppet master”. Thus the Judge was right to order disclosure of documents, which were, the Court of Appeal held, under the litigant’s control pursuant to CPR 31.8(2)(b).

In reaching its decision the Court of Appeal considered the House of Lords judgment in Lonrho –v- Shell [1980] 1 WLR, determined under the former Rule of the Supreme Court which provided that the document should be within the litigant’s “power, possession, custody and control” – “power” meaning “a presently enforceable legal right to obtain from whoever actually holds the document or inspection of it without the need to obtain the consent of anyone else”. However, even the Lords stated the facts of that case were exceptional.

It might be that North Shore is another exceptional case where the Court of Appeal based its decision on the reality of the facts before it. However, it does demonstrate that the Court will and should look to the underlying factual matrix in deciding whether documents are within a party’s control.

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