Electronic Disclosure – New pitfalls for litigants

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West African Gas Pipeline Company –v- Willbros [2012] CILL TCC. Ramsey J

West African Gas Pipeline Company (WAG CO) engaged Willbros’ subsidiary to build a 400 mile pipeline from Nigeria to Ghana.  Willbros provided a parent company guarantee for $273,000.  In due course WAG CO sacked the subsidiary and began proceedings to recover the guaranteed $273,000 from the guarantor.  A 6-week trial was arranged and electronic disclosure was ordered. Unfortunately WAG CO and their IT consultants and solicitors failed to de-duplicate documents so that there were many copies of the same document cluttering up the process.  They failed to make an initial review and gathering together of a complete set of documentation and they further failed to review the documents once they had searched the database before they put them in their disclosure list.  These were gross and fundamental failures of disclosure which caused a great deal of wasted time and trouble for the Claimants.

HELD:

  1. Willbros was entitled to an additional cost order in respect of WAG CO’s shambolic disclosure.  An interim award of £135,000 was made with the balance to be assessed at a formal hearing (which no doubt WAG CO would also have to pay for).

Comment

Electronic disclosure is an innovation by the judges.  In theory it speeds up and simplifies the disclosure process.  In practice it has turned into a monster which grossly inflates all manner of disputes, both large and small.  There is a whole new industry of IT specialists battened on to this process and the courts have shown in cases such as this and also in Phaestos –v- Ho [2012] EWHC668 (TCC) that parties who fail to get their act together in doing E-Disclosure in time or who give grossly inadequate disclosure will be punished severely in costs.

This is bound to drive litigants and their lawyers towards ever more cautious and thorough electronic disclosure processes which will disproportionately increase the cost of litigation.