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• Background

1
The existing law

BACKGROUND

1 THE HIGH COURT RULES (which regulate the civil procedure of the High Court) and the District Court Rules 1992 (which have the same function in relation to the District Courts) both provide for discovery and inspection of documents.[1] This is the method by which each party to a civil litigation can obtain access to documents in the possession or control of the other party or parties.[2] Although the subject of discovery may seem unattractively technical and arid, in fact it is of substantial practical importance. Ours is an adversarial system under which each party to proceedings is required to procure its own bullets. Great injustice could be done if the rules failed to provide a method by which party A could obtain access to documents on which party B was sitting, and which party A needed to:

• prove party A’s case; or

• be properly informed of the documentation to be relied on at trial by party B.

2 We set out the relevant High Court Rules in appendix A. Their effect is that each party has the right to compel every other party to provide a list of all documents “relating to any matter in question in the proceedings” which are, or have been, in the possession, custody or power of the party providing the list.[3] The words quoted, “relating to any matter in question in the proceedings” are traditional words. They descend from the corresponding expression “relating to any matter in question in the action” used in the English Supreme Court Rules 1875,[4] and copied in New Zealand in 1882.⁵ It was in that year that Compagnie Financiere du Pacifique v Peruvian Guano Co[6] Brett LJ in the English Court of Appeal described the effect of the formula in words that have ever since been treated as authoritative.

We desire to make the rule as large as we can with due regard to propriety; and therefore I desire to give as large an interpretation as I can to the words of the rule, “a document relating to any matter in question in the action”. I think it obvious from the use of these terms that the documents to be produced are not confined to those, which would be evidence either to prove or to disprove any matter in question in the action; and the practice with regard to insurance cases shews, that the Court never thought that the person making the affidavit would satisfy the duty imposed upon him by merely setting out such documents, as would be evidence to support or defeat any issue in the cause.

The doctrine seems to me to go farther than that and to go as far as the principle which I am about to lay down. It seems to me that every document relates to the matters in question in the action, which not only would be evidence upon any issue, but also which, it is reasonable to suppose, contains information which may—not which must—either directly or indirectly enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary. I have put in the words “either directly or indirectly”, because, as it seems to me, a document can properly be said to contain information which may enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary, if it is a document which may fairly lead him to a train of inquiry, which may have either of these two consequences ...

3 In 1882, the documents required under the Peruvian Guano formula to be listed would (unless printed) have been hand-written. For this reason they were few in number. The problem with which this report is concerned results from the enormous increase in the number of discoverable documents that has resulted from the invention during the intervening 12 decades of new techniques for creating and reproducing documentation and of new methods of communication. Typewriters, photocopiers, computers and electronic mail are obvious examples.[7] The concern that has led the Law Commission to embark upon this project is that, under existing procedural rules, the cost of discovery can be disproportionately high when measured against its benefits. Moreover:

A connected problem is the ability of a defendant bent on either exhausting a plaintiff’s war chest or obstructing proceedings for some other purpose to achieve these ends by making contrived and inordinate discovery demands.[8]

We described the effect of the existing rules in our preliminary paper in these words:

General discovery requires the compilation of a list of documents by one party (which dispiriting task involves culling the discoverable from the irrelevant and assigning a description to documents in the former category) and inspection by the other. The cost includes the time of the parties (meaning in the case of corporations, their executives and other employees) and the time (for which the client pays) of the solicitors involved in the process. It is sufficient for present purposes to note that in large commercial and intellectual property cases, the number of documents requiring consideration can be huge, the time required can run into months, and the cost to the parties of the whole process can be enormous.[9]

We concluded this passage in our preliminary paper with this quotation from Lord Woolf:

The result of the Peruvian Guano decision was to make virtually unlimited the range of potentially relevant (and therefore discoverable) documents, which parties and their lawyers are obliged to review and list, and which the other side is obliged to read, against the knowledge that only a handful of such documents will affect the outcome of the case. In that sense, it is a monumentally inefficient process, especially in the larger cases. The more conscientiously it is carried out, the more inefficient it is.[10]

4 In our preliminary paper we acknowledged that the existence of the mischief that we identified, namely that the cost of general discovery was excessively and disproportionately high, was unsupported by empirical evidence, and that we were reliant on the generally accepted beliefs held by legal practitioners. We pointed out that:

In New Zealand the number of lawyers practising at all extensively in the field of civil litigation is sufficiently small for the knowledge of the workings of a widely employed procedural process to be general.[11]

We said “If we have our facts wrong no doubt we will be told in submissions that this is so”.[12] In the event, while submitters did not agree on a solution, all except one accepted that there was such a mischief as we had identified and that it required addressing. We turn to a consideration of appropriate remedies.