Nice try. That’s my reaction to White & Case seeking to get its costs assessed at £1m followed the uncontested judgment in a claim where the firm represented Goldman Sachs.
The claim lasted nine months and involved a debt of £8.8m. The vast bulk of the costs apparently related to Goldman’s own disclosure exercise, allegedly complicated by Goldman’s size and the number of servers, databases, laptops and so on that had to be searched for documents.
The judge refused to assess costs at this stage, given the lack of detailed breakdown. White & Case will have to return with an itemised bill in due course. The judge described the lack of a costs breakdown as “unacceptable” but the case also highlights the disproportionate costs which are racked up by disclosure exercises, even in cases which appear relatively simple and which don’t go to trial.
Despite the many rule changes to impose cost budgets and to potentially limit disclosure, parties and their lawyers still seem to find it very difficult to tailor the disclosure process to make it proportionate to the issues and the amounts at stake.
Law firms look at different ways of limiting the costs of disclosure exercise by outsourcing work to low cost centres and by the use of sophisticated software. In the end, however, a lawyer handling the case has to review key documents and the age of email and now social media, makes that a gargantuan task, even in relatively simple cases.
What can we do about this? Particularly since it is rare for all that effort to actually produce a smoking gun document which determines the case and indeed, at trial, we still tend to rely on a “core bundle” which contains the really important material!
As a mediator, I would emphasise the benefits of a limited and targeted early disclosure exercise, to be followed by mediation or early neutral evaluation: even if this doesn’t resolve the case, it enables the parties to really asses each other’s position and this will often kick start the settlement process.
What about the litigation process? The Government and the judges need to be alive to the risk that unfettered document disclosure undermines the overriding objectives of the CPR. We don’t won’t to risk one of the “jewels in the crown” of common law dispute resolution-the professional obligation on lawyers to ensure that all relevant documents (helpful and unhelpful) are disclosed.
However, limited initial disclosure should become the norm, with more wide ranging disclosure only justified by the requirements of justice for the individual case. Recoverable costs of the disclosure process should be strictly limited.
Charles Gordon is a panellist with alternative dispute resolution services provider JAMS International