Your Periodic Discovery Reminder

Wednesday 17 May, 2017

This periodic reminder comments on two particular issues that can pose challenges to organisations dealing with litigation: the duty to preserve documents, and the application of privilege to reports prepared internally or externally in the course of seeking legal advice or preparing for apprehended or actual proceedings.

Privileged information

Some documents may not be discoverable because they are privileged. In most cases, these documents will also be protected from disclosure under the Local Government Official Information and Meetings Act (‘LGOIMA’), and from other forms of legal compulsion.  

Communications between the organisation and its legal advisers are privileged if they are for the purpose of obtaining (or providing) legal services.  Communications with third parties, such as valuers and other experts, are privileged if they are prepared for the purpose of preparing for a proceeding or apprehended proceeding.

Steps can be taken in your day-to-day work to ensure that privileged documents are not at risk of disclosure:

• labelling (or heading) internal communications for the purpose of seeking legal advice as “Confidential and Privileged:  for the purpose of obtaining legal advice”;
• raising potential legal issues with your in-house or external lawyers as soon as they arise;
• labelling internal investigations / collations of documents (and so on) as “Confidential and privileged: Prepared for the purpose of an anticipated proceeding”;
• asking your in-house or external lawyers if you are not sure whether something is privileged. 

Preservation of documents

In 2012, changes to the High Court and District Court Rules came into effect, including (for the first time), an express duty to preserve documents.  The consequences of failing to do so may include increased costs, your claim or defence being struck out, or factual findings being made against you. 

An organisation needs to preserve documents as soon as a proceeding is ‘reasonably contemplated’. This means that discovery obligations may arise before proceedings are even issued – often much earlier than organisations realise. So whenever there is a dispute brewing, an organisation should be ready to preserve its documents so it is not hurt later if the dispute goes to court. 

An organisation must take 'all reasonable steps' to preserve documents which have been identified as needing preservation. Organisations therefore need to have robust systems in place.

Documents that are reasonably likely to be subject to a discovery order will often be mixed in with documents which are not. This includes hard copy documents on and off site, all types of electronic files and documents which may be in the control of third parties.  Organisations should take a conservative approach to document retention where there are legal disputes on foot.  Your lawyer will be able to help you identify the categories of documents that need to be preserved. 

Good housekeeping is essential to meeting discovery obligations

Organisations need to consider what systems and policies are in place to preserve potentially discoverable documents. Some sound practices include:

• having clear file management, retention and destruction policies;
• ensuring that employees and third parties are aware of their discovery obligations;
• ensuring that document destruction policies include confirmation that the documents are not relevant to a potential proceeding;
• ensuring that privileged documents are easily identifiable; 
• ensuring documents are preserved in a form that are readily retrieved and which do not require significant work to convert them into a form that is usable.

Good management of documents, while essential for discovery, is also helpful for preparing for your case.  It can reduce the cost of instructing lawyers because documents have already been identified and are well organised as a matter of course.  It can also ensure that the best case is put forward and that there are no surprises.

Please contact James MacGillivray or Kate Cornegé if you would like advice on these or other discovery issues.