PART 18 REQUESTS SHOULD NOT BE AUTOMATIC ASPECT OF LITIGATION, NOR SHOULD THEY BE MADE AS A MATTER OF ROUTINE: HIGH COURT DECISION

The judgment of Richard Salter QC (sitting as a Deputy Judge of the High Court) in  Al Saud & Anor v Gibbs & Anor [2022] EWHC 706 (Comm) contains a detailed consideration of the rules and case law relating to Part 18 requests.  It provides a useful “cut out and keep” guide to the principles relating to the making and answering of requests and also what a party should do if it is dissatisfied with replies it has reecived.

“The requirement in the Practice Direction that requests under CPR Pt 18 must be strictly confined to matters which are reasonably necessary and proportionate for one or other of the stated purposes reflects that fact that requests and orders under CPR Pt 18 are not an automatic aspect of the progress of litigation under the CPR, and should not therefore be made as a matter of routine.”

THE CASE

The judge was considering an application by the claimants seeking an order that the defendants give more detailed replies to Part 18 questions that the claimant had asked.

THE JUDGMENT ON PART 18 PRINCIPLES

The judge allowed some of the claimants’ requests, but not others.  The judge considered the law relating to Part 18 in detail.  His view was that Part 18 requests are confined to relatively narrow issues, relating to what was in dispute, they should not be a routine part of litigation.  A particular feature of this case was that there was a pending application for summary judgment.  The existence of this application was also a factor that

CPR Part 18
    1. CPR Pt 18.1 provides that:
(1) The court may at any time order a party to –

(a) clarify any matter which is in dispute in the proceedings; or

(b) give additional information in relation to any such matter,

whether or not the matter is contained or referred to in a statement of case.

(2) Paragraph (1) is subject to any rule of law to the contrary.
(3) Where the court makes an order under paragraph (1), the party against whom it is made must –

(a) file his response; and

(b) serve it on the other parties,

within the time specified by the court.

Paragraphs (a) and (b) of CPR Pt 22.1(1) (when read with the definition of “statement of case” in CPR Pt 2.3(1)) between them require any further information provided under Pt 18 (either voluntarily or pursuant to a court order) to be verified by a statement of truth.
    1. Paragraph 1.1 of Practice Direction 18 requires a written request (allowing a reasonable time for response) to be served before any application is made to the court for an order under Part 18: and paragraph 1.2 of that Practice Direction provides that such a request:
.. should be concise and strictly confined to matters which are reasonably necessary and proportionate to enable the [requesting] party to prepare his own case or to understand the case he has to meet ..
    1. The request for further information under CPR Pt 18 has replaced two different procedures under the old RSC: the Request for Further and Better Particulars under RSC O 18 r 12 and the procedure for Discovery by Interrogatories under RSC O 26. It enables a party to seek clarification or additional information relating to any matter, whether or not that matter is pleaded or referred to in a statement of case.
    1. In support of his submission that the court should take a liberal approach to the scope of CPR Pt 18, Mr Atrill relied upon Harcourt v Griffin [2007] EWHC 1500 (QB), [2008] Lloyd’s Rep IR 386. In that case, Irwin J granted an application by a personal injury claimant for an order under CPR Pt 18 for further information to establish the full nature and extent of the insurance cover enjoyed by the respondents who were liable for his injuries. Mr Atrill particularly drew my attention to Irwin J’s observation (at [10]) that:
.. The nature and extent of the Defendants’ insurance cover is not in itself a ‘matter .. in dispute in the proceedings’ between the Parties, in the sense that the proper quantum of damages payable to the Claimant could be determined without determining whether the Defendants can actually pay those damages. However, it appears to me that the wording of CPR. r. 18 requires to be interpreted reasonably liberally. The purpose of the jurisdiction must be taken to be to ensure that the Parties have all the information they need to deal efficiently and justly with the matters which are in dispute between them. Moreover, the wording need not be taken to imply that there must be a live disagreement about the relevant issue, since on very many occasions parties are properly required to furnish information pursuant to CPR r. 18 precisely to discover whether there is or is not a live disagreement between the parties on a given point. The whole thrust of the new approach to civil litigation enshrined in the Civil Procedure Rules is to avoid waste of time and cost and to ensure swift and, as far as possible, proportionate and economical litigation. Therefore, I have no hesitation in finding that if there is no rule of law or significant rule of practice to the contrary, then the wording of CPR r. 18 is broad enough to cover information of this kind ..
    1. Irwin J’s decision in Harcourt was followed and applied by HHJ Robinson (sitting as a Judge of the High Court) in another personal injuries case, Senior v Rock UK Adventure Centres Ltd [2015] EWHC 1447 (QB).
    1. Mr Parker, however, invited my attention to the case of West London Pipeline & Storage Ltd v Total UK Ltd [2008] EWHC 1296 (Comm)[2008] Lloyd’s Rep IR 688, in which Steel J declined to follow Harcourt, holding that (on the facts of that case) the court had no jurisdiction under CPR Pt 18 to require disclosure of the insurance position, since it was not in itself a matter which was in dispute in the proceedings.
    1. Steel J’s approach was in turn followed by Thirlwall J in XYZ v Various Companies (the PIP Breast Implant Litigation) [2013] EWHC 3643 (QB)[2014] Lloyd’s Rep IR 431. Thirlwall J held (at [29]) that the claimants’ request for disclosure of the defendant’s insurance position did not fall within the scope of Pt 18 because:
.. The insurance position of the defendant is not a matter in dispute in these proceedings. Information about it does not relate to any matter in dispute. In light of the Practice Direction I cannot conclude that [CPR Pt 18] should be given a sufficiently broad interpretation to permit me to make the order sought here ..
    1. Thirlwall J nevertheless held that the general power of case management under CPR 3.1 (2)(m) gave the court power (on the facts of that case) to order the respondent defendant to disclose, not whether it had insurance cover against any finding of liability, but rather whether it had insurance adequate to fund its participation in the litigation to the completion of the trial and the conclusion of any appeal. Unlike the scope of insurance cover against liability, that was an issue relevant to case management and so could properly be the subject of an order made for the purposes of case management.
    1. With great respect to Irwin J, it seems to me that his more liberal and pragmatic approach to CPR Pt 18 risks stretching the scope of the rule beyond that which can reasonably be thought to be contemplated by its terms. The rule expressly says that the matter about which clarification or further information can be sought must be one “which is in dispute in the proceedings”. That wording, in my judgment, makes it clear that there are two cumulative aspects to this restriction: the matter must be “in dispute”, and that dispute must be “in the proceedings”.
    1. That means (for example) that requests under Pt 18 cannot be used for the purpose of obtaining material for cross-examination as to credit (Thorpe v Chief Constable of Greater Manchester [1989] 1 WLR 665), or to obtain material to support different claims between the same parties or claims against different parties (Trader Publishing Ltd v Autotrader.com Inc [2010] EWHC 142 (Ch)). As Morgan J observed in Barness v Formation Group Plc [2018] EWHC 1228 (Ch) at [10]:
.. [R]ule 18 deals with the current position at the time of the application to the court and requires the court to identify: what matter is currently in dispute? It is only in relation to such a matter that an order can be made clarifying the matter or giving additional information in relation to the matter ..
    1. The terms of the Practice Direction also make it clear that requests and orders under CPR Pt 18 must be strictly confined to matters which are reasonably necessary and proportionate for the stated purposes. In Hall v Sevalco Ltd [1996] PIQR 344 at 349 (a case about interrogatories under the RSC) Lord Woolf MR observed that “necessity is a stringent test”: and in King v Telegraph Group Ltd [2004] EWCA Civ 613[2005] 1 WLR 2282 at [63], Brooke LJ laid particular stress on the strictness required by the terms of the Practice Direction:
.. the emphasis, as always in the CPR, is on confining this part of any litigation (in which costs tended to get out of control in the pre- CPR regime) “strictly” to what is necessary and proportionate and to the avoidance of disproportionate expense ..
    1. In my judgment, the requirement of the rule that the information sought must relate to a “matter which is in dispute in the proceedings”, and the requirement of the practice direction that any request must be strictly confined to matters which are reasonably necessary and proportionate for one or other of the stated purposes, are threshold conditions. If those conditions are not satisfied, then the court simply has no jurisdiction to make any order under CPR Pt 18 (though, as Thirlwall J has pointed out, there may be other powers available to the court to assist in avoiding the waste of time and costs and in achieving the “swift and .. proportionate and economical litigation” referred to by Irwin J).
    1. If, however, those threshold conditions are satisfied, then the question becomes a matter for the court’s discretion. The power under CPR Pt 18 is one of the court’s case management powers, and its exercise should be considered in the context of the overall case management of the action: see Toussaint v Mattis [2001] CP Rep 61, CA, at [16], per Schiemann LJ.
    1. CPR Pt 1.2 requires the court to seek to give effect to the overriding objective when considering whether and, if so, how to exercise a power such as that under CPR Pt 18. As Roth J noted in the cartel case of National Grid Electricity Transmission plc v ABB Ltd [2014] [EWHC] 1555 (Ch) at [39]:
A Part 18 request .. is to be interpreted in the light of the overriding objective and is part of the more open approach to litigation which the CPR seeks to establish and promote.
    1. As the notes at paragraph 18.1.10 of the White Book state, that will usually mean in cases involving CPR Pt 18 having regard:
.. (a) to the likely benefit which will result if the information is given and (b) to the likely cost of giving it; and (c) whether the financial resources of the party against whom the order is sought are likely to be sufficient to enable that party to comply with such an order ..
    1. The requirement in the Practice Direction that requests under CPR Pt 18 must be strictly confined to matters which are reasonably necessary and proportionate for one or other of the stated purposes reflects that fact that requests and orders under CPR Pt 18 are not an automatic aspect of the progress of litigation under the CPR, and should not therefore be made as a matter of routine.
    1. Statements of Case, if properly drafted, should already contain all the information necessary to define the issues which the court has to decide and to ensure that each party knows the case which it has to meet: see eg Ventra Investments Ltd v Bank of Scotland [2019] EWHC 2058 (Comm) at [22] to [25]. Moreover, clarity is usually better served by brevity than prolixity. As Lord Woolf MR pointed out in McPhilemy v Times Newspapers Ltd and others [1999] 3 All ER 775 at 793:
.. As well as their expense, excessive particulars can achieve directly the opposite result from that which is intended. They can obscure the issues rather than providing clarification ..
    1. It follows that it will not usually be either necessary or proportionate (or in accordance with the overriding objective) for the other party to request (or for the court to order) a party who has served a compliant but concise statement of case to expand upon that pleading by the provision of more detailed further information.
    1. In cases begun using the procedure in CPR Pt 7, disclosure under CPR Pt 31 will normally be followed by the exchange of witness statements under CPR Pt 32. It will therefore also not often be necessary or proportionate (or in accordance with the overriding objective) for the other party to request (or for the court to order) a party to provide at any earlier stage information which will in due course be revealed on disclosure or which will be contained in those witness statements or in expert reports: see eg National Grid Electricity Transmission plc v ABB Ltd [2012] EWHC 869 (Ch) at [73] to [74], per Roth J, and Stocker v Stocker [2014] EWHC 2402 (QB) at [27], per HHJ Richard Parkes QC (sitting as a judge of the High Court).
    1. Of course each case must depend upon its own facts. As Schiemann LJ went on to say in Toussaint (supra), “The court now has a wide range of case management powers, and they are capable of being used flexibly to meet the precise needs of an individual case”.
    1. There will always, regrettably, be cases in which the statements of case do not, as they should, ensure that each party knows the case which it has to meet. There will also be other cases in which the court can be satisfied that “a clear litigious purpose will be served” (per Lord Woolf MR in Hall v Sevalco (supra)) by ordering the provision of further information either at an earlier stage or in a more extensive fashion than would normally be the case under the CPR. Such cases may, perhaps, include those where a clearer early understanding of the other party’s position than can be obtained by correspondence is realistically likely to help the parties to narrow the issues between them, to avoid wasting costs on unnecessary steps connected with the litigation (eg in relation to disclosure, witnesses of fact or expert witnesses), or to promote settlement.
    1. The burden must nevertheless always be on the party seeking an order under CPR Pt 18, both to demonstrate that the threshold conditions identified in paragraph 35 above are met and (to the extent not already implicit in the satisfaction of those conditions) to satisfy the court that, in all the circumstances, the making of such an order would assist in dealing with the case justly in accordance with the overriding objective.
    1. One of the complaints made by the claimants about Mr Gibbs’ responses to the RFI is that they show that he has failed to exercise reasonable diligence in examining relevant documents and undertaking reasonable enquiries. Mr Atrill invited my attention to the following passage in paragraphs [20.96], [20.98] and [20.101] of Matthews and Malek, Disclosure (5th edn, Sweet & Maxwell 2017):
.. It is incumbent upon a party responding to a Request to a Pt 18 order to exercise reasonable diligence in formulating a response ..
.. [T]he court is likely to regard a party [as] being under a duty to undertake reasonable enquiries, but what constitutes reasonable enquiries will depend on the circumstances .. [A] party is not bound to make enquiries to the extent that such enquiries place an unfair or oppressive burden on him ..
.. If it is necessary for the purposes of responding to a Request, the party must examine the documents in his control .. or that of his servants or agents held in that capacity. If a such search would be unduly burdensome, then that may be a ground for objecting to the Request ..
    1. In my judgment, those passages accurately state the law in this area. I would, however, add this rider. Where, as in the present case, a request under Pt 18 has already been answered, and the objection is that the answer given is inadequate because reasonable diligence has not been exercised, the proper way forward will not usually be to ask the court (as the claimants in the present case have done) simply to order that the original generally worded request should be answered again. Such a course will often just postpone until an application for sanctions for non-compliance or for relief from such sanctions is made the inevitable issue of what reasonable diligence in formulating a response to that request – and thus compliance with the order – actually requires. By that time it is likely to be too late to consider the appropriateness of the scope of the original order: see eg Griffith v Gourgey [2015] EWHC 1080 (Ch) at [40] and [54(1)].
    1. The better course will usually be, wherever possible, to ask the court to specify in its order precisely what further enquiries the party responding to the Pt 18 request should carry out, so that the issue of what proper compliance requires is plainly defined from the outset.
    1. A related issue (which similarly arises on the facts of the present application) is how the court should approach assertions by the party responding to a Pt 18 that that party is not able to recall and/or to provide the requested information, either at all or in the detail requested.
    1. On an application under Pt 18, the court is not required to take at face value and without analysis everything that a party says in its response or its witness statements. In some cases it may be clear that there is no real substance in the assertions made: see eg (in the context of CPR Pt 24) ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 at [10], per Potter LJ. However, it is also clear that the court should not, on such an interim application, conduct a “mini-trial”. In most cases, it will neither be possible nor appropriate (having regard to the overriding objective) to go behind what is said in answers to Pt 18 requests: cf the guidance given by Beatson J in West London Pipeline and Storage Ltd v Total UK Ltd [2008] EWHC 1729 (Comm) at [80], in relation to challenges to claims to privilege. To reject a statement contained in a document verified by a statement of truth will, in many cases, involve the implicit conclusion that the person making the statement has lied. That is a conclusion which a court will understandably be reluctant to reach on an interim application where the statement has not been tested in cross-examination.
Analysis and conclusions
    1. Against that background, I now turn to consider the specific requests that have been made.
    1. Two general factors seem to me to be of importance to the exercise of the court’s discretion in the present case. The first is that there are cross-applications for summary judgment which are likely to be heard in about a month’s time. Those applications may or may not dispose of the case as a whole, or of parts of the case. The summary judgment application by HRH Princess Deema is confined to her alternative case based on Mr Gibbs’ alleged failure to comply with the April 2018 Settlement Agreement. If that application based on her alternative case is successful, the claimants’ primary claims may well go no further.
    1. HRH Princess Deema’s alternative claim is pleaded in paragraph 41 of the Amended Particulars of Claim, in the following terms:
If, contrary to paragraph 40 above, the claims are precluded by the April 2018 Settlement Agreement, Mr Gibbs breached the said agreement as follows:
41.1 By failing or refusing to transfer or liquidate the Investment Portfolio or any part of it, and/or to transfer any proceeds thereof to the Claimants;
41.2 By reinvesting the proceeds of liquidations and/or available cash into other assets;
41.3 By failing to provide the certificates and reports required by Clause 1.4.
    1. The relief sought on the basis of this alternative claim is pleaded in paragraphs 46 to 48:
46. In the further alternative, Mr Gibbs’ breaches of the April 2018 Settlement Agreement have caused HRH Princess Deema, alternatively HRH Prince Khaled, loss and damage by Mr Gibbs’ failure to transfer or liquidate the assets and/or transfer the proceeds of any liquidations as required.
47. If the investments had been transferred or liquidated and their proceeds transferred as agreed, they would have been invested by Mr Kholaifi in a balanced portfolio of real estate, with 75% invested in commercial and residential opportunities in Europe and the USA which would have achieved returns of 8-9% per annum, and 25% invested in commercial and residential opportunities in Saudi Arabia which would have achieved returns of around 30% every two years. Such a portfolio would have been selected by Mr Kholaifi and approved by HRH Prince Khaled.
48. The quantification of this loss will be a matter for expert evidence, but the Claimants estimate such total loss to be at least US$30 million. Mr Gibbs is estopped from denying that the loss is at least US$24,561,691 by his representation in the Schedule to the April 2018 Settlement Agreement that the value of Princess Deema’s assets was this sum.
    1. Mr Atrill submitted that the fact that these summary judgment applications were pending did not mean that the scope of the information that could be ordered on this Pt 18 application was limited solely to that which was relevant to those Pt 24 applications. He submitted that it would be in accordance with the overriding objective for the court now to order the defendants to provide all of the further information to which the claimants were entitled, in order to avoid the need for any further applications to the court.
    1. Mr Parker, by contrast, submitted that the fact that HRH Princess Deema had already issued an application for summary judgment meant that it was clear that no further information was necessary. In that connection, he drew my attention to paragraph 20.4 of Mr Khatoun’s second witness statement, made on 29 October 2021 in support of HRH Princess Deema’s summary judgment application, in which Mr Khatoun stated that:
20.4 If the Defendants continue to refuse to provide information as to precisely what assets were liquidated and in what sums, HRH Princess Deema will seek by this Application (in addition to summary judgment on the cash holding of US$826,117):
20.4.1. Summary judgment in the sums set out in the Schedule in respect of the asset classes that have apparently been liquidated or have matured, i.e., company shares, futures contracts and the Credit Suisse managed securities (those sums being US$2,536,000, US$3,476,812 and US$2,323,000 respectively), on the basis that these are the sums for which (at the least) those assets should have been liquidated, upon the instruction of 25 April 2018;
20.4.2. Alternatively, an interim payment in the same sums, pending determination at a short quantum trial of what sums of money should have been realised by the liquidation of the assets in question (the question of liability having been determined summarily this Application)
This, Mr Parker submitted, clearly showed that no further information was “reasonably necessary” for either of the stated purposes in connection with that application, since the claimants’ solicitor had himself stated that the application could proceed without it.
    1. In my judgment, that submission to some extent overstates the position. Paragraph 20.4.2 of Mr Khatoun’s witness statement reflects the fact that HRH Princess Deema’s application notice seeks judgment on the question of liability, and either summary judgment for an ascertained sum or an order for an interim payment. It is possible that further information may still be “reasonably necessary” in relation both to liability and to quantum. The fact that the claimants have asserted this fall-back position does not, of itself, mean that no further information of any kind could reasonably be necessary for HRH Princess Deema and the court.
    1. Nevertheless it would not, in my judgment, be proportionate or in accordance with the overriding objective for me to make any order for the provision of further information on the present application that goes beyond what is reasonably necessary for the forthcoming summary judgment applications. The costs and time that would be involved in complying with any such further order might well be wasted. Even if those applications do not in practice bring this litigation to an end, they could well change the landscape of it, and so change the nature and scope of the further information reasonably required by the claimants; and compliance with any wider order might well unnecessarily and unfairly hinder or distract Mr Gibbs from his preparation for those applications.
  1. The second general factor is that Mr Gibbs has already provided answers (albeit answers which the claimants submit are inadequate) to each of the relevant requests in the RFI. I have to consider what practical litigious purpose would be served by simply repeating those general requests in the form of a court order at this stage, given the impending summary judgment applications. I have to consider how likely is it that such an order would, in reality, produce further information that would actually be useful to HRH Princess Deema and to the court. Very different considerations may, of course, apply if and when any judgment is obtained against Mr Gibbs.