By its nature, discovery often involves disclosing confidential documents, or documents containing confidential information.
Confidentiality is usually not grounds for withholding (i.e. not disclosing) a discoverable document. Documents can be withheld on the grounds of privilege (either as codified in the Evidence Act 2006, or the residual common law privileges) or irrelevance, but there is no privilege for “commercial sensitivity” or other such aspects of confidentiality (see ss 68-70 of the Evidence Act for other grounds).
But this does not mean that confidential documents need to be handed over without restriction.
The starting point is relevance, under the “adverse documents” test. If a document is not required to be discovered, then issues of handling confidential information in that document should not arise.
If a document is discoverable, then High Court Rule 8.15(2)(f) permits the producing party to propose “restrictions … to protect the claimed confidentiality of any document”. Rule 8.28(3) then permits the producing party to produce those documents subject to the proposed restrictions. If the receiving parties wish to challenge the proposed restrictions, they may do so pursuant to Rule 8.25.
There are several important points to note:
- The confidential documents must be listed as confidential documents in the affidavit of documents (usually ‘part 3’).
- The proposed restrictions on the confidential documents must be stated in the affidavit of documents itself.
- The producing party is free, within reason, to propose whatever restrictions they consider appropriate, though this should be read subject to the duty to co-operate.
- It is up to the receiving party to challenge the restrictions, if they wish. This will usually require an interlocutory application or a memorandum seeking directions (a party that inappropriately claimed confidentiality, or proposed inappropriate conditions, would likely have to pay costs).
What restrictions can be applied?
While rule 8.30(4) limits the use of discovered documents to the purposes of the proceeding only, and prevents extra-judicial disclosure, the producing party still may wish protect the confidentiality of certain information.
The producing party is at liberty to propose appropriate restrictions. Common restrictions include:
- Redacting documents. While relevant information cannot be withheld on the grounds of confidentiality, non-relevant confidential information could be redacted, making the resulting document discoverable with redactions (“DWR”; the same can apply to privileged documents). For example, a document may be commercially sensitive because it contains sales figures or name of other customers. If sales figures or customer names are not relevant to the dispute, a redacted version of the document omitting that information could be provided (as a Part 1 document).
- Limiting inspection. Confidential documents are sometimes provided on an “attorney’s eyes only” basis that limits inspection to the receiving party’s lawyers and experts only. This is usually supported by an undertaking from the receiving party’s solicitor.
- A combination of the above, where redacted versions are made available to the receiving party themselves (without restrictions), and the full versions are available for the receiving party’s lawyers (with undertakings) to inspect in order to confirm the legitimacy of the redactions.
Common sense should prevail
Care should be taken not to claim confidentiality over-zealously. Rule 8.30(4) provides a reasonably robust level of protection to all discovery documents, and it is not necessary (nor appropriate) to claim confidentiality across tracts of documents without an “elevated” need to do so. A robust case should be made.
In practice, most discovery issues of this nature can and should be resolved between the parties on a common sense basis – which is supported to some extent by the duty to co-operate that the new rules impose.