Dispute Resolution analysis: Aidan Casey QC and Tom Poole reflect on a recent decision which considered an application to amend consequent upon a failure to provide standard disclosure, and assess the practical implications of the case.
What was the background to the decision?
First Personnel Services (First Personnel) and Halfords had a long trading history which came to an end as a result of a re-tendering process carried out by Halfords in 2011 in relation to the provision of temporary workers. A number of employment agenciesparticipated in the tender, including First Personnel as the incumbent provider of temporary workers to Halfords. Staffline Group Plc won the tender and as a result a number of temporary workers transferred from First Personnel to Staffline. It was First Personnel’s case that this transfer (known as a ‘temp-to-temp’ transfer) triggered the payment of transfer fees by Halfords to it. First Personnel claimed in excess of £550,000 in transfer fees.
Halfords defended the claim on the basis that it had no liability to pay First Personnel any fees in relation to the temporary workers who transferred to Staffline. Halfords also counterclaimed in respect of overpayments that it claimed it had made to First Personnel as a result of First Personnel charging Halfordsmore than had been agreed/represented in respect of the temporary workers.
The trial of First Personnel’s claim and Halfords’ counterclaim was due to start on 6 June 2016. On 3 May 2016, First Personnel disclosed a significant amount of data from its payroll and invoicing system (known as Tempaid). On 25 May 2016, Halfords applied under CPR 17.1(2)(b) to amend its defence and counterclaim. Halfords contended that the need for the application and its timing was explained by the late disclosure of the Tempaid data. Halfords’ application was heard on the first day of trial.
Following several days of argument, Mr Jeremy Cousins QC (sitting as a Deputy High Court Judge) granted Halfords permission to amend.
What was the basis for the decision on the breach of standard disclosure?
Part of First Personnel’s objection to Halfords’ application to amend was that the Tempaid data did not fall within the scope of standard disclosure. The judge rejected this argument on the basis that the Tempaid data, quite plainly,could support Halfords’ case or adversely affect First Personnel’s case as to whether there had been an unexplained discrepancy as to what a worker had been paid and what was charged to Halfords for that worker’s services.
First Personnel’s fall-back argument was that disclosure of the Tempaid data could have led to disproportionate costs. It relied on CPR 31.7(3):
‘Where a party has not searched for a category or class of document on the grounds that to do so would be unreasonable, he must state this inhis disclosure statement and identify the category or class of document’……
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