High Court permits discovery documents to be used for additional purposes

When a party is in receipt of discovery documents from an opposing party in litigation, it is under an implied undertaking not to use those documents for any purpose other than the particular proceedings.

However, in a recent case, which was the first of its kind in this jurisdiction, the High Court removed the undertaking and permitted the documents to be used for additional purposes.

Details of the case

The bank obtained summary judgment against the defendants in February 2015 and faced some difficulty in enforcing the judgment.

In November 2015 the first named defendant was ordered to disclose and identify all of his bank accounts solely or jointly from 2009 and to provide all documents relating to the disposal and/or acquisition and/or transfer of any asset owned by or in his possession with a value in excess of €5,000. The first named defendant provided some discovery to the bank.

The documents discovered by the first named defendant appeared to demonstrate asset transfers in which he attempted to place assets beyond the reach of the bank.

The bank wanted to issue proceedings against the transferees to reverse the transfers and needed to rely on the discovery documents as evidence. The first named defendant refused to consent to the removal of the implied undertaking not to use the documents for any other purpose and as a result a court application was necessary.

Decision

The court accepted that the documents provided on discovery were relevant to the proposed action and a discovery application could be made in any new proceedings. Mr Justice McGovern concluded that by making an order removing the undertaking not to use the documents for any other purpose, it would save unnecessary costs and the court’s time. As a result the court granted the first ever order removing the implied undertaking.

Why is this decision important?

The decision emphasises the importance of the Court’s role in balancing rights of privacy in discovery against ensuring that justice can be achieved in a practical way. It reminds parties of the importance of the implied undertaking but creates a solution.

Ex tempore judgment of McGovern J of 29 February 2016 in AIB plc v Whelan and Whelan 2014/2792S).

Beauchamps acted for the plaintiff in this application