Curtiss v Zurich Insurance – a close focus on Issues for Disclosure

This is an aside from the main point of this article, but disclosure / discovery enthusiasts are not necessarily much interested in the final outcome of the cases which they read about. Their focus is usually on an application decided by reference to the rules of court. Sometimes the point arises at trial, and may affect the final outcome (though the arguments by that stage are more usually about the contents of documents than about compliance with the rules); sometimes the procedural disclosure point, however early or late, brings the case to an end there and then (see e.g. Eaglesham v Ministry of Defence [2016] EWHC 3011 (QB) where the defence was struck out for failure to comply with an “Unless” order, closing off argument about the merits and taking the claim straight to quantum). Sometimes you get a feeling for the likely outcome from the points arising on a disclosure application, and be reasonably certain that settlement discussions will begin at once.

Often, however, the disclosure point is won or lost, we all learn something, and then lose interest in the end result. We might form a view as to the merits (or, at least, as to where our sympathies lie), but do not know all the factors which will drive the final decision or induce a settlement. It is a bit like watching a horse race from a point on the course but not knowing or caring who wins.

That, as I say, is by the way. The case which prompts this thought is Curtiss & Ors v Zurich Insurance Plc & Anor [2021]. Leasehold owners of flats in a development in Swansea face very serious losses as a result of defects in the buildings. We are not told the status of their claims against other parties, but this claim is against Zurich in respect of a so-called New Home Warranty Insurance that the developer had contracted for Zurich to issue in certain circumstances. The leaseholders claim that Zurich’s issue of a cover note amounted to representations that Zurich had undertaken a genuine final inspection of the properties and that the works had been properly done. This, it is alleged, was fraudulent “because the surveyors knew that they had not carried out any genuine final inspections and because Zurich had no real belief that they had done so, and that [the claimants] were induced by the representations to purchase apartments that were considerably less valuable than the price they paid for them.”

The judgment is about the claim for exemplary damages or, rather, it is about the claimants’ demand for certain matters relevant to their claim for exemplary damages to be included in the list of Issues for Disclosure. The statements of case are set out in paragraphs 7 and 8, and the disputed Disclosure Issues appear in paragraph 9. The words “Issues for Disclosure” appear in the judgment beginning with capitals because the concept is so described in the Disclosure Pilot in Practice Direction 51U – these are not just “issues for disclosure” but the more technical and specific “Issues for Disclosure” introduced in paragraph 7.3 of PD 51U in the following terms:

‘Issues for Disclosure’ means for the purposes of disclosure only those key issues in dispute, which the parties consider will need to be determined by the court with some reference to contemporaneous documents in order for there to be a fair resolution of the proceedings. It does not extend to every issue which is disputed in the statements of case by denial or non-admission.

Not all of the issues in dispute are “Issues for Disclosure”. The judgment sets out (beginning at paragraph 13) the guidance given on this point by the Chancellor, Sir Geoffrey Vos, in McParland & Partners Ltd v Whitehead [2020] EWHC 298 (Ch). Perhaps this is the only point you need to take away from the Curtiss judgment – read PD 51U and read McParland, before getting stuck into lengthy and expensive correspondence and applications on the point.

It is worth reading, however, from paragraph 19 where the judge takes in turn each of the points claimed as “Issues for Disclosure”. Most of the succeeding paragraphs begin “I do not approve this as an Issue for Disclosure”. Perhaps as you nod your way through them, you will mutter “Of course – can’t think why they ran with that one”, but that is more easily done once a judge, closely focussing on the rules and untrammelled by client pressure, dismembers each point in turn. I can’t argue with any of the judge’s analysis.

The judicial words are of general application – “not a key issue”, “this is an inadequate justification”, “I cannot identify any issue at all in this respect”, “any relevant matters are already provided for”, “a vehicle for obtaining far-reaching and speculative disclosure”. There are others. It might be good to note them down as tests to be applied in future proposed applications together with the bare words of PD 51U.

It is easy to decide where one’s sympathies lie as between leaseholders facing ruin on one side and developers and insurers on the other (do feel free to insert your adjectives of choice before “developers” and “insurers”, but I am trying to be objective here). We see this snapshot of a legal-cum-technical part of a case and, as I put it in opening, we learn something and move on. I will probably never hear what the outcome is.

I do wonder, though, what a result which turns on expressions like “a vehicle for obtaining far-reaching and speculative disclosure” looks like to the claimants, stuck in their defective flats while they fight a faceless insurer at vast expense. My own life assumptions – that all developers are corner-cutting spivs and that most insurance is a legally-sanctioned form of fraud – are not much help. Developers and insurers have rights too, and we have yet to devise a better way of resolving major disputes like this.


About Chris Dale

I have been an English solicitor since 1980. I run the e-Disclosure Information Project which collects and comments on information about electronic disclosure / eDiscovery and related subjects in the UK, the US, AsiaPac and elsewhere
This entry was posted in Court Rules, CPR, Discovery, eDisclosure, eDiscovery, Electronic disclosure. Bookmark the permalink.

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