Sretaw v Craven House Capital Plc

• Jurisdiction: Ireland
• Judge: Mr Justice Max Barrett
• Judgment Date: 10 October 2017
• Neutral Citation: [2017] IEHC 580
• Docket Number: 2016 No. 6386P
• Court: High Court
• Date: 10 October 2017

[2017] IEHC 580

THE HIGH COURT

Barrett J.

2016 No. 6386P

Between:

SRETAW

Plaintiff

– AND –

CRAVEN HOUSE CAPITAL PLC

Defendant

Practice and Procedures – Discovery obligations – O.31, r.12 and r.21 of the Rules of the Superior Courts 1986 – Vexatious application – Abuse of process.

Facts: The plaintiff sought discovery of all the documents from the defendant, an order for better discovery pursuant to o.31, r.12 of the Rules of the Superior Courts (‘RSC’) 1986 and an order striking out the whole or part of the defence and counterclaim of the defendant pursuant to o.31, r.21 of the RSC. The plaintiff contended that the defendanthad failed to positively engage in relation to discovery and comply with its discovery obligations. The plaintiff also sought an order precluding the defendant from producing further documents.

Mr. Justice Max Barrett refused to grant all the reliefs sought by the plaintiff. The Court held that on perusal of the evidence, it appears that the defendant had complied with its discovery obligations. The Court noted that there was nothing in the present case that would justify the Court granting the strike out remedy as sought by the plaintiff. The Court observed that there was nothing in the pleadings that was bound to fail and no abuse of process wasevident from perusal of the pleadings.

JUDGMENT of Mr Justice Max Barrett delivered on 10th October, 2017.

I. Background

1 This is a discovery and discovery-related application made in the context of proceedings in which: (i) Sretaw seeks (a) a declaration that it is not party to a binding contract with Craven House, pursuant to a document entitled “Heads of Agreement” (“HOA”)[1] and dated 21st May, 2015, and (b) declaratory relief (if required) that insofar as the HOA might be deemed to be a valid contract (which is obviously disputed) such contract has been determined and/or Sretaw is no longer bound by the terms of same; (ii) Craven House seeks specific performance of the HOA and/or damages thereon.

[1] The HOA relates to a purported agreement on the part of Sretaw to sell to Craven House, and for Craven House to purchase from Sretaw, the entire share capital of Adnap 1 ISOM Limited and all associated subsidiaries for the sum of €78m.

II. Notice of Motion

2 By notice of motion of 10th May, 2017, Sretaw seeks the following reliefs:

(1) an order compelling Craven House to discover all documents as per Categories 1-8, 10-11 and 13, as agreed with Sretaw, and Categories 9, 12 and 14 as ordered by the High Court on 13th February, 2017;

(2) in the alternative, and without prejudice to the foregoing, an order for further and better discovery pursuant to O. 31, r.12 of the Rules of the Superior Courts 1986 (as amended) (“RSC”);

(3) in the alternative, and not without prejudice to the foregoing, an order pursuant to O.19, rr. 27 and/or 28, and/or O. 31, r.21 of the RSC and/or the inherent jurisdiction of the court striking out the whole or part of the defence and counterclaim as delivered by Craven House on 1st November, 2016, on the grounds that (a) Craven House has failed to comply with its discovery obligations, and (b) in light of the discovery made by Craven House, the defence and counterclaim is frivolous, vexatious, discloses no reasonable cause of action per the counterclaim, would constitute an abuse of process if permitted to proceed, and would delay the trial of the action;

(4) in the alternative, and without prejudice to the foregoing, an order precluding Craven House from producing further documents up to or at the trial of the action that ought to have been discovered per the terms of the categories of discovery as previously agreed/ordered.

III. Problems Presenting?

(i) Overview.

3 The parties to these proceedings initially agreed to exchange discovery by 10th April, 2017. At that point Craven House had decided not to instruct an independent e-discovery expert and tasked its in-house counsel with performing the necessary discovery exercise. A personal matter affecting the in-house counsel required that the date of discovery be extended to 24th April, 2017. However, it was becoming increasingly clear to Craven House that it had, doubtless in good faith, underestimated the scale of the discovery required of it. On 24th April, 2017, at a directions hearing, the court ordered that unless an affidavit of discovery was filed on or before 2nd May, 2017, the defence and counterclaim would be struck out. An affidavit of discovery was sworn by Craven House's in-house counsel on 2nd May, 2017. On 10th May, 2017, the solicitors for Sretaw issued a motion seeking various reliefs, including an order for further and better discovery and an order that Craven House's defence and counterclaim be struck out. This motion was returnable to the court on 15th May, 2017. On that date the motion was adjourned to 29th May, 2017, and Craven House was given until 25th May to file a supplemental affidavit of discovery. Between 2nd May, 2017 and 25th May, 2017, Craven House instructed Informa as an independent e-discovery expert. Though Craven House does not, the court understands, accept all of Sretaw's concerns as to the original affidavit of discovery, in the interests of fully complying with its discovery obligations and in progressing the within proceedings, Craven House instructed an independent expert: to alleviate concerns that Sretaw had raised in relation to the “searchability” of Craven House's discoverable documents; to ensure that complete discovery was made using their software and to ensure that all such documents were properly scheduled and categorised with the retention of appropriate metadata. A supplemental affidavit of discovery of 25th May, 2017, was prepared in conjunction with Informa and utilised its software and expertise in relation to searching, collating, scheduling and hosting the discoverable documents.

(ii) Failure to engage positively.

4 It has been contended by Sretaw that Craven House has failed to positively engage in relation to discovery. This aspect of matters has been addressed at some length by Ms Sarah Brown, a solicitor within the firm of solicitors acting for Craven House. It is not entirely clear to the court that this remains a live issue but it is clear from the affidavits of Ms Brown, Mr Winters (in-house legal counsel with Craven House) and the submissions of counsel at the hearing of...