Collateral undertaking
Disputes & Litigation

During the course of disclosure, highly confidential documents may be disclosed by the parties to one another. This right to having such documents disclosed to litigants comes with an obligation not to use the documents, or copies of them or information contained in them for any purpose other than for the litigation within with they are disclosed. This is the collateral undertaking.

Historically, the collateral undertaking could be enforced by an injunction or a charge of contempt of court. Where fresh proceedings were commenced based on documents which are subject to the undertaking, they are liable to be struck out on the basis that they rely on documents which have been produced subject to the undertaking.

Application

The application of the collateral undertaking has now been codified in the Civil Procedure Rules. CPR 31.22 applies such that a party to whom a document has been disclosed may only use the document for the purpose of the proceedings in which the document was disclosed. The restriction ceases to apply where (1) the document has been read in open court or referred to at a hearing held in public; (2) the court gives permission; (3) the disclosing party agrees. The court may make an order restricting further use of a document where it has been read or referred to by the court during the course of litigation.

The Civil Procedure Rules will apply where the document in question has been disclosed in accordance with CPR 31.2, which states that a document is disclosed when a party states that it exists or has existed. The Court of Appeal has interpreted these words take a wide meaning, and any statement that expressly or impliedly states that a document exists will suffice. Thus where an affidavit or witness statement refers to a document, that will amount to a relevant disclosure for the purposes of CPR 31.2.

It is unlikely that the collateral undertaking will apply to voluntary disclosures of documents, including those made in Pre-Action Disclosure (but not by under the force of a court order), witness summaries and expert reports. Confidentiality of sensitive information may be preserved by agreement in such circumstances.

When the undertaking ceases to apply (for instance, when the document has been read in court, and there are no orders preventing subsequent use), the document is in the public domain and may be used for any reason, subject to copyright law.

Order for Express Undertaking

Courts retain their jurisdiction to make orders where information that is to be disclosed is particularly sensitive, such as confidential information, where the potential for disclosure is likely, or the collateral undertaking will not provide adequate protection for the disclosing party. The court may order that documents be redacted prior to production, production be restricted to a limited class of persons, or order further production to be restrained by injunction.

Releasing from the Undertaking

The undertaking may be modified by order in exceptional circumstances, provided that modification of the rule would not cause the person giving disclosure injustice.

Clear reasons must be given for parties to be released from their obligations, and the orders given will depend on the intended use to which the documents are intended to put and the circumstances under which they were disclosed.