Clarifying the law on pre-action production in Singapore under the new Rules of Court: Gillingham James Ian v Fearless Legends Pte Ltd and others [2023] SGHCR 13

Order 11, rule 11 of the Rules of Court 2021 (“ROC 2021”), which provides for the production of documents and information before the commencement of proceedings or against a non-party, is the successor provision to the previous Order 24, rule 6 of the Rules of Court (Cap. 322, R 5, 2014 Rev. Ed.) (“ROC 2014”).

In Gillingham James Ian v Fearless Legends Pte Ltd and others [2023] SGHCR 13, the High Court held that a party, who has basis for believing that he has a viable cause of action, may apply to obtain documents and/or information to cover “critical gaps” in his/her intended claim.

Key Takeaways:

1. The pre-action production regime continues to exist under Order 11, rule 11 of the ROC 2021, allowing a party who has a basis for believing that he has a viable cause of action to obtain documents and/or information to cover “critical gaps” in the intended claim.
2. The purpose of pre-action production remains the same (i.e. to save judicial costs and time and to ensure the efficient management of court processes).
3. The scope of pre-action production under Order 11, rule 11 of the ROC 2021 is wide and enables parties to identify possible parties to any proceedings, “trace” a party’s property, or for “any lawful purpose”.
4. The threshold for obtaining pre-action production has been raised to that of “materiality”, which connotes a higher level of importance to the case at hand, as opposed to the previous standard of “necessity” under the previous Order 24, rule 6 of the ROC 2014. An applicant must demonstrate that the documents or information obtained is material to the determination of whether there is a cause of action that can sustain a viable claim.
5. An applicant would only have to pay the reasonable costs of the application and reasonable costs of the respondents in complying with the production orders.

Background

This application was commenced by Mr James Gillingham (the “Applicant”) to seek pre-action discovery against four respondents, Fearless Legends Pte Ltd (the “Company”), Mr Christopher David Mansfield, Mr Plaskocinski Thomas Andre, and Mr Liam Patrick Jones (collectively, the “Respondents”).

The Applicant had sought production of documents and information in support of two potential claims for: (1) minority oppression under Section 216 of the Companies Act 1967; and (2) a claim for the tort of lawful and/or unlawful conspiracy.

The Applicant’s case was that his alleged abrupt removal as CEO and director of the Company, along with the suspected diversion of the Company’s main assets, poaching of the Company’s employees, and approaches to the Company’s customers, if proved, would give rise to potential claims.

Key findings of the General Division of the High Court

The Court found that the Applicant’s potential claims for minority oppression and lawful/unlawful conspiracy were both viable for the purposes of seeking pre-action production but narrowed the requests based on a holistic assessment of the “interests of justice”.

The pre-action production regime persists under the ROC 2021

The Court held that the pre-action production regime continues to subsist under the ROC 2021, reiterating the Court of Appeal’s comments in Dorsey James Michael v World Sport Group Pte Ltd [2014] (“Dorsey”) that the pre-action production mechanism is aimed at saving judicial costs and time, as well as ensuring the efficient management of court processes. This regime would help avoid litigation where the intended claimant realises that his/her suspicions are unfounded, or to identify the real issues in dispute where litigation is unavoidable (Dorsey at [26]).

However, the scope of pre-action production has been widened under the ROC 2021 in comparison to its predecessor provision, Order 24, rule 6 of the ROC 2014. Under the ROC 2021, pre-action production can be sought “to enable a party to trace the party’s property or for any other lawful purpose”, as opposed to merely the identification of potential parties to any proceedings under the previous Order 24, rule 6 of the ROC 2014.

In particular, pre-action production would be warranted in a situation where an applicant has some basis for believing that he has a viable cause of action, but is unable to properly plead his claim because he requires certain documents and information to cover “critical gaps” in the intended claim. The “critical gap” could be occasioned by the fact that the intended claim is “largely based on circumstantial and hearsay evidence”.

The threshold for obtaining pre-action production is that of “materiality”

The Court observed that the requirement of “necessity” has been replaced with that of “materiality”. Under the ROC 2014, an applicant could demonstrate necessity by showing that the documents and information sought are necessary for the applicant to have sufficient knowledge of the intended causes of action and the basis upon which the causes of action have arisen.

Under the ROC 2021, the applicant would now be required to demonstrate that the documents and information obtained through the pre-action production mechanism must be “material” to the applicant’s determination of whether there is a cause of action which may be fashioned into a viable claim against a potential defendant.

The Court may consider the scope of the requests based on a holistic assessment of the “interests of justice”

Even if an applicant succeeds in satisfying the Court that the documents and/or information sought in pre-action production would be material to the determination of a viable cause of action, the Court nevertheless retains a discretion in determining the manner in and the extent to which pre-action production is granted.

The Court held that that was ultimately a broader exercise in achieving the “interests of justice”, and synthesized the following non-exhaustive set of six factors for consideration:

1. The need to guard against requests of a fishing and roving nature, which are brought in the hope of gathering information on making out a speculative claim.
2. The seriousness of the injury and/or the loss and damage behind the complaint made.
3. The reasonable expectations of non-parties in maintaining confidentiality and privacy, including in relation to their own private information, or to satisfy duties of confidentiality owed to others.
4. The need to avoid unnecessarily inconveniencing, embarrassing, or prejudicing non-parties by requiring them to disclose the information sought, especially when they may not or cannot be parties to any eventuating litigation.
5. The danger that judicially administered orders for pre-action production can increase the expense of resolving disputes, such as through encouraging satellite litigation on claims that may not be, or have not been, commenced.
6. The nexus between the intended claim and Singapore.

The Court considered all six factors and ordered a narrowed set of requests in terms of scope and operative timeframe in the interests of justice.

The Court further pointed out that the Applicant would be able to seek production of the denied items at a later date, should the Applicant be able to meet the required thresholds at that time.

An applicant would need to pay the reasonable costs of the application

Finally, in determining the issue of costs, the Court observed that there was a difference in terms of the scale of costs allowed under Order 11, rule 11(3) of the ROC 2021 (as opposed to Order 24, rule 6(9) of the ROC 2014). This scale had been altered from “indemnity” costs to “reasonable” costs.

This represents a significant reduction in costs for a prospective applicant for pre-action production. An applicant for pre-action production would now only be required to pay the reasonable costs of the application, which would be significantly lower than the costs assessed on an indemnity basis.

Bird & Bird ATMD’s Dispute Resolution team represented the Applicant. For queries on the above case, please do not hesitate to contact the key contacts listed.

This article is produced by our Singapore office, Bird & Bird ATMD LLP. It does not constitute as legal advice and is intended to provide general information only. Information in this article is accurate as of 22 September 2023.