Location, Location, Location: Third Party Disclosure And Jurisdiction

Businesses and other organisations in the Turks and Caicos Island (TCI) could be served with third party disclosure orders from the English courts, following an important court ruling.  The award-winning commercial litigation lawyers at ParrisWhittaker are experienced in representing individuals and organizations served with disclosure and other orders within the TCI and surrounding jurisdictions.

A third party disclosure order is an order requiring a person or organisation who isn’t party to the litigation to disclose information or documents in its possession. Such orders include the Norwich Pharmacal order which may be made against a party who is innocent of any crime or misconduct.

The Court of Appeal¹ has clarified that the English courts have power to make an order for disclosure of documents against a third party who is outside England and Wales, but it appears the power is limited by the actual location of the documents. The ruling has important persuasive authority on the courts in the TCI.

What’s the background?

The claimant was Russian and ran a fertiliser business. He sought third party disclosure of documents held electronically by English law firm Forsters LLP. The documents were likely to be relevant to his primary claim relating to ownership of the Russian business. However, the UK law firm said they held the documents on behalf of the appellants who were trustees, and the disclosure order should be made the trustees and not the law firm. 

The trustees were Cyprus-based companies and the court subsequently granted permission for the application for third party disclosure to be served on the trustees out of jurisdiction. At issue on appeal was whether the court had jurisdiction to order disclosure against a third party outside of England and Wales. 

The trustees argued that the English court never has jurisdiction to order production of documents by a third party outside the jurisdiction. The court gave a useful and detailed analysis of the legal framework and prior case law to determine the overall purpose of the law. It also pointed out that English legislation is generally presumed not to have extra-territorial effect. 

However, the UK Parliament sometimes expressly provides (or implies) that legislation is to apply to persons anywhere in the world. Though someone may be outside the jurisdiction, the matter before the court could be regarded as within the jurisdiction, depending on the circumstances.

Here, the critical fact was that the documents in question were located in England, even though the trustees were not. The judge refused to accept that the fact the documents were held electronically was not relevant. The documents were sent to England so that the trustees could be advised – and some of that actually occurred in the UK. 

The documents were not held in the UK by chance and the principle of territoriality had little or no application here.  By sending the documents to England, the trustees made the documents subject to the jurisdiction of the English court, accepting the risk of being subject to an order for production.

The court had jurisdiction both to make the order for disclosure of documents against the trustees; and an order for service of the application for the order on the trustees out of the jurisdiction.

What does this mean?

The ruling confirms there is no complete bar to the service of a third party disclosure application where the relevant party is located outside of the English jurisdiction. However, the critical factor in this specific case was the location of the documents – not the actual party. 

Any individual, company or other organisation who sends information and documents to a law firm or anyone else in England and Wales could lawfully be made the subject of a disclosure order – including a Norwich Pharmacal order.

How can we help?

For expert advice on disclosure orders and Norwich Pharmacal orders any all other commercial dispute matters, get in touch with the award-winning team of commercial lawyers at ParrisWhittaker on +1.242.352.6112

¹Gorbachev v Guriev [2022] EWCA Civ 1270