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Bermuda International Security Limited v KGMG, Court of Appeal

5 March 2001
The issues

Pre Accident Disclosure – Costs

The facts

BISL sought pre action disclosure from KPMG for the purposes of proposed proceedings against KPMG for negligence. At first instance Timothy Walker J granted an Order on the basis that there would be a saving for costs and that KPMG had already reviewed the documents (as a result of the proposed claim) and that it would therefore be no burden to hand them over and that the production might assist in the disposal of the case without recourse to litigation. He made no order that BISL should pay the costs not withstanding the presumption to the contrary under CPR 48.1. KBMG appealed. Before the appeal BISL conceded that it should pay KBMG costs of producing the documents but not of the application necessary to obtain the order.

The decision

It was early days in the life of rules relating to pre action disclosure and it was therefore (?) inappropriate for the Court of Appeal to lay down guidelines as to the way in which the discretion should be exercised. The exercise of the Judge’s discretion could not be criticised given that KBMJ in view of the Court of Appeal had unreasonably resisted the application.

Appeal dismissed.

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