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	England and Wales High Court (Technology and Construction Court) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Technology and Construction Court) Decisions >> The New Lottery Company Ltd v The Gambling Commission [2025] EWHC 486 (TCC) (05 February 2025) URL: http://www.bailii.org/ew/cases/EWHC/TCC/2025/486.html Cite as: [2025] EWHC 486 (TCC)

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IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (KBD)

		The Rolls Building 7 Rolls Buildings Fetter Lane, London EC4A 1NL
		5 February 2025

MRS JUSTICE JEFFORD:

1. This hearing was directed by Waksman J to deal with three issues, of which the first two were (i) directions for the hearing of the claimants' application dated 23 January, to make use of privileged documents which the defendants say were inadvertently disclosed and (ii) to deal with the issue of any further limitation protections required in relation to the so-called "deleted documents" and privileged documents within the "wider disclosure", both of those being terms used in prior correspondence between the parties and copied to the court. There is a third further issue which I will come to in due course.
2. The first thing to say is that the claimants' application dated 23 January will be heard on 7 March and not on a later date, and therefore I am, in that respect, concerned with directions leading to a hearing on that date.
3. By way of background, and as Miss Hannaford KC has said, in a procurement dispute of this nature the burden of disclosure falls heavily on the defendant, but it is, I would say, equally true that the burden of considering the impact of that disclosure is on the claimant, and it is often said by claimants that they cannot know their case without adequate disclosure.
4. In this case, what has variously been described as an unprecedented, certainly an extraordinary, position has arisen.
5. I am not going to set out the whole history of the disclosure matters, which are fully set out in the skeleton arguments before me, but summarising, by consent, disclosure was split into two tranches. Tranche 1 disclosure was given on 22 November 2024, which I believe was an extended date already, and some of the disclosure a little bit later, on 26 November, but nothing turns on that.
6. Almost since then, certainly since December of last year, issues have arisen about what the defendants say are documents that are privileged or partly privileged and were inadvertently disclosed. It is now said that over 4,000 documents which were in whole or in part privileged were inadvertently disclosed. That identification of over 4,000 documents was the product of a category-based review carried out on a pool of documents which were re-reviewed after the disclosure review. The results of that review, in the sense of the number of documents, were shared with the claimants and the interested parties on 17 January of this year.
7. After that, on 29 January, by email, Hogan Lovells, on behalf of the defendants, said that, over the past forty-eight hours, they had also identified that there appeared to be further inadvertently disclosed documents in the remainder of the tranche 1 disclosed documents not so far reviewed, and referred to, and it is the term I am going to adopt, as "the wider pool". In the statement of Ms Dickey, served two days ago, it was stated that approximately 19,000 documents were now being reviewed to identify what documents may have been inadvertently disclosed.
8. As I have said, that position – the number of documents already identified as having been inadvertently disclosed and potentially to be identified as inadvertently disclosed - is quite extraordinary and it seems to me, despite some compromise proposals which Ms Hannaford has offered, that the defendants are seeking, in effect, to let this issue of inadvertent disclosure of privileged documents drive the timetable and case management. It is proving to be a distraction not so much from the substance of the proceedings but in terms of the deployment of the resources of all of the legal teams involved.
9. Even given the vast number of documents apparently identified for disclosure, running to the millions, it is obvious that something went very wrong with the first review for privilege. That is said to be at least in part the product of human error but, as Mr Hossain KC has submitted, no further explanation has been offered as to the nature of the human error or how it came about, what instructions may have been given to those reviewing documents for privilege, and where those instructions may have been in error or the human applying them may have been in error. But it seems to me that it must now be the case that the defendant has some idea, at the very least, of what those errors were and where that process went wrong.
10. What Hogan Lovells say they are now doing is taking – and this is my word, not theirs – a "cautious" approach to the review of further documents. That is being carried out at a very high level and by a highly experienced team within the firm, and I certainly do not doubt that the matter is being taken very seriously and great efforts, both in terms of time applied and care applied, are being made. But the court and the claimants are still being told that it will take until 10 March to complete this review, and that is said with very little explanation as to why, other than the care that is being taken over the review, and the time that was taken to review the documents between December and the email of 17 January.
11. As Mr Hossain has submitted, it seems to me important that this is not a first review, but rather it is a re-re-review against a background of knowledge of what has gone wrong before. In any event, the need to revisit the privilege review is entirely down to the defendant. It should not be allowed to drive the case management of this litigation; rather it should be fitted into the time available. It seems to me incumbent on the defendant to cut its cloth accordingly, and so it will be, I think, apparent from that that, whilst I may be prepared to tweak the proposed dates in respect of preparation for the hearing and the review of the wider disclosure pool, it will not be to the extent that the defendant seeks.
12. So, as I said at the start of this, the hearing of the claimants' application of 23 January will be on 7 March. There is a large measure of agreement as to the directions to that hearing. What I propose to do, or will ask the parties to do in drawing up the order, is to use the claimants' version as the template, but to substitute at 3(a) and 3(b) what is in the defendant's draft at 2(a) and 2(b), but with the dates of 10 February in respect of each of those sub-paragraphs, which will deal with the identification of what is claimed to be privileged and the provision of redacted versions of some of the so-called deleted documents. That will require a bit of amendment to the defendant's drafting, as has been discussed in the course of the hearing, to ensure that it covers both the so-called "recalled documents", which are going to be highlighted to show that over which privilege is claimed, and the so-called "deleted documents", which will be provided in redacted form, but I am confident that I can leave counsel to formulate something that captures that properly. I will come back to the rest of the directions to the hearing on 7 March.
13. In respect of the documents said to have been inadvertently disclosed in the wider pool, using again the claimants' version of the draft order, at paragraph 5, I will order that the defendant will identify any further claims of inadvertent disclosure in writing to the parties by no later than 14 February 2025. I recognise that that puts considerable pressure on the legal teams but, as I have already said, it seems to me that the approach to this yet further review will have to be tailored accordingly. The nature of the error that was made and how to correct it, or the errors that were made and how to correct them, must be known to the defendant. That these errors would have to be addressed and the way in which those errors needed to be addressed must have been apparent for some time because of the review that has already produced the 4,000 documents said to have been inadvertently disclosed. That date is later than the claimants would want and considerably earlier than the defendant would wish, but it will have to be a case of cutting one's cloth accordingly.
14. To take account of that, going back to, in the claimants' version, subparagraph 4(c), I will make the date for the claimants' supplemental evidence 24 February, which allows a few extra days - albeit that is over a weekend, everybody seems to be working weekends in this case anyway. It seems to me that should be sufficient time for the claimants to deal both with the documents that are identified under subparagraphs (a) and (b), as they will be, and with the documents from the wider disclosure pool, so I do not, at the moment, propose to make the order that the wider disclosure pool documents need not be addressed until the claimant serves its evidence in reply. What I will say is that if there should be any application to that effect in due course, then that can be made to the court, as it were, informally, and I would expect it to be acceded to, given the indications already given.
15. The following directions as to the defendant's evidence, the claimants' evidence in reply and skeleton arguments should then run as per the claimants' draft. I would like to include, at (f), which is skeleton arguments being exchanged on 4 March, an express provision, for the avoidance of doubt, that they should also be filed with the court, together with any further bundle for the application and any bundle of authorities, which I would anticipate there would be for this hearing. The court's reading time will be 6 March, but if the materials are available a day before that allows for some slippage and the unlikely prospect that the judge will be able to read earlier. So if I could ask counsel again to tweak those provisions accordingly.
16. I should add that, in making those orders, and particularly those in relation to the identification of inadvertently disclosed documents in the wider pool, I have taken account of Miss Hannaford's submission that some slippage could be allowed in the timetable so that if, after identification of such documents on 10 March, as the defendant wanted, there was no agreement as to how the decisions made on 7 March should be applied to the documents, that sort of slippage could be accommodated. I am afraid I consider that submission to be unrealistic or at least one on which I simply cannot form a sensible view as things stand. There is simply no material before the court that gives any indication of how many documents have been identified already from the review of the wider pool as potentially being inadvertently disclosed and therefore no indication of how many documents may be identified as having been inadvertently disclosed, and, as Mr Hossain has said, no indication as to why it is said that documents have been inadvertently disclosed and what the disclosure errors or reviewing errors have been. So it is simply not possible to form a view as to what the scope of the exercise after 10 March might be and what impact it might have on the timetable and it is, in principle, wrong in these circumstances, it seems to me, to simply assume that all will be well and all would be agreed. The directions that I have therefore made are intended to avoid that open-ended possibility.
17. I think it follows, given Mr Hossain's submissions in reply, that the date for the amendments of the Particulars of Claim not affected by inadvertent disclosure issues should then be pushed back to 21 February to allow for review of any further documents identified from the wider pool, and then the further date of 11 April will remain. I am not persuaded that I should order that all amendments should be, as it were, put off until 11 April. It may seem generous of the defendant to offer that, but there is an understandable concern on the claimants' part about getting their amendments in, and it seems to me if the claimants wish to progress by giving the defendant greater notice of the amendments they wish to make, in accordance with the existing timetable, then so be it. Pushing the date for all amendments off into April would not meet all of the other issues that arise in relation to the inadvertent disclosure of privileged documents.
18. In relation to limitation, I will make the order in the terms sought in the claimants' draft. Again, as has been discussed in the course of the argument, the defendant's offer might seem a generous one, but the claimants have concerns about it. It is, as Mr Hossain said, only the claimants who are at risk on limitation, and therefore the approach that they wish to take should, I think, be preferred.
(See separate transcript for continuation of proceedings)

I will deal with the issue as between Mr Hossain and Miss Hannaford's clients first. Miss Hannaford rightly makes the point that both parties had included in their draft orders provision for all costs relating to the defendant's claims for privilege since 5 December, including the costs of and occasioned by the claimants' application of 23 January and the costs of the directions hearing, to be reserved and determined at the 7 March 2025 hearing. That does not seem to me to preclude Mr Hossain making the application for costs that he now makes. Although that form or draft Order was provided after the directions hearing was fixed, and therefore could have anticipated the nature of the hearing, it seems to me that it must have been proposed against the background that this would be a straightforward directions hearing. It had a two-hour estimate and was a hearing simply to fix dates. That is, in effect, ultimately what has happened but, in order to get to that point, there have been very very substantial arguments between the parties as to the dates by which the defendant is to take certain actions, including the identification of the documents in respect of which they say there has been inadvertent disclosure within the so-called wider pool of documents. That seems to me to have taken this hearing, albeit strictly speaking within the ambit prescribed by Waksman J, into a wholly different area of argument and costs.

19. The issue as to the identification and the dates for identification of the documents that are said to have been inadvertently disclosed, the identification of what is said to be privileged or not, are all issues that arise not because of the claimants' application per se, but because of the apparent errors that have been made by the defendant in disclosure in the first place, and then the time taken to identify what those errors are and the nature of the errors and provide to the claimants the particulars of those parts of documents that are said to be privileged. In those circumstances I do think that the focus of this hearing has been on fixing dates for those matters to be dealt with, which is no fault of the claimants, and not strictly speaking the product of their application to be heard in March. Therefore, given that the claimants have been substantially successful, I do consider that their costs should be paid by the defendant. That should be on the standard basis. Anything that is said to reflect failures by the defendant is dealt with by making an order that it should pay the claimants' costs of this hearing rather than by going further and saying that those costs should be paid on the indemnity basis.
20. The schedule of costs, however, I agree with Miss Hannaford, is astonishing in its amounts. Mr Hossain has submitted that it deals with costs only incurred since 29 January when he says it became apparent that directions could not be agreed. As Miss Hannaford rightly points out, it was not until, I think, 31 January that Waksman J said he could not deal with this matter on paper and ordered this hearing to be held. The hearing was given an estimated time of two hours, as I have already observed, reflecting what one might have expected to happen in terms of the fixing of dates. What was prepared for this hearing was a bundle which added some documents to the permanent case management bundle. After 29 January, there was limited correspondence between the parties and then, of course, counsel had to prepare their skeleton arguments, which I would expect to be reviewed, but no more than that, by their instructing solicitors. That work has generated a costs bill in that short period of time, even taking it from 29 January rather than the date when the hearing was directed, in a sum of £116,000, excluding VAT. That is generated by what are clearly extremely high hourly rates; enormous numbers of hours apparently spent by solicitors; multiple solicitors attending this directions hearing; 22 hours of communication with counsel in a short period of time; a substantial period (9 hours) of communication with the client, in respect of a matter that the client would have very little input into; 31 hours apparently spent communicating with the other party and other outside lawyers when no outside lawyers have been identified and the communications with the other parties have been extremely limited. I do not intend to go through the whole of the bill but that gives a flavour of the very high level of hours which are either wholly unnecessary, such as multiple attendances at court, or, as Miss Hannaford submits, highly duplicative of the time spent by counsel.
21. What I intend, therefore, to do is not go through each of those sets of hours item by item - indeed it would be impossible to do so because other than high-level descriptions it is difficult to discern what has been done - but what I will do is take counsel's fees, which ought to have formed the bulk of the work in terms of the preparation of the skeleton arguments, round those to a figure of £45,000, and add to that £20,000 in respect of the solicitors' fees. So I will summarily assess the costs at £65,000, to be paid by the defendant.
22. In relation to the interested parties, as Mr Birdling submits, the position is rather different.
(See separate transcript for continuation of proceedings)
23. On the principle, I am afraid that I am against Ms Hannaford again and I am going to order the defendant to pay the interested parties' costs. The interested parties were principally in attendance because of the issue relating to use of documents, and I accept, as Mr Birdling said, that the issue needed to be resolved and needed to be resolved now, and was a specific matter that was listed by Waksman J to be dealt with at this hearing. There was no agreement on this issue. The hearing has been helpful in flushing out the issues generally but that limited issue is principally why the interested parties were here. Mr Birdling was careful to confine his submissions, both in writing and orally, very much to those matters and not the directions and, in any event, their attendance in relation to the directions has been in relation to the same matters that caused me to find that the defendant should pay the claimants' costs. So I will order the defendant also to pay the interested parties' costs of this hearing.
24. On the schedule, I take note of the fact that there is, once again, a very high, even higher, partner rate. The expenditure of partner time, however, has been much more proportionate. There are a few hours, Miss Hannaford may argue too many hours, but a proportionate amount of time. I am slightly more concerned about the attendance at the hearing. I will make a small reduction and I will summarily assess the interested parties' costs at £20,000, exclusive of VAT, which it is accepted is not recoverable.