Comparative Corner: a discussion of pretrial discovery methods in Mexico, Canada and the United States
Von Wobeser, Mexico City
BLG, Toronto, Ontario
Blank Rome, New York
Pablo: The United States system of pretrial disclosure seems to us in Mexico to be extremely broad, burdensome on the party required to comply, and expensive.
Rob: I have the same impression from a Canadian perspective.
Richard: I understand how you could reach that conclusion, and in some respects you are correct. The US pretrial discovery procedures are broad and can be expensive. But they are important, even necessary, in the context of the US system.
Litigation in the US is premised on the concept that fairness requires there should be no surprises at trial; that the truth is more likely to prevail if all relevant evidence is available to the parties in advance of the trial; and that full disclosure tends to foster resolution of disputes without the necessity of a trial. To this end, the rules of civil procedure applicable in federal courts (and, with some differences, the rules generally applicable in the state courts) offer several discovery tools designed to allow parties considerable latitude in obtaining documentation and information from the opposing party. Any issues of undue burden and expense can usually be addressed and minimised by court intervention.
In federal court parties are required to make an ‘Initial Disclosure’ of the documents in their possession relevant to the claims and defences as articulated in the Complaint and Answer. But the main discovery tools in the US for obtaining evidence in the possession of an adverse party are interrogatories, requests for production of documents, requests for admissions and depositions. A party also may serve subpoenas on third parties for documents and testimony.
Interrogatories are essentially written questions that the opposing party must answer under oath. Many local rules limit the number of interrogatories that may be asked and when they may be served. Requests for production of documents are in writing and usually list specific categories of documents that relate to the claims or defences in the case. Requests to admit are factual statements that the opponent must admit or deny. There are consequences for the failure to respond and for the denial of a factual statement that is later proven to be true at trial.
Depositions are very similar to testimony at trial. The party seeking the deposition sends a notice requiring the opposing party to produce a witness or witnesses at a specific place at a specific time. The requesting party will then ask the witness questions relating to the matter that the witness is required to answer under oath. A court reporter is present to record the questions and answers. Depositions are most commonly used to gain information about the opposing party’s case, and to keep witnesses ‘honest’ when they testify at trial. But they can also be used to preserve evidence for trial. Objections during depositions are very limited, and all evidentiary objections are reserved for rulings by the judge at the time of trial. The witness is generally required to answer all questions unless there is a legitimate concern regarding privilege or potential disclosure of sensitive or proprietary information. Even then, an objection and instruction not to answer the question is risky. If the objection is subsequently ruled on by the court adversely to the objecting party, the witness may have to appear again at a continued deposition to answer those questions,
The timing and deadlines for serving and completing discovery are usually set by the court, with the input of the parties. In federal court the parties are required to complete a proposed Discovery Plan, setting out the desired timing, subjects and anticipated issues relating to discovery. The final schedule is contained in a case management/scheduling order issued by the court.
Pablo: The procedure in Mexico, based on the civil law system, is nothing like the system in the US. Except for witness testimonies, everything is in writing. The parties must file their evidence with their complaint or answer. Pretrial discovery is limited to preserving evidence and is allowed in very limited circumstances. Unlike in the US, you cannot gain information on the opposing party’s case in Mexico. Surprises definitely can – and do – happen.
This raises the interesting question of why the Mexican legal system does not allow pretrial disclosure? In my opinion, there are two main reasons.
The first is historical. The US and Mexican legal systems come from very different traditions. Mexico’s legal tradition is mainly influenced by French, Italian, German and Spanish law. To my knowledge, these legal traditions do not allow for pretrial disclosure.
The second is philosophical. Mexico’s legal system – especially in civil matters – tends to prefer legal truth over historical truth. The system is designed so that parties have virtually the entire burden of making and presenting their own cases for the courts to rule on.
Regarding depositions, a party can request a court to allow witness testimony before filing its complaint or answering it when the witness is of advanced age or is in imminent danger of losing their life. But the objective of this procedure is to preserve evidence, not to learn about the other party’s case in advance of trial.
One procedure similar to a US discovery is when a party does not possess, or for some other reason is unable to file, a document upon which it bases its case. In this circumstance the party needing the document may request the court to issue an order requiring whoever has that document to produce it. However, the petition for producing a document must specifically identify the document for which production is sought.
Rob: The procedure in Canada is a mixture of US law and the procedures Pablo describes. In Canada, discovery is a two-stage process of pretrial disclosure of documents and information by all parties in an action. In most cases, discovery consists of both documentary discovery and questioning of a party representative under oath: so-called ‘examination for discovery’.
Discovery in Canada is structured to meet a number of objectives, key among them are to: allow each party to know the case it must meet; enable parties to collect information to assess the strengths and the weaknesses of its case; obtain admissions from the other party that can be used to dispense with formal proof of documents or facts at trial; avoid surprises at trial; and obtain admission that may hurt the opposing party’s case. Discovery can also facilitate settlement and narrow the issues in dispute between the parties.
Courts in Canada generally expect the parties to collaborate in planning the discovery process and expect the parties to lay out a discovery plan in advance. A discovery plan must be in writing and typically includes information such as: the intended scope of documentary discovery, taking into account relevance, costs and the importance and complexity of the issues; procedure for serving each party’s affidavits of documents; information regarding the timing, costs and manner of production of documents; the names of persons to be examined for discovery; and the time and length of examinations for discovery. If parties fail to agree to a discovery plan, the court may impose one or award costs on a related motion.
With regards to documentary production, relevant documents that are in the possession, power or control of a party, for which privilege is not claimed, must be listed in an affidavit of documents. The affidavit of documents discloses to the fullest extent of a party’s knowledge, information and belief all relevant documents that are, or have been, in the possession of a party’s possession, control or power, and also lists privileged documents. A party that believes the other party’s affidavit of documents is inaccurate or deficient can compel an accurate or complete affidavit of documents, if they establish that the documents are relevant to the pleadings and in the possession of the other party. Production of documents is also typically an open and extensive process that goes beyond mere inspection. Typically, parties will cooperate and include copies of non-privileged documents along with their affidavits of documents, either in hard copy or electronic form. It is important to note that a party is precluded from using a document in evidence that has not been disclosed and produced.
With regards to examinations for discovery, courts have generally held that no questions are to be taken under advisement; questions should be answered unless clearly improper or prejudicial or would require the disclosure of privilege information; and answers are to be provided under reserve of objection. There are also limits on refusal motions. No refusal motion may be brought until all parties have completed their examinations for discovery of any adverse party. Significant cost sanctions may be imposed against unsuccessful or unreasonable parties.
An overarching rule of proportionality generally governs both oral and documentary discovery.
Lastly, the deemed undertaking or the implied undertaking rule provides that evidence and information obtained pursuant to certain discovery rules cannot be used for any purpose other than those of the legal proceeding in which the evidence was obtained.
Richard, in the US system are there any limits on the scope of the documents that may be requested, or the questions that a party may ask in the deposition? It seems like almost anything is fair game.
Richard: Yes, there are limits. The general test is that the requests and questions must be relevant to the claims or defences at issue or must be reasonably calculated to lead to the discovery of relevant evidence. If a party believes document requests or interrogatories go beyond that scope, it is entitled to serve objections to such requests. And if the matter cannot be resolved through negotiation, either party may seek a ruling from the court. Depositions are trickier. As noted above, objections are generally reserved and a deponent who refuses to answer a question does so at their peril. Moreover, since depositions are expensive and that expense is born in the first instance by the party seeking the deposition, parties generally are reluctant to spend time exploring irrelevant matters. If it appears that the deposition is intended to harass and intimidate the witness, rather than legitimately explore issues in the case, a party can seek a telephone ruling from the court or simply terminate the deposition and take its chances on later convincing the court that it was entitled to do so. Also, at least in federal court, depositions are limited to seven hours total unless otherwise agreed by the parties or extended by the court.
What limits are placed on the parties’ discovery rights in Canada?
Rob: Previously, the tendency of the courts was to provide litigants with full and complete discovery prior to trial to remove as much as possible of what used to be known as the ambush tactics of the adversarial system and to render the trial fairer and more efficient by allowing each party to inform itself fully of the precise nature of the case it had to meet prior to trial.
However, in recent years many provincial Superior courts have enacted rules to limit discovery. For example, in 2008 Ontario (province) amended its rules to limit discovery to questions ‘relevant’ to any matter at issue in the action. The scope of discovery was further limited by an overarching principle of proportionality that requires courts, when determining issues with respect to discovery of documents or person, to consider whether: (i) the time required for the party or other person to answer the question or produce the document would be unreasonable; (ii) the expense associated with answering the question or producing the document would be unjustified; (iii) requiring the party or other person to answer the question or produce the document would cause him or her undue prejudice; (iv) requiring the party or other person to answer the question or produce the document would unduly interfere with the orderly progress of the action; and (v) the information or the document is readily available to the party requesting it from another source
The Ontario rules also limit each party to a total of seven hours of examinations for discovery, regardless of how many witnesses need to be examined. The limit may be extended with consent or leave of the court. The courts have extended the time limit in complex litigation involving many parties.
At the federal level, discovery is also guided by the principle of proportionality, which has now been entrenched into the rules of procedure, mandating that the courts consider the proceeding’s complexity, the importance of the issues involved and the amount in dispute. There are also limits at the federal level on oral discovery, depending on the length of the trial. For example, a trial scheduled for 11 to 20 days is limited to three days’ oral discovery.
How does it work in Mexico, Pablo?
Pablo: In Mexico, the right to prove is part of due process. However, as I have previously said, there is no pretrial discovery; there is only the right to preserve evidence in certain limited circumstances. Each party has to present its case with the evidence it has available. We therefore do not reach the issue of the limits of pretrial discovery.
Richard: One issue that has received a lot of attention in the last 20 years or so is discovery of electronic data, in particular emails. It is now well established that electronic data and emails are considered ‘documents’, subject to the rules and procedures relating to discovery requests for documents. The problem is that a discovery request to a company for ‘all emails relating to a subject’, even if that subject is narrowly defined, can lead to a massive amount of data/documentation that needs to be produced. This requires technological assistance to locate all such documents on the company’s servers and either print out the documents in hard copy or download those files to another storage device – preferably one that will allow the receiving party to organise, categorise and search the native documents. Although a carefully structured search regimen will do a lot of the work, human eyes are still required to determine the relevance and importance of any given email. Electronic discovery as therefore introduced several layers of additional costs, which can be tremendous depending on the size of the files subject to the document requests.
Fortunately, the rules applicable in federal courts specifically address e-discovery and include proportionality considerations that balance the requesting party’s need for the data against the undue burden and cost production of the data on the producing party. Courts in the US now generally address electronic discovery in the case management/scheduling order, which resolves many of the issues that can arise.
Pablo: Electronic data and emails are admitted as evidence in Mexico. The parties may use emails they have available to them, and it is also possible to request a specific email from the counterparty.
Rob: In Canada, parties that are preparing discovery plans are required to consult and have regard to the Sedona Canada Principles Addressing Electronic Discovery (Third Edition, January 2022) (the ‘Sedona Canada Principles’). The first Sedona Canada Principle is that electronically stored information (ESI) is discoverable. The Sedona Canada Principles also note that parties should be prepared to produce relevant ESI that is reasonably accessible in terms of cost and burden and that the parties may use electronic tools and processes to satisfy their discovery obligations.
In line with the case law in Canada, the Sedona Canada Principles note that in any proceeding parties should ensure that steps taken in the discovery process are proportionate, taking into account: (i) the nature and scope of the litigation; (ii) the importance and complexity of the issues and interests at stake and the amounts in controversy; (iii) the relevance of the available ESI; (iv) the importance of the ESI to the court’s adjudication in a given case; and (v) the costs, burden and delay that the discovery of the ESI may impose on the parties.
Pablo: Richard, in the US system who must pay for the additional expense relating to the electronic discovery? In Mexico, if a court orders a party to produce an email, the party must bear the cost of its production. To my knowledge, there has not been any case in which this rule has been challenged.
Richard: The question of who must pay for electronic discovery is a very good one. Generally, in the US the party producing the documents must bear its own expense to produce them. But there have been some modifications to those general rules with respect to electronic discovery. When a request to produce requires a party to produce large amounts of electronic data, the party served with the request may seek cost-sharing relief from the courts. The courts have been willing to grant such relief.
Rob, what is the situation in Canada?
Rob: The reasonable costs of all phases of discovery of electronically stored information is generally borne by the party producing it. In limited circumstances, it may be appropriate for the parties to arrive at a different allocation of costs on an interim basis, by either agreement or court order.
Richard: Well, this has been a very interesting discussion, and I now better appreciate the similarities and differences in our three systems. I look forward to meeting again during the IBA Annual Conference in Miami this November.