Litigation in lockdown – insights and predictions

The English court system has adapted to the Covid-19 pandemic. We predict that the solutions used during lockdown will have lasting impacts on how disputes are managed and litigated.

In brief:

• English Courts have remained open for business throughout the pandemic, hearing both fully remote and “hybrid” trials.
• Simmons & Simmons has advised on several disputes that have reached trial during the pandemic. These include a 10-week hybrid trial in the High Court, and a fully remote 5-week LCIA arbitration.
• The pandemic has triggered and accelerated changes that will have lasting impacts on each stage of the litigation process.

Initial response to lockdown from the Government and the Court

When UK lockdown was first imposed in March 2020, parties to Court proceedings were wondering to what extent Commercial Court hearings could continue at all, and if so, in what format. Many predicted the need for adjournments in major cases that were approaching trial.

However, in contrast to many jurisdictions, the clear message from Government and the judiciary was that hearings and trials would proceed despite the pandemic, and that they would do so remotely, if necessary. The Lord Chief Justice released two statements in March 2020, saying that remote hearings should be used "where possible" so as to "ensure as many hearings in all jurisdictions can proceed and continue to deal with all urgent matters".

Shortly thereafter, the new Coronavirus Act 2020 came into force on 25 March 2020, which provided for greater use and availability of video and audio links in court proceedings and to allow a wider range of proceedings to be carried out in this way. On 26 March 2020, the senior judiciary released a protocol on remote hearings which contains guidance on remote hearings.

These new rules and guidance were quickly tested in a series of cases. In the case of Re One Blackfriars Limited [2020] EWHC 845 (Ch), which had a 5-week trial scheduled for June, the Court refused an application made by both parties for an adjournment. The Court said: "as many hearings as possible should continue and they should do so remotely as long as that can be done safely".

Similarly, adjournment was refused in several other cases, including In re Smith Technologies (Unreported, 26 March 2020) and National Bank of Kazakhstan v Bank of New York Mellon [2020] EWHC 916 (Comm). The Government's data bears this out. In the period March-to April 2020, approximately 80-90% of all hearings were conducted on a video or audio basis, with upwards of 3,000 such hearings being conducted on some days.

In some other cases, a short extension only was allowed: see for example Heineken v Anheuser-Busch [2020] EWHC 892 (Pat). Although unreported, Simmons & Simmons was also involved in arbitration hearings being given a short adjournment to allow the parties to put in place appropriate arrangements.

The trend to allow fully remote trials may be concerning to some clients, who may feel that their more significant cases, with reputation or large sums of money at stake, should be tried with live evidence. Clients may feel that some of the force of their advocacy may be "blunted" by delivery over video. However, the policy of the Courts from the very outset was that trials must continue.

Hybrid hearings

Following the initial lockdown period, we saw the emergence of hybrid hearings: where some participants are physically present in Court, and others watch remotely. COMBAR released a Guidance Note on Remote Hearings which sets out best practise for remote and hybrid hearings in the Commercial Court.

As to what format of hearing will be most appropriate, it appears that:

• fully remote will normally be appropriate for all short, procedural hearings, or non-witness applications; and
• for substantive hearings, including those involving witness evidence, it will depend on the nature of the case, and the decision ultimately rests with the Judge (taking into account factors such as fairness to the parties, the location of witnesses, and safety considerations).

One factor that does appear to have been given considerable weight by the Courts, however, is whether it is important to have the Judge and witnesses in the same space. Re One Blackfriars Limited [2020] EWHC 845 (Ch) a 5-week trial scheduled for June, involving four factual witnesses and 13 expert witnesses, the Court held that the trial could be held on a fully remote basis because "there were no allegations of dishonesty or fraud" and it was not "a case in which it can be said that it is essential to have the witness, the cross-examiner and the judge and the other participants in the same physical space". A similar conclusion was reached in National Bank of Kazakhstan v Bank of New York Mellon - where the Court held that the mere fact that a case is complex or involves multiple witnesses does not mean that it cannot be conducted remotely.

By contrast, in PCP Capital Partners LLP v Barclays Bank LLP, in which this firm acted, the trial judge decided that it was important for key witnesses to be physically present. The case involved allegations of fraud, and alleged oral misrepresentations. This was therefore a case in which the credibility and demeanour of witnesses was considered significant.

The Judge's preferred solution was for a hybrid trial, with the Judge, witness and up to five representatives of each party physically present in the Court room on a socially distanced basis. Applications were made on behalf of certain witnesses who had health concerns about attending in person. Of these, some were approved but some were rejected - on the basis that the Judge wished to hear the witness' evidence in person and it was felt that suitable measures had been put in place to safeguard even those with health conditions that made them more vulnerable.

It appears therefore that in-person hearings will be preferred by Judges for cases involving fraud, or where the credibility of a witness is in question.

Practical insights and predictions for hearings

Based on our experience of remote and hybrid hearings, we predict that there will be lasting changes to the way that Court hearings are carried out, even after the health risks of the pandemic are brought under control. In particular:

• Remote hearings have clear benefits: time and cost savings for all; clients can attend more readily, especially if they have a busy schedule; court room size restrictions become irrelevant; legal teams can access their materials more effectively whilst the hearing takes place; communications are more effective (without a post-it note in sight).

• The support solutions offered by third party providers have developed significantly during the pandemic. They now provide full remote hearing support, including hearing managers and video conferencing with integrated presentation of evidence. This trend is sure to continue.

• We therefore predict that "remote" formats will become popular for procedural hearings.

However, in our experience, digitalisation of the Court process contributes its own challenges to complex and lengthy hearings (especially trials):

• Nuances of counsel advocacy styles, and cross-examination of witnesses, can be blunted when translated onto a screen.

• Virtual hearings spanning many weeks can take an increased mental toll on participants.

• Witnesses may be unfamiliar with the technology as well as the hearing process, and assistance with practicalities is more difficult remotely.

• Judges generally prefer witnesses to be physically present - though as noted above the mantra has been to insist on witness attendance at Court only where credibility is particularly significant to the Judge's findings.

For these reasons, we anticipate that longer hearings requiring heavy advocacy or extensive witness evidence will typically revert to traditional in-person hearings.

However, we predict a more flexible approach. Hybrid hearings - with the option to participate remotely - may become more common, especially as technology improves. This will most likely be led by demand from clients, who benefit most from related efficiencies.

Other lasting impacts on the dispute resolution process

We also predict that litigators will have to adapt to other enduring changes to managing disputes:

• Witness interviewing (or "proofing") has necessarily continued despite the restrictions. It is inherently more difficult to put a witness through their paces, and evaluate how they would perform as a witness, when dealing with them remotely. Techniques have been adapted, but challenges remain. Many are questioning whether we will revert to a standard practice of travelling to meet with witnesses in person, or whether we can "make do" with meeting them virtually, once the pandemic is over. Clients will need to be guided through the challenges as well as cost savings when deciding on their approach.

• The changes brought about by the pandemic will also present challenges in relation to disclosure of documents (eDiscovery). When colleagues are not physically present with each other, their communications are more likely to be written (or on recorded lines), and "chat" platforms have proliferated. Entire meetings are now regularly being recorded.

• The communication habits arising from home working present obvious compliance risks. The use of unauthorised communications channels is almost impossible to monitor. For those assisting at an early stage of a dispute, the benefit of thorough fact-finding at an early stage cannot be overstated.

• Remote ADR requires different communication techniques. Mediations have continued, with some even reporting higher rates of settlement.

What this means for you

• Digitalisation is here to stay. Disputes lawyers, whether in house or in private practice, need to think about the systems they use in managing their disputes.

• The pandemic has been a catalyst for change at every stage of a dispute. We are helping to guide clients through the new skills and processes they will need.

• Court hearings will see lasting changes. Those with trial experience during this period will have the advantage in advising on solutions going forwards.

The broader issue

Here we focus on issues for commercial litigators but there needs to be a broader debate. Digitalisation (and associated cost efficiencies) has the potential to benefit those areas of the justice system, including criminal law, where funding has threatened viability. However, if digitalisation is to benefit all Court users, modernisation will need to trickle down through the system.

In the UK, regional and county courts lag behind, with documents still sent by post and e-filing via email (with attachment size restrictions). These issues are solvable but require continued operational investment. Care will be needed to ensure technology facilitates access to justice, rather than becoming another barrier.