To Disclose or Not to Disclose? That is the Question

by Andrew M. Toft on November 23, 2011

On Nov. 19, the Denver Bar Association held its annual Bench/Bar Retreat on the “Civil Access Pilot Project in the District Courts: Limits on Discovery in Business Cases.”  The Bench/Bar Retreat is an event at which judges and litigators of all stripes get together on a Saturday morning in an informal setting and discuss issues facing the courts and the lawyers who file cases.  The event is a combination of panel discussions and roundtable discussions among the bench and bar.  If you have not participated in the past, I encourage you to do so in the future.

CAPP is effective for many types of cases filed on or after Jan. 1, 2012, in the Adams, Arapahoe, Denver, Gilpin,  and Jefferson County district courts.  There are Pilot Project Rules (PPR) that govern pretrial process in CAPP actions filed after Jan. 1.  Anyone filing cases in CAPP district courts should read Chief Justice Directive 11-02 and must be familiar with the rules and time periods, which are all available here.  Amended Appendix A in the directive lists  the case types included in CAPP and specific exclusions.  PPR 1 states that the Colorado Rules of Civil Procedure will govern, except to the extent there is an inconsistency, in which case the PPRs will take precedence.  The impact of the PPRs on the handling of CAPP cases will be very significant.  Time deadlines, pleading requirements, discovery, use of experts, judicial involvement, disclosures and the procedural impact of the filing of a motion to dismiss will all change under the PPRs.  Clients will need to be educated about the impact if they will have cases in the CAPP district courts.  The impact of CAPP on the cost of litigation cannot be predicted with certainty, but litigators should be aware that one of the goals of CAPP is to increase the number of cases going to trial by reducing the cost of discovery.

A recent appellate decision, In re Averyt v. Wal-Mart Stores, Inc., released Nov. 7, by the Colorado Supreme Court, raises a disclosure and discovery issue under not only the PPR but also Rule 16 and Rule 26.  PPR 9.1 states:

Discovery shall be limited to matters that would enable a party to prove or disprove a claim or defense or to impeach a witness and shall comport with the factors of proportionality in PPR 1.3 (emphasis added).

Compare PPR 9.1 to In re Averyt, in which the Colorado Supreme Court stated, in pertinent part:

 As a general rule, however, discovery is not required for public documents that are equally available to all parties. …In addition, we apply this general rule in the context of automatic disclosures because nothing in Rule 26 requires disclosure by a party of documents which it would not be required to produce, if requested, under C.R.C.P. 34 [footnote omitted].

Modifying the facts of In re Averyt, in which the impeaching public document was obtained by plaintiff’s counsel after a jury trial had commenced, what are counsel’s obligations if a potentially impeaching public document is found well prior to trial, perhaps even before discovery is closed?  The trial courts’ perspective on the nondisclosure or nonproduction of a relevant public document “equally available to all parties” that has been in one party’s possession for months prior trial may well provide grist for the appellate mill both under and outside of the CAPP courts.  Will this lead to a greater incidence of trial by ambush when one party finds a critical document in the public domain? Clearly CRE 403 will continue to apply, but what impact will the general rule articulated in In re Averyt have on the application of CRE 403 if a party can introduce at trial a document the other party has never seen?

Will the new rule apply only to evidence used for impeachment in light of the requirements of CRCP 16(f)(3)VI(B)? Arguably this can be read into the decision, but who knows?  Does the disclosure obligation change if a CRCP 26(a)(2)(B)(I) expert considers one of these documents?

How should the apparent inconsistency between In re Averyt and PPR 9.1 (let alone CRCP 16 and CRCP 26) be resolved?  In my opinion, the trial judge should discuss counsels’ obligations under In re Averyt and PPR 9.1 with counsel at the case management conference mandated by PPR 7.  If the judge does not raise this issue, I think counsel should strongly consider bringing the issue to the attention of the judge to get direction from the court.

Since 1998, Andrew M. Toft has had a practice focusing on representing institutional lenders in commercial and civil litigation, real estate litigation, commercial foreclosures, commercial collections, loan workouts and restructurings, creditor’s rights in bankruptcy and Uniform Commercial Code issues.  He is a member of the American, Colorado and Denver Bar Associations, serving on the Board of Governors of the CBA and the Board of Trustees of the DBA.  Toft is also a member of the Turnaround Management Association (2012 VP-Chapter Relations, Executive Board and Board of Trustees), American Bankruptcy Institute, Commercial Law League of America and the Risk Management Association.  

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