So, you have been sued! What records will you need?

Filomena Matti & Planned Cover , 27 March 2023

Matters are won and lost based on the evidence put before the Court. Planned Cover Risk Manager Filomena Matti takes us through the the detailed and accurate records a defendant will need.

You may already be familiar with the sinking feeling that accompanies receiving a statement of claim or subpoena, particularly if served in person.

Once the sinking feeling subsides, and you have notified your insurer and lawyer, what is the next step? The answer is evidence, or more accurately, collating the often-voluminous records brought about by modern society which may amount to evidence at trial.

This article will explore why keeping detailed and accurate records is integral to success in the prosecution or defence of a matter. In short, who cares and why?

Defending a matter (or prosecuting one) always begins with the production of every version of a plan, scribbled file note and email, which relates to your client and the project in any way. Your lawyer will want to see everything to properly advise on your chance of success. The production of these documents to the other party and the Court is a legal procedure called “discovery”. You will be required by law to provide all documents in your possession or control which relate to the issues in the proceeding.

What do you have to produce? Everything.

The following is a non-exhaustive list of discoverable documents you might be required to produce to the Court pursuant to the Commonwealth Evidence Act:

  • Contractual documents (ie, your Consultancy Agreement, Novation Deeds, compliance certificates, statutory declarations)
  • Pre-negotiation documents
  • Plans, sketches, drawings, computations, whether in draft or final form
  • File notes
  • Text messages, phone records, voicemails
  • Social media posts and messages
  • Emails, WhatsApp or similar chats
  • Diaries
  • Photographs, drone footage

Matters are won and lost based on the evidence put before the Court. It is therefore incredibly important that you keep proper written records as contemporaneous evidence of what happened at the time the agreement was signed, and the project was ongoing. You can’t just “know” you are right – you must prove it. The required standard of proof in civil proceedings is “the balance of probabilities”.

How do you prove it? With accurate written records.

Written evidence outweighs oral evidence because they are contemporaneous records which are not affected by the passage of time, or the prejudice of either party. In short – they usually accurately reflect what happened at the time the project was undertaken and performed, rather than trying to rely on your memory alone as to who selected a defective product five years ago.

I recently discussed the importance of accurate records with a builder who informed me that issues often arise during construction due to discrepancies between tenders and finalised plans and specifications. Somewhere between the tender and working drawings, the carefully client-selected marble tile had morphed into a “marble like” tile, which was then installed in all wet areas of the project. The client was not impressed, insisted he did not make the change and was not willing to accept the faux marble tile. The architect paid two thirds of the cost of rectification following mediation with the builder as they could not prove when the selected tile had changed due to the earlier versions of the plans and specifications being overwritten. This cost of rectification might have been avoided if the records were accurate and all versions were stored correctly.

You may be thinking, how simple, let’s get everyone typing and recording. That is true to an extent, but the real key for your organisation will be having a clear record management policy, both for internal efficiency and if you find yourself involved in mediation or litigation.

Steps in your policy should include:

  • A clear, simple definition of what a record is. You may consider including a list of examples, and what they should contain. All versions of tenders, plans and specifications should be kept to avoid situations like the above.
  • A system to categorise records.
  • A plan for how records will be stored (electronically and, if kept, hard copy).
  • A retention policy that sets out how long records should be kept (Planned Cover’s Practice Guide – Document Management recommends at least ten years, and longer if possible) and how they are to be destroyed.

Your policy should also explain that if the rule of thumb is you will be required to produce “everything”, then care must be taken when recording and storing sensitive or personal information, particularly as it may have an adverse effect on the outcome of litigation. For example, simply because a document is marked “Confidential” or “Without Prejudice” does not automatically mean it is not a discoverable document or will not need to be produced pursuant to a subpoena.

Record management is everyone’s responsibility. Records should be comprehensive and accurate, and the management system intuitive and secure. After all, these records may be the very reason for your success in litigation.

Filomena Maffi is a Risk Manager with Planned Cover.

This article is only general advice in respect of risk management. It is not tailored to your individual needs or those of your business, nor is it intended to be relied upon as legal or insurance advice. For such assistance you should approach your legal and/or insurance advisors.