Seriously deficient disclosure process not sufficient to reopen costs order - Cabo v MGA

The judgment of Mrs Justice Bacon in Cabo Concepts Ltd v MGA Entertainment (UK) Ltd [2026] EWHC 768 (Ch) provides a clear analysis of two points of practical importance for UK practitioners: first, the need for solicitors to comply with their duties under the disclosure regime under PD57AD when advising on and supervising searches; and secondly, that costs orders for a party to pay another party’s costs are final orders, which will only be disturbed in limited circumstances.

Background

The trial in Cabo v MGA was originally listed to begin on 27 June 2022. Shortly beforehand on 6 June 2022, MGA revealed there had been serious flaws in its disclosure process which meant that approximately 800,000 documents had been missed at the collection stage. This required the original trial to be adjourned and the judge at that stage ordered MGA to pay Cabo’s costs of the adjournment.

In 2023 it emerged that there had also been issues with Cabo’s disclosure before the original trial which necessitated disclosure of circa 5000 additional documents from phones under Cabo’s control. At the adjourned trial which took place in 2025 this failure was found to have been careless and showing a lack of diligence by Cabo.  

MGA brought an application to vary the original costs order from 2022 and seeking repayment of the sum that had been paid. This application was heard in January 2026 with the judgment handed down on 31 March 2026.  

Proper disclosure searches are a solicitor’s responsibility

The judgment contains trenchant criticism of Cabo’s solicitors’ oversight of the disclosure process, and of the solicitors’ explanation of their disclosure process.  

The court found that the solicitors’ approach taken to searching Cabo’s mobile phones fell far short of what was required. Key failings identified in the disclosure process were:

• The search of mobile phones was left to the clients themselves without clear instructions as to what was required,

• There was no written record of what was requested and so it remained unclear what the Cabo individuals had been asked to search for,

• There was no proper explanation of the scope of disclosure duties or the issues to which the search needed to be directed,

• There was no meaningful supervision of how the searches were carried out by the client, and

• The solicitor signed a disclosure certificate certifying that searches had been carried out in a “responsible and conscientious manner” without any proper basis for doing so.

Further Cabo’s solicitors’ evidence at an earlier hearing as to how the disclosure process had been undertaken was found to be inaccurate as it had been prepared without the expected care and diligence.  

The judgment emphasised that while there is no absolute obligation for solicitors personally to search clients’ devices or to instruct an external provider in every case, PD57AD imposes a positive duty on solicitors to “advise and assist” their clients to comply with their disclosure obligations. That duty includes giving clear instructions, ensuring the client understands their duties when performing any search, and exercising active supervision. Further solicitors should make sure that any instructions are in writing so that there is a written record of any such instructions.  

An informal or casual approach to disclosure can result in significant disclosure issues which can include late disclosure of significant material with potentially serious cost consequences, and the possibility of serious criticism from the court for both the party and their solicitors.

Costs orders are final — and hard to undo

MGA sought to overturn the order requiring it to pay the costs arguing that the later‑discovered disclosure failures by Cabo meant that the original costs order should be varied or reversed. The court rejected that application.

The judgment held that an order requiring one party to pay another’s costs, even if made following an interlocutory or case‑management decision during ongoing proceedings, is a final order. This is because it finally determines liability for costs on that issue, even if the precise amount remains to be assessed.

Where a party seeks to revisit a final order relying upon matters which occurred after the order was made CPR 40.8A will be the correct procedural route and not CPR 3.1(7). Given the importance of finality in litigation the judgment made clear that disturbing a final costs order based on subsequent events requires a compelling case. The judgment draws an important distinction between cases where later events destroy the entire basis of the original order or render compliance impossible, and cases where a different order might have been made had all the facts been known. Allowing final costs orders to be reopened merely because subsequent developments cast the earlier decision in a different light would undermine certainty and invite repeated satellite litigation.

The judge then rejected MGA’s application to amend the original order given that MGA’s disclosure failures had made the adjournment necessary regardless of Cabo’s failures. This meant that the original costs order was justified on the evidence before the original judge and it was not enough for MGA to show that, with hindsight, a different order might have been made had all the facts then been known.

Conclusion

Cabo v MGA is a cautionary decision on two fronts. For solicitors, it reinforces that compliance with PD57AD is not a box‑ticking exercise: clear instructions, proper searches, and active supervision are essential, and disclosure certificates must only be signed where there is a proper evidential basis. Further it confirms that costs orders imposing a liability to pay are final orders, and that the bar for reopening them is high; finality, once reached, will rarely be disturbed.