piBlawg

the personal injury and clinical negligence blog

A collaboration between Rebmark Legal Solutions and 1 Chancery Lane

Exit Mitchell enter Denton

Our jurisdiction generally does not favour laws (whether judge- or parliament-made) which fail to take account of what is just in the individual circumstances of the particular case. The common law prides itself in being able to adapt to new situations to yield what we would generally understand to be the ‘right’ result. This is a priority of our legal system and Mitchell fell foul of it – whether because it overstepped the mark in the first place or whether because it was wrongly interpreted. It is a strength of our system that it has been able to correct itself within such a short space of time. Exit Mitchell and enter Denton (or perhaps it will become known as ‘Decadent’). The Court of Appeal explains that when approaching rule 3.9 the first stage is to identify and assess the seriousness and significance of the ‘failure to comply with any rule, practice direction or court order’. If the breach is neither significant nor serious then there is no need to spend much time on the second and third stages. The second stage is to consider why the default occurred. The third stage is to evaluate ‘all the circumstances of the case, so as to enable [the court] to deal justly with the application including [factors (a) and (b)]’. The assessment of ‘seriousness and significance’ is substituted for the ‘triviality’ test. The Law Society had contended for a test of ‘immateriality’. The Court of Appeal was content with this as long as it involved not just a question of whether trial dates were affected but also the effect on litigation generally. Because this test did not take account of breaches which were serious but did not affect the efficient progress of the litigation, the Court preferred to stick to whether or not the breach was ‘serious or significant’. At this stage unrelated past failures should not be taken into account. The second stage is to consider why the default occurred. The examples in Mitchell are to be considered as no more than examples. When it comes to the third stage, if there is a serious or significant breach and there is no good reason for it the application will not automatically fail but the court will consider ‘all the circumstances of the case, so as to enable it to deal justly with the application’. The Court of Appeal rowed back from the epithet ‘paramount importance’ which had been attached to the only two factors expressly referred to in rule 3.9. They are now of ‘particular importance’ and should be given particular weight when all the circumstances of the case are considered. The Court of Appeal is on a tight rope. Its aim is evidently to avoid relaxation which 'will inevitably lead to the court[s] slipping back to the old culture of non-compliance which the Jackson reforms were designed to eliminate.' Equally it wants to put an end to the plethora of decisions which have come from some judges which are 'manifestly unjust and disproportionate'. Whether Denton will achieve that remains to be seen.

Allocation and admissions

Where a defendant admits a part of a claim, how does the admission affect the allocation of the claim? This was the question considered in Akhtar v Boland [2014] EWCA Civ 872. The defendant filed a Defence admitting hire, recovery and storage charges in the sum of £2,496. The claimant’s claim was pleaded at more than £5,000 but less than £10,000. However, if the sum of £2,496 was subtracted from the pleaded claim, it fell below £5,000 and therefore was below the then current limit for the fast track. Following Allocation Questionnaires the district judge allocated the claim to the Small Claims Track. The claimant applied to have the claim reallocated to the Fast Track but the judge refused the application but entered judgment against the defendant for £2,496. The Court of Appeal held that the sum of £2,496 fell into the category of ‘any amount not in dispute’ which was to be disregarded pursuant to part 26.8(2)(a) when allocating the claim to a track. An admission is binding and the Court has no jurisdiction to investigate facts which have been admitted unless permission has been granted for the admission to be withdrawn. That principle applied even more strongly to a judgment: neither party may make submissions or adduce evidence whichwould lead to decisions or findings inconsistent with a judgment. The Court of Appeal also made it clear that where there was judgment for a part of a claim the claimant’s cause of action was not extinguished: the claimant was entitled to pursue and seek judgment for the balance. Tactically defendants may want to make admissions which will bring the value of the claim into the Small Claims Track. However they will need to be careful of the costs consequences of so doing as part 44.15(3)(iv) says the court may allow the claimant costs of the proceedings to the date of the admission of part of the claim. To avoid such costs consequences it would be prudent to make such an admission during the pre-action protocol period.

Rescued from an error of procedure

Rule 3.10 rescues parties where “there has been an error of procedure such as a failure to comply with a rule or practice direction”. Where it applies “the error does not invalidate any step taken in the proceedings unless the court so orders”. The question therefore is when an error is merely an error of procedure and when it is such an error that it is irremediable. In Isaac Stoute v LTA Operations Ltd [2014] EWCA Civ 657 the Court of Appeal looked at this question in the context of failed service. Is service of the claim form by the court in disregard of a claimant’s notification that he wished to effect service himself (1) a nullity and (2) ‘an error of procedure’ within r. 3.10? The problem in this case was that the claimant had notified the Court that his solicitors wished to serve the claim form. Rule 6.4(1) states that the Court will serve the claim form except where the claimant notifies the Court he wishes to serve it. It was argued that service by the Court must therefore have been a nullity which rule 3.10 could not rescue. The Court of Appeal found that service by the court (in error) was not a nullity and was an error of procedure within r.3.10. Underhill L.J. held that there was nothing contrary to the fundamental scheme of the Rules, or radically unfair to the parties, in allowing service to stand. The Court had wrongly effected service – but Court service itself was provided for by the rules. There was no prejudice to the defendant who would not have even known that service was irregular when it was effected. It was objected by the defendant that rule 7.6 applied (making provision for extending time for service of the claim form) and that rule 3.10 was just a way of getting round this. The Court of Appeal found that rule 7.6 applied to cases where service had not been effected within the period allowed by rule 7.5. Rule 3.10 could be relied upon to establish that service had been effected, albeit by the wrong person. I blogged recently on service and rule 3.10 (‘Rule 3.10: looking beyond 3.9 for relief’, 21st March 2014). My posting concerned the case of Integral Petroleum v SCU-Finanz AG [2014] EWHC 702 (Comm). That case involved rule 3.10 and the time for serving Particulars of Claim. The judge in that case considered that the rule was to be construed as of wide effect so as to be available to be used beneficially wherever the defect has had no prejudicial effect on the other party.” However he thought that a narrower approach to r. 3.10 should be taken when dealing with the originating process. The decision in the case of Stoute suggests that the approach is not narrower than the approach the judge took to the Particulars of Claim in Integral Petroleum. One issue which arises frequently in cases at the moment is whether an application for relief from sanctions to be made where there has been a breach of a court order, rule or practice direction but there is no automatic sanction prescribed. Rule 3.10 may often be the answer.

Jackson on Jackson

“It was no part of my recommendations that parties should refrain from agreeing reasonable extensions of time, which neither imperil hearing dates nor otherwise disrupt the proceedings” said Jackson L.J. in Hallam Estates Limited v Teresa Baker [2014] EWCA Civ 661. In Hallam the claimants (paying parties) asked for an extension of time for filing their points of dispute in proceedings for detailed assessment of costs. The defendant had been late in filing her bill of costs. Jackson L.J. held that they had given sensible reasons for asking for the extension and, given her own delay, the defendant could hardly object to a modest extension. Pursuant to r. 3.8(3) the court’s approval was required for such an extension but this should have been no more than a formality. In fact the judge approved it on paper without a hearing and this approach was endorsed by the Court of Appeal. Rule 3.8 is about to be amended to allow parties to agree extensions of time for up to 28 days as long as no hearing dates are imperilled. The parties have a duty to further the overriding objective (which includes allotting an appropriate share of the court’s resources to cases) and thus, according to the great man himself, agreeing reasonable extensions which don’t imperil dates or disrupt the course of litigation is not a breach of a legal representative’s duty to their client. Jackson L.J. made it clear that if an application was made for an extension of time before the expiry of the time permitted by a rule or practice direction the application remained an application for an extension of time even if time expired before the application was heard. He said that the principles governing relief from sanctions were not applicable in these circumstances. As was said in Mitchell itself, it is clearly better to make an application for an extension in advance if a deadline is likely not to be kept. Greater clarity has now been brought to the extent to which parties can agree extensions of time. A number of cases have now emphasised the need to identify whether a court sanction has actually been imposed by breach of a court order, rule or practice direction – not all breaches automatically result in a sanction and therefore it is doubtful that relief from sanctions is required in such circumstances.                

CPR change - permission for extensions of time to be agreed

The Civil Procedure Rules Committee will approve a new ‘buffer’ measure at its next meeting, in a few weeks’ time (see www.lawgazette.co.uk/practice/buffer-rule-to-relieve-mitchell-pressure-on-courts/5040518.article).  The rule will permit parties to agree time extensions of up to 28 days for serving certain documents, without needing to make an application to the court. It will apply to all civil cases.  The new measure is designed to alleviate the pressure being felt by courts overburdened by post-Mitchell applications. The courts' difficulties have become increasingly evident. Many readers of piBlawg will have received orders after the time limit for compliance has expired.      

Rule 3.10: looking beyond 3.9 for relief

The dreaded realisation that you have not complied with a rule or practice direction. Your life flashes past you and a cold sweat breaks out. Out comes rule 3.9 and the new criteria, Mitchell, a call to the insurers… Or perhaps r. 3.10 applies? “Where there has been an error of procedure such as a failure to comply with a rule or practice direction- (a) The error does not invalidate any step taken in proceedings unless the court so orders…” There are some nuggets to be found in the recent case of Integral Petroleum v SCU-Finanz AG [2014] EWHC 702 (Comm) in which the scope of r.3.10 was explored by Popplewell J. In Integral the parties agreed an extension of time by e-mail for the service of the Particulars of Claim by 28 days to 6th June (in fact 28 days would have given until 10th June). The Particulars were served by e-mail at 18.41 on 10th June meaning they were deemed served out of time. SCU challenged validity of service on the grounds that e-mail was not a permitted method of serving and, in any event, service was late. No Defence was filed and Integral obtained judgment in default. Under r.6.20 e-mail may only be used to serve documents other than the claim form where a party has indicated that he or she is willing to be served by e-mail. SCU had not given such an indication. The judge found that the error of procedure in serving the Particulars of Claim by e-mail was a failure to comply with a rule or practice direction which fell within r. 3.10. Accordingly under r. 3.10(a) such service was a step which was to be treated as valid: He considered that the rule was to be construed as of wide effect so as to be available to be used beneficially wherever the defect has had no prejudicial effect on the other party. The method of service was recognised but the formalities necessary to make it a permitted method had not been concluded.  He drew a distinction between service of the originating process and service of Particulars of Claim and thought a narrower approach to r. 3.10 should be taken when dealing with the originating process. r. 3.10 was particularly apposite for treating as valid a step whose whole function was to bring a document to the attention of the opposing party where such function has been fulfilled - he said “It prevents a triumph of form over substance”. The judge also found that the rule applied in relation to service of the Particulars of Claim 5 days out of time. The upshot of all of this was that Integral could not set aside judgment as of right but the judge did set it aside under r. 13.3. Rule 3.10 is one to bear in mind when you next find yourself having a scrape with deadlines, procedural formalities etc. In the light of Mitchell the caselaw on this rule is likely to expand greatly.

What's trivial?

    There are an increasing number of reported cases about breaches that can be characterised as “trivial” and thus meriting relief from sanctions without the need to show a “good reason”, providing the application was made promptly. One example is Adlington – referred to in a blog posting on 10th February.   Hamblen J considered this issue very recently in Lakatamia Shipping Co Ltd v Nobu Su and others [2014] EWHC 275 (Comm). The Defendant was required by an Unless order to serve a disclosure list on 17th January 2014. The order did not specify the time for compliance, but the default date provided by the Commercial Court Guide was 4:30pm. The Defendant mistakenly thought it had until 5pm to serve the list. At 4:45pm – 15 minutes late – the Defendant sought to exchange lists with the Claimant. The Claimant replied that the Defendant was out of time. The Defendant proceeded to serve its list unilaterally at 5:16 – 46 minutes late. The Defendant made a prompt application for relief from sanctions. This was opposed. The judge noted that the delay was measured in minutes rather than hours and considered it was a “no more than insignificant failure to comply” and could be characterised as “narrowly missing a deadline” – examples of trivial breaches given by the Court of Appeal in Mitchell. The judge also addressed the consequences of the breach – these were minimal. There was no prejudice. This re-enforced the conclusion the breach was trivial. The Claimant sought to rely on a history of non-compliance to say that this, further, breach, should not be treated as trivial. The judge disagreed, holding “what matters is whether the non-compliance which resulted in the sanction is trivial and… that involves a consideration of the default in question, not other defaults at other times”. The history of default “did not affect the characterisation of the relevant non-compliance or metamorphose a trivial default into a serious default”. Given that the Court of Appeal held that relief will “ordinarily” be granted for trivial breaches on a prompt application, Hamblen J held that “compelling circumstances” were likely to be required to prevent the Court granting relief for a trivial breach. The judge examined the factors set out in the old “checklist” and considered these mainly pointed towards granting relief. The judge noted that other court users were not affected by the breach and that there was no prejudice to the Claimant. The history of default was a factor against granting relief, but was not sufficient to prevent relief being granted. Does this mean that relief for trivial breaches, notwithstanding a substantial history of default, may be granted more readily following Mitchell than before? The answer must be no. If the history of default is so bad that relief would not have been granted even before the CPR changes, then (it seems to this author) this should constitute “compelling circumstances” preventing a Court from exercising its discretion in the post-Mitchell legal universe.

Applicable Law in Tort and the Instruction of Expert Witnesses

Wall v Mutuelle de Poitiers Assurances [2014] EWCA Civ 138; LTL This appeal arose out of a preliminary issue trial on the proper meaning of Articles 1.3 and 15 of the Rome II Regulation in the context of permission to rely on expert (medico-legal) evidence which was to be adduced on behalf of an Englishman who suffered spinal cord injury during the course of a visit to France. Liability was conceded and it was common ground that the English Court had jurisdiction. However, the applicable law was that of France. The Defendant sought to restrict the Claimant's medico-legal expert evidence to the kind of French or "French-style" expert evidence that might be permitted by a French Court. The Defendant's arguments were rejected at first instance ([2013] EWHC 53 (QB)) and subsequently on appeal. The Court of Appeal gave important and timely guidance on the proper approach to expert evidence in claims of this kind (and on the meaning of Articles 1.3, 15 of and recital (33) to the Rome II Regulation).

'Plebgate', budgets, relief from sanctions and a new kind of justice

The Court of Appeal have now finally had their say on the Jackson Reforms: "...we hope that our decision will send out a clear message". The message is that a "new more robust approach..." has arrived. Failure to file a costs budget in time will result in parties being "treated as having filed a budget comprising only the applicable court fees" and relief from sanctions will only be granted where there has been a "trivial breach" or where there is a "good reason". The new approach "will mean that from now on relief from sanctions should be granted more sparingly than previously". Mr Mitchell's case (Andrew Mitchell MP v News Group Newspapers Limited [2013] EWCA Civ 1526) provided the perfect vehicle for the Court of Appeal. The Sun newspaper had reported that Mr Mitchell had engaged in a foul mouthed rant against police officers. Mr Mitchell issued proceedings alleging defamation on 7th March 2013. A CMC and costs budget hearing was fixed for 18th June 2013. On 17th June Master McCloud sent an e-mail to the parties' solicitors noting there was no budget for the claimant. The budget was filed that afternoon with an estimated figure of £506,425. Master McCloud ordered that the claimant be treated as having filed a budget comprising only the applicable court fees and she adjourned the CMC and budget hearing to another date at which any relief from sanctions application would be heard. That date involved her moving another hearing which had been listed to deal with claims arising out of "asbestos-related diseases". At that hearing she refused the application for relief from sanctions. Amongst other things she said there was no evidence of particular prejudice to Mr Mitchell, she took account of the Master of the Rolls' speach on the Jackson Reforms which said that a tough approach was required so that justice could be done in the majority of cases. She said that the stricter approach under the Jackson reforms had been central to her approach. The Court of Appeal upheld her decisions. As to confining the claimant to court fees, it said that CPR 3.14 (confining the defaulting party to court fees) was not just directed to the case of a party who does not file a budget at all. Budgets being filed in time (7 days prior to the hearing) was important in order to enable the hearing to be conducted efficiently and for discussions to take place beforehand. The judge was therefore not wrong to apply the sanction. As to relief from sanctions, the Court of Appeal said that the provision in 3.14 "unless the court otherwise orders" involved the same considerations as relief from sanctions under CPR r.3.9. All the circumstances of the case should be taken into account but more weight should be given to the two factors listed in the new rule (directed at efficiency, proportionate cost and compliance with rules etc.). The Master of the Rolls cited and endorsed his speech on the Jackson Reforms about a more robust approach and taking account of the failures to comply on other court users (illustrated, as though almost by design, by vacation of the hearing of the asbestos-related claims). Guidance was given by the Court of Appeal: relief will only be granted where the default is "trivial" for example where there has been a failure of form rather than substance and where a deadline has been narrowly missed. Where it is not trivial the burden is on the defaulting party to persuade the court to grant relief and it will need a "good reason". Examples given were a document not being filed due to a party or solicitor suffering from a debilitating illness or an accident or where later developments in litigation show the period for compliance was unreasonable. Merely overlooking a deadline on account of work or otherwise was unlikely to be a good reason. A key point for practitioners in difficulties is that applications for an extension of time made before time has expired will be looked upon more favourably than applications for relief made after the event. The Court of Appeal found the perfect case to make their point. It involved a politician from one of the parties currently in government and which is presiding over the reduction of resources in the court system. The vacating of the asbestos-related claim illustrated the knock on effect of inefficiency and failure in one claim on other litigation. However the decision is extremely harsh: failure to comply by 7 days on the part of his solicitors has meant that Mr Mitchell will be unable to recover the costs of his action if he is successful. Those costs are estimated to be £506,425 - which suggests that the sanction is hardly proportionate to the breach. One wonders whether there is not in fact a much more appropriate sanction. Mr Mitchell's solicitors have said that they will carry on and that he will not be affected financially by the judgment. But in other cases it might well lead to a claim for professional negligence - a step which would clog up the court system with more complicated satellite litigation. Are judges really to second guess what impact a failure might have on the court system as a whole when for the most part they have little evidence to assist them with attaching weight to this factor?The Master of the Rolls said in his speech that "the achievement of justice means something different now" - the extremity of this decision begs the question whether one would still define it as "justice" or just a hard form of utilitarianism.  Photo courtesy of freefoto.com (Photographer: Ian Britton)

Personal Injury practices safe 'at this stage'

“Will they or won’t they?” has been the question for many personal injury lawyers wondering whether their practices were about to disappear into oblivion with the raising of the small claims limit. The question has now been answered: “not at this stage”. The government clearly thinks that it would be good to raise it. However it does not intend to do so ‘at this stage’ because it might have an adverse effect on victims of RTAs with genuine injuries. It wants to develop safeguards before an increase in the limit is considered. The government has also responded to the consultation on its proposal to set up panels of independent medical experts. It intends to go ahead with this with the intention of having experts who give better advice on whiplash injuries. The view is that only reports from accredited medical experts would be accepted in evidence in whiplash claims. Reports will be in a standardised format and the government intends to stop experts being paid by those who favour a certain outcome. Further work is to be done before a proposal is published. You may or may not have been aware that the transport select committee had recommended reducing the limitation period for road traffic cases involving personal injury from three years. The government has made it clear it does not intend to do so. Such a move would make the law of limitation more complicated and would cause a massive surge in litigation – at a point when the court system is struggling in any event. The government has also suggested measures to challenge fraudulent or exaggerated claims. These include better data collection in order to establish the extent of the problem, prohibiting settlement without a medical report and the sharing of data by insurance companies with claimant solicitors to help claimant lawyers carry out ‘know your client checks’. Whether this will really make any difference is open to doubt – one school of thought is that vehicle technology (dashboard cameras, speed recording devices etc) will only really make a difference.