Carpmaels & Ransford LLP v Regen Lab SA
| Jurisdiction | England & Wales |
| Judge | Mr Justice Waksman |
| Judgment Date | 17 February 2021 |
| Neutral Citation | [2021] EWHC 845 (Comm) |
| Docket Number | No. CL-2019-000786 |
| Date | 17 February 2021 |
| Court | Queen's Bench Division (Commercial Court) |
[2021] EWHC 845 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Rolls Building
Fetter Lane
London, EC4A 1NL
THE HONOURABLE Mr Justice Waksman
No. CL-2019-000786
Mr J. McKean (instructed by Carpmaels & Ransford LLP) appeared on behalf of the Claimants.
Mr R. Wilcock (instructed by Black Legal LLP) appeared on behalf of the Defendant.
(via Microsoft Teams)
I have before me an application made by the defendant company Regen Lab SA to set aside a judgment entered against it pursuant to proceedings brought by two of its former solicitors (of whom there appear to be a significant number), for payment of their fees where the respective retainers of each had been terminated by the defendant. The first claimant had been instructed between 29 March and 22 December 2017 at which point its unpaid bills were some €201,000. The second claimant replaced the first in relation to forthcoming patent litigation brought by the defendant. That firm of solicitors acted between 19 December 2017 and the termination of its retainer on 9 August 2018 which was after the litigation had concluded. The amount owing to the second claimant in terms of unpaid bills was about £320,000. That meant that the defendant had then instructed a third firm of solicitors although that firm, too, was dismissed by November 2019.
What happened after the particulars of claim were served was this that the defendant, who is no stranger to serious and significant litigation around the world in order to protect its patent interests, filed an acknowledgement of service on 20 March having been served in Switzerland on 25 February. No point was taken on service. The acknowledgement of service first of all purported to contest jurisdiction but, secondly, said that a defence was going to be produced. In the event, no defence was produced within the required time and, indeed, no draft defence has been produced as of today. Secondly, there was no application to set aside the claim on the basis of lack of jurisdiction which meant that under the rules such an application could no longer be made. In the event, although there was originally before me a jurisdiction element to the defendant's application to set aside judgment, that is gone and I should record, rightly so; it was entirely hopeless because all the claimants had done was seek an administrative resolution in Switzerland, as opposed to court proceedings there, and when that did not work, they brought the proceedings here.
Judgment was entered by Bryan J on a default basis on 19 June and on the last day that he allowed for an application to set aside to be made, the application was made on 22 July. That application is now supported by a single witness statement of Mr Okaki, the defendant's present solicitor, for the purposes of this application. There were earlier statements but as he explains, they are now redundant. There is no witness evidence of any kind from the underlying clients and as I will explain in due course, the single evidence of Mr Okaki is thin in the extreme in terms of what I have to deal with and, essentially, consists of a number of legal submissions apart from one paragraph.
For the claimants, I have a witness statement of Mr Kirby who is a partner at Carpmaels, the first claimant. There is also a statement from Mr Bamford who is a partner in Collyer Bristow, the second claimant. There was a statement from a Swiss lawyer but that has now gone by the board because there is no longer any Swiss law issue.
As this is an application to set aside judgment and as is conceded by Mr Wilcock, for whose submissions I am indebted, there is really now effectively a two-stage process. First of all, it is accepted that the application to set aside judgment itself engages the well known principles applicable to applications for relief from sanctions under Denton. Secondly, there is the procedure laid down in r.13.3 whereby any application to set aside judgment, an important matter is whether the application was made promptly and then either the defendant has got to show merit in the sense of a real prospect of success or, alternatively, there is some other good reason why the judgment should be set aside. Finally, because this is a case of solicitors' fees, even if there is a judgment for those fees and regardless of the time that has passed, the court has a discretion under section 70(3) of the Solicitors Act 1974 to at least entertain an application for a section 70 assessment. However, that discretion is circumscribed because it cannot be exercised or considered except in special circumstances. As an ultimate fallback position, Mr Wilcock says that if he is wrong about everything else, he now wishes to make that application. I will deal with all of these matters.
First, by way of background, it is worth saying just a little bit more about the claimants. The litigation on which both sets of solicitors were to be engaged in fact resulted in almost complete victory for the defendant here, Regen, in the sense that the defendant to those proceedings was found guilty of patent infringement in every respect. However, because of the conduct of Regen's own director, it was found to have published the relevant information ahead of time, as it were, or in advance and for that sole reason, its claim was barred.
It is worth noting what happened after that. There were applications to appeal and cross-appeal and by both sides to the patent litigation and those applications, which then came in relation to the putative appeal, were dealt with by Floyd LJ in 2020. At that particular point, Mr Terzi, Regen's director, made various applications in person. I will just read from some of Floyd LJ's remarks which are fairly trenchant in their terms so far as the conduct of Regen is concerned. First of all, it then made an application for a stay which Floyd LJ said at para.24 was late. At para.25, it said that Regen's conduct in terms of bringing proceedings was inconsistent. At para.26, which is directly relevant to whether Regen is sophisticated so far as knowledge of legal proceedings is concerned, he said this:
“Regen has shown itself perfectly content to launch litigation in multiple countries against Estar [which was the patent litigation defendant] with no apparent regard for saving costs. The relatively small costs saving achieved by staying the appeal carries little or no weight against that background.”
He found that the factors against granting a stay came down heavily against Regen.
There was then an application that the appeal should be adjourned and the learned Lord Justice said that all the difficulties encountered were of Regen's own making. It had now been 14 months since the underlying judgment of Judge Hacon. So there was to be no adjournment. Then at para.30, he said this:
“I turn next to consider whether the appeal should be dismissed on the own motion application for failing to lodge the appeal bundles. On such an application, one would expect the party in default to come forward with an explanation for non-compliance.”
This was particularly important here as Regen has:
“…a history of procedural wrongdoing. One is tempted to say procedural vandalism.”
He said it had broken the March and July costs orders. It had launched an application for relief from sanctions in respect of those costs orders which it had then failed to support either with evidence, or attendance, or representation at the hearing. It had ignored successive directions in the appeal for the service of its response to Estar's strikeout and security for costs applications. Against that background, there was an obvious inference that its continued breaches would be treated as intentional and not warrant any further indulgence being offered by the court. One would expect an explanation with some precise and concrete proposals as to when and how the failure was to be rectified. The learned Lord Justice says he was particularly interested to learn why the appeal had not been progressed. However, he found in para.33 there was no good explanation for any of that. He ultimately struck out Regen's appeal.
Turning then to the particular applications, as I say, one starts, in my view, with the application for relief from sanction. The failure to serve a defence or, alternatively, if there was anything in it, to make an application under CPR...
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