Denton and Others v Th White Ltd and Another; Decadent Vapours Ltd v Bevan and Others; Utilise Tds Ltd v Cranstoun Davies and Others

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeThe Master of the Rolls,Lord Justice Vos,Lord Justice Jackson
Judgment Date04 Jul 2014
Neutral Citation[2014] EWCA Civ 906
Docket NumberCase Numbers: A2/2014/0126; A3/2014/0767; and A3/2014/0870

[2014] EWCA Civ 906

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE QUEEN'S BENCH DIVISION OF THE HIGH COURT

BRISTOL DISTRICT REGISTRY: HHJ DENYER QC: CLAIM No. 7BS90560

AND ON APPEAL FROM THE CHANCERY DIVISION OF THE HIGH COURT

CARDIFF DISTRICT REGISTRY: HHJ JARMAN QC: CLAIM No. 3CF30143

MANCHESTER DISTRICT REGISTRY: HHJ HODGE QC: CLAIM No. 3MA30330

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

The Master of the Rolls

Lord Justice Jackson

and

Lord Justice Vos

Case Numbers: A2/2014/0126; A3/2014/0767; and A3/2014/0870

A2/2014/0126 (appeal from HHJ Denyer QC's order dated 23 rd December 2013)

Between:
Charles Graham Denton
Mary Denton
Roger Thomas Denton
Claimants/Respondents
and
Th White Limited
De Laval Limited
Defendants/Appellants
Part 20 Defendants/Appellants

A3/2014/0767 (appeal from HHJ Jarman QC order dated 18 th February 2014)

Between:
Decadent Vapours Limited
Claimant/Appellant
and
(1) Joseph Bevan
(2) Jamie Salter
(3) Celtic Vapours Limited
Defendants/Respondents

A3/2014/0870 (appeal from HHJ Hodge QC's order dated 24 th February 2014)

Between:
Utilise TDS Limited
Claimant/Appellant
and
(1) Neil Cranstoun Davies
(2) Bolton Community College Corporation
(3) Watertrain Limited
Defendants/respondents

In Denton

Mr Andrew P McLaughlin (instructed by BLM LLP) for the Defendant/Appellant

Mr Richard Stead (instructed by Burges Salmon LLP) for the Claimants/Respondents

In Decadent

Mr Gerard Clarke and Mr Mark Vinall (instructed by DWF LLP) for the Claimant/Appellant

Mr Ben Blakemore (instructed by Beor Wilson Lloyd) for the Defendants/Respondents

In Utilise

Mr Vikram Sachdeva and Mr Jack Anderson (instructed by Linder Myers LLP Solicitors) for the Claimant/Appellant

Mr David Mohyuddin and Mr Ian Tucker (instructed by Mills & Reeve LLP) for the 2 nd Defendant/2 nd Respondent

Interveners

Mr David Holland QC (instructed by Colemans-ctts LLP and the Law Society) for the Bar Council and Law Society

Hearing dates: 16 and 17 June 2014

Lord Justice Vos

The Master of the Rolls and

1

This is a joint judgement to which we have both contributed.

Introduction

2

These are three appeals (which we shall refer to as " Denton", " Decadent" and " Utilise") in which one or other party has sought relief from sanctions pursuant to CPR rule 3.9. This rule provides:

" Relief from sanctions

(1) On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need –

(a) for litigation to be conducted efficiently and at proportionate cost; and

(b) to enforce compliance with rules, practice directions and orders.

(2) An application for relief must be supported by evidence."

We shall refer to the matters set out in sub-paragraphs (a) and (b) of rule 3.9(1), where convenient, as "factor (a)" and "factor (b)".

3

The correct approach to the application of this rule has given rise to much litigation and debate among practitioners and academics. As is well known, this court gave some guidance in its decision in Mitchell v. News Group Newspapers Ltd [2013] EWCA Civ 1537, [2014] 1 WLR 795 which has been the subject of criticism. In the light of this, the court invited the Bar Council and the Law Society to intervene in these appeals. We are grateful to them (as well as the representatives of the parties) for their submissions. For the reasons that we give later in this judgment, we think that the judgment in Mitchell has been misunderstood and is being misapplied by some courts. It is clear that it needs to be clarified and amplified in certain respects.

4

The history and purpose of the reforms that were proposed by Sir Rupert Jackson's Review of Civil Litigation Costs: Final Report, December 2009 (the "Jackson Report") are now also very well-known and have been rehearsed in a large number of cases. The relevant background is set out in Mitchell, and we do not propose to repeat it here.

The three appeals

5

Denton is a case in which the parties had served all their witness statements for use at trial by 27 July 2012, yet the claimant served six further statements in December 2013 one month before the date fixed for a 10 day trial. The further statements were said to be in response to a change of circumstances that had occurred in August 2013. The judge granted the claimant relief from the automatic sanctions in CPR rule 32.10, which provides that: "[i]f a witness statement …for use at trial is not served … within the time specified by the court, then the witness may not be called to give oral evidence unless the court gives permission". As a result the trial had to be adjourned. The defendant and Part 20 defendant appeal with permission from Jackson LJ.

6

In Decadent, the claimant failed to comply with an order which provided that, unless it paid certain court fees by 4.00 pm on 19 December 2013, its claim would be struck out. A cheque for the full fees was sent to the court on the due date by document exchange, so that it could have been expected to arrive only one day late. In fact, the cheque was lost either in the DX or at court, and the non-payment only came to the attention of the parties when the judge mentioned it at a pre-trial review on 7 January 2014. They were paid on 9 January 2014. The judge refused relief from sanctions on 18 February 2014 and permission to appeal was granted by Davis LJ.

7

Utilise is a slightly more complicated case in that two breaches were under consideration. First, the claimant filed a costs budget some 45 minutes late in breach of an order which specifically made reference to the automatic sanctions in CPR rule 3.14 which provides that: "[u]nless the court otherwise orders, any party which fails to file a budget despite being required to do so will be treated as having filed a budget comprising only the applicable court fees". Secondly, the claimant was 13 days late in complying with an order requiring it to notify the court of the outcome of negotiations. The District Judge declined to grant relief from the sanctions in rule 3.14, holding that the second breach rendered the first breach, which would otherwise have been trivial, a non-trivial one. The judge on the first appeal held that, despite the fact that the District Judge had been wrong to think that there had been a previous default in filing a costs budget, there was no good reason for him to interfere with the exercise of her case management discretion. Accordingly, the judge dismissed the appeal. Lewison LJ granted permission for a second appeal to be brought.

Mitchell

8

Since Mitchell was decided in November 2013, there have been many first instance and appellate decisions on questions concerned with relief from sanctions. Almost all the decisions to which we have been referred have purportedly applied the guidance given in Mitchell.

9

The facts in Mitchell were that the claimant served his costs budget six days late and one day before the case/costs management conference at which it was due to be considered. The consequence was that the hearing had to be adjourned and another hearing arranged to deal with (a) the question of relief from sanctions and (b) the claimant's costs budget if relief were granted. The claimant's non-compliance caused substantial extra work and extra costs to be incurred by the defendant. It also disrupted the work of the court. The master had to vacate half a day which had been allocated to deal with asbestosis claims. She refused to grant relief from sanctions and the Court of Appeal upheld that decision. The master's decision was within the ambit of her case management discretion, so there was no proper basis upon which the Court of Appeal could set it aside.

10

At para 36 of the judgment in Mitchell, the court said of factors (a) and (b):

"These considerations should now be regarded as of paramount importance and be given great weight. It is significant that they are the only considerations which have been singled out for specific mention in the rule".

11

The court continued at para 37:

"We recognise that CPR 3.9 requires the court to consider "all the circumstances of the case, so as to enable it to deal justly with the application". The reference to dealing with the application "justly" is a reference back to the definition of the "overriding objective". This definition includes ensuring that the parties are on an equal footing and that a case is dealt with expeditiously and fairly as well as enforcing compliance with rules, practice directions and orders. The reference to "all the circumstances of the case" in CPR 3.9 might suggest that a broad approach should be adopted. We accept that regard should be had to all the circumstances of the case. That is what the rule says. But (subject to the guidance that we give below) the other circumstances should be given less weight than the two considerations which are specifically mentioned."

12

It then gave the following guidance:

"40. We hope that it may be useful to give some guidance as to how the new approach should be applied in practice. It will usually be appropriate to start by considering the nature of the non-compliance with the relevant rule, practice direction or court order. If this can properly be regarded as trivial, the court will usually grant relief provided that an application is made promptly. The principle " de minimis non curat lex" (the law is not concerned with trivial things) applies here as it applies in most areas of the law. Thus, the court will...

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