Hytec Information Systems Ltd v Coventry City Council

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeTHE MASTER OF THE ROLLS,LORD JUSTICE WARD,LORD JUSTICE AULD
Judgment Date04 December 1996
Judgment citation (vLex)[1996] EWCA Civ J1204-11
Docket NumberQBEN1 95/1516-7/B
Date04 December 1996

[1996] EWCA Civ J1204-11

IN THE SUPREME COURT OF JUDICATURE

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE QUEEN'S BENCH DIVISION (OFFICIAL REFEREE'S BUSINESS

(HIS HONOUR JUDGE HAVERY QC)

Royal Courts of Justice

Strand

London WC2

Before:

The Master of the Rolls

(Lord Woolf)

Lord Justice Auld

Lord Justice Ward

QBEN1 95/1516-7/B

Hytec Information Systems Limited
Plaintiff/Respondent
and
The Council of the City of Coventry
Defendant/Appellant

MR A WILLIAMSON (Instructed by Sharpe Pritchard, London WC1V agents for Mr J Wood, Coventry) appeared on behalf of the Appellant.

MR A MACGREGOR QC and MR J HAGE (Instructed by Messrs Cole & Cole, Oxford EX2 0SZ) appeared on behalf of the Respondent.

THE MASTER OF THE ROLLS
1

Lord Justice Ward will give the first judgment.

LORD JUSTICE WARD
2

This is an appeal by the defendant Council against two orders made by His Honour Judge Havery QC. By his first order, dated 9 June 1995, he ordered that the Defence be struck out, the plaintiff be at liberty to enter judgment in the sum of £48,000 with interest and that the Counterclaim be dismissed. Judgment was duly entered on 14 June 1995.

3

By his second order, dated 28 July 1995, he refused to enlarge the time limited by the previous order of His Honour Judge Hicks, dated 13 January 1995, for the defendant to comply with an earlier order of 4 November 1994 that he give further and better particulars of his Defence and Counterclaim. The learned judge on that occasion also refused to set aside his order of 9 June and the judgment entered pursuant thereto.

4

I need not state the facts at great length. The plaintiff is a company carrying on business in providing computer software. By a writ issued in August 1993, it sued for sums falling due under an agreement made in September l990 to provide a software package to the Local Authority's Education Committee designed for the more efficient management of schools.

5

By an Amended Defence the City Council claimed that the plaintiff had failed to ensure that the software performed in accordance with the contract and the defendant accordingly sought to reject the goods and terminate the agreement. There was a Counterclaim for the recovery of £200,000, being a part payment of the price. There were also allegations of a failure to provide an acceptable level of maintenance and support, and a failure to supply an updated system. It was alleged the goods were unfit for the purpose for which they were supplied and further damages were counterclaimed. The plaintiffs sought further and better particulars of that Defence and Counterclaim on 16 November 1993.

6

On 13 March 1994 the first order was made directing that the defendants serve particulars by 1 April. On 26 April, that time was extended to 6 May which was marked as a final extension. On 6 May some particulars were given which, despite or perhaps because of, incorporating 700 pages of various memoranda and print-outs, were held to be inadequate.

7

There was, therefore, a summons to strike out for failure to comply with the order, but on 4 November 1994 His Honour Judge Newman made the third order that particulars be delivered by by 2 December 1994. No particulars were served and the plaintiff restored the application to strike out which was fixed for hearing on 13 January 1995. On 12 January certain particulars were served, but again they were inadequate with the result that on 13 January His Honour Judge Hicks made the fourth order directing that, unless proper particulars were filed by 20 January, the Defence and Counterclaim were to be struck out.

8

On 20 January some particulars were served, but once again they were inadequate. In the result the plaintiff renewed its application to strike out the Defence and Counterclaim. This was granted by His Honour Judge Havery QC on 9 June 1995 when he made the first order now under appeal. A curious and unsatisfactory feature of that hearing was that counsel, who had attempted so unsuccessfully to comply with the previous orders, inexplicably made herself unavailable though she had long known of the hearing. She sent in her place her six months' pupil who was so overwhelmed by the complexity of the case that she indicated that she could do no more than seek an adjournment. The learned judge, not surprisingly, rejected the application to adjourn. The pupil and her instructing solicitors, who were the in-house lawyers to the City Council represented by a legal Executive, remained in court but took no further part in that hearing. Counsel for the plaintiff accordingly addressed the judge who made the orders I have indicated.

9

The arrogant attitude of counsel whose name appeared on the pleadings was that the particulars already supplied were good enough; that it was now for experts to report; that the application to strike out was frivolous; and even that the plaintiffs were to blame for delaying the proper progress of the litigation. That advice had been tendered to the Legal Excutive who accepted it without question. When, however, he found that his employer's Defence and Counterclaim had been struck out, he reported to his senior lawyer in the office. They took fresh advice from new counsel as a result of which they applied to the judge to reconsider his previous decision. It was that application which Judge Havery heard and disposed of on 28 July 1995 which is the subject of the second appeal.

10

I would summarise his judgment as follows. On 9 June he observed that the defendant was effectively unrepresented. He commented on the "voluminous document purporting to be Amended Further and Better particulars of the Defence and Counterclaim" and said:

"Had it not been drafted in a style reminiscent of what has been described as the greatest literature of the 20th century…."

11

(an allusion to James Joyce):

"I would have said it was illiterate gibberish in several places. it is very difficult, if not impossible to understand what the defendant is trying to say, if indeed the defendant is trying to say anything."

12

The learned judge was clearly not impressed with counsel's efforts. He pointed out that there was no application for him to extend the time and to give yet another chance to remedy the defect. He accordingly directed himself in accordance with the judgment of the Vice Chancellor, Sir Nicolas Browne-Wilkinson, in re Jokai Tea Holdings [1993] 1 All ER 630 to which I shall refer. He concluded that "the defendants did have the intention of ignoring or flouting the order" made by Judge Hicks; that they had "ample opportunity to sort out the position"; they had "shown no intention of doing anything to rectify the inadequacies in the particulars". Accordingly he was satisfied that the defendant had "behaved in a contumacious manner, apparently taking the view that it was not necessary to serve an intelligible pleading". He therefore made the orders I have recited striking out the Defence and Counterclaim.

13

In his judgment on 28 July 1995, the judge considered, first, whether he had the jurisdiction to entertain the application for an extension of time for compliance with an unless order even after the action had been dismissed. He concluded that he would have the jurisdiction, at any rate where the judgment in default had not been made after a hearing on the merits. Looking at that question he concluded that the hearing was a hearing on the merits and, therefore, there was no jurisdiction to rehear the matter. Had he held that there was such jurisdiction, he would have again dismissed the application because he was satisfied that the solicitor was seriously negligent over a long time, that counsel was not only seriously negligent but intended to flout the court's order and that the Council were responsible for the activity of their lawyers.

14

The judge concluded in strong terms that the defendants had been playing around for too long, "Enough is enough. I decline to exercise my jurisdiction, if I have any, to extend time" and accordingly the matter rested there.

15

It seems to me that on this appeal there are four issues to be resolved: (a) whether, and if so, in what circumstances, the court at first instance has "jurisdiction to set aside its own order and to rehear an application to strike out the proceedings"; (b) what is the proper test for striking out the proceedings for failure to comply with an "unless order"; (c) as a particular question, whether the contumacious conduct of a legal representative is to be held against the client who may be personally blameless for the inadequacies of the preparation of his case; (d) when discretion is properly exercised what is the right order in this case?

16

Looking to the first question and the court's jurisdiction, it seems to me that there may be some limited powers in a judge to revisit an interlocutory order not to change it, but only to vary the method of giving effect to it: see Lewis v Daily Telegraph Limited No 2 [1964] 2 QB 601. When, however, the order is final in its effect, then I apprehend that, unless provided for by the rules, there is no power in the judge to rehear his own decision. Lord Diplock said in de Lasala v de Lasala [1980] AC 546:

"The test whether a judgment or order finally disposes of the issues between the parties is not determined by inquiring whether for the purposes of the rules of court relating to time or leave to appeal it attracts the label `final` or ` interlocutory`. The test is: has the court that made the order a continuing power to vary its terms, as distinct from making orders in aid of in forcing those terms under a liberty to apply?"

17

Within that test this was a final order. If one then looks to the rules, one finds a power...

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