Jonathan Holt v Allianz Insurance Plc
| Jurisdiction | England & Wales |
| Judge | Mr Justice Andrew Baker |
| Judgment Date | 04 April 2023 |
| Neutral Citation | [2023] EWHC 790 (KB) |
| Docket Number | Case No: CF002/2022CA |
| Court | King's Bench Division |
[2023] EWHC 790 (KB)
Mr Justice Andrew Baker
Case No: CF002/2022CA
IN THE HIGH COURT OF JUSTICE
KING'S BENCH DIVISION
ON APPEAL FROM CARDIFF COUNTY COURT
HHJ Harrison
H00CF897
Cardiff Civil and Family Justice Centre
Benjamin Williams KC & Helen Rutherford (instructed by Principia Law Ltd) for the Appellant
Jonathan Hough KC & Edward Ramsay (instructed by Keoghs LLP) for the Respondent
Hearing date: 22 March 2023
Approved Judgment
This is a reserved judgment to which CPR PD 40E has applied.
Copies of this version as handed down may be treated as authentic.
Introduction
The appellant was involved in a road traffic accident on 16 July 2020 that, it is accepted, was the fault of the other driver, liability for whose negligent driving was covered by insurance provided by the respondent insurer. A car was provided to the appellant from 10 August to 3 September 2020 (inclusive), a rental period of 25 days, on credit hire terms agreed between him and Auxillis Services Ltd (‘Auxillis’).
On 4 September 2020, Auxillis presented a written claim to Allianz with a demand for payment of £10,387.50 (£8,656.25 + VAT) in respect of its credit hire charge for that hire period. Proceedings were threatened if payment in full was not received “ by return”. The claim amount was presented in a table with rows also for repair costs, engineer's fee and storage/recovery charges, all of which were stated at £0.00. In short, the credit hire charge of over £10,000 was the only claim intimated. A supporting document sent with the letter showed that the amount claimed represented 25 days rental at £343.05 + VAT, plus delivery and collection charges of £40 + VAT (each).
Allianz responded with evidence that it said showed a going rate at the time, to hire an equivalent car on ordinary rental terms (not credit hire terms), of just under £62 per day (including VAT), say £1,550 for a 25-day rental. That was based on rates available for 7-day hire periods, making £434 per week. If four 7-day rentals were used as a measure, that would be £1,736 to cover the 25 days for which Auxillis was claiming that the appellant needed a replacement car because of the accident.
Having in mind the prima facie irrecoverability of credit hire costs incurred in excess of an ordinary going car hire rate, under Dimond v Lovell [2002] 1 AC 384, Lagden v O'Connor [2003] UKHL 64, [2004] 1 AC 1067, and the cases that have developed the law since, Allianz asked Auxillis:
(i) to say whether the case for the appellant was one of impecuniosity, and
(ii) if it was, to disclose some basic documentation for that case.
Auxillis refused to countenance any such thing at the pre-action stage, and insisted on payment of its claimed amount in full if Allianz wished to avoid litigation. Allianz therefore applied for pre-action disclosure of:
(i) the appellant's bank, credit card and savings account statements covering the period of hire and three months prior to it;
(ii) wage slips or other proof of income covering the same period.
By Order dated 13 January 2022, following argument of the application on 18 October 2021 and the handing down of a reserved judgment dated 3 December 2021, HHJ Harrison granted the application. The judge refused permission to appeal, as did Steyn J on the papers.
On oral renewal of the application for permission to appeal, Bourne J granted permission, although he considered that the appeal did not have a real prospect of success. Bourne J judged there to be a compelling reason for the grant of permission because there was “ a divergence of practice between different courts. On the one hand, such orders for pre-action disclosure serve a clear and benevolent purpose. On the other hand, they are exceptional, especially when granted to defendants … [and] the reasons for making the order in this case could apply in many, if not most, other credit hire cases. In those circumstances, I consider it proper for the matter to be considered at High Court level because that may, I stress may rather than will, lead to guidance which would be binding at County Court level.”
The reference by Bourne J to a divergence of practice between different courts derived from examples he was shown or told about of County Court decisions in factual circumstances similar to those of the present case variously allowing or refusing pre-action disclosure applications.
The appeal hearing came before me, leading now to this judgment.
One of the appellant's arguments was that under CPR 52.21(1)(b), I should say that it was in the interests of justice to re-hear the CPR 31.16 application de novo, rather than limit myself in the normal way to a review of the decision below. I explored that idea with Mr Williams KC, but rejected it, at the hearing. It seemed to me its premise, in substance, was that what I might say as to the applicable law, or the approach to the exercise of the pre-action disclosure power, would be more authoritative upon a rehearing than upon a review, or that how I chose to exercise my discretion in this case upon a re-hearing would be authoritative rather than only being, as in truth it would be, an exercise of a discretion by a judge on a particular occasion. I think that premise is false.
I therefore turn now to the law relevant to the application before HHJ Harrison and therefore to this appeal, before summarising the claim correspondence that gave rise to that application and reviewing the judge's decision on it.
The Law
The County Courts Act 1984 provides, by s.52(2), that:
“ On the application, in accordance with rules of court, of a person who appears to the county court to be likely to be a party to subsequent proceedings in that court, the county court shall, in such circumstances as may be prescribed, have power to order a person who appears to the court likely to be a party to the proceedings and to be likely to have or to have had in his possession, custody or power any documents which are relevant to an issue arising or likely to arise out of that claim–
(a) to disclose whether those documents are in his possession, custody or power; and
(b) to produce such of those documents as are in his possession, custody or power to the applicant or, on such conditions as may be specified in the order,–
(i) to the applicant's legal advisers; or
(ii) to the applicant's legal advisers and any medical or other professional adviser of the applicant; or
(iii) if the applicant has no legal adviser, to any medical or other professional adviser of the applicant.”
The leading authority on the scope of that power is Black v Sumitomo Corpn [2002] 1 WLR 1562, which considered the High Court's exactly similar power under s.33(2) of the Supreme Court Act 1981 (as it was then). The decisive point was that the judge had not given consideration to whether, as a matter of discretion, the pre-action disclosure sought in that case should be ordered, as a matter separate from and additional to his assessment that the conditions for the exercise of the power were satisfied.
The analysis and interpretation of the statute in the judgment of Rix LJ (with which May and Ward LJJ agreed), even if not ratio, was fully considered and so is strongly persuasive authority. It was relied on by Allianz in the argument before me and I was not invited by the appellant not to treat it as correct.
Rix LJ concluded that the requirement that the parties to the pre-action disclosure claim are “ likely to be” party to subsequent proceedings requires only that they may well be party to proceedings if proceedings are later commenced ( ibid at [71]–[72]). Mr Hough KC submitted, and I agree, that the other statutory requirements defined in that way must be construed similarly. Thus:
(i) the requirement that the respondent is “ likely to have or to have had” documents requires only that they may well have, or have had, documents; and
(ii) the requirement that such documents be relevant to an issue “ likely to arise” in the proceedings requires only that the issue, to which the documents would be relevant, may well arise.
The rule of court governing applications for pre-action disclosure, and under which Allianz made its application in the present case, is CPR 31.16. That rule applies where an application is made under any Act for disclosure before proceedings have been started ( CPR 31.16(1)) and requires that the application must be supported by evidence ( CPR 31.16( 2)). CPR 31.16(3) sets conditions to be satisfied before pre-action disclosure is ordered, CPR 31.16(4) requires certain terms to be included if it is ordered, and CPR 31.16(5) identifies some terms that may also be included, all as follows:
“ (3) The court may make an order under this rule only where–
(a) the respondent is likely to be a party to subsequent proceedings;
(b) the applicant is also likely to be a party to those proceedings;
(c) if proceedings had started, the respondent's duty by way of standard disclosure, set out in rule 31.6, would extend to the documents or classes of documents of which the applicant seeks disclosure; and
(d) disclosure before proceedings have started is desirable in order to–
(i) dispose fairly of the anticipated proceedings;
(ii) assist the dispute to be resolved without proceedings; or
(iii) save costs.
(4) An order under this rule must–
(a) specify the documents or classes of documents which the respondent must disclose; and
(b) require him, when making disclosure, to specify any of those documents–
(i) which are no longer in his control; or
(ii) in respect of which he claims a right or duty to withhold inspection.
(5) An order under this rule may–
(a) require the respondent to indicate...
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