Mansion Place Ltd v Fox Industrial Services Ltd
| Jurisdiction | England & Wales |
| Judge | Mrs Justice O'Farrell DBE,Mrs Justice O'Farrell |
| Judgment Date | 14 October 2021 |
| Neutral Citation | [2021] EWHC 2747 (TCC) |
| Docket Number | Case No: HT-2021-000033 |
| Court | Queen's Bench Division (Technology and Construction Court) |
[2021] EWHC 2747 (TCC)
IN THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
TECHNOLOGY AND CONSTRUCTION COURT (QBD)
Royal Courts of Justice
Strand, London, WC2A 2LL
Mrs Justice O'Farrell DBE
Case No: HT-2021-000033
Camille Slow & Dalton Hale (instructed by Addleshaw Goddard) for the Claimant
George Eyre (instructed by Excello Law Limited) for the Defendant
Hearing date: 6 th October 2021
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
The matters before the court are cross applications by the parties in respect of witness statements served for the trial in this matter, listed to commence on 18 October 2021. The applications raise issues as to the interpretation and requirements of Practice Direction 57AC, concerning trial witness statements in the Business and Property Courts.
Background to the dispute
By a contract dated 19 February 2020, the Defendant contractor agreed to design and build an extension to, and refurbishment of, student accommodation in Nottingham for the Claimant property developer.
Delays occurred to the project and the contractual dates for completion were not achieved. A dispute arose between the parties concerning the Claimant's right to deduct liquidated damages from sums claimed by the Defendant in a payment notice dated 22 October 2020.
The central issue is whether on 14 October 2020 Mr Mark Kite, managing director of the Defendant, entered into an oral agreement by telephone with Mr Shankar Ramanathan, a director of the Claimant, whereby the Claimant agreed that it would not deduct any liquidated damages from the Defendant in respect of the delays to the project, in return for which the Defendant would not claim any loss and expense.
The Claimant's position is that no binding agreement was made as alleged; alternatively any agreement amounted to a revocable waiver of rights which the Claimant validly retracted by means of a subsequent payless notice.
The Defendant's position is that there was a binding agreement as alleged; alternatively the liquidated damages provision is void and/or unenforceable because it is uncertain and/or a penalty and/or the Claimant failed to serve the required contractual notices.
Proceedings
The dispute was referred to adjudication, an award was given in the Defendant's favour and enforcement proceedings were settled by the Claimant's payment of £524,300 to the Defendant.
On 28 January 2021 the Claimant issued proceedings, seeking declaratory relief and repayment of the settlement sums paid to the Defendant.
The proceedings are being conducted under the Shorter Trials Scheme. At the case management conference held on 30 April 2021, Jefford J ordered that the trial should take place on 18 October 2021 with a duration of 3 days. Directions were given, including permission for witness statements to be served by 25 June 2021, with supplementary statements by 30 July 2021, in each case limited to Mr Ramanathan and Mr Maunder for the Claimant; Mr Kite and Mr Higginbottom for the Defendant.
The dates for the service of witness statements and supplementary witness statements were extended by consent.
On 20 July 2021, the day before witness statements were due to be served, Ms Roberts of Addleshaws, the Claimant's solicitors, sent an email to confirm the approach that would be used for cross-referencing the witness statements to the documents:
“In compliance with Practice Direction 57AC, each witness statement will be accompanied by a list of documents identifying what documents the witness has referred to or been referred to for the purpose of providing the evidence set out in their trial witness statement (PD57AC, paragraph 3.2). Documents will only be referred to in the body of the witness statements where necessary and if required for any of the reasons indicated in the Statement of Best Practice appended to this Practice Direction.
Paragraph 3.6 of the Statement of Best Practice requires that where documents have been referred to in accordance with the above the witness statement should not exhibit the document but should give a reference enabling it to be identified by the parties, unless it is a document being produced or disclosed by the witness that has not been disclosed in the proceedings. We intend to enable any such documents to be identified by inserting a cross reference to the number of this document in either the Claimant's Disclosure List (CDL) or Defendant's Disclosure List (DDL) as appropriate …
If you could please confirm that such an approach will be adopted by you it would be greatly appreciated. If not, please do let us know how you intend to identify such documents within the Defendant's witness statements.”
In response, Mr Belshaw of Excello Law, solicitors for the Defendant, stated:
“I have to confess I wasn't aware Practice Direction 57AC applied and have prepared the statements the “old fashioned way” by exhibiting documents referred to in the statements.
Whilst I am happy to adopt the approach suggested in your email below this will though require producing lists of documents for each statement identifying the documents referred to in the statements cross referenced to the disclosure lists which will take time which I haven't allowed for and don't have due to other work commitments. Because of this are you happy to nudge back the date for filing and exchange of statements of fact to 5:00pm on Friday 23 July 2021 as I will require this time to draw up the document lists cross referenced to the disclosure lists.
If you are happy to further extend the date for exchange of statements I will draw up a draft consent order for signing, dating and filing at court…”
The date for the witness statements was extended but, by email dated 21 July 2021, Mr Parker-Bishop of Addleshaws raised his concerns:
“I note with some surprise that you have failed to comply with Practice Direction 57AC in preparing your witness statements. Whilst this non-compliance causes us significant concern, our client is content to allow the extension requested. We reserve our client's right to bring this correspondence to the attention of the court in relation to costs in due course. I await to see how you propose to deal with this failure to comply with the Practice Direction so as to ensure that your statements are fully compliant with the same.”
Mr Belshaw replied by return email, stating:
“Firstly we haven't failed to comply with Practice Direction 57A hence the reason for my previous email to Bethany. Had I provided witness statements which didn't comply with Practice Direction 57A then there would be some force in the point which you are seeking to make.”
On 23 July 2021 the parties exchanged their respective witness statements.
By letter dated 10 August 2021 the Claimant raised concerns in relation to the Defendant's witness statements and compliance with PD 57AC.
By letter dated 13 August 2021 the Defendant replied, refuting the allegations of non-compliance and raising concerns in relation to the Claimant's witness statements.
Further exchanges took place but the parties were unable to resolve the issue.
The applications
On 16 September 2021, one day before the PTR, the Claimant issued its application, seeking the following orders:
i) pursuant to Paragraph 5.2 of Practice Direction 57AC, the first and second witness statements of Mr Mark Kite dated 23 July 2021 and 20 August 2021 respectively and the first witness statement of Mr Guy Higginbottom dated 23 July 2021 be redacted to remove those parts of the evidence that are said to be non-compliant with PD 57AC; and
ii) pursuant to Paragraph 4.4 of Practice Direction 57AC, the certificate of compliance in respect of the above witness statements be amended to include statements that the requirements of PD57AC were not discussed with or explained to the witnesses until after the statements had been drafted, and that they were not prepared in accordance with the Statement of Best Practice.
On 28 September 2021 the Defendant issued its application, seeking an order pursuant to CPR 32.1 and/or paragraph 5.2 of Practice Direction 57AC, that the first witness statements of Mr Shankar Ramanathan dated 23 July 2021 and Mr Matthew Maunder dated 23 July 2021 be amended/redacted to remove those parts of the evidence that are said to be non-compliant with those rules.
The Court has the benefit of reading witness statements in respect of the applications:
i) Mr Paul Barge of the Claimant's solicitors dated 16 September 2021;
ii) Mr Stephen Belshaw of the Defendant's solicitors dated 28 September 2021;
iii) Mr Guy Higginbottom, claims consultant for the Defendant, dated 28 September 2021;
iv) Mr Jake Parker-Bishop of the Claimant's solicitors dated 1 October 2021.
Relevant rules for trial witness statements
CPR 32.1 provides:
“(1) The court may control the evidence by giving directions as to –
(a) the issues on which it requires evidence;
(b) the nature of the evidence which it requires to decide those issues; and
(c) the way in which the evidence is to be placed before the court.
(2) The court may use its power under this rule to exclude evidence that would otherwise be admissible.”
CPR 32.4(1) defines a witness statement as:
“a written statement signed by a person which contains the evidence...
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