Walsham Chalet Park Ltd (t/a The Dream Lodge Group) (Claimant/ Respondent) v Tallington Lakes Ltd
| Jurisdiction | England & Wales |
| Judge | Lord Justice Richards,Lord Justice McCombe,Lady Justice Sharp |
| Judgment Date | 12 December 2014 |
| Neutral Citation | [2014] EWCA Civ 1607 |
| Docket Number | Case Nos: A3/2014/0399, 0399(A), 0399(B), 0681 |
| Court | Court of Appeal (Civil Division) |
| Date | 12 December 2014 |
[2014] EWCA Civ 1607
Lord Justice Richards
Lord Justice McCombe
and
Lady Justice Sharp
Case Nos: A3/2014/0399, 0399(A), 0399(B), 0681
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
MERCANTILE COURT
HHJ Mackie QC
Royal Courts of Justice
Strand, London, WC2A 2LL
The appellant was represented by its director, Mr Neil Morgan
Mr Michael Buckpitt (instructed by Charles Fussell & Co LLP) for the Respondent
Hearing date: 27 November 2014
The matters before us relate to case management decisions by His Honour Judge Mackie QC, sitting in the Mercantile Court, in a case which the judge described as "one of the least manageable I have ever tried to manage".
The case arises out of the termination of a joint venture agreement by which the claimant was to market and sell caravans and lodges to be pitched at the defendant's site. There is a dispute as to whether the agreement was terminated consensually or because the defendant repudiated it. Each party alleges that the other failed to account for payments received in respect of transactions entered into during the period of the agreement. The claimant seeks the value of stock which was at the defendant's premises when the agreement ended and which the defendant refused to allow the claimant to collect. There are claims for loss of profit. The claimant values its total claim at over £500,000, whilst the defendant values its counterclaim at over £200,000.
By orders dated respectively 6 December 2013 and 7 February 2014 the judge dismissed applications by the defendant that the claim be struck out for, among other things, failure to comply with the timetable laid down by an earlier order as regards disclosure, service of a schedule of account, and exchange of witness statements. The following matters arise:
i) The defendant's appeal against the order of 6 December 2013. Permission to appeal was granted by Briggs LJ. The claimant applied to set aside the grant of permission. The set-aside application was listed for hearing together with the appeal and was not formally abandoned before us but the issues in it were subsumed within the substantive issues on the appeal.
ii) The defendant's application for permission to appeal against the order of 7 February 2014, listed before us on the basis that the appeal would follow immediately if permission was granted. The issues are closely related to those arising in relation to the order of 6 December 2013.
iii) The defendant's application for permission to amend the grounds of appeal against the order of 6 December 2013 so as to add a detailed allegation (briefly advanced in the application for permission to appeal against the order of 7 February 2014) that the judge was biased or prejudiced against the defendant and should have recused himself from further involvement in the proceedings.
It is convenient to retain the first instance terminology of "claimant" and "defendant" rather than referring to "respondent" and "appellant" respectively.
The defendant has been represented throughout by its director, Mr Neil Morgan. Although he is a non-lawyer, he has displayed a considerable knowledge of the relevant rules and authorities, to which he says he has devoted many hours of reading for the purposes of the appeal, having previously been wholly unfamiliar with them. The claimant has been represented throughout by counsel (Mr Daniel Saoul before Judge Mackie, Mr Michael Buckpitt before us).
The relevant procedural history
The claim was issued, and a defence and counterclaim was filed, in June 2012. All the case management has been done by Judge Mackie. I will not attempt a full procedural chronology but will pick out what appear to me to be points of particular relevance.
The order the judge made at the first effective CMC, on 25 January 2013, included provisions that (i) standard disclosure was to be made by 12 April 2013 and inspection was to be completed by 7 days thereafter; (ii) the claimant was to file and serve by 10 May 2013 a schedule of account setting out the transactions claimed to have been conducted pursuant to the agreement and identifying the monies paid or payable to each party in connection with each such transaction; (iii) the defendant was to serve a counter-schedule of account by 24 May 2013; (iv) signed statements of witnesses of fact and any required hearsay notices were to be exchanged by 21 June 2013; and (v) the trial was to be fixed for a date not before 30 August 2013, with a time estimate of 4 days.
At the second effective CMC, on 23 April 2013, the judge heard, among other matters, an application by the defendant for a strike-out and/or summary judgment in respect of the claimant's allegations of repudiatory breach of contract. The judge dismissed the application and ordered the defendant to pay the claimant's costs of that and a further application, summarily assessed in the total sum of £4,900, by 7 May 2013. That triggered secondary applications:
i) The defendant applied to the Court of Appeal for permission to appeal against that part of the judge's order. Permission was refused on the papers in January 2014. We are told that the hearing of the oral renewal has been stood out pending determination of the matters now before us. In conjunction with the application for permission to appeal, the defendant sought a stay of execution of the costs order. No stay was granted. The defendant has nevertheless failed to comply with the order.
ii) On 10 June 2013 the claimant filed an application that the defence and counterclaim be struck out unless the defendant paid the costs of £4,900 within 7 days of the hearing of the application.
The order made by the judge at the CMC on 23 April also included variations to the timetable laid down in the 25 January order, including provisions that (i) standard disclosure be made by 27 May 2013; (ii) the claimant's schedule of account be filed and served by 21 June 2013; (iii) the defendant's counter-schedule of account be filed and served by 5 July 2013; (iv) witness statements be exchanged by 2 August 2013; and (v) the start date of the trial (which had been fixed for 9 December 2013 pursuant to the previous order) be adjourned to 13 January 2014.
On 14 May 2013, that is before the 27 May deadline for standard disclosure, Mr Morgan sent an email to the claimant's solicitor, Mr Winter, identifying various categories of documents the disclosure of which the defendant demanded. In a reply dated 7 June, Mr Winter said that the claimant "will deal with disclosure as soon as possible in the conventional way by serving our client's List of Documents". By an email on 10 June Mr Morgan repeated that full and frank disclosure was required of all documentation within the categories previously identified. On 11 June, on receipt of the claimant's application for a strike-out for non-payment of the costs ordered on 23 April, Mr Morgan sent a further email, in the course of which he said this about disclosure:
"On the subject of applications, you should note that we have not so far applied for your claim to be struck out because you have failed to comply with the disclosure deadline order. This is simply because you would then rush to complete disclosure before any deadline of any unless order and provide everything. However, we want you to take your own sweet time. You take as much time as you like. We have no doubt that you and your client are trying to shred documents / destroy documents / hide documents as fast as you possibly can. Just be aware of what the consequences will be if we catch you. And we are going to be trying really hard to catch you."
In his submissions to us, Mr Morgan sought to explain all that by saying that he was expecting the claimant's disclosure to be made very soon in any event. But whatever he intended, the message conveyed by the email was that the timing of disclosure was not a matter of concern to the defendant.
Mr Morgan's email of 11 June also attached the defendant's own list of documents by way of (late) compliance with the disclosure provision in the order of 23 April. Mr Winter replied by letter of 12 June acknowledging receipt of the defendant's list, apologising for the delay in serving the claimant's list (which was attributed to Mr Winter's other commitments) and stating that he would seek to serve it as soon as possible. That was the last communication between the parties on the subject of disclosure until the end of September or early October. Further exchanges between them in July related to the claimant's application for a strike-out for non-payment of the costs order.
The communications from Mr Morgan included some unpleasant and abusive language which was subsequently the subject of adverse comment by Judge Mackie. It is not directly relevant to the issues before us and I do not need to deal with the explanation that Mr Morgan gave us for his behaviour. He was restrained and courteous in his conduct of the defendant's case at the hearing of the appeal.
The claimant says that by letter dated 30 September 2013 it sent its list of documents to the defendant, offered inspection or the provision of copies of those documents, and requested copies of all the documents disclosed on the defendant's list. The defendant says that it did not receive such a letter. A follow-up letter from the claimant was sent by email on 8 October, also enclosing the schedule of account...
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...strike-out application the proportionality of the sanction is very much in issue; see Walsham Chalet Park Ltd v Tallington Lakes Ltd [2014] EWCA Civ 1607 at [44]. (3) If the Court is able to say that a case is “unwinnable” such that continuance of the proceedings is without any possible be......
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