Relief for Litigators

Litigators across the country breathed a collective sigh of relief as the 73rd update to the Civil Procedure Rules came into force on 5th June 2013.  Coupled with the recent decision by the Court of Appeal in the case of Chartwell Estate Agents Limited v Fergies Properties SA & Hyam Lehrer [2014] EWCA Civ 506 there now appears to be some respite from the perceived harshness of Jackson reforms that were introduced on 1st April 2013.

Since April 2013, the courts have adopted a near ‘zero-tolerance’ approach when it comes to enforcing compliance with court orders, rules and practice directions.  The leading case involved the  solicitors acting for the MP Andrew Mitchell in his case against the Sun newspaper.  In that case, the solicitors failed to file their costs budget within the required time.  The sanction for this failure (set out in CPR 3.14) – applied by the High Court and upheld in the Court of Appeal – means Mr Mitchell will be unable to claim his legal costs if the claim succeeds and will be only recover the court fees.  Mr Mitchell’s costs budget is reported to have been £506,425 – a very substantial loss which has presumably been borne by his solicitors.

The recent changes to the CPR and the case of Chartwell would not have changed the outcome in Mr Mitchell’s case, but they do soften some of the knock-on effects of the judgment.

There are concerns that the Jackson reforms have stopped co-operation between parties and in some cases led to cheap point scoring on procedural issues (see Summit Navigation Ltd v Generali Romania Asigurare Reasigurare SA [2014] EWHC 398).  The amendment to CPR 3.8 to include rule 3.8(4) allows the parties (by prior written agreement) to agree 28 day extensions to rules, practice directions and court orders, provided hearing dates are not put at risk and the court has not ordered otherwise.  It is already known colloquially as the ‘buffer-rule’ and should bring back common sense in dealings between the parties.

The decision in Chartwell shows that the courts are willing to take account of factors other than those listed in CPR 3.9 when considering whether to grant relief from sanctions where there has been a failure to comply with a rule, practice direction or court order.  In that case, both parties had failed to exchange witness evidence in accordance with a court order. Importantly, this was not considered trivial but relief from sanctions was nonetheless granted. The judgment is nuanced but importantly both parties were in default, the trial date could be maintained and it was considered that refusing relief would grant the defendant a windfall.  It should be  emphasised that the decision is fact specific and unlikely to be of general assistance to parties seeking relief from sanctions.

The amendment to CPR 3.8 and the decision in Chartwell show the high-water mark of the judiciary’s zero-tolerance approach has been reached. Compliance with court rules and orders, however, remains essential.

Jack Waller, Personal Injury Solicitor