This is a brief note on an important Court of Appeal judgement. Mitchell v News Group Newspapers Ltd is actually a defamation case but it is an essential point of reference for anybody involved in civil litigation.

The case concerns the scope of the new CPR 3.9(1), which concerns applications for relief from court sanctions, and which replaced the old checklist from 1/4/13:

“On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need—

(a) for litigation to be conducted efficiently and at proportionate cost; and

(b) to enforce compliance with rules, practice directions and orders.”

The implications of this Rule could hardly have been more serious for the Claimant and his solicitors, who failed to file a costs budget within the time limits prescribed by the relevant practice direction until a day before the case management hearing. The High Court Master found that there was no adequate excuse for the late filing of the budget, the whole process had been prejudiced and applying CPR 3.14, a costs budget that was in excess of £500,000 was limited to the court fees only. The Claimant’s application for relief from sanctions was heard about 6 weeks later and involved the vacation of a hearing involving victims of asbestos exposure. The solicitors gave an account of their overstretched resources, the lack of prejudice to the Defendant by the late filing and the windfall to the Defendant in terms of costs protection. Nevertheless, the judge refused the application for relief and the Claimant’s appeal to the Court of Appeal was likewise dismissed.

The Court of Appeal gave general guidance on the scope of CPR 3.9 at paras 40-41 of its judgement:

We hope that it may be useful to give some guidance as to how the new approach should be applied in practice. It will usually be appropriate to start by considering the nature of the non-compliance with the relevant rule, practice direction or court order. If this can properly be regarded as trivial, the court will usually grant relief provided that an application is made promptly. The principle “de minimis non curat lex” (the law is not concerned with trivial things) applies here as it applies in most areas of the law. Thus, the court will usually grant relief if there has been no more than an insignificant failure to comply with an order: for example, where there has been a failure of form rather than substance; or where the party has narrowly missed the deadline imposed by the order, but has otherwise fully complied with its terms. We acknowledge that even the question of whether a default is insignificant may give rise to dispute and therefore to contested applications. But that possibility cannot be entirely excluded from any regime which does not impose rigid rules from which no departure, however minor, is permitted.

 

If the non-compliance cannot be characterised as trivial, then the burden is on the defaulting party to persuade the court to grant relief. The court will want to consider why the default occurred. If there is a good reason for it, the court will be likely to decide that relief should be granted. For example, if the reason why a document was not filed with the court was that the party or his solicitor suffered from a debilitating illness or was involved in an accident, then, depending on the circumstances, that may constitute a good reason. Later developments in the course of the litigation process are likely to be a good reason if they show that the period for compliance originally imposed was unreasonable, although the period seemed to be reasonable at the time and could not realistically have been the subject of an appeal. But mere overlooking a deadline, whether on account of overwork or otherwise, is unlikely to be a good reason. We understand that solicitors may be under pressure and have too much work. It may be that this is what occurred in the present case. But that will rarely be a good reason. Solicitors cannot take on too much work and expect to be able to persuade a court that this is a good reason for their failure to meet deadlines. They should either delegate the work to others in their firm or, if they are unable to do this, they should not take on the work at all. This may seem harsh especially at a time when some solicitors are facing serious financial pressures. But the need to comply with rules, practice directions and court orders is essential if litigation is to be conducted in an efficient manner. If departures are tolerated, then the relaxed approach to civil litigation which the Jackson reforms were intended to change will continue. We should add that applications for an extension of time made before time has expired will be looked upon more favourably than applications for relief from sanction made after the event.

So, whereas in the past a hearing that had been aborted through late filing of documents might have been visited with a costs order against the defaulting party, the new regime is intended to impose even stricter sanctions than before. We are familiar I think with the practice whereby the date for exchange of standard disclosure and witness statements is postponed with the agreement of the parties (often occasioned by a heavy workload). In the light of this judgement, parties will be persisting in this practice at their peril and will be best advised to file agreed revised directions with the Court before the time for compliance arrives.