Legal Watch: Personal Injury May 2014 Issue: 016
Post Jackson/Mitchell Cases The full judgment of the Court of Appeal has now been handed down in Chartwell Estate Agents Ltd v Fergies Properties SA
In This Issue:
had granted the claimant relief from sanctions for failing to
• Post Jackson/Mitchell Cases
and another (2014) EWCA Civ 506. The judge at first instance serve witness statements within the specified time.
Both
parties had been in default and refusal of relief would have had the disproportionately severe consequence of effectively ending the claim.
• Disclosure • Cost/Alternative Dispute Resolution
In the proceedings, the claimant had sought disclosure of
certain documents from the defendant without which it claimed to be unable to complete witness statements. The defendant
refused disclosure. Exchange of witness statements did not
Events
stated that it had not finalised its statements because of the exchange date, the claimant applied for permission, as
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The judge, applying the recently revised CPR 3.9, granted
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take place by the time specified by the court. The defendant claimant’s stated position. Several weeks after the ordered
required by CPR 32.10, to serve the statements out of time. both sides relief from sanctions and an extension of time to exchange.
Refusing the defendant’s appeal, the Court of Appeal held that CPR 32.10 provided that where a witness statement was not served on time, the witness could not be called to give oral
evidence unless the court gave permission. Since the rules had determined the applicable sanction, there could be no argument that the sanction was unjust or disproportionate.
The question was therefore whether the sanction should be
disapplied in the particular case. For that purpose, the phrase “unless the court gives permission” in 32.10 could not be applied in a free-standing way. The court had to have regard to other relevant rules such as CPR 3.1, 3.8 and 3.9. The White Book suggested that CPR 3.9 did not apply in the instant
situation because, before trial, the CPR 32.10 sanction had not
had effect within the meaning of CPR 3.8. However, a broader reading was required. Otherwise, applications to extend time
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for service of a statement made before trial could stand on a
expectation which otherwise would have arisen. Mitchell
when the witness was actually to be called. The sanction
always prevail over any other circumstances.
significantly different footing from applications made at trial provided for in CPR 32.10 had effect once the time limit for serving the statement expired.
The judge had been entitled to decide the matter as he had. He had been justified in finding that the claimant’s non-
compliance was not trivial and that no good reason had been advanced to explain non-compliance. The parties’ correspondence showed a lack of understanding of the
requirements of the revised rules. Their approach had
been tantamount to setting their own timetable. Further, the claimant could have lodged witness statements by the specified date, even if needing to supplement them later in
had not said that the factors specified in CPR 3.9 would
‘The revised CPR 3.9 appeared unfortunately, but hopefully temporarily, to have promoted satellite litigation’
the light of subsequent disclosure. The default could not
A further factor was the defendant’s default. It had also
having been party to it. The judge had been required by CPR
relief, no doubt having calculated that if the claimant could
be entirely regarded as justifiable because of the defendant 3.9 to consider all the circumstances of the case, including
that the trial date would not be lost and no significant extra cost would be occasioned if relief were granted. He had
also been entitled to attribute importance to the fact that refusal of relief effectively meant the end of the action, since
the burden of proof was on the claimant and it would have
no evidence. Arguably, that was simply a consequence of the sanction under CPR 32.10. However, 32.10 did not
provide that failure to serve a witness statement resulted
in striking out. It would be unreal to disregard such a de facto consequence of termination. That could not, however,
necessarily be a determinative factor in the claimant’s favour, because of the requirements in Mitchell: circumstances other than those in CPR 3.9(a) and (b) were ordinarily to be given
less weight than those matters. The White Book suggested that where a witness statement was served late it would be
unjust to exclude the evidence from trial save in very rare
circumstances, but that stated the position too broadly. The revised CPR 3.9 and Mitchell required an altogether more rigorous approach. The judge had not decided to grant the
claimant relief solely because of a disproportionately severe consequence. He had concluded that it would be too severe
a consequence when set against all the background history and other matters. That had entitled him to depart from the
needed relief to rely on its witnesses, but had not applied for not rely on witness evidence it would not matter if it likewise
could not do so. That would be an unattractive result. The judge had been entitled to attach importance to that factor.
The revised CPR 3.9 appeared unfortunately, but hopefully temporarily, to have promoted satellite litigation. However,
one sure way to avoid that was for parties to comply precisely with rules and orders and, where that was not possible, to seek from court extensions of time and relief
from sanction at the earliest moment. The Court of Appeal’s reluctance to interfere with case management decisions applied not only to decisions where relief from sanction had been refused, but also to robust and fair decisions where relief had been granted.
Disclosure Cases dealing with disclosure are relatively rare but then
review it could not be regarded as infallible. It was almost
are of wider application.
not be taken as waiving its rights in documents which might
In Tchenguiz and others v Director of the Serious Fraud
matters in the body of the briefing note which indicated
permission to use certain documents which were said to be
disclosure. It was not similar in any relevant sense to other
privilege in judicial review proceedings relating to the
which no privilege had been claimed.
come along in pairs. Two commercial cases on this topic
inevitable that some mistakes might occur. The SFO could be inadvertently disclosed. Moreover, there were specific
Office (2014) EWHC 1102 (Comm) the claimants applied for
that there had been an obvious mistake in relation to its
subject to public interest immunity and legal professional
documents which had been disclosed and in respect of
collapse of the Icelandic banks.
its title, had been redacted in places, and had been disclosed
‘..it would have been obvious to a reasonable solicitor … that a mistake had been made by its disclosure’.
a report; (iii) two emails between the defendant (SFO) and
From the contents of the report, it was clear that it had been
CPR 31.20 states: “Where a party inadvertently allows a
privileged document to be inspected, the party who has inspected the document may use it or its contents only with the permission of the court.”
The documents in question consisted of (i) an Intelligence
Unit briefing note, which made no reference to legal advice in by a legally qualified employee of one of the claimants; (ii) the Treasury Solicitor; and (iv) a PowerPoint presentation prepared by the Icelandic Government, in respect of which a
public interest certificate had been issued. The SFO claimed
public interest immunity in respect of the latter document, and legal advice privilege and litigation privilege in respect
of the others. All of the documents had been disclosed inadvertently; therefore, the position was governed by CPR
31.20. It was common ground that the relevant guidelines were those set out by Clarke L.J. in Al Fayed (2002). Since
it was not a case where the receiving party in fact realised
that a mistake had been made, the issue was whether the
mistake would have been obvious to a reasonable solicitor in the position of the reviewer.
Refusing the application the High Court judge held that
although the claimants were entitled to rely on the SFO’s
legal team to conduct the disclosure process review
properly, given the scale and complexity of that disclosure
produced for the dominant purpose of the judicial review, and it would have been obvious to a reasonable solicitor, in
the position of the legally qualified employee who reviewed it, that a mistake had been made by its disclosure.
The subject line of the emails and their contents made it clear that the Treasury Solicitor was seeking instructions
about an application being made in the context of the
judicial review proceedings. It was therefore plain from the face of those emails that they were created for the dominant purpose of such an application. It followed that
they attracted litigation privilege, and that that would have been obvious to a reasonable solicitor in the position of the claimants’ solicitors.
The statement in Al-Fayed that the same principles applied
to public interest immunity as to legal professional privilege represented a correct statement of the law. Nevertheless,
those principles recognised that the court was exercising
The claimant submitted that the documents were all subject
That was equally true of the position under the CPR 31.20.
and highly confidential. He argued that, having sent them
an equitable jurisdiction and that there were no rigid rules. The fact that a public interest certificate had been issued in
respect of the PowerPoint presentation was a very potent and relevant matter to consider. It was not the case that,
absent obvious mistake, the court would be bound to grant permission to use the documents; any such conclusion
would be contrary to the Al-Fayed principles. Since the court had not been invited to consider whether the public interest immunity was properly claimed, or should be
overridden having regard to the private interests of the parties, the public interest certificate had to be taken at face value and given effect, without deciding whether the instant case was one of “obvious mistake”. Accordingly, the SFO
was granted the relief sought and the discretion under CPR 31.20 was not exercised in the claimants’ favour.
In the second case, Shepherd v Fox Williams LLP and others (2014) EWHC 1224 (QB) the applicant/claimant applied
for summary judgment in his claim for delivery up, and/or destruction of, certain documents against the respondent/ defendants.
The claimant’s partner was a former employee of the second respondent. The partner had brought employment tribunal proceedings against the second respondent. The first respondent solicitors’ firm acted for the second
respondent in those proceedings and gave disclosure of several documents which related directly to the claimant’s
personal affairs, including documents relating to his divorce and financial position. The second respondent, in response
to the claimant’s request to explain how it had obtained those documents, said that they had been lawfully obtained
during an examination of its own computer system. It was
common ground at the instant hearing that the documents had been on the second respondent’s server, having been stored there as a result of the claimant’s partner viewing or
opening them on her work computer during her employment
with the second respondent after the claimant had emailed them to her.
to legal advice and litigation privilege, without prejudice to his partner’s personal email address and not to her work
email address, he had not waived his privilege in them. The second respondent argued that it was likely that the claimant had emailed the documents to his partner’s work
email address and that in doing so he would, or should, have known that the second respondent would have an electronic
information policy in place meaning that his partner would
have no expectation of privacy in relation to the documents. Finding in favour of the claimant, the High Court judge held that there was no dispute that the claimant was entitled to assert privilege in respect of the relevant documents. In
those circumstances the ultimate question was whether he had communicated the privileged documents to his partner
in circumstances importing, expressly or impliedly, that she should treat them as confidential, in which case privilege was maintained; or whether the documents had been disclosed to her with no express or implied requirement,
that they should be treated as confidential so that there
had been a waiver, on a limited basis, of privilege. There
was no evidence whatsoever to support the respondents’
assertion that the claimant, or his solicitors, had emailed the
privileged documents to the partner’s work email address. Accordingly, there was no factual foundation for the
respondents’ case based on waiver. Any proposition that by sending the documents to his partner’s personal email
address, was to be treated as having waived his privilege
in relation to her employer, went too far. It would have been
contrary to the interests of the administration of justice if privilege was regarded as waived in such circumstances or
treated as waived generally because a privileged document
was disclosed for a limited purpose by a party who plainly did not contemplate doing anything which might cause his
privilege to be lost. The fact that the claimant might not be able to assert privilege against his partner did not mean that he should be taken to have waived privilege more generally
or in relation to the respondents specifically. There was no evidence that the claimant had asked his partner to forward
the documents to her work email address or to copy them
to her employer’s server; he had merely asked her to review
and comment on them. She was aware that the documents were privileged, highly confidential and contained sensitive personal data, and she had not realised that they would
be stored on the server as a result of her actions. Further, there was no evidence that the claimant had been aware
of the second respondent’s electronic information policy and it was not entitled to rely on that policy to argue that
privilege had been waived. Accordingly, given the highly confidential nature of the documents, the limited purpose for which they were forwarded to the claimant’s partner
and the circumstances in which they were communicated by the claimant to her (which carried implied obligations of
confidentiality), there was no arguable basis for contending
that the claimant had waived his privilege in the relevant documents, notwithstanding that they had been found on the second respondent’s computer system. In those
circumstances, the claimant’s application to strike out was well founded.
Comment These cases clearly illustrate the care that is required when handling privileged documents, particularly those held in
electronic format. It is not merely the content that must
be kept in mind but also the consequences of sending the material electronically to a third party.
Costs/Alternative Dispute Resolution The case of PGF II drove home the need for a party to
The defendant submitted that it was entitled to its costs
engage in ADR. The case of R (on the application of Paul
that there should be no order as to costs, primarily because
seriously consider any offer made by another party to
because it was the successful party. The claimant argued
Crawford) v Newcastle Upon Tyne University (2014) EWHC
the defendant had unreasonably refused to engage in
position where more than one form of alternative dispute
the handbook had been clearly drafted.
1197 (Admin) involved the court considering the costs’ resolution (ADR) was available.
mediation and because there would have been no claim if
Education. In November 2011 the adjudicator provisionally
‘..it was difficult to see how the defendant was being unreasonable in not engaging in a different and further form of ADR’
to start judicial review proceedings, so the complaint
The High Court judge held that when the claimant was
claimant immediately invited the defendant to attempt
simultaneously been pursuing his complaint before the
The claimant had failed his final year examinations. He
repeated the final year and failed again. He appealed, asserting that the defendant had not calculated his grade
in accordance with the Bachelor of Medicine and Bachelor of Surgery Stage 5 Handbook for 2010/2011. His appeal and a subsequent review were rejected. Whilst pursuing
the internal appeals process the claimant had repeated his complaint to the Independent Adjudicator for Higher
rejected the complaint. The claimant expressed an intention terminated. The proceedings began in May 2012. The mediation. The defendant’s solicitors said that they agreed,
in principle, to ADR, but that they needed to take instructions
from the defendant. They asked what the claimant had in mind. He replied that he wanted to undertake a 12-month medical placement before resitting his final examinations for
a second time. He suggested that his proposal be explored
in mediation. The defendant did not reply. In the meantime, on 2 July 2012, the judicial review proceedings were stayed on the claimant’s application pending the reopening and final
determination of his adjudication complaint. The complaint was found to be unjustified, although the adjudicator briefly
noted that the defendant’s handbook could have been clearer. In April 2013 the defendant sent the claimant a Part
36 offer letter, offering to bear its own costs if the claimant
discontinued his claim. The claimant did not reply and the offer was withdrawn. The judicial review claim was heard in December 2013 and dismissed.
inviting the defendant to engage in mediation, he had
adjudicator. Both parties had fully engaged with the adjudication process, whose issue was the same as
that in the judicial review proceedings. The reality of the situation was that the adjudication process had been a
form of ADR. The fact that the defendant’s solicitors had agreed in principle to ADR did not amount to an unqualified acceptance that it was appropriate, especially as there had
been no proposal from the claimant as to what mediation might achieve. To the extent that it had been proposed to
resolve whether the claimant’s final examination had been
correctly marked, that matter had already been pursued before the adjudicator, so it was difficult to see how the
defendant was being unreasonable in not engaging in a
different and further form of ADR. There had been nothing
further to mediate beyond the substance of the claimant’s claim that he was entitled to his degree because his final
paper had been wrongly marked. He had already been allowed to resit his final year. It was not in dispute that the
defendant could, in exceptional circumstances, allow a
further resit, but the claimant had not raised any exceptional circumstances; it had not been enough for him simply to say that he wished to undertake a placement before a
second resit. After the adjudication, the defendant had been
entitled to take the view that it had grounds to resist the challenge made to its decision; such a stance could not be characterised as unreasonable. Furthermore, the claimant’s
case in mediation was to seek an outcome different from
that which was sought in the judicial review proceedings: the objective of the former was to persuade the defendant to allow the claimant a second resit, whereas the purpose of
the latter was to attack the content of the handbook. There
had, therefore, been no reasonable prospect of the mediation succeeding. The defendant had been discourteous in not
responding to the claimant’s mediation invitation. Silence
might be unreasonable and lead to costs sanctions even if an outright refusal to participate would have been justified on reasonable grounds. However, that was not an invariable rule; the burden remained on a claimant to show that the failure to respond had been unreasonable. The
defendant’s solicitors had responded. It could not be said that the defendant had refused to engage in ADR because it had engaged with the adjudication process. There was, therefore, no reason to depart from the general costs rule.
Whilst the adjudicator had criticised the handbook as being
ambiguous, the claimant’s case was that the handbook was unambiguous in his favour and that if it had been properly applied, he would have passed his final examination. There
was no basis for depriving the defendant of its costs simply because the terms of the handbook were not clear.
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