Joyce v West Bus Coach Services Ltd [2012] EWHC 404 (QB)

Case No QB/2011/0655[2012] EWHC 404 (QB)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Venue Royal Courts of Justice, Strand, London, WC2A 2LLDate 01/03/2012
Before
MR JUSTICE KENNETH PARKER
Between
MICHAEL ANTHONY JOYCEClaimantWEST BUS COACH SERVICES LIMITEDDefendant
Mr R Marven (instructed by MTA Solicitors LLP) for ClaimantMark Turner QC (instructed by Berrymans Lace Mawer LLP) for DefendantHearing Hearing date: 21 February 2012
JudgmentMr Justice Kenneth Parker :
[1]This is an application to appeal against the order (“the challenged order”) of HH Judge Winstanley of 22 July 2011 allowing the appeal of the Claimant against the order of District Judge Grosse of 10 December 2010 whereby, among other directions, the Claimant’s claim was struck out (by virtue of breach of an earlier order of 3 September 2010) and the Claimant was ordered to pay the Defendant’s costs of the proceedings, assessed at £1580. The basis of the challenged order was that, as at 10 September 2010, the Claimant had not breached the “unless” order of 3 September 2010 in any material respect, that on 17 September 2010 the Claimant had accepted a Part 36 offer, and that the acceptance of such offer had brought the claim to an end at that date, with the result that the District Judge had no power to strike out a claim which had been stayed by operation of the Rules of Court.[2]If HH Judge Winstanley was wrong to conclude that the Claimant had not breached the “unless” order of 3 September 2010 as at 10 September 2010, the claim would have been treated as automatically struck out on 10 September 2010, and the question would arise whether, the claim having been struck out, the Part 36 offer was still capable of acceptance on 17 September 2010. This question is of general importance; I am satisfied that the Defendant (the proposed Appellant in this appeal) had made out an arguable case; and I grant permission to appeal.

Background

[3]The Claimant’s vehicle was damaged in an accident on 29 August 2008 as a result of the Defendant’s admitted negligence. In consequence the Claimant had his vehicle repaired; and he hired a replacement vehicle from Helphire from 10 September 2008 until 30 October 2008 at a total cost of £22,230.77 (including VAT).[4]Under cover of a letter dated 2 March 2009 the Defendant’s insurers, QBE, sent Helphire a cheque for £11,976.78 in respect of repair and hire charges. The letter of even date from QBE explained that the sum of £11,976.78 comprised: £6,854.01 (i.e. £5,833.20 plus VAT) in respect of hire, £5,064.03 (i.e. £4,309.81 plus VAT) for repairs plus £58.75 (i.e. £50 plus VAT) administration fee.[5]In due course in July 2009 the Claimant issued proceedings for the balance of the hire charges, i.e. £15,376.77 (being £22,230.77 minus £6,854.01, with what was presumably a rounding error of a penny). The Defence admitted liability but disputed the sum of £15,376.77.[6]On 10 September 2009 the Defendant’s solicitors, Berrymans Lace Mawer (“BLM”), sent the Claimant’s solicitors MTA Solicitors LLP (“MTA”) a Part 36 offer letter offering £6,912.76 in respect of the claim.[7]On 22 September 2009 the Court allocated the claim to the fast track and gave directions. Following an application by the Defendant on 29 December 2009, the Court made, on paper and without a hearing, an “unless” order dated 12 January 2010 for the Claimant to serve witness statements by 27 January 2010; and to file a pre-trial checklist by 3 February 2010. The Claimant did not comply with this order and the claim stood struck out. However, it does not appear to be disputed that the Claimant did not receive either the application of 29 December 2009 or the order of 12 January 2010. Hence the Claimant made an application by notice dated 22 March 2010 to set aside the order of 12 January 2010.[8]At a telephone hearing on 3 September 2010 the claim was “reinstated” and further directions were given, as follows:
“2) By 4pm on 10 September 2010 the Claimant shall provide disclosure by filing and serving a standard disclosure list together with copies of all documents upon which he seeks to rely in respect of damages. … 4) By 4pm 20 September 2010 the Claimant shall file a pre trial listing questionnaire together with the appropriate listing fee. 5) The matter shall be listed for an assessment of damages at 10.30am on 23 September 2010 with a time estimate of 2 hours. 6) By 4pm 20 September 2010 the Claimant shall pay to the Defendants solicitors the costs of this application that have been summarily assessed at £535.50. 7) For the avoidance of doubt should the Claimant default in any one of the above directions set out in paragraphs 2 to 6 inclusive the claim will be struck out without further order and the trial date vacated.”
(emphasis added)[9]Under cover of a letter dated 9 September 2010 MTA sent BLM a List of Documents and a witness statement. BLM e-mailed MTA on 10 September 2010 explaining that the disclosure statement was not signed by the Claimant but by MTA, and saying that unless a list was received signed by the Claimant, they would apply to strike out the claim. Subsequently, on 10 September 2010, BLM wrote to the Court inviting the Court to strike out the claim.[10]On 17 September 2010 the Claimant purported to accept the Defendant’s 10 September 2009 Part 36 offer. On 22 September 2010 District Judge Grosse, apparently having considered the papers and on her own motion without hearing the parties, ordered that the action should be stayed pending payment of the listing fee [there seems to be a sub-issue whether the fee had in fact been lodged in the Court office by 20 September 2010, in compliance with the order of 3 September 2010 above] and filing the pre-trial check list. If the listing fee was not paid, and the pre-trial check list not filed by 6 October 2010, the claim was to be struck out. District Judge Grosse also vacated the trial date of 23 September 2010.[11]Immediately, on 23 September 2010, the Defendant applied that the order of 22 September 2010 should be set aside, on the ground that the Claimant had, in several respects, failed by 10 September 2010 to comply with the “unless” order of 3 September 2010, that pursuant to that order the claim stood automatically struck out on 22 September 2010, and that no further order was either appropriate or permissible on 22 September 2010. The Defendant’s application was not heard until 10 December 2010. The hearing was by telephone, with counsel being heard for each side. Claimant’s counsel at that time did not oppose the application. In particular, he did not resist the Defendant’s contention that the list of documents had not been served, as required by the order of 3 September 2010, by 10 September 2010. He did refer to the purported acceptance of the Part 36 offer on 17 September 2010, but treated such purported acceptance as irrelevant on the legally mistaken belief that the Part 36 offer had expired by effuxion of time. There was no application by the Claimant for relief from the sanction imposed by the order of 3 September 2010. Given the non-opposition of the Claimant and the absence of any application for relief, District Judge Grosse ordered inter alia that the order of 22 September 2010 should be set aside and that the claim be struck out pursuant to the order of 3 September 2010. In the light of the way in which the position was presented to her on 10 December 2010 it is very hard to see what other order she could have made. Certainly there was no argument that there was no relevant breach of the “unless” order by 17 September 2010 and that the claim was stayed on that date by reason of the acceptance of the Part 36 offer. Nor was there any argument that, even if the “unless” order had taken effect on 10 September 2010, the Part 36 offer still remained effective and could be accepted. Those arguments were deployed only on the appeal to HH Judge Winstanley in July 2011.[12]I turn to consider the issues raised in this appeal from the order of HH Judge Winstanley. Issue (1): Was there breach of the order of 3 September 2010 by 10 September 2010?[13]The first difficulty of the Claimant on this issue is that at the telephone hearing on 10 December 2010 Counsel for the Claimant (not Counsel who appeared on this appeal) conceded before District Judge Grosse that the Claimant was, on 10 September 2010, in breach of the order of 3 September 2010. The Defendant contended that that was the position, and counsel for the Claimant said this:
“… I am just explaining that on her own evidence [that is, on the evidence of those instructing him]… she says that the list of documents were filed and served on 14 September which, of course, is in clear breach of the unless order and that in itself was enough to strike the claim out.”
(emphasis added)[14]In allowing the appeal against the order of District Judge Grosse of 10 December 2010, HH Judge Winstanley does not explicitly address the concession made by counsel for the Claimant. However, that concession was made on instructions from counsel’s instructing solicitor, in the light of a witness statement, was unequivocal and was in substance a concession of fact, namely, that the list of documents, contrary to the peremptory order of 3 September 2010, had not been served by 10 September 2010. It does not appear that any proper explanation was given to HH Judge Winstanley as to how the concession came to be made and why it would be in the interests of justice to permit the Claimant, on appeal, to resile from an unequivocal statement of fact made to the court below. For my part I see no good grounds why the Claimant should have been permitted to resile from such a concession.[15]In any event, putting aside the concession, it appears to me that the order of 3 September 2010 was technically breached by late service of the list of documents. CPR 6.26 provides:
“A document, other than a claim form, served within the United Kingdom in accordance with these Rules or any relevant practice direction is deemed to be served on the day shown in the following table -”
The table stipulates that if the method of service is first class post, the deemed date of service is:
“The second day after it was posted, left with, delivered to or collected by the relevant service provider provided that day is a business day; or if not, the next business day after that day.”
[16]It is now common ground that the list, being a document within CPR 6.26, was posted first class on Thursday, 9 September 2010 and service was deemed to be effected on the next business day, that is, Monday, 13 September 2010, three days late.[17]The fact that the document was in fact received, and even acknowledged as received, by the Defendant putatively within time on 10 September 2010 is not relevant. In Godwin v Swindon Borough Council [2002] IWLR 997; [2001] EWCA Civ 1478, a claim form, although in fact received by the prospective defendant before expiry of the limitation period, was deemed under CPR r 6.7(1) (the predecessor to CPR r 6.26) to have been served after the expiry of that period. The headnote succinctly and accurately sets out the ratio of the Court of Appeal (Pill, May LLJ, Rimer J (dissenting in part)):
“CPR r 6.7(1) contained general rules about the service of documents, which applied to any document capable of being served either by the parties or by the court under the rules and dealt with all permitted methods of service other than personal service; that the purpose of the rule was to enable the parties to ascertain in relation to a document served otherwise than personally the date of service on which all court timetables depended; that the provision in rule 6.7(1) that “A document … shall be deemed to be served on the day shown in the following table” and the heading to the second column in the table “deemed day of service” clearly means that, for each of the five methods of service covered by the rule, the day to be derived from the second column was to be treated as the day on which the document was served; that in the case of the methods of service which were not bound to put the document literally in the hands of the person to be served on any particular day it was in the interests of the parties to have a deemed date of service which was certain and not subject to challenge on factual grounds, particularly where a claimant sought to serve a claim form at the very end of the available period; that (Rimer J dissenting in part) the deemed date of service laid down by the rule was not rebuttable by evidence nor were the limitation consequences for a claim form which was served late amenable to the court’s discretion; that, moreover, neither the power under rule 6.1(b) to order that the rules should not apply not the power to dispense with service under rule 6.9 could be used to enable the court to extend time in circumstances where rule 7.6(3) specifically forbade it; and that accordingly, the documents having been posted too late to be deemed to have arrived in time, the fact that they arrived earlier than the deemed day of service was of no help to the claimant.”
[18]Mr Robert Marven, on behalf of the Claimant, seeks to distinguish Godwin, on four grounds. First, he contends that, because District Judge Grosse took the draconian step of making the order of 3 September 2010 an “unless” order, she must have intended that the time for service under the order was either the time specified by CPR r 6.26 or, if the document was actually received before expiry of the time limit in the order, the time when it was so received. However, in my view, there is no force in that argument. There is nothing on the face of the order to support the intention that Mr Marven seeks to impute to the judge. Nor is it permissible to imply any such intention, which presumably would then be potentially imported into all “unless” orders that refer to service of documents. Such an implication would defeat in this context the interests of legal certainty, the paramount consideration in Godwin, because disputes would inevitably arise as to first, whether the alleged intention could be implied in the circumstances of a particular order, and second, whether a document served under an “unless” order had in fact been received before the deadline. There is nothing in Godwin to suggest that the nature of the order under which service of a document is to be effected is a material consideration, and, as observed above, a distinction of that kind is inimical to the rationale underlying the decision of the Court of Appeal.[19]Secondly, Mr Marven contended that Godwin should be restricted to claim forms. However, the ratio of the decision, as the citation of the headnote clearly demonstrates, extends to all documents, and any purported restriction of the ratio to claim forms would simply leave service of all other documents vulnerable to the legal uncertainty that the Court of Appeal in Godwin was anxious to avoid. Thirdly, Mr Marven points out that a list of documents had been served about a year before the unless order, in October 2009. However, the order of 3 September 2010 was clear on its face: whether or not a list had been served sometime in the distant past, the Court was insisting, particularly given the then expected imminence of the trial, that the Claimant serve an up-to-date standard disclosure list and that the Claimant specifically serve copies of all documents upon which he sought to rely at the forthcoming trial in respect of damages. It is somewhat obscure whether the list “served” on 10 September 2010 was the same as the list served in October 2009. However, it is generally not open to a party to say that a step in the action clearly required by the court to be taken between the date of the order and a time specified in the future has in fact already been carried out at some time in the past, and that the order is, therefore, redundant or has been complied with. Again, conduct of that kind would not properly respect the intention of the court and would furthermore simply be a recipe for disputes. It is not suggested here that compliance with the order in accordance with its strict terms was at all onerous to the Claimant. In short, the “unless” order was clear, unambiguous and had to be obeyed in accordance with its terms.[20]Fourth, Mr Marven contends that, by acknowledging on 10 September 2010 receipt of the list of documents, the Defendant was “estopped” from taking the point that the list was not served until 13 September 2010. However, an express agreement between the parties to extend the relevant time limit to 13 September 2010 could not be effective, and there is simply no room under CPR r 6.26 for any “estoppel” arising from conduct rather than by express agreement.[21]It does not appear that Godwin was drawn to the attention of the learned judge, and I very much doubt whether, if it had been drawn to his attention, he would have reached on this first issue the conclusion that he did at paragraph 13 of his judgment. I have sympathy for the judge because his reasoning reflected ancient practice and, as Godwin shows, was adopted by several judges in respect of the current Rules before Godwin laid down the law definitively. However, in my view, the judge’s conclusion cannot stand in the light of Godwin, and none of the points advanced by Mr Marven is sufficient to defeat the inescapable conclusion that, pursuant to CPR 6.26, service of the relevant list was effected on 13 September 2010, a few days beyond the time stipulated in the “unless” order of 13 September 2010.

Issue 2: What was the meaning of the “unless” order of 3 September 2010?

[22]There has been a contest between the parties upon what I would regard at the end of the day as a somewhat sterile issue, namely, the meaning of the words, “The claim will be struck out without further order”.[23]Mr Marven contends that in the context the word “claim” is a reference to a “statement of case” and that District

Judge Grosse was exercising the power explicitly conferred by CPR r 3.4(2):

“The court may strike out a statement of case if it appears to the court – (a) … (b) … (c) that there has been a failure to comply with a rule, practice direction or court order.”
[24]Mr Mark Turner QC, on the contrary, contends for the Defendant that “claim” means claim and is not a reference to a “statement of case”. District Judge Grosse was not exercising the power explicitly conferred by CPR r 3.4(2), but was making an order in the exercise of the court’s inherent jurisdiction, which is preserved by CPR r 3.1, and is noted at 3.4.5 (under the title “inherent jurisdiction to strike out”) in Civil Procedure, Volume 1, page 80, (“The White Book”) as follows:
“In addition to the power under r 3.4 the court has inherent jurisdiction to strike out any documents or strike out, dismiss or stay any proceedings which amount to an abuse of the court’s process… This jurisdiction is preserved by r 3(1) and r 3.4(5). It duplicates but is not limited to the express powers to strike out which are conferred by r 3.4(2).”
[25]Mr Turner QC also submitted that the meaning of “strike out” in the glossary at Section F of The White book, Volume 1, at page 2795, namely “the court ordering written material to be deleted so that it may no longer be relied upon”, was of no real assistance, because the glossary is a guide “to the meaning of certain expressions as used in these Rules”, and Mr Turner’s argument is that District Judge Grosse was exercising an inherent jurisdiction where “strike out” means no more than “put an end to”.[26]On this issue the learned judge concluded in effect that District Judge Grosse was exercising a power under the Rules, and I am inclined to agree with him. The circumstances before District Judge Grosse fell squarely within CPR 3.4(2)(c), which is tailor made to address the situation that had arisen in these proceedings. There was simply no need for District Judge Grosse to be exercising any “inherent jurisdiction”, outwith the tailor made Rule, when the Rules provided for the circumstances and conferred ample power on the court to make an appropriate order. Given that context, and a reasonable presumption that the court is exercising a power expressly conferred by the Rules for the purpose in question, I see no real difficulty in interpreting “claim” to mean “a statement of case”.[27]However, even if District Judge Grosse was striking out a statement of case under CPR 3.4(2)(c), the substantive effect of such an order was that the claim in the proceedings could no longer be pursued, unless the Claimant could obtain from the court relief from the sanction of strike out under CPR 3.9. The real question on this appeal is whether a claimant may accept a Part 36 offer, which has not been withdrawn and which ostensibly remains open for acceptance, notwithstanding that the court has made an order having the substantive effect described above. I turn to that issue.

Issue 3: Could the Claimant accept the Part 36 offer, notwithstanding the strike out?

[28]Mr Marven accepted that if a claim were dismissed following, for example, an interlocutory inter partes hearing, or final judgment was given or entered under, for example CPR r 3.5, a claimant could no longer accept a Part 36 offer that would otherwise have been open for acceptance. In this case, following the proven failure of the Claimant to comply with the “unless” order, the Defendant could have taken the formal steps to obtain judgment under CPR r 3.5, but did not do so. It is well established that, if there is a hearing under CPR r 3.5(5), the court’s function is limited to deciding what order should properly be made to reflect the striking out order which has already taken effect: Marcen Shipping (London) Ltd v Kefalos [2007] EWCA Civ 643, [2007] IWLR 1864.[29]Mr Turner QC for the Defendant submits that, where the claim has been brought to an end by a strike out order, the Claimant can no longer accept the Part 36 offer. His principal argument rests upon the express terms of CPR 36.11(1) (under the heading, “the effect of acceptance of a Part 36 offer”):
“If a Part 36 offer is accepted, the claim will be stayed”
(emphasis added)[30]He submits that CPR 36.11(1) is plainly predicated upon the basis that there is an extant claim to be stayed: ex hypothesi, there is no such claim, for the substantive effect of the strike out order is to put an end to the Claimant’s claim. On the Claimant’s case, CPR 36.11(1) would serve no useful purpose in the present context, because, following the strike out order, the claim could not in any event proceed. Mr Turner QC accepted that, if the Claimant obtained relief from sanction under CPR r 3.9, and the claim were reinstated, the Part 36 offer (if it had not in the meantime been validly withdrawn in any event) would revive, but he submitted that there were no real practical difficulties with such a scenario. He also, in my view, implicitly accepted that the position would be no different if a defence were struck out. The Defendant would no longer be able to take steps to defend the claim (without the benefit of an order under CPR r 3.9), and the Claimant could formally proceed to obtain judgment under CPR 3.5. Again CPR 36.11(1) would serve no useful purpose: other than for the purely formal step of obtaining judgment, the claim would be at an end and no stay would be either necessary or appropriate.[31]As to the consequences if the Claimant were correct, Mr Turner QC postulated a case of frequent and contumelious breach of court orders, culminating in a strike out by the court on its own notion. The Claimant in such a case would nonetheless be able to accept the Part 36 offer, receiving damages within 14 days and benefiting from the usual entitlement to costs.[32]Mr Marven, in response, referred to Gibbon v Manchester CC [2010] EWCA Civ 726, in particular to the observation of Moore-Bick LJ at paragraphs 3 and 4 that CPR Part 36 is “a carefully structured and highly prescriptive set of rules”, and it is “a self contained code”. Mr Marven also relied upon CPR r 36.9(2):
“… a Part 36 offer may be accepted at any time (whether or not the offeree has subsequently made a different offer) unless the offeror serves notice of withdrawal on the offeree;”
(emphasis added) and upon CPR r 36.9(5): “… Unless the parties agree, a Part 36 offer may not be accepted after the end of the trial but before judgment is handed down.” from which, submits Mr Marven, it is implicit that “judgment” would ordinarily be necessary to preclude acceptance of a Part 36 offer, the only exception being where there has been a trial and judgment is awaited. Mr Marven also submitted that there could be complications in that there might potentially be a dispute as to whether the sanction in an “unless” order has in fact taken effect, so that a Part 36 offer was not open for acceptance where it was disputable whether a claim had been struck out.

Discussion

[33]There is, in my view, some tension between CPR r 36.9(2), which provides that a Part 36 offer may be accepted at any time unless the offeror serves notice of withdrawal on the offeree, and CPR r 36.11, which clearly implies, as Mr Turner QC correctly submitted, that a Part 36 offer cannot be accepted where there is in substance no claim left to be pursued (because a putative stay of the proceedings would be redundant in those circumstances). The tension between these Rules is, however, much reduced by the Claimant’s acceptance that a Part 36 offer cannot be accepted after a claim is dismissed (whether on the merits or by reason of procedural default), or judgment entered. That acceptance is consistent with CPR r 36.9(5), relied upon by the Claimant.[34]However, in my view, that acceptance is highly damaging to the Claimant’s case. The reason why the dismissal of the claim or the entry of judgment precludes the acceptance of a Part 36 offer is that on dismissal or entry of judgment the claim is to all intents and purposes at an end. But that is also the position where a statement of case or claim has been struck out under an “unless” order. The purpose of the “unless” order is to avoid the need for any further application or hearing to obtain dismissal of the claim. I am not impressed by the argument that ex hypothesi the Defendant has not requested judgment under CPR 3.5, for that is a purely formal step that follows automatically as a consequence of breach of the “unless” order and in recognition of the fact that the claim is now at an end; and in my view the implications for the acceptance of Part 36 offers should not turn upon such a relatively fortuitous nicety, where as a matter of substance the “unless” order has brought the claim to an end, no less than a final judgment or dismissal would do.[35]Nor am I impressed by any argument that CPR 3.9 (relief from sanctions) was intended to hold a claim that has been struck out on life support, so to speak, awaiting the ministering dispensation of relief by the Court so as to obviate final extinction. That is how practitioners may, without proper justification, have come to view it. A claim that has been struck out is in law at an end. CPR 3.9 provides for an exceptional judicial discretion to reinstate a claim, on terms, if there is a sufficiently compelling case.[36]In interpreting the Rules I must, of course, seek to give effect to the overriding objective (see CPR r 1.2), and I turn to consider whether an interpretation of the Rules which precluded acceptance after a claim was in substance at an end, although it had not been dismissed after a hearing and judgment had not formally been entered, would promote, or militate against, the overriding objective.[37]As to justice, I see no injustice to either party by reason of such an interpretation. The Claimant has by his own conduct brought about the consequence that he cannot accept the Part 36 offer, by his failure to comply with an order that told him in terms that such failure would result in the termination of his claim. The Claimant may, of course, apply for relief from the sanction and, if the circumstances were sufficiently compelling, the claim would be reinstated and the Part 36 offer reactivated, unless it had already been withdrawn validly (a risk to which the Claimant was in any event exposed). The non-defaulting party would not be seriously prejudiced because, as Mr Turner QC pointed out, such a party would be free to negotiate a compromise in the same or similar terms outwith the Part 36 code, fortified no doubt and not unfairly by the fact that, as matters stood, the claim was at an end, unless it could be reinstated under the Court’s discretionary powers.[38]Looking at the specific points under CPR 1.1(2), the interpretation in question places the parties on an equal footing. The Defendant whose defence was struck out would suffer the same consequences (see paragraph 30 above). As to expense, expedition and court resources, it appears to me that the interpretation, on balance, would promote these objectives. I see some force in Mr Marven’s argument that it might intensify any dispute about whether the unless order had been breached, and strengthen a claimant’s resolve to seek relief from sanction. The Claimant would, on his case, have an opportunity to cut his losses, and could simply accept the Part 36 offer, so saving cost and deployment of court resources in resolving such a dispute or in considering whether to exercise such a discretion.[39]However, in my view, in this context it is more appropriate to consider the position at the stage before the “unless” order was breached, for, in a properly functioning system of civil justice, first, “unless” orders should rarely be necessary to ensure that parties comply with applicable rules, orders and directions; secondly, in that event disputes should be even rarer as to whether such orders that have proved necessary because of a party’s failure or failures have been complied with, and; thirdly, relief from sanctions should be sought infrequently and in the most exceptional circumstances. It appears to me that, looking at the position at the appropriate stage, the interpretation that I intend to adopt would create exactly the right incentive. Failure to comply with rules, orders and directions, is a serious problem in our system of civil justice, particularly in respect of relatively small claims where the proceedings ought to proceed, in accordance with the rules, in a speedy, inexpensive manner that does not involve disproportionate use of court resources. It is unnecessary to go beyond the facts of the present rather lamentable proceedings to see that this objective is not infrequently frustrated. If a Claimant or Defendant appreciated that failure to comply with an “unless” order of the Court (which would ordinarily arise only because of previous serious failures) not only puts at risk his ability to continue the claim or defence, as the case might be, but also would preclude him from accepting a Part 36 offer, it could well be that there would be fewer “unless” orders, fewer breaches of such orders, and fewer disputes and applications following such alleged or actual breach.[40]Furthermore, a defaulting Claimant faced with an unless order who thought that he was at real risk of (yet again) failing to comply with a court order, but who now incurred the additional risk of being unable to accept a subsisting Part 36 offer, might well decide that it was in his best interests to accept the offer forthwith, thus terminating a claim that ex hypothesi had not hitherto been efficiently conducted in accordance with the rules and/or court orders. That response would avoid the further cost and deployment of resources that the continuation of such a claim would be likely to entail. That result would, in my judgment, tend to promote, rather than militate against, the overriding objective.[41]For these reasons I respectfully disagree with the learned judge’s conclusion that the Claimant in this case could accept the Part 36 offer once he was in breach of the “unless” order and his claim in substance had been brought to an end. Issue 4: Should the Claimant have relief from the sanction imposed by the “unless” order of 3 September 2010?[42]As well as appealing against the order of District Judge Grosse of 10 December 2010, the Claimant by its notice of appeal sought before HH Judge Winstanley to obtain relief from the sanction imposed by the “unless” order of 3 September 2010. This was a separate self standing application that did not depend on the outcome of the appeal against the order of 10 December 2010. In the circumstances HH Judge Winstanley dealt briefly with that application, at paragraph 17 of his judgment. In essence he held that the breaches of the order of 3 September 2010 were minor, liability had been admitted by the Defendant, the only outstanding issue was the amount of damages and a fair trial of that issue was still possible. If necessary, he would, on terms, have given relief from the sanction of strike out and would have allowed the outstanding issue to proceed to trial.[43]On appeal to this Court the Defendant did not expressly address in its written case the judge’s ruling on relief from sanction, or advance arguments why that ruling was wrong in law, especially having regard to the fact that the judge was exercising a discretionary power under CPR 3.9. Mr Turner QC, I believe, recognised that in the circumstances he was under some difficulty in respect of this issue. At the hearing, however, he submitted that on a proper reading of HH Judge Winstanley’s judgment he had not in fact made any ruling on relief from sanction. At paragraph 6 of the judgment the judge referred to two breaches of the order, namely, the failure to pay the listing fee on time, and the failure to pay the solicitor’s costs until 18 January 2011. The judge held that, as these breaches had not been contested before District Judge Grosse on 10 December 2010, strike out had been inevitable, and there was no reasonable prospect of success on appeal “certainly against the orders striking out the claim”. Mr Turner QC submitted that there was an inconsistency between what the judge found at paragraph 6 of his judgment and the ruling at paragraph 17 on relief from sanction, or at least an ambiguity in what he was doing. In that event this Court itself ought to look again at the question of whether relief from sanction should be granted.[44]I reject that submission. It is perfectly plain to me what the judge was doing. At paragraph 6 he was saying that there was no real issue that the Claimant had breached the order of 3 September 2010 by reason of his conduct after 17 September 2010 and that, if the matter rested there, the Claimant could not succeed on its appeal against the order of District Judge Grosse of 10 December 2010 that the claim stood struck out. However, the matter did not rest there because the Claimant now for the first time advanced the argument that there had not been any material breach of the “unless” order as at 17 September 2010 (an argument accepted by the judge, who considered, but rejected, the alleged breaches), the Part 36 offer had been validly accepted, and District Judge Grosse had no power to strike out on 10 December 2010 a claim that had been stayed pursuant to the Rules on 17 September 2010. The judge also held that, even if there had been material breach of the “unless” order as at 17 September 2010, the Claimant was not precluded from accepting the Part 36 offer. At paragraph 17 of his judgment the judge was proceeding on the alternative basis that he might have been wrong on his ruling that the Part 36 offer had been validly accepted, and quite understandably, in considering the self standing application for relief from sanction, focussed on the post-17 September 2010 admitted breaches of the “unless” order, having already dealt earlier in his judgment with the alleged breaches before that date. It is plain, looking at the judgment as a whole, that if the judge had re-considered these alleged breaches in the specific context of the application for relief from sanction (and even on the footing that they were actual breaches), his ruling on relief from sanction would have been no different, in the light of the view that he had formed of the matters giving rise to these alleged breaches.[45]There is, therefore, no inconsistency, ambiguity or obvious flaw that would vitiate the judge’s ruling on relief from sanction, and I see no good reason, therefore, why that ruling should not be allowed to stand and why the eventual order of this Court on the present appeal should not properly reflect a ruling lawfully made by the judge below in respect of a wholly self-standing matter that is not affected by the outcome on the other issues considered on this appeal.[46]For the avoidance of doubt, I might add that I would have reached the same conclusion as the judge on this issue. The breaches were relatively minor. The service of the list was three days late, on the strict application of CPR 6.26, but no real prejudice was caused because the Defendant did in fact receive the list by 10 September 2010. The other breaches were not serious for the reasons given by the judge. It appears that the breaches after 17 September 2010 were against a background in which the Claimant believed, wrongly but not unreasonably, that the claim had been stayed in any event by his acceptance of the Part 36 offer. The breach of the earlier “unless” order of 12 January 2010 had occurred in the mitigating circumstances explained at paragraph 7 above. It appears that the trial date was vacated because the Court on 22 September 2010 believed that the listing fee had not been paid, when it seems that the fee had been received by the court. As the judge observed a fair trial of the outstanding issue was still possible.[47]The only real countervailing point was the conduct of the Claimant’s legal representatives on 10 December 2010. At the telephone hearing before District Judge Grosse they simply admitted breach of the order of 3 September 2010, did not advance an argument that a Part 36 offer had been accepted (rather they avowed that no such acceptance had been feasible), and they did not apply there and then for relief from the sanction imposed by the order of 3 September 2010. Had the matter been properly prepared and presented, all issues could have been considered at that time, or at least District Judge Grosse could have granted a short adjournment so that at a normal inter partes hearing with all physically present the issues could have been fully ventilated. However, these failures were wholly, or at least mainly, attributable to the Claimant’s legal representatives, and any prejudice to the Defendant by reason of such failures can be reflected in the final order for costs made by this Court on the present appeal. They do not impinge on the fairness of the trial of the outstanding issue. On balance, therefore, I would not be persuaded that this factor should defeat the Claimant’s application for relief from sanction that is justified on an appraisal of the relevant circumstances as a whole.

Conclusion

[48]Relief from sanction returns the parties to the position that prevailed before the claim stood struck out on 10 September 2010 through the Claimant’s failure to comply with the “unless” order of 3 September 2010. At that time the only issue between the parties was whether the recoverable hire charges were £15,376.77, as alleged by the Claimant, or £6,854.01, as paid to Helphire on 2 March 2009 (see paragraphs 3 - 5 above). On this appeal the Defendant in its written case contended that the Part 36 offer of £6,912.76 was in respect of the whole amount of loss (including expense of repairs) that the Claimant said that he had sustained as a result of the Defendant’s acknowledged responsibility for the accident. It appears that it was on some such bizarre footing that on 10 December 2010 District Judge Grosse ordered Helphire (not a party to the action) to repay £11,976.78 to the Defendant, being the amount paid on 2 March 2009 in respect of the repair costs and hire charges.[49]With respect, this contention is pure nonsense, as explained by HH Judge Winstanley, albeit in somewhat politer language. Mr Turner QC wisely did not refer to this contention at the hearing before me. The amount of £11,976.78 was paid before the claim was brought. It was the amount that the Defendant alleged and acknowledged to be owing in respect of repair costs and hire charges occasioned by its tortious behaviour. The only matter left in dispute, that became the subject of proceedings, was the further amount of £15,376.77 in respect of hire charges, which the Claimant alleged was properly due but which the Defendant denied.[50]In the light of this judgment the parties should seek to draw up an agreed order to reflect the terms of the judgment and to deal with all ancillary matters, such as costs. Given the history of these proceedings, I have to say that I am not wholly optimistic that there will not be points of disagreement. If there is any disagreement, submissions should be made in writing and I shall endeavour to decide on the basis of such submissions so as to avoid the costs and resource implications of any further hearing in what began as a limited dispute over a relatively modest monetary sum.

Cited in 1 later judgment