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Associated Electrical Industries Ltd v Alstom UK, High Court, 24 February 2014

14 March 2014

The issues
Extensions of time – particulars of claim – non-compliance – Mitchell.

The facts
The defendant applied to strike out the claim on the basis that the particulars of claim had been served out of time. The claimant cross-applied for an extension of time for service of the particulars. The claim related to an indemnity claim issued in respect of a mesothelioma claim that had been settled by the claimant. The claimant had until 29 October 2013 to serve the particulars of claim. On that date the claimant asked the defendant for an extension of time, which was refused. The defendant applied to strike out on the 13 November 2013. The particulars were in fact served on the 28 November 2013. The claimant applied for a retrospective extension of time on the 30 January 2014.

The decision
At the beginning of the action the claimant’s solicitors had not been informed that the acknowledgment of service had been filed by the defendant. The CPR provided that upon receipt of an acknowledgment of service, the court had to notify the claimant in writing (CPR 10.4). In fact, the claimant’s knowledge of the CPR came only because a court clerk from the claimant firm made enquiries of the Commercial Court Registry. The court clerk was given the explanation by the court office that “the Commercial Court was very busy”. The judge noted that it was provoking for solicitors to have such explanations given, when the Court of Appeal had said, financial pressures notwithstanding, solicitors could not avail themselves of such excuses.

Cross-applications for extensions of time had little practical purpose. The court had to hear two applications, which were two sides of the same coin.

The application had not been made promptly. The explanation from the claimant’s solicitors was that the claim was of a relatively modest value and that they hoped it could be resolved using the simplest procedure possible. However, the failure to make an application did not give the CPR time limits the respect that was now demanded. The application should have been made well before the 13 November 2013.

Was the non-compliance trivial?
The non-compliance was not deliberate. However, the claimant’s solicitors were aware of the deadline and took no steps to comply with it. They could have asked the defendant for an extension of time long before the 29 October 2013. If the application had been made, it would have been decided without a Hearing and almost certainly granted.

There was no automatic sanction applicable under the CPR to the non-compliance. The delay did not impact on other court users or particularly on court resources. The defendants had not been prejudiced other than that they had agreed not to invoke a time bar on the basis that proceedings would be issued by 12 October 2013. The period of non-compliance was 20 days. Following the guidance in Mitchell, a default of 20 days could not be categorised as trivial. In Mitchell, the claimant was five days late. In Raayan, which had been criticised by the Court of Appeal, particulars of claim were served two days late. In the round, this was not a case where the non-compliance could be regarded as trivial.

Was there a good reason for non-compliance?
Reasons or explanations for the non-compliance have been put forward by the claimant’s solicitors. Namely that seven days had been lost because of the court’s failure to inform them about the acknowledgment of service; and another day had been lost because of the weather; and that there had been difficulties in researching elements of the claim, which involved information and documents dating back to 1956. These were all factors to be considered, but the court was not persuaded that there was insufficient time to draft and check the pleadings after the 8 October 2013, when the claimant’s solicitors had learned that the acknowledgment of service had been filed and that the claim was disputed. Even disregarding the period that could be put down to the fault of the court, the claimant had not persuaded the court that there was good reason for not serving the pleading by the 29 October 2013 or for making a timely request for an extension.

If the claim was struck out, would any fresh claim brought by the claimant’s solicitors fall to be struck out as an abuse of process?
The court could not assume that it would.

If the defendant’s application to strike out was granted, there was the real prospect that it would result in further litigation between the parties, which would be less than straightforward, costly, demand court resources and would be satellite.

Was it possible to take these matters into account?
The Court of Appeal in Mitchell had said that a desire to discourage satellite litigation (as had been shown by Walker, J in Wiche v Care Force Group Plc) was not a good reason for adopting a more relaxed approach to compliance. Whilst recognising that the approach adopted by the Court of Appeal discouraged judges from giving too much weight to the prospect of unprofitable hearings, the judge did not understand Mitchell to decide that this concern was never a relevant circumstance and had always to be entirely disregarded.

How to strike the balance
If the decision depended only on what was just and fair, the claim form would not be struck out and a retrospective extension of time for service of the particulars would be granted. Judging the position simply between the parties, an order striking out the claim form would be a disproportionate response to the non-compliance. The emphasis the Court of Appeal had given to enforcement of the CPR in order to encourage procedural discipline, withstanding that it was a disproportionate response and unjust to refuse an extension to strike out the claim form, drove the judge to conclude that the defendant’s application should be granted and that of the claimant rejected.

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