RELIEF FROM SANCTIONS: DECISION OF THE HIGH COURT: THE LETTER OF THE LAW
The case of Forstator -v- Python (Monty) Pictures Ltd  EWHC 3759 is a case where the Court granted relief from sanctions. It was heard before the Mitchell decision but judgment was given afterwards. The judge did not hear submissions on the Mitchell criteria but stated that he had considered it.
The successful party had failed to serve notice of the funding arrangement, Form N251, although notification of the existence of the conditional fee agreement had been given by letter. To recover the additional liability relief from sanctions was required. Relief was granted so that the additional liability could be recovered from the date of the letter. The judge stated:
- In considering whether to grant relief from sanction I must have regard to the need, so far as is practicable to enforce “rules, practice directions and orders”. This does not mean that each of them must in all circumstances be regarded in exactly the same way, and that the enforcement of each will require exactly the same measures to be taken. This was a failure (through human error) to comply with a rule of general application: it may be contrasted with a conscious failure to comply with a specific order made in the action itself. The policy embodied in CPR 44.3B had at 19 July 2012 been fulfilled (albeit not in a technically correct way) and the substance of the rule was then complied with. The conveying of the requisite information in a letter instead of on form N251 had no discernible impact on the conduct of the action. The failure to convey the information until 19 July 2012 probably had an impact on the conduct of the action (because until then PMP was not in possession of all of the information relevant to a disposal of the claim) and MFPL has not demonstrated that it did not. The consequence of refusing relief may be that MFPL is contractually liable to pay a success fee but would not recover it from PMP: as against that it would appear to have a strong defence to a claim for a success fee from its solicitors, and a claim over against its solicitors in respect of any claim by Counsel. Granting relief would deprive PMP of what may properly be regarded as a windfall (in that it received the relevant information on the wrong piece of paper).
- 47.In all the circumstances I would grant relief from sanctions to this extent: MFPL shall be entitled to recover such additional liability as would have been recoverable if form N251 had been served on 19 July 2012. This leaves open all of the issues normally considered in relation to CFAs (especially the appropriate level of success fee). I consider that a grant of such relief is not inconsistent with the objectives embodied in the current CPR 1.1(2). I have borne in mind this conclusion when making the costs order summarised in paragraph 34.”
This could probably come within the error of form rather than substance, or de minimis, errors described in Mitchell. The opposition knew of the existence of the funding arrangement from that date. Needless to say any prudent litigator should serve the requisite form, it is not a precedent for saying that relief from sanction will always be granted in these circumstances.
The decision can be found at http://www.bailii.org/ew/cases/EWHC/Ch/2013/3759.html
There is a helpful summary of the case in Litigation Futures at