NO PLAYING OF THE ADVANTAGE RULE IN CIVIL LITIGATION: LATE WITNESS STATEMENTS LEAD TO CLAIMANT’S CASE BEING SENT OFF: GOOD TRY BUT NO TRIAL
In Gladwin -v- Bogescu [2017] EWHC 1287 (QB) Mr Justice Turner uses the English language to its full effect when ruling that a claimant who served a witness statement late should not have been granted relief from sanctions. The case sends out a clear as a whistle warning to anyone thinking of serving witness statements late or who cannot comply with the court timetable.
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This case started life as a very straightforward and relatively low value road traffic accident claim but thereafter descended into procedural chaos. Responsibility for this state of affairs is entirely that of the claimant’s solicitors who have, through a combination of complacency and procrastination, proceeded as if compliance with the Civil Procedure Rules and the orders of this court were of scant importance. This left His Honour Judge Gregory trying valiantly to rescue what he could from the procedural wreckage when the matter came before him for trial on 8 February 2017. In the event, he granted the claimant relief from sanctions notwithstanding his solicitors’ serious breaches for which no good reason had been provided and the direct consequence of which was the vacation of the trial date.
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In reaching this conclusion the learned judge considered that, on the very particular facts of this case, the consequences of refusing relief to the claimant would be more prejudicial to the defendant than if relief were to be granted. He thus applied the judicial equivalent of the advantage rule in rugby union and allowed play to continue without formally penalising the offender.
KEY POINTS
- A judge had erred in granting relief from sanctions to a claimant who had served a witness statement very late.
- A party who serves a statement late is not automatically entitled to tender that statement at trial.
- The court should not have granted an adjournment in circumstances where this was caused by late service of the claimant’s evidence.
- The court should have exercised its discretion to strike out the entire action in a case where the witness evidence was served shortly before trial.
- In this case the action was struck out.
THE CASE
The action related to a road traffic accident in November 2014. In August 2016 the court gave directions for the service of witness statements, including the terms:-
“Oral evidence will not be permitted at trial from a witness whose statement has not been served in accordance with this order or has been served late, except with permission from the Court.”
- The claimant requested an extension of time at the very last minute and this was granted by the defendant.
- However the extended time limit passed without service.
- Less than a week before trial the claimant applied for relief from sanctions in relation to service of the witness statements.
- The day of the trial was taken up with the application for relief from sanctions.
THE DECISION OF THE CIRCUIT JUDGE
The circuit judge found that the breach was significant and there was no good reason. However relief from sanctions was granted.
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The judge went on, however, to consider the third limb of Denton and reached the conclusion that if he were to refuse the claimant’s application for relief from sanctions the result would be that the defendant would suffer greater prejudice than the claimant because the claimant, although debarred from giving oral evidence, would potentially remain entitled as of right merely to rely on his witness statement and thereby evade the perils of cross-examination. Accordingly, the court decided that it was doing the defendant a favour by finding for the claimant whose victory was predicted to be likely to turn out to be distinctly Pyrrhic. The defendant, however, seeks to persuade the court on this appeal that the claimant should have been deprived of the fruits of any sort of victory, whether Pyrrhic or otherwise.
THE ARGUMENTS ON APPEAL
Turner J considered the question of whether the judge had correctly interpreted the sanction.
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The first basis upon which this appeal is brought is that the Learned Judge too narrowly interpreted the scope of the order of District Judge Coffey. He was given leave to do so by the judge on paper.
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There can be no dispute that the order of the District Judge and the wording of CPR 32.10 both provided for a sanction in the event that witness statements were not served on time. This sanction is one which, by the operation of CPR 3.8, would have effect unless the defaulting party were successfully to apply for relief.
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Mr Turton, the defendant’s solicitor, set out the grounds upon which his client resisted the application for relief from sanctions in a witness statement dated 7 February 2017. He asserted in paragraph 22:
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“…if the claimant cannot give evidence, he cannot prove his claim and it therefore comes to an end.”
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It would appear that the claimant’s solicitor was of the same view. In her witness statement in support of the application for relief from sanctions she conceded that if relief were not given then the likely consequence would be that the claimant would “be unable to recover any of his losses”.
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The learned judge, however, and quite rightly in my view, expressed the view that such a conclusion would not necessarily be correct. The relevant rule and order go so far as to state only that the sanction for breach is that the author of the statement may not be called to give oral evidence. It makes no provision for the evidential status, if any, of the witness statement as a standalone piece of documentary hearsay. As the learned judge observed:
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“…the order says what it says on the face of it and it would not be right in my judgment, for me to seek to qualify it, amplify it or change it in any way.”
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Counsel for the defendant sought to persuade me that the learned judge was wrong on this point and that the automatic consequence of failing to serve a witness statement is that the party in default will not only be unable to call the author to give evidence but will be precluded from relying on the contents of the witness statement in any way.
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In support of this proposition reliance was placed upon a number of cases in which the court had assumed that failure to give relief from the sanction imposed by CPR 32.10 would effectively bring an end to the claim.
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For example, in Chartwell Estate Agents Limited v Fergies Properties SA [2014] EWCA Civ 506 Davis LJ held at para 50:
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“But a further circumstance which the judge was, in my view, also justified in taking into account, and to which he was entitled to attribute importance, was that refusal to grant relief from the sanction stipulated in CPR r.32.10 would effectively mean the end of the claim: since the burden of proof was on Chartwell to prove its case and it would have no evidence.”
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However, it is evident from the judgment of the Court of Appeal in that case that neither party had considered the possibility that, even if the defaulting party had been precluded from calling oral evidence of the contents of the statement, the statement itself could still be deployed as hearsay evidence to which the court might be entitled to give at least some residual weight. The extent to which the provisions of the Civil Evidence Act 1995 might be capable of preserving at least some of the evidential potency of the contents of a witness statement where the author has been precluded from giving evidence is, so far as the researches of counsel have revealed, not an issue which has previously been adjudicated upon in any reported case.
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Accordingly, I am satisfied that the learned judge was entirely right to conclude that the operation of the order of the district judge and of CPR 32.10 did not have the automatic consequence that the claimant’s witness statement was evidentially extinguished. I stress the word “automatic”. However, this finding is not, in itself, fatal to this appeal. The defendant has applied orally for permission, which the judge had refused on paper, to challenge the learned judge’s decision on the alternative ground that he erred more broadly in the exercise of his discretion. This application I now grant. To address this question, it is necessary first to consider the evidential status of the witness statement of a witness who cannot be called to give oral evidence by the operation of CPR 32.10 and/or as a result of a sanction imposed by the court. Such a statement is inevitably subject to the law and rules relating to hearsay.
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HEARSAY
“1 Admissibility of hearsay evidence.
(1)In civil proceedings evidence shall not be excluded on the ground that it is hearsay.
2 Notice of proposal to adduce hearsay evidence
(1)A party proposing to adduce hearsay evidence in civil proceedings shall, subject to the following provisions of this section, give to the other party or parties to the proceedings—
(a)such notice (if any) of that fact, and
(b)on request, such particulars of or relating to the evidence,
as is reasonable and practicable in the circumstances for the purpose of enabling him or them to deal with any matters arising from its being hearsay.
(2)Provision may be made by rules of court—
(a)specifying classes of proceedings or evidence in relation to which subsection (1) does not apply, and
(b)as to the manner in which (including the time within which) the duties imposed by that subsection are to be complied with in the cases where it does apply.
(3)Subsection (1) may also be excluded by agreement of the parties; and compliance with the duty to give notice may in any case be waived by the person to whom notice is required to be given.
(4)A failure to comply with subsection (1), or with rules under subsection (2)(b), does not affect the admissibility of the evidence but may be taken into account by the court—
(a) in considering the exercise of its powers with respect to the course of proceedings and costs, and
(b) as a matter adversely affecting the weight to be given to the evidence in accordance with section 4.”
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In fairness to the learned judge, the matter appears not to have been fully argued before him and it is to his considerable credit that he identified the procedural possibility, not previously articulated on behalf of either party, that the claimant’s witness statement might, at least theoretically, have been capable of being deployed at trial. He does not, however, appear to have had his attention drawn to the specific provisions of the 1995 Act and he proceeded on the assumption that, having rightly construed the order of DJ Coffey in a narrow sense, his case management powers did not thereafter allow him to prevent the claimant from simply proffering his witness statement in support of his claim and thereby secure the advantage of precluding the defendant from cross examining him on its more controversial aspects.
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I am of the view that the learned judge was wrong to conclude that his powers were thus limited. He fell into error by assuming that he could not act more robustly to preclude the claimant from relying on his witness statement. He further fell into error by failing to have proper regard to his powers to strike out the claim altogether in response to the claimant’s breaches. I stress, however, that the learned judge conclusions are hardly surprising to the extent that he laboured under the very considerable disadvantage of the articulation of a defence case which was initially pitched too high and which thereafter lapsed into undue reticence. In these circumstances, I am free to exercise my own discretion in the resolution of the matters which fell to be determined by the learned judge.
SHOULD THE COURT HAVE GRANTED AN ADJOURNMENT
Mr Justice Turner held that an adjournment should never have been granted.
“ADJOURNMENT
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The claimant had applied to vacate the trial. In the event, the learned judge acceded to this request on the basis that this would give the defendant the opportunity to raise Part 18 and 35 questions. In my view, he too readily followed the path of adjournment. Indeed, the adjournment application should have been refused. Applying the overriding objective, the arguments in favour of granting an adjournment were weak. In the context of a relatively modest claim, the additional expenses generated by an adjournment would have been significant. The claim would not have been expeditiously disposed of and the court’s resources would have been wasted. Serious failures to comply with rules and orders had been perpetrated. As Chadwick LJ observed in Boyd & Hutchinson v Foenander [2003] EWCA Civ 1516 at para 9:
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“Nevertheless, in deciding whether or not to grant an adjournment, the court must have regard to the overriding objective of the Civil Procedure Rules set out in CPR 1.1, and in particular at subrule (2) of that rule. Having regard to the overriding objective requires the court to deal with a case, so far as is practicable, in a manner which saves expense, is proportionate to the amount of money involved and allocates to it an appropriate share – but no more than an appropriate share – of the court’s limited resources. Courts are directed (by CPR 1.4) to have the overriding objective in mind when managing cases.”
“The power to forgive defaults, litigant-induced delay and other forms of noncompliance must be exercised so as to further the overriding objective, which has been revised in consequence of Sir Rupert Jackson’s report on Civil Litigation Costs and which is known as Mark II overriding objective Since the best-laid case management plans would be worthless if litigants do not fulfil their process obligations by the relevant deadlines, the success of the CPR system of court control of litigation depends on the court’s ability to secure better standards of compliance. … the criterion for success is whether the court is able to deliver justice with proportionate use of resources and within reasonable time.”
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As against this, it is true that the consequences of a refusal to adjourn (as I will find) would have been fatal to the viability of the claim as a whole. After all, liability was not in dispute and the defaults were not those of the claimant but of his advisors. Indeed, on this appeal, much was made of the claimant’s personal innocence of fault. The notes to the White Book at 3.9.9 summarise the position where the blame rests on the shoulders of legal advisers rather than litigants. Particular reference can be made to the case of Training in Compliance Ltd v Dewse [2001] C.P. Rep 46 at p 66:
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“Of course, if there is evidence put before the court that a party was not consulted and did not give his consent to what the legal representatives had done in his name, the court may have regard to that as a fact, though it does not follow that it would necessarily, or even probably, lead to a limited order against the legal representatives. It seems to me that, in general, the action or inaction of a party’s legal representatives must be treated under the Civil Procedure Rules as the action or inaction of the party himself. So far as the other party is concerned, it matters not what input the party has made into what the legal representatives have done or have not done. The other party is affected in the same way; and dealing with a case justly involves dealing with the other party justly. It would not in general be desirable that the time of the court should be taken up in considering separately the conduct of the legal representatives from that which the party himself must be treated as knowing, or encouraging, or permitting.”
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Furthermore, since the introduction of the Jackson reforms, the general approach of the courts is likely to be less rather than more indulgent of the defaults of legal advisers as a justification for granting forbearance to the litigants themselves. In this respect, I endorse at least the general thrust of the views expressed by Zuckerman (ibid) at paragraph 11.191:
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“Although it may appear unjust at first sight to refuse an extension of time or relief from sanction when the default was due to the carelessness of a party’s legal representatives, it causes greater harm in the long term to spare litigants the consequences of their lawyers’ defaults. A policy of absolving clients from the consequences of their lawyers’ default undermines the court’s ability to enforce process requirements because it obliges the court to grant relief whenever a legal representative puts up his hands and accepts responsibility. This imposes a burden on the administration of justice and on the opponent. Tolerance of lawyer’s default encourages sloppy practice and satellite litigation, thereby making litigation more hazardous and the cost more unpredictable.”
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Of course, I fully recognise the prejudice which would be occasioned to the claimant in having to look to his advisers for redress and the potential disadvantages, including the loss of privilege, which this entails. I accept that this is a factor to be borne in mind but, in the circumstances of this case, it does not attract sufficient weight, when taken in combination with all the other relevant factors to be taken into account when seeking to apply the overriding objective, to prevail.”
STRIKING OUT
Turner J then considered whether the action should have been struck out. He held that it should.
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If the application for an adjournment had been refused then the claimant would have had no alternative but to seek to tender the claimant’s witness statement as evidence there and then. He would, however, have faced the serious, and in my judgment ultimately insurmountable, problem that DJ Coffey had ordered on 23 August 2016 that the parties must serve all notices relating to evidence, including Civil Evidence Act notices, by 4pm on 3 November 2016. In the face of such a flagrant breach of the rules relating to the service of Civil Evidence Act notices, the claimant would have had to have fallen back on section 2(4) of the 1995 Act to the extent that it provides that a failure to comply with the rules relating to the service of Civil Evidence Act notices “does not affect the admissibility of the evidence”.
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However, to allow a party to rely upon a witness statement rather than to call the witness himself who, as here, is sitting at the back of the court would normally be absurd. It would be akin to the creation of a “worst evidence rule”. In these circumstances, it would often be appropriate for the court to exercise its power under CPR 32.1 (2) to exclude the evidence of the witness statement even if it would otherwise have been admissible under section 2(4) of the 1995 Act. I readily accept that, as a general rule, the court should exercise caution in using this power (see Great Future International v Sealand Housing Corporation [2002] EWCA Civ 1183 and First Subsea v Balltec Ltd [2013] EWHC 1033 (Pat)). However, I do not accept the proposition advanced by counsel for the claimant that in appropriate circumstances this power cannot be exercised to maintain procedural discipline in respect of hearsay statements. It was, for example, deployed in Kimathi and others v Foreign and Commonwealth Office [2015] EWHC 3432 specifically to exclude hearsay evidence, albeit not in that case as a sanction in response to procedural default.
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In this context, the learned judge at first instance rightly pointed out:
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“It would be the subject, I am quite sure, of lengthy argument and submission, what his witness statement, were it to be received as a hearsay statement, is capable of proving and what it is not capable of proving and what weight should be attached to it in relation to the various elements of the evidence contained within it, and the heads of damage it attempted to substantiate…Of course, submissions could be made and the trial judge would be directed to consider the weight that can be attached to the statement as a whole or in part but it would be a most unsatisfactory way of proceeding.”
Where the learned judge erred, however, was in defaulting to indulging the claimant by adjourning the trial and granting relief from sanctions. Having decided that the case could not proceed on the day listed for trial without causing significant prejudice to the defendant, the court was entitled to give consideration to its powers to strike out the case under CPR 3.4 which provides, in so far as is material:
“(2) The court may strike out a statement of case if it appears to the court
…(c) that there has been a failure to comply with a rule, practice direction or court order.”
“This application was founded on (c), not (a). It is now trite that when exercising any power given to the court by the rules, the court must seek to give effect to the overriding objective which is to deal with cases justly. It is a draconian remedy for it excludes the claimant from the judgment seat. Nevertheless, the judge having refused, and as is conceded, rightly refused to grant an adjournment, justice and fairness would not done to the defendants if the conduct of their defence was significantly prejudiced by the claimant’s failures to comply with court orders. Defendants are also entitled to a fair trial.”
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Counsel for the defendant in the instant case (who did not appear on this appeal) wrongly conceded before the judge at first instance that it would not be appropriate to strike out the claim. This was purportedly on the basis that to do so would go beyond the extent of the specific sanction imposed by the District Judge.
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It is to be noted, however, that the District Judge’s order also provided:
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“Warning: you must comply with the terms imposed upon you by this order otherwise your case is liable to be struck out or some other sanction imposed.“
Although this direction did not engage the provisions of CPR 3.8 to the extent that the sanction for breach was not specified automatically to be a striking out of the case, it was a salutary reminder that the power of the court to strike out a case extends to all cases where there has been a failure to comply with a rule, practice direction or court order. Accordingly, it was wrong to treat the limits of the specific sanction imposed in respect of the late service of witness statements as if this rendered it automatically inappropriate to strike out the claim. The effect of the District Judge’s order was to preclude the claimant from giving oral evidence but not thereby to entitle him, as of right, to fall back on his witness statement. The learned judge should not have treated the limits of the automatic sanction as if they also circumscribed the parameters of his broader case management powers and counsel for the defendant was wrong to encourage him so to do.
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Indeed, on the facts of this case, I am satisfied that the claim should be struck out in its entirety.
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I appreciate that striking out the claim in this case brings to an end litigation in which liability was admitted and which will probably result in the claimant bringing a claim against her own legal advisors with all the difficulties that entails. Nevertheless, the alternatives before the learned judge were even less palatable. They involved either (i) vacating the trial date and, save for the making of an adverse costs order, relieving the claimant from all consequences of a very serious default or (ii) proceeding to a hearing in which the controversial evidence of the claimant was untested by cross-examination and the extent of any weight to be given to any or all of it rendered entirely unpredictable and unsatisfactory and thus giving rise to a virtual guarantee of unfairness.
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Furthermore, I am not persuaded that it would be appropriate to permit the claimant’s case to limp on in reliance upon any of the other documents in the case such as, for example, the credit hire invoices and medical report. That would also be liable to produce unpredictable consequences which would be very unlikely to lead to a fair or just result. It would also potentially make it harder rather than easier to determine what the financial consequences of the claimant’s solicitor’s defaults were and render the quantification of any claim in professional negligence more rather than less problematic. In some cases it is possible to predict with some confidence what discrete impact the exclusion of the evidence of one or more witnesses is likely to be but where, as here, the consequences are so speculative and strike at the central evidence in the case then to allow the claim as a whole to proceed would the antithesis of justice.
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THE CONCLUSION (AND THE NEED FOR CLEAR WORDING)
The final words of the judgment make the position clear. They also endorse the revised wording in relation to sanctions for late service of witness evidence.
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“In the circumstances, even making all due allowance for the breadth of the discretion involved in the making of case management decisions, I am satisfied that the learned judge was wrong to grant the claimant relief from sanctions in this case and, in the exercise of my own free-standing discretion, I strike out this claim.
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By way of postscript. I record that the template now generally adopted by District Judges in Liverpool in respect of credit hire claims has been revised and now provides:
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