“PLEADINGS THAT ARE OF SUCH DISPROPORTIONATE LENGTH AND DENSITY”: “THE CLAIM BECAME IMPENETRABLE AND UNNECESSARILY EXPENSIVE TO DEAL WITH”

In Galazi& Anor v Christoforou & Ors [2019] EWHC 670 (Ch) Chief Master Marsh considered the costs consequences of amendment and the effective discontinuance of certain causes of action.  There are two particular aspects of the judgment of general interest. Firstly the pleadings of both parties were subject to criticism. Secondly the question of whether it was desirable to leave issues relating to interlocutory matters to the trial judge.

 “Both sides entirely lost sight of the requirement for concision in the statements of case. The indulgent way they have both approached the claim colours the approach adopted by the court and, inevitably, has adverse consequences for both sides.”

THE CASE

The Master was considering the costs consequences where a substantial amendment had been to the Particulars of Claim.  The litigation had a tortuous and labyrinthine  history.  The claimants eventually made substantial amendments to their statement of case.

STATEMENTS OF CASE: THE NEED TO BE CONCISE

The Master was critical of the way that all sides had drafted their statements of case.

  1. The particulars of claim ran to 283 paragraphs and 56 pages. By the time the statements of case were complete, the pleadings extended to 382 pages. It is deeply unsatisfactory that a claim such as this one, which is not inherently complex, should produce pleadings that are of completely disproportionate length and density. The claim became impenetrable and unnecessarily expensive to deal with.
  2. The original particulars of claim, which were not settled by the Galazi Claimants’ current counsel team, have come in for a good deal of criticism and Mr Hunter, who now appears for the Galazi Claimants, acknowledges that the manner in which the claim was pleaded is less than ideal. The particulars of claim set out far too much detail. The word ‘concise’, the relevance of which does not need to be articulated, was ignored. However, it is significant that the defendants took no step to apply to strike out the particulars of claim, in whole or in part, or for summary judgment. The defendants responded enthusiastically in a defence and counterclaim that runs to 104 pages. Mr Grant, who appeared for the Christo Defendants, and who was not involved in its drafting, described it as a ‘behemoth’. However, it is not open to the Christo Defendants to say with any conviction that the production of a behemoth was justified by the claimants’ pleading. The requirement for concision applies equally to a defence (and counterclaim). It is hard to avoid the conclusion that the Galazi Claimants and the Christo Defendants took up arms against each other in a consciously overblown and aggressive manner that is typical of a claim between siblings. Both sides entirely lost sight of the requirement for concision in the statements of case. The indulgent way they have both approached the claim colours the approach adopted by the court and, inevitably, has adverse consequences for both sides.

WHEN ISSUES OF COSTS SHOULD NOT BE LEFT TO THE TRIAL JUDGE

The Master considered, and rejected, a submission that matters relating to the costs of amendment and discontinuance should be left to the trial judge.

    1. Rule 38.6 deals with costs where there has been a discontinuance. The default position, unless the court orders otherwise, is that the claimant is liable for the costs of the defendant. The only difference between discontinuance and partial discontinuance is that in the case of the latter, the costs will not, unless the court orders otherwise, be assessed until the end of the proceedings. The Galazi Claimants say that the default rule should not apply in the circumstances of this case. Their primary position is that the incidence of costs should be left over to the trial judge. They identify five relative advantages to postponing the decision:
(1) The trial judge will have the time to familiarise themselves, on a granular level, with the existing issues in both sets of proceedings.
(2) The trial judge will have the benefit of understanding the nature and scope of those issues in the light of the evidence at trial.
(3) The trial judge will necessarily have a better understanding of what work, and in particular what factual investigations, and legal research, is properly attributable to those issues, as compared with aspects of the original Galazi pleadings which are no longer pursued (at least in their original form).
(4) The trial judge will have the benefit of considering the issues as they may have developed, in the interim, during the Claimants’ ongoing investigations into the conduct of the Christo Defendants.
(5) The trial judge will be able to apportion responsibility for the circumstances which gave rise to the Galazi Pleadings Review in the light of the Court’s conclusions as to the substantive merit of each side’s position overall.
  1. At one level it is attractive to leave thorny and contentious issues about costs to the trial judge; and I accept there are circumstances in which it is the right order to make. However, I am not persuaded that postponement of the decision is appropriate in this case. The premise upon which the submissions set out above are based is that the trial judge will necessarily become familiar with both claims, including the Galazi Proceedings in their original form. This is obviously wrong. The trial judge will only wish to consider the claims in the form in which they reach trial. There will be no need at all for the trial judge to consider the enormously lengthy pleadings in the Galazi Proceedings before most of the claims were stripped out on the amendment. It would be very unattractive for the trial judge to be required to undertake an archeological excavation of the pleadings to examine their state in a different era with a view to analysing the issues that were dealt with at the trial and, importantly, not dealt with at the trial because they had been discontinued.
  2. Furthermore, it seems to me that wherever possible the court should when dealing with the management of a claim avoid adding to the burdens of the trial judge and decisions about the case, including costs, should be made as the case proceeds. This enables the parties to assess their respective positions with greater accuracy and facilitates settlement.