RELIEF FROM SANCTIONS: A CASE WHERE RELIEF WAS REFUSED
This post discusses a recent case where the Court refused relief from sanctions.
In Thavattheva Theveraraja and Southern Territory Ltd –v- Riordan, Burke and Prestige Property Developer UK Ltd (Ch D 09/08/2013) Hildyard J refused relief from sanctions when he found that a party had failed to comply with an unless order in relation to disclosure of various documents. It had been admitted that the disclosure order had not been complied with in certain respects. However it was argued that the defaulting party had taken real and reasonable steps to comply, there had been no breach of a freezing order that was in place and the breaches had not been deliberate.
The judge held although not every allegation of breach of disclosure had been made out it had been established that there were serious failures in complying with the disclosure order.
- Although the checklist of relevant considerations under the old r.3.9 had been removed, they were nonetheless matters which needed to be considered.
- The checklist enabled the court to assess whether relief from sanctions was appropriate under the new r.3.9.
- It was not correct to say that the removal of that list meant the introduction of a less rigorous regime.
- Rather, the court should be less ready to grant relief under the new r.3.9, which required the court to be fully satisfied that relief from sanctions was thought appropriate and just in the particular case, the court being slow to draw such a conclusion.
- If non-compliance with the unless order was established, what was required in order to grant relief from sanctions was a material change in circumstances.
- The defaulting party had not taken all reasonable steps to ensure compliance.
- If the defaulting party had taken rigorous steps and been unable to obtain documentation then that party should have informed the court and an order obtained to ensure compliance.
- The court had to be cautious to grant dispensation from court orders and was constrained to refuse relief from sanctions.
I stress that I am working from a summary of the judgment (I have ordered a transcript and will post on this when it arrives). However this is indicative of the approach that the courts are now taking.
However, of particular importance, is the observation that if a party is making genuine attempts to comply and is having difficulty, then an application should be made to court for further directions to assist in compliance (in that case documents were needed from a third party).
What is certain is that a party faced with difficulties in the face of an unless order cannot simply “do their best” and hope it is enough. Rigorous and vigorous compliance is needed. If there is a genuine problem with compliance then the only safe course of action is to return to court to seek further directions before the date for compliance.