SURVIVING MITCHELL A PRACTITIONER’S GUIDE 3: IF YOU CANNOT COMPLY WITH A RULE OR PRACTICE DIRECTION THEN MAKE AN APPLICATION BEFORE IT IS BREACHED

December 22, 2013 · by · in Applications, Avoiding negligence claims, Civil Procedure, Relief from sanctions

The Mitchell case makes it clear that applications for relief from sanctions made after breach will be granted sparingly.  Here we consider the merits of making an application in advance of the date of breach.

 WHAT THE COURT OF APPEAL SAID IN MITCHELL

The subject of applications made in advance of the date of breach was mentioned, almost in passing, at paragraph 41 of the Mitchell judgment where the Court stated, after emphasising the rigour of the test for applications for relief made retrospectively:

“We should add that applications for an extension of time made before time has expired will be looked upon more favourably than applications for relief from sanction made after the event.”

 So an applicant has the “comfort” of knowing that an application made in advance will be

treated “more favourably”.  At present that is all we have to work with.

THE PREVIOUS CASE LAW

In Robert –v- Momentum Services Limited [2003] EWCA Civ 299 the Court of Appeal held that where an application for an extension of time is made before the expiry of the stipulated period this was not a case as one of relief from sanctions. The court’s discretion should be exercised by having regard to the overriding objective. The court considers only the prejudice caused by the failure to take the relevant step and does not, normally, consider pre-existing delay or prejudice – except in exceptional circumstances.

There are a number of important points to note:

APPLICATIONS FOR EXTENSIONS OF TIME MADE IN ADVANCE ARE GOVERNNED BY CPR 3.1(2)(a) and not CPR 3.9.

In Robert Dyson L.J. (as he then was) stated:-

30.    It is notable that Rule 3.1(2)(a) contains no list of criteria for the exercise of the discretion to grant an extension of time. In this respect it is to be contrasted with Rule 7.6, (application for extensions of time for service of the claim form after the end of the period specified by Rule 7.5 or court order), and Rule 3.9, (application for relief from sanctions).  I have no doubt that this was quite deliberate. In Totty v Snowden [2001] EWCA Civ 1416 [2001] 4 All ER 577, this court had to consider the interrelationship between Rule 7.4(2) and Rule 3.1(2).  At paragraph 46 of his judgment Chadwick LJ said:

“Third, there is no compelling reason of policy why the court should interpret r 7.4(2) and r 7.6 in order to cover a  situation to which, on their terms, they are not addressed.  As Kay LJ has pointed out, there is a clear rationale for the provisions of r 7.6 in relation to the service of the claim form itself.  There is no comparable rationale in relation to the service of particulars of claim, in circumstances in which the claim form has itself been served.  There is no reason why that situation should not be left to be dealt with, as a matter of discretion, in the exercise of the powers conferred by r 3.1(2)(a),  having regard to the overriding objective.  Once the claim form itself has been served, the defendant will know that there is a claim against him; and he will be in a position to invoke the assistance of the court if particulars of claim are not forthcoming within due time.” 

3.9 DOES NOT APPLY WHEN AN APPLICATION IS MADE IN ADVANCE AND THE KEY DATE IS WHEN THE APPLICATION IS MADE

Dyson L.J. went on to state:

          “I see no reason to import the rule 3.9(1) check lists by implication into Rule 3.1(2)(a) where an application for an extension of time is made before the expiry of the relevant time limit. There is a difference in principle between on the one hand seeking relief from a sanction imposed for failure to comply with a rule, practice direction or court order, where such failure has already occurred, and on the other hand seeking an extension of time for doing something required by a rule, practice direction or court order before the time for doing it has arrived. The latter cannot sensibly be regarded as, or even closely analogous to, a relief from sanctions case. If the draftsman of the rule had intended that the check list set out in rule 3.9(1) should be applied when the court is exercising its discretion under CPR 3.1(2)(a) in such a case, then he could and, in my judgment, would have said so. By not spelling out a check list in rule 3.1(2)(a), it seems to me that the draftsman was intending that the discretion should be exercised by simply having regard to the overriding objective of enabling the court to deal with cases justly including, so far as practicable, the matters set out in Rule 1.1(2).” 

THE MERITS OF THE CLAIM SHOULD RARELY BE CONSIDERED ON AN APPLICATION TO EXTEND TIME

Dyson L.J. was critical of the judge’s consideration of the case on the merits.

“41.        The remaining point about which I need to make comment is in relation to the merits of the claim itself. The judge was considerably influenced in reaching his decision by his view that the claimant’s case “does not inspire a great deal of confidence in its prospects of success.”

42.         I will make two points about this. First, it seems to me that it will rarely be appropriate to dismiss an application for an extension of time on the grounds that the claim is weak unless the court is able to conclude that an application to strike out the claim under rule 3.4(2)(a) or (b), or an application for summary judgment by the defendant under rule 24.2 would succeed.  To refuse a prospective application for an extension of time on the grounds that the claim is weak, where neither the rule 3.4(2)(a) or (b) nor the rule 24.2 threshold is met would be a truly draconian step to take, and might well infringe a claimant’s rights under Article 6 of the European Convention on Human Rights. In my judgment, if a defendant wishes to seek to persuade a court not to grant an extension of time for service of particulars of claim on the grounds that the claim is weak, then it would be desirable for him or her to issue an application to strike out under rule 3.4(2)(a) or (b) or for summary judgment under rule 24.2 to be heard at the same time as the application for an extension of time.

43.         This brings me to the second point. If a defendant does wish to pray in aid the overall merits of a claim as a reason for refusing an extension of time, notice should be given to the claimant.  This will enable the claimant to submit evidence directed to the point.  In the present case, no notice was given beyond a passing reference in the grounds of appeal to the defendant being faced with a “stale claim which has prima facie significant weaknesses.”  In my view, this was not sufficient to put the claimant on notice that the weakness of her claim would be relied on as an independent reason why the decision of the district judge was wrong. In the result, there was no evidence on behalf of the claimant dealing with the merits of the claim.”

  Atriam Training: High Court finds that Robert still applies

 In Atriam Training Services [2013] EWHC 1562 (Ch) Mr Justice Henderson considered an application for an extension of time by liquidators to give disclosure in a complex insolvency case.  Disclosure was due to take place on the 2nd April 2013, however on the 28th March 2013 the solicitors for the liquidators made an application for an extension of time until the 28th June 2013. A cross-application was made for an order that the action be struck out, or that any extension should be made on an “unless” basis

The judge held that the fact that this was a prospective application meant it would be wrong to treat it as an application for relief from sanctions.  The court would apply the principle in Robert

“… by simply having regard to the overriding objective of enabling the court to deal with cases justly including, so far as practicable, the matters set out in rule 1.1(2)”.

The relevance of the change in the overriding objective

 The overriding objective now includes the enforcement of compliance with orders.  To this end the court had to balance two issues:

“52. The matters set out in rule 1.1(2) now include, of course, the enforcement of compliance with orders. To that extent, it is no doubt the case that the court will scrutinise an application for an extension more rigorously than it might have done before 1 April, and that it must firmly discourage any easy assumption that an extension of time will be granted if it would not involve any obvious prejudice to the other side.”

The balancing act: parties should not behave unreasonably

 However the court had to provide a balance:

53. On the other hand, I think it is important not to go to the other extreme, and not to encourage unreasonable opposition to extensions which are applied for in time and which involve no significant fresh prejudice to the other parties. In cases of that nature, considerations of cost and proportionality are highly relevant, and the wider interests of justice are likely to be better served by a sensible agreement, or a short unopposed hearing, than by the adoption of entrenched positions and the expenditure of much money and court time in preparing for and dealing with an application that could have been avoided.

54. I would also observe that, although all court orders mean what they say, and must be complied with even if made by consent, there are some orders relating to the completion of specified stages in preparation for trial (such as disclosure, the exchange of witness statements or a timetable for expert evidence) where there may still be so many imponderables when the order is made that the date for compliance cannot sensibly be regarded as written in stone. Everything will always depend on the circumstances of the particular case, and the stage in the proceedings when the order is made, but in many such cases it should be understood that there may be a need for reasonable extensions of time or other adjustments as the matter develops. It would, I think, be unfortunate if the new and salutary emphasis on compliance with orders were to lead to a situation where, in cases of the general type I have described, a reasonable request for an extension were to be rejected in the hope that the court might be persuaded to refuse any extension at all.”

 The judge made an order extending time but made an “unless” order in relation to disclosure on the extended timetable.

The practical significance of this

1.         The first principle has to be to comply with the orders and rules to the letter (and date!).

2.         If a party finds that there is a possibility that they are unable to comply with an order then there is no doubt that the only prudent course of action is to make an application to extend prospectively.

3        A prospective application is not bound to succeed and may be considered with some rigour. The party making the application will have to justify it.  The absence of prejudice is not decisive.  However, in Mitchell, the Court of Appeal indicated that this type of application will be looked at “more favourably”.

A CAVEAT

Note, however, that in Mitchell the Master of the Rolls did not, expressly, refer back to his earlier judgment in Robert. However it has not been overruled or questioned and, indeed, was expressly applied in Atrium.  However, as noted above, the only express guidance we have is that applications made in advance will be “looked upon more favourably”.

RELATED POSTS

 RELATED POSTS IN RELATION TO SANCTIONS AND AVOIDING PROBLEMS

THE CASES

The Robert case can be found at http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWCA/Civ/2003/299.html&query=roberts+and+momentum+and+services&method=boolean

The Atrium case is at http://www.bailii.org/cgi-bin/markup.cgi?doc=/ew/cases/EWHC/Ch/2013/1562.html&query=atrium&method=boolean

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