DELAY IN MAKING APPLICATIONS CAN BE FATAL: SAMARA -V- MBI APPLICATION TO HAVE JUDGMENT SET ASIDE REFUSED ON GROUNDS OF DELAY

The case of  Samara –v- MBI & Partners EWHC 563 (QB) considers whether the “Mitchell” criteria is relevant to applications to have judgment set aside.

THE FACTS

The claimant entered judgment in default. It was more than a year later, after the claimant attempted enforcement proceedings, that the defendant made an application to set judgment aside. This was refused by the Master. The defendant appealed.  One of the issues before Mr Justice Silber was whether the new “Mitchell” principles applied to an application to have judgment set aside.

THE RELEVANCE OF DELAY

“V. Does the new regime apply to the application to set aside the judgment pursuant to CPR 13.3?

1. The new regime came into force on 1 April 2013. It is common ground that the illuminating and very comprehensive 15^th and 18^th Lectures in the Implementation Programme on the Application of the Amendments to the Civil Procedure Rules do not deal specifically with the approach to CPR r.13.3 and my attention has not been drawn to any of the other lectures in that series that deal with this issue or anything in Sir Rupert Jackson’s report which does.

1. Mr. Neaman submits that the underlying philosophy and the rationale behind the consequential amendments to the CPR have changed the approach of Courts to failures to comply with all rules and orders, including CPR r. 13(3).

1. Insofar as Mr. Dale contends that the new regime does not apply to the special rules under CPR Part 13 because there had been no trial, I cannot agree because the new regime has universal application to all rules in the CPR. Indeed, it is based on and underpinned by the changes to the overriding objectives which apply to all parts of the CPR. As is widely known, the new overriding objectives in CPR r.1.1 state (with the post-April 2013 additions in bold) that:-

“1.1. (1) These rules are a new procedural code with the overriding objective of enabling the court to deal with cases justly and at proportionate cost.

(2) Dealing with a case justly and at a proportionate cost includes, so far as is practicable …

(f) enforcing compliance with rules, practice directions and order.”

1. There is no express statement that CPR Part 13 or that any part of it is excluded from these provisions and I have found nothing in the rules or in the decided cases to show expressly or impliedly that this is so. Further, there is no theoretical justification from excluding this rule from the new regime and the new underlying objectives. Indeed, most importantly, the Master of the Rolls, Lord Dyson, described the effect of the new regime in very general terms and as being of universal application when giving the judgment of the Court of Appeal in Mitchell v News Group [2013] EWCA Civ 1537 when he explained that:-

(a) “[T]he new more robust approach [which] will mean that from now on relief from sanctions should be granted more sparingly than previously” ([46]);

(b) This approach, which meant an end to the belief that the “culture of delay and non-compliance “would continue (ibid);

(c) “[T]he starting point should be that the sanction has been properly imposed and complies with the overriding objective” [45];

(d) Relief would be granted if the default is trivial “provided that an application is made promptly” (ibid [40]) or if there is a good reason for failure to comply (ibid [41]). Good reasons are likely to arise from; circumstances outside the control of the party in default (ibid [43]) and by contrast inefficiency or incompetence of a party’s solicitors –for example, the fact that a deadlines is simply overlooked- is unlikely to prove a good reason (ibid [41]) (see Leggatt J in Summit Navigation Ltd and another v Generale Romania Asigurare Reasigurare SA and another [2014 EWHC 398 (Comm)[39]); and

(e)  Applications for relief must be made promptly (ibid [40] and [46]).

1. The need for promptness in making applications was also stressed by Richards LJ when giving the judgment of the Court of Appeal in Durrant v Chief Constable of Avon & Somerset Constabulary [2013] EWCA Civ 1624 when refusing to grant relief from a sanction for failing to serve witness statements in time (see especially paragraphs [40] –[56]). Similarly, in Thevarajah v Riordan [2014] EWCA Civ 14, the Court of Appeal considered that the delay in making the application for relief was an additional reason why it had to be rejected. It is very clear that in the new regime, the need for promptness has even greater significance than it had previously and that relief will be granted much more sparingly than hitherto. I will have to consider if this means that the decision of the Master cannot be faulted unless, as was explained inMitchell, the delay was trivial or unless there was good reason for it.”

THE JUDGE WOULD HAVE MADE THE SAME DECISION UNDER THE SAME RULES

It is important to note that the judge went on to find that he would have made the same decision even prior to the amendment of CPR 3.9. The rules state that an application should be made promptly.

NOTE FOR DEFENDANTS (AND FOR EVERYONE) MAKE AN APPLICATION PROMPTLY

This case does not affect that part of CPR 13.3 which allows the court to set aside a regular judgment on the merits.  However CPR 13 also states that an application must be made promptly.   Defendants must be aware that even if they have a defence on the merits an application to set aside judgment could (and probably will) fail if there is delay in making that application.