RELIEF FROM SANCTIONS, LATE WITNESS STATEMENTS AND LITIGANTS IN PERSON
The judgment of Mr Justice Warren in Chadwick -v- Burling  EWHC 1610 (Ch) highlights some important issues in relation to relief from sanctions in general, and the position of litigants in person in particular.
The applicant in the case was the trustee in bankruptcy and bringing an action for possession and declarations of ownership in relation to a number of properties. An order was made for the filing of evidence. The respondents did not file any evidence. A peremptory order was made that evidence be served by 5th August 2014 or the respondents be debarred from relying on evidence.
The second-respondent was the former wife of the bankrupt. She did not file evidence. She stated that she did not recall receiving the order, but did not positively state she did not receive it.
An application was made for relief from sanctions. That application was refused by the Deputy Registrar. The second-respondent appealed.
- In relation to one of the properties the Deputy Registrar had erred in not giving full reasons for refusing relief from sanctions.
- Although the appeal was allowed (in relation to one property) the judge considered the discretion he had and exercised it in the same way. Relief from sanctions was refused.
- The application had not been made promptly.
- The fact that the respondent was a litigant in person at the time of the order was not relevant.
- The “merits” of the respondent’s case were irrelevant in this type of application.
RELIEF FROM SANCTIONS AND THE LITIGANT IN PERSON
The judgment contains an interesting review of the relevant principles in relation to sanctions and litigants in person.
- An application for relief from sanction is made under CPR rule 3.9. Under that Rule, the court must consider
“all the circumstances of the case, so as to enable it to deal justly with the application, including the need –
(a) for litigation to be conducted efficiently and at proportionate cost; and
(b) to enforce compliance with rules, practice directions and orders”
Applications should, in accordance with sub-rule (2), be supported by evidence.
- This rule has been subject to some high profile cases. Denton v TH White Ltd  EWCA Civ 906 lays out the process a judge has to follow on an application for relief from sanction. It is a three stage test. The first stage is to identify and assess the seriousness or significance of the failure to comply with any rule, practice direction or court order which engages rule 3.9(1). The second stage is to consider why the default occurred and whether there is any excuse for it. The third stage is to evaluate all the circumstances of the case, so as to enable the court to deal justly with the application, including factors (a) and (b) in CPR r.3.(1). These two factors are “of particular importance” and particular weight is to be given at the third stage when all the circumstances are considered to the need (a) for litigation to be conducted efficiently and at proportionate cost and (b) to enforce compliance with rules. Relevant factors at the third stage will include the promptness of the application and other past or current breaches of the rules, practice directions and court orders.
- As a general rule, the fact that an individual is a litigant in person is not of itself a reason for the disapplication of the rules. This was the view expressed by Briggs LJ at  of his judgment in Nata Lee v Abid  EWCA Civ 1652, a judgment with which Moore-Bick and Underhill LJJ agreed:
“…..In short, the CPR do not, at least at present, make specific or separate provision for litigants in person. There may be cases in which the fact that a party is a litigant in person has some consequence in the determination of applications for relief from sanctions, but this is likely to operate at the margins.”
- In Global Torch Ltd v Apex Global Management Ltd and others (No 2)  1 WLR 4495 the Supreme Court has endorsed the approach that in respect of a case management decision,
“it would be inappropriate for an appellate court to reverse or otherwise interfere with it, unless it was ‘plainly wrong in the sense of being outside the generous ambit where reasonable decision-makers may disagree’ as Lewison LJ expressed it in Broughton v Kop Football (Cayman) Ltd  EWCA Civ 1743 at .”
- At  to , Lord Neuberger considered whether the merits of the underlying claim were relevant to the grant of relief from sanctions. He expressed the view that the merits were generally irrelevant to such an application. The ultimate prospects were only relevant if it was a matter of summary judgement.”
THE JUDGE’S DECISION ON RELIEF FROM SANCTIONS
The judgment is interesting because the judge held that the Deputy Registrar had displayed an error of principle. However, exercising the discretion afresh, and applying the Denton principles properly, this was not a case where relief from sanctions should be granted in any event.
” I deal with 237 Rayleigh Road and 9 Selwood Road separately.
237 Rayleigh Road
- As to 237 Rayleigh Road, I am persuaded that the judgment of the Deputy Registrar displays an error of principle. I put it that way, rather than saying that he actually erred in principle, because he may in fact have had in mind all of the factors which should have been taken into account but simply failed to address all of the relevant factors in his judgment. It seems to me that there is force in Mr Hill-Smith’s submissions about what the Deputy Registrar should have, but did not expressly, take into account. That, coupled with his conclusions concerning the alleged contribution of £6,000 and his implicit rejection of any possible reliance on the pre-existing joint ownership lead, in my judgment, to the conclusion that he did not properly exercise his discretion. He appears to have taken the merits into account as part of “all of the circumstances of the case” when, for reasons already given, he should not have done so: see paragraph 30 above.
- I can, in these circumstances, exercise the discretion myself (although in theory I could remit the matter but that would be unsatisfactory for a number of reasons). Mr Hill-Smith submits that I should grant relief from sanctions and allow Mrs Burling to adduce further evidence about her claim to a share in 237 Rayleigh Road. The factors on which he relies are essentially the same factors which the Deputy Registrar did not expressly address which I have already mentioned: see paragraph 30 above. Further, he says that factors (a) and (b) in CPR 3.9(1) do not militate against relief being granted: see paragraph 33 above. Further, whilst accepting that the discipline of compliance with the rules is important, to grant relief in the circumstances of the present case, with a litigant in person ignorant (I use his word) of what was to be expected of her and lacking in understanding of the whole process, would not send any sort of message to litigants in general and their advisers that the court is willing to be lax in its requirement of compliance with the rules and thereby signal a return to the approach which the Jackson reforms were designed to change.
- If he is right that I should grant relief at all, then I would agree that Mrs Burling should have a final opportunity to produce her evidence, including evidence from Mr Burling. In that context, I understand that a witness statement was made by him for the last hearing before me but in the event no application was made to adduce it. But if this matter is to proceed to a substantive hearing it would not be sensible, in my view, to restrict Mrs Burling to the evidence which she has already produced, namely her own two witness statements and the statement of her friend Susan Carroll.
- Mr Shepherd submits that the only proper conclusion which I can reach is to refuse relief. He made a number of points:
i) The application for relief was not made promptly. Indeed, no application was made until the oral application on 6 October 2014 notwithstanding the letter dated 27 August 2014 from Mr Chadwick’s solicitors mentioned at paragraph 7 above.ii) At best, the application was made 2 months late at the hearing when, in relation to 237 Rayleigh Road, Mrs Burling explained that “I have a letter here saying I was on the mortgage” and asked for a week for her solicitors to write everything out for her.
iii) There was a breach of the previous order of Deputy Registrar Briggs as well as breach of Registrar Barber’s order. Although that is true, the comments in Denton about breaches of other orders being taken into account are really directed at compliance generally with the rules. In nearly all cases of non-compliance with “unless” orders (in contrast with an automatic sanction laid down in the rules themselves) there will have been a prior order without any sanction attached. It does not really add anything in terms of the grant of relief to point out the breach of the “unless” order was preceded by a breach of a similar order without a sanction attached.
iv) As pointed out at  of Denton,
“the culture of compliance that the new rules are intended to promote requires that judges ensure that the directions that they give are realistic and achievable. It is no use imposing a tight timetable that can be seen at the outset to be unattainable. The court must have regard to the realities of litigation in making orders in the first place….. “Unless” orders should be reserved for situations in which they are truly required: these are usually so as to enable the litigation to proceed efficiently and at proportionate cost”.
Clearly, Registrar Barber saw her order as truly required and provided a generous timetable to ensure that it was realistic and achievable.
v) It is only at the margins that the fact that an individual is a litigant in person is relevant. On the facts of the present case, Mr Shepherd submits that it is irrelevant. First, the orders of both Deputy Registrar Briggs and Registrar Barber were not complicated and were clear. Secondly, the letter of 27 August 2014 to Mrs Burling from Mr Chadwick’s solicitors alerted Mrs Burling to the need for her to take action by making an application supported by a witness statement.
vi) The merits of the claim are irrelevant. I agree with that, subject to the qualification that the merits may be important, or even conclusive, when the merits are clear in one direction or the other such as to justify summary judgment. That is not the present case in relation to 237 Rayleigh Road.
vii) Mrs Burling’s personal circumstances concerning her health and her divorce are not relevant because of the timing. Her accident and other health problem predated Mr Chadwick’s application and she had recovered sufficiently to manage her affairs within the time-table laid down by the orders of Deputy Registrar Briggs and, a fortiori, those of Registrar Barber.
viii) The fact that Mrs Burling will lose the opportunity to make good her claim if relief is not granted is irrelevant. That is simply a consequence of the breach of the “unless” order. It is true that it is simply a consequence of the breach, but that is not to say that it is not properly a factor to be taken into account. The court might be more reluctant to grant relief where the sanction is deprivation of some collateral advantage (as in Mitchell where Mr Mitchell was deprived of the possibility of recovering costs even if successful but could still prosecute his claim) than where the sanction is deprivation of a significant property right.
ix) Contrary to Mr Hill-Smith’s argument, Mr Shepherd submits that there would be serious consequences if relief from sanctions was granted. Firstly, there would be more delay. I have already addressed Mr Hill-Smith’s position on this aspect at paragraph 33 above. Mr Shepherd suggests that the hearing on 6 October 2014 could have been used to deal with the whole case even if Mrs Burling had produced her evidence in time. I think that that is unlikely. Secondly, the breach of Registrar Barber’s order has resulted in increased costs quite apart from this appeal. These increased costs will in practice be irrecoverable resulting in the creditors being out of pocket. There can be no doubt that some increased cost will have been incurred as a result of Mrs Burling’s default. But if the costs of this appeal are left out of account, it is not obvious to me that a significant amount of extra cost will have been incurred.
- Mr Shepherd asks what, in the light of all of the submissions on both sides, are the circumstances which tip the balance in favour of granting relief. The answer he gives to his own question is that Mrs Burling became co-operative, appointing solicitors to guide her, and indicated that a witness statement could be produced within 7 days. He submits that there is no other factor. I do not consider that that assessment does justice to Mr Hill-Smith’s points.
- First, Mr Shepherd’s assessment of the impact of factors (a) and (b) in CPR 3.9(1) is stronger than I consider is justified. Although I accept that Mrs Burling’s conduct has not been consistent with the efficient conduct of the litigation, the result in terms of delay (ignoring the delay caused by this appeal) is not likely to have been great given that the 6 October 2014 hearing was, in my assessment, unlikely to have been the occasion for the final disposition of the case had Mrs Burling filed her evidence in time. And although I accept that a litigant in person as much as a represented litigant must observe the rules and orders of the court, this is not a case where to grant relief from sanctions would send the wrong message to litigants in general. Although factors (a) and (b) are, in accordance with Denton, of particular importance, their impact must be viewed against the facts of the particular case as indeed they were in Denton and the other appeals (Decadent and Utilise) heard at the same time.
- Secondly, one cannot discount entirely the factors which Mr Shepherd identifies in answering his own question. But it seems to me to carry very little weight that Mrs Burling, at the last moment and well out of time for compliance with the “unless” order, sought legal assistance. As Mr Shepherd points out, the orders of Deputy Registrar Briggs and Registrar Barber are not difficult to understand. And as I have noted, the discovery of documents in the cupboard may have prompted Mrs Burling to act. But suppose that she had not found the documents in the cupboard but had simply sought, way out of time, to adduce evidence about the joint ownership and transfer of the property. The question would then obviously arise as to why she had not adduced this evidence before. There is simply no explanation. She has not said, for instance, that she thought that evidence only meant documentary evidence and did not include her own account of the joint ownership and the transfer of the property. It is no answer to the failure to adduce that evidence to say that documents have now been found in a cupboard: that may have prompted Mrs Burling into action, but it does not provide an excuse for previous inaction.
- It seems to me that the only potential answer to this is that Mrs Burling is not simply a litigant in person but is also an individual who is ignorant of the system and how she is supposed to operate within it. It cannot be right, however, that the court must enquire into the state of knowledge and intellectual capacity of a litigant in person who says that he or she did not understand the process or realise that he or she had certain substantive rights (and so did not serve evidence to support a claim to those rights) (although there may be cases where it is obvious on the facts that this is so and can be taken into account). Although the fact that an individual is a litigant in person can be a relevant factor, this, I agree, is only at the margins; typically this might be so where there is some extremely complex factor or complicated order which any lay person might find it difficult to understand. In the present case, as I have said, the relevant orders were straightforward and easy to understand. Moreover, Mr Chadwick’s solicitors explained to Mrs Burling the need for her to make an application supported by evidence if she was to be allowed to adduce any evidence.
- Taking account of all the circumstances as I have identified them and in the light of the submissions addressed to me, my decision is that relief from the sanction imposed by Registrar Barber should not be granted in relation to 237 Rayleigh Road.
9 Selwood Road
- As to 9 Selwood Road, I am not persuaded that the judgment of the Deputy Registrar displays any error of principle. On the material before him, it was well within the range of appropriate decisions for him to conclude that, applying the third stage of the Denton test, in all the circumstances relief from sanctions should not be granted. He was entitled to take account, as I have explained, of the merits of Mrs Burling’s claim because the case was one where, even if the evidence on which Mrs Burling sought to rely had been admitted, it would not have assisted her case; and he was entitled to reach that conclusion even if the case would otherwise be one where relief from sanctions ought to be granted: see paragraph 29 above. Even if the Deputy Registrar should have taken into account other factors which he did not, at least expressly, take into account, I consider that, applying the correct approach, he could only properly have come to the conclusion which he did come to. Once it is accepted, as it must be, that Mrs Burling’s case for relief from sanctions in relation to 9 Selwood Road rested exclusively on the documents in the carrier bag, and in particular the will, it follows that if those documents provide no arguable case then the application for relief should fail. I would therefore dismiss Mrs Burling’s appeal from the Deputy Registrar’s decision to refuse relief from sanctions in relation to 9 Selwood Road.
(2) Refusal to adjourn
- So far as the refusal to adjourn the hearing on 6 October 2014 to allow Mrs Burling to obtain further advice is concerned, I reject any suggestion that the Deputy Registrar erred. She had plenty of time from the date of Registrar Barber’s order in which to obtain advice and even longer from the date of Deputy Registrar Briggs order which was when she ought to have given serious consideration to the preparation of her evidence.
- The declarations made by the Deputy Registrar in relation to both 237 Rayleigh Road 9 Selwood Road stand. I will deal with the date for the granting of permission following the handing down of this judgment.
Application to amend the notice of appeal
- Since I have refused the appeal against the refusal of relief from sanctions in relation to 9 Selwood Road, the application to amend the Notice of Appeal in relation to that property falls away. Nonetheless, I wish to say that, had I decided that relief from sanctions should be granted in relation to 9 Selwood Road, I would have refused permission to amend the Notice of Appeal. The amendment does not seek to add to or amend an existing ground of appeal in relation to a particular order appealed against. Rather, it seeks to add an entirely new ground of appeal in relation to a part of the order not yet appealed against, namely to assert a beneficial interest in 9 Selwood Road. This is a claim which was expressly disavowed in the skeleton argument (prepared by experienced insolvency counsel who did not appear before me) in support of the Grounds of Appeal. The application to amend was not made until 22 December 2014. That was far too late, in my judgment, to seek to raise an entirely new ground of appeal when no new material over and above that which Mrs Burling discovered just before the hearing on 6 October 2014 had come to light. The point does not arise for decision and so I make only those brief observations in relation to the application.
DEALING WITH LITIGANTS IN PERSON
One factor in the case (unlikely to be decisive but which features in the judgment) is the fact that the trustee’s solicitors wrote to the respondent in detail explaining the effect of the order, that it had been breached and that relief from sanctions was required.
The number of posts on relief from sanctions on this blog make it impractical to provide links (see the “Sanctions: Case Watch” section).
In relation to litigants in person.
- Kerry Underwood writes on “Litigants in Person: Acting in Cases Involving Them and Advising Them”.
- The Bar Council: Representing Yourself in Court.
- Ian Besford on Costs and Litigants in Person.
- The Law Society, Bar Council and CILEx Litigants in person: new guidelines for lawyers