PROVING THINGS 69: SOLICITORS EVIDENCE OF (THEIR OWN) LOSS “WHOLLY INADEQUATE”: IMPORTANT POINTS ABOUT DELAY TOO
This blog often reports on cases where a party fails to appreciate the scope and depth of evidence needed to prove a claim for damages. This issue arose in the judgment today in Hersi & Co Solicitors, R (On the Application Of) v The Lord Chancellor  EWHC 2667 (TCC). The assertion of a loss, without evidence or documentation, meant there was no basis on which the court could have awarded damages.
“With considerable understatement, Mr Westgate described the evidence referred to above as “concise”. Given that there was no other evidence on damages, I would describe it in a rather different way: in my view, it was wholly inadequate to support the pleaded damages claim. Thus, there was no evidence before the court at the time of the trial which could have supported any special damages claim whatsoever. There was therefore nothing for the court to adjourn to a later date.”
“In my view this litigation has been conducted in an abysmally slow and haphazard fashion. No regard has been had to the orders of the court, or to the CPR (which contrary to the belief in some quarters, applies to the Administrative Court just as it applies to all other parts of the High Court). The claimant has been in breach of both court orders and the rules.”
The claimant firm of solicitors was seeking a judicial review of the decision not to award it a contract for immigration and asylum work. Part of the claim included a claim for damages. The claimant failed on the judicial review application, however Mr Justice Coulson commented both on the paucity of evidence in relation to the claim for damages and the delay there had been in conducting the claim.
THE CLAIM FOR DAMAGES: UNSUPPORTED BY EVIDENCE
“On the first day of the trial, which had been set down to deal with all issues of liability and damages, Mr Westgate asked me to rule that the trial be concerned with liability only, with damages being left over to another date. I said that, given that this case had started seven years ago, it was an extraordinary thing for the court to be asked, on the first day of trial, and for the first time, to put off any consideration of damages. I indicated, however that, if this was an agreed course, I would not interfere.
I was not told during the trial that this course of action had been agreed; indeed, Mr Taylor had made some strong points about quantum in his written opening. After I had provided the parties with a copy of this Judgment in draft, which dealt with certain points of principle in connection with the damages claim, I was told that an agreement had been reached between the parties outside court just before the start of the trial, although this was ‘subject to the court’s determination’.
This is obviously an unfortunate situation and I have considered it carefully. It seems to me that it would be contrary to the overriding objective to leave unanswered the principal issues on damages, provided of course that the claimant would not be prejudiced by my doing so. In my view, the claimant cannot be prejudiced by the observations that follow, because all the points I make arise out of the claimant’s own evidence.
First, it should be stressed that, but for the existence of what the claimant must have considered to be an arguable claim for damages, there would have been no purpose or point to these proceedings in the first place. The proceedings were not conducted with sufficient speed to have had any effect upon the procurement exercise itself, so this was always a claim for damages only.
“34. The claimant’s turnover for publically funded cases in the year und eth contract that ended in 2010 was £390,000 from 175 matter starts: £2,228.57 per matter start.
35. The 2010 contracts ran from November 2010 to April 2013, a period of just over two years and four months (2.3 years).
36. The claimant therefore estimates its lost income at £2,228.57 x 850 x 2.33 = £4,413,685.71, at least 50% of which would have been profit.”
“Hersi & Co bid for 850 cases. It was expecting to earn about £2300.00 from each case. Therefore, the loss to Hersi & Co is approximately £1.95 a year. For a contract duration of 2.33 years that would be £4.5 million. This is to be reduced by the fact that not all of it would have been profit. And further to be reduced by the fact that not every firm got what it bid for.”
There was no other witness evidence in support of the damages claim. In addition, no documentation of any sort has been disclosed to make good any of the component figures within the claim.
With considerable understatement, Mr Westgate described the evidence referred to above as “concise”. Given that there was no other evidence on damages, I would describe it in a rather different way: in my view, it was wholly inadequate to support the pleaded damages claim. Thus, there was no evidence before the court at the time of the trial which could have supported any special damages claim whatsoever. There was therefore nothing for the court to adjourn to a later date.
On receipt of the draft judgment, Mr Westgate complained that, if the claimant had known that damages were going to be dealt with, Mr Hersi could have given oral evidence and been cross-examined. That is incorrect for a variety of reasons: not only had the parties agreed well in advance of the trial (and therefore in advance of the conditional agreement) that there would be no oral evidence, but the absence of any detail and any documents to support any of the claimed figures would have been fatal to the damages claim in any event. Mr Hersi could not have given oral evidence in chief on any matter that went beyond his (inadequate) witness statement, so there would have been no need for Mr Taylor to cross-examine him, and nothing to cross-examine him on.”
Earlier in the judgment the judge commented
“I do not propose to set out the procedural history at this stage because, ultimately, it is irrelevant to any consideration of the merits of the claimant’s claim. However, I do deal with it in Section 11 below, in the hope that, in setting out the sorry saga of this case between 2010 and 2016 (when the case was transferred to the TCC), it will come to be regarded as an example of how not to conduct a public procurement challenge.”
This was expanded later in the judgment.
“11. THE PROCEDURAL HISTORY
I said at paragraph 3 above that I would return to the procedural history. That is for two reasons. First, it seems to me that the delays in this case were inexcusable; secondly, and more importantly for this purpose, I consider that the claimant’s conduct of this case was wholly unsatisfactory. It cannot be right that in the modern age, a case of this kind can be allowed to take seven years to get to trial.
These judicial review proceedings began in November 2010 in the Administrative Court. The claim was attached to, and then uncoupled from, a number of the other cases arising out of the legal aid procurement exercise to which I have referred. Although this is a regular practice in the Administrative Court, in my experience it often causes more trouble than it is worth. I note that, in the end, none of the seven reported cases involving this public procurement were dealt with or heard together.
The issue of permission in this case was not dealt with until March 2013, two and a half years after the proceedings began. Even then, Blake J refused permission to bring these proceedings on all grounds except inequality of treatment and the Tideland principle, but he did not grant permission on those grounds either. Instead, he adjourned the permission hearing until after disclosure.
A PTR was held in July 2013 and the court made an “unless” order requiring the claimant to file amended proceedings by 2 August 2013. The claimant failed to provide its amended pleading by that date. On one view, the claim should have been struck out then because of the failure to comply with the “unless” order. It appears that no-one even raised that possibility.
Thereafter, the claimant did nothing for almost 3 years. In February 2016 the defendant sought to strike out the proceedings. On 2 March 2016, following the hearing of that application in the Administrative Court, the claim was not struck out, although the reasons for that are not clear from the papers I have. Permission to bring judicial review proceedings was granted on that occasion, almost six years after the claim had been commenced. Again, I do not understand how such a delay was permitted to arise. The case was then transferred to the TCC.
At the PTR in July 2017, O’Farrell J ordered that a Scott Schedule of the claimant’s comparators be provided by 11 September 2017. The claimant had to provide the relevant information first. It failed to do so. In the end, the Scott Schedule was not provided until 12 October, rendering it all but useless, because neither party had been able to refer to it in their written openings.
At the PTR, the claimant was ordered to prepare a trial bundle by 25 September 2017. Again, it failed to do so. Much of that work was instead done by the defendant. Because there was no Scott Schedule, the original trial bundle included the 19 files said to be relevant to the claimant’s comparison exercise.
To compound matters, the claimant’s opening should have been provided by 2 October 2017. It was not provided then, although the defendant did provide a helpful opening that far in advance of the trial. The date was subsequently re-jigged by the parties to 12 October 2017, but the claimant’s opening was not provided to the court on that date either. In fact, a copy of it had to be obtained by my clerk from defendant’s counsel on 13 October 2017, the last day before the trial. This was despite the fact that my clerk had sought the claimant’s opening earlier in the week, so everyone knew that the court was keen to see it as soon as possible.
In my view this litigation has been conducted in an abysmally slow and haphazard fashion. No regard has been had to the orders of the court, or to the CPR (which contrary to the belief in some quarters, applies to the Administrative Court just as it applies to all other parts of the High Court). The claimant has been in breach of both court orders and the rules. I very much hope that no case ever comes to trial in the TCC again with a 6 year procedural history.”
RELATED POSTS: THE PROVING THINGS SERIES
- Proving things 1: Civil Evidence Act notices will not cut it
- Proving things 2: evidence to support a claim for damages must be pitch perfect.
- Proving things 3: the complete absence of evidence means the court will not speculate
- Proving things 4: Witnesses who just aren’t there.
- Proving things 5: witness statements and failing on causation.
- Proving things 6: “That’s what I always do” & proving causation.
- Proving things 7: If you don’t prove a loss you don’t get an order.
- Proving things 8: a defendant must prove that a failure to wear a seatbelt made a difference.
- Proving things 9: the role of experts
- Proving things 10: “He said, she said”: the difficulties of recollection.
- Proving things 11: Lies, damn lies and…
- Proving things 12: That oral contract is not worth the paper its written on.
- Proving things 13: Loss, there was no loss.
- Proving things 14: proving mitigation of loss
- Proving things 15: damages and evidence: going back to College
- Proving things 16: if you don’t prove it you don’t get it.
- Proving things 17: Heads of damage that were “entirely bogus”
- Proving things 18: Damages; Car hire; Proof & Summary Judgment
- Proving things 19: prove service or you could be caught out.
- Proving things 20: allegations of improper conduct have to be prove
- Proving things 21: when the whole process of investigation is flawed
- Proving things 22: damages, mitigation part 36 (and bundles).
- Proving things 23: serving important evidence late
- Proving things 24: Damages & the “But for test”: when it gets really complexProving things 24: Damages & the “But for test”: when it gets really complex
- Proving things 25: Attempts to smuggle in witness statements do not help (and carry no weight).
- Proving things 26: distinguishing between what you can remember and what you now think you did.
- Proving things 27: Burdens of proof, hearsay evidence and… attempted murder.
- Proving things 28: make unwarranted personal attacks and use a “mud-slinging” expert: that always ends well.
- Proving things 29: Make sure the witness evidence deals with the relevant issues
- Proving things 30: Office Gossip Proves Nothing: The importance of the source of information and belief.
- Proving things 31: witnesses tend to remember what they want to remember.
- Proving things 32: Damages claim struck out as unsustainable: application to amend refused.
- Proving things 33: causation and the burden of proof in claims against solicitors.
- Proving things 34: There is no primer for scuttlers: when your ship doesn’t come in.
- Proving things 35: Reconstruction, documents & memory.
- Proving things 36: credibility and contemporaneous documents.
- Proving things 37: An approach to damages that was “fundamentally deficient throughout”.
- Proving things 38: Proving inability to pay on a security for costs application.
- Proving things 39: You can spend £10 million in costs and still not prove your case.
- Proving things 40: No evidence – no loss.
- Proving things 41: Proving damages – you are not going to get a second bite of the cherry.
- Proving things 42: silence does not prove inducement.
- Proving things 43: How the Court decides: a Primer.
- Proving things 44: Findings of Fact, Walter Mitty and Witness Training.
- Proving things 45: If you can’t prove loss the defendant is going to get summary judgment.
- Proving things 46: Late theories advanced by experts rarely help.
- Proving things 47: Fire in the loft: it wasn’t the mouse man at all.
- Proving things 48: valves, floods, models and causation.
- Proving things 49: it is difficult to prove damages when the opinion evidence in your witness statement has been struck out.
- Proving things 50: to prove breach of contract you first have to prove that there was a contract.
- Proving things 51: No evidence of loss – no damages
- Proving things 52: Solicitor’s negligence action fails on all counts: no negligence and no loss.
- Proving things 53: dishonesty some of the times doesn’t mean dishonesty all of the time.
- Proving things 54: getting £2 in damages after claiming £15 million.
- Proving things 55: I’ll say it again: No evidence – no damages.
- Proving things 56: A judge will not speculate when things could have been proven.
- Proving things 57: Lease said soonest mended: claim for substantial damages fails (and guess the reason)
- Proving things 58: Failure to prove causation leads to award of nominal damages.
- Proving things 59: To get special damages you have to plead them and prove them.
- Proving things 60: Putting seaweed out of the window and the judge who was even-handedly offensive
- Proving things 61: More on social media: Facebook Entries & witness credibility.
- Proving things 62: “Totally unsatisfactory evidence” at trial fails to prove special damages.
- Proving things 63: “Law Society fails to prove it made a loss”
- Proving things 64: Absence of strong and stable evidence leads to damages award of £2.00
- Proving things 65: Assumptions are not evidence (if the Court of Appeal has to ask for the matter to be made simple you are in serious trouble).
- Proving things 66: It all comes down to the credibility of witnesses: where there’s a will there’s a way.
- Proving things 67: The difficulties when witnesses depart from their statement: multiple inconsistencies damage credibility
- Proving things 68: Claim £4,177,782 receive £46,815: Lease said soonest mended.