APPLYING FOR RELIEF FROM SANCTIONS: 14 KEY POINTS TO HELP EASE THE STRAIN
There was a nice tweet earlier today from pupil barrister Miranda Grell explaining she had just appeared in her first relief from sanctions application and had found this blog useful. This reminded me that it may be a good time to recap on some basic guidance on applying for relief from sanctions. It also provides an opportunity to remind people of the webinar on the 6th December 2018 “Avoiding Procedural Pitfalls and Putting Them Right” which looks at the key problem areas of civil procedure, how to avoid problems and how to rectify problems if things do go wrong. It also deals with relief from sanctions applications.
1. IF YOU ARE MAKING AN APPLICATION FOR RELIEF MAKE IT AT ONCE
The speed with which an application is made is a factor that the court can take into account when considering the discretion.
- Speed here is probably best measured in hours, days at the most. If it is measured in weeks then the writing is probably already on the wall.
“I also have in mind, although this is a point of more minor weight, that there was a delay which I regard as excessive in making this application to seek relief from sanctions. It was a week after Flaux J’s order and almost two weeks after the deadline had expired.” Popplewell J Sinclair -V- Dorsey & Whitney (Europe) LLP  EWHC 3888 (Comm)
2. MAKE THE APPLICATION PROPERLY AND GIVE IT A REALISTIC TIME ESTIMATE
This is a matter of judgment. However if the application is going to be contested then the application is rarely going to be shorter than an hour. If the time estimate is 10 minutes and two advocates turn up then, in extreme cases, the application itself may be struck out. Certainly there will be an adjournment at someone’s expense (usually the applicants). However:
- A respondent owes a duty to the court. If it is clear that the time estimate is inadequate then it is wise to point this out to the applicant, and the court, at the earliest opportunity.
- If (as sometimes happens) the application is consented to then, again, the parties should let the court know at the earliest opportunity.
3. THE EVIDENCE IN SUPPORT SHOULD BE AN EXPLANATION AND NOT AN EXPOSITION
Many, many, many witness statements in support of (and in opposition to) an application for relief take the opportunity to provide the court with huge chunks of the Court of Appeal judgment in Rastin. Sometimes chunks from Mitchell and earlier as well for good measure.
1. Most judges are now familiar with the Denton principles. Arguing points of law in a witness statement add to the time and expense.
2. The fact that someone can operate the cut and paste feature to produce lengthy “statements” is rarely synonymous with legal erudition.
3. Keep the statement as short as possible. Explain the relevant background to the matter; explain (and be totally honest) about why the breach occurred. Explain what has been done to remedy the situation.
4. GIVE AN EXPLANATION FOR THE DEFAULT
Some applicants are “coy” about the reason for the default. Sometimes concerned about the impact on their own liability insurance. Whilst it is essential that the insurer is consulted you should be clear that “coyness” can be a major hurdle to obtaining relief. In most cases it is clear that the litigator is at fault in any event. One thing that the the Denton decision did, was to put an end to the “mandatory” requirement for a “good reason” to explain a breach when applying for relief from sanctions. However it is always incumbent upon an applicant to provide an explanation for the delay, even if the reason for the breach is not a good one. This is a brief look at two recent cases on this issue. The case law indicates that whilst an explanation is always required to explain default the absence of a “good reason” is not a bar to the court granting relief from sanctions.
5. BRITISH AIRWAYS: ABSENCE OF A GOOD REASON NOT A BAR TO RELIEF FROM SANCTIONS BEING GIVEN
The position was made clear by Mr Justice Morgan in British Airways PLC -v- Airways Pension Scheme Trustee Limited. The judge was considering objection to late amendments. One argument the defendant made was that BA did not provide a good explanation.
“I do not accept Mr Rowley’s submission that I am disabled from granting permission to make these particular draft amendments because BA did not provide a good explanation for the delay. I do not consider that the relevant legal principles make the provision of a good explanation an absolute pre-condition to the court’s exercise of its discretion to grant permission to amend. The presence or absence of a good explanation will normally be a factor which is to be taken into account and the absence of a good explanation for a late application will often be a very weighty factor against the grant of permission. However, the absence of a good explanation for a late application does not amount to a complete barrier to the grant of permission to amend in a case where the court is persuaded that it is otherwise fair and just to permit the amendment.
In Quah Su-Ling, the judge referred to Mitchell v News Group Newspapersand that citation was the obvious source of the statement she made at (g). However, it is also relevant to refer to the decision of the Court of Appeal in Chartwell Estate Agents Ltd v Fergies Properties SA  3 Costs LR 588, which was approved in Denton v T H White Ltd  1 WLR 3926. It is clear from Chartwell that, even where the default is non-trivial and there is no good reason for the default, the court retains a real discretion to relieve from a sanction. This also appears from the more recent decision on the subject of relief from sanctions, British Gas Trading Ltd v Oak Cash & Carry Ltd (Practice Note)  1 WLR 4530 at .”
6.THE COURT WILL STILL REQUIRE AN EXPLANATION
A court, however, may be unwilling, or unable, to exercise its discretion if there is no explanation at all for the breach. In Redbourn Group Ltd -v- Fairgate Development Limited  EWHC 1223 (TCC) Mr Justice Coulson stated that an explanation is usually needed
“ It is always incumbent upon a solicitor seeking relief from sanctions to explain why something is late or why a proffered date could not in fact be met. On that topic, an analogy can be drawn with the recent trend in cases concerned with late amendments, such as Su-Ling v Goldman Sachs International EWHC 759 (Comm), where Carr J made plain that, on the recent authorities, the absence of a proper explanation for delay will often, without more, lead to the application to amend being refused.”
7. THERE IS AN APPARENT TENSION HERE – THAT IS EASILY RESOLVED
A party applying for relief from sanctions must explain the reason for the breach and any delay.
- The only option is honesty. The court must be told the real reason that the obligation was overlooked. An explanation is required.
- The fact that the reason is not a “good” one is far from decisive. It is only one factor.
- If there is no “good” reason it is often prudent to concede this.
- The safest course of action is, if at all possible, to remedy any default as soon as possible. Certainly well before the date of any application for relief from sanctions.
8. EVERY SINGLE THING SHOULD BE PERFECT, JUST PERFECT
An application is not helping their cause if witness statements are inadequate, pages missing, exhibits unmarked and bundles not lodged, or lodged in time. These may appear to be minor matters (they are not). An applicant seeking relief from sanctions needs all the help they can get.
9. PUT THE BREACH RIGHT BEFORE THE HEARING
Any default is going to be compounded if it is not put right before the hearing. The fact that a party remains in default at the date of the hearing is likely to be a major, if not determinative, factor.
” Further, even now, some eight weeks after the extended deadline, the claimants are still not offering security which is satisfactory. “
(Mr Justice Popplewell in Sinclair -v- Dorsey & Whitney  EWHC 3888 (Comm).)
10. OFFER A PLAN OF ACTION WILL WHICH IS POSITIVE, ECONOMIC, AND PROGRESSES THE CASE
It is often forgotten that the amended CPR 3.9 and the Denton criteria arise in the context of a situation where judges are under a legal duty to manage cases in accordance with the overriding objective (CPR 1.2 & 1.4) and the parties are required to help the court to further the overriding objective (1.3). It can help a party in default if it has suggestions (including draft directions) which put will put the case back on an appropriate course.
11. BUNDLES, SKELETONS AND SUBMISSIONS SHOULD BE LODGED AT COURT WELL AHEAD OF THE DATE OF THE HEARING
Which involves (coincidentally) instructing your advocate well ahead of the date.
12. IF AT ALL POSSIBLE THE PERSON RESPONSIBLE FOR THE DEFAULT SHOULD ATTEND THE HEARING (EVEN IF THEY ARE NOT DOING THE ADVOCACY).
I am not recommending this as a form of shaming or public contrition. It is a matter of utility. It is surprising how often matters come up at a hearing for relief from sanctions which require clarification. Having the relevant person present, together with the file, can speed up time, and ease the application greatly. There are matters that can be omitted from the fullest of instructions. This helps both in relation to past conduct and also the proposed directions/future management of the case.
13. DO WHATEVER THE COURT ORDERS AT ONCE: DON’T WAIT
If relief from sanctions is granted then get on with the case with speed and diligence. Whatever happens do not allow any further breaches to occur. I have been to several hearings where there was a second application for relief from sanctions. Things do not, generally, turn out well for applicants.
14.WHATEVER HAPPENS LEARN FROM THE EXPERIENCE (AS AN INDIVIDUAL AND AS A FIRM)
It is tempting (and understandable) to put a stressful (and often expensive) experience behind you. However those incidents (or that inactivity) that lead to the need for relief from sanctions are often warning signs that issues need to be addressed. Even if relief is not granted in that particular case the experience can, and should, be used to ensure that it does not happen again.