THE STATEMENT OF CASE WOULD NOT HAVE BEEN STRUCK OUT: JUDGE PROVIDES A LESSON IN THE BASIC PRINCIPLES OF PLEADING

In Tejani v Fitzroy Place Residential Ltd & Anor [2020] EWHC 1856 (TCC) Mr Justice Pepperall sent out a clear reminder of the basic purpose of pleading. He rejected an argument by the defendant that a particulars of claim should have been struck out.  The particulars should not have pleaded evidence, expert evidence or why or how the claimant had mitigated his loss.

“It is important that parties properly distinguish between a concise statement of facts and recitation of the evidence upon which they seek to prove such facts. Every bar student is taught that they should plead facts and not evidence, but it is regrettably a distinction that is all too often lost sight of and is increasingly responsible for extraordinary prolixity in pleadings”

THE CASE

The claimant brought proceedings for damages and loss caused by noise that prevented the use of an apartment.

THE PLEADED CASE

    1. Mr Tejani pleads that the apartment is not fit for habitation and that the defendants are liable for breach of s.1 of the Defective Premises Act 1972. Further, he pleads a breach of clause 5.6 of the 2012 contract by which the developer agreed to take reasonable steps to procure that defects that were the responsibility of the building contractors would be remedied as soon as reasonably practicable, and a breach of clause 4.1 of the lease by which the freeholder covenanted to ensure that Mr Tejani would enjoy quiet possession of the apartment. In addition, he pleaded that the noise amounted to a nuisance and that the Defendants had caused or permitted such nuisance.
    2. As to loss and damage, Mr Tejani pleaded at paragraph 31:
“Further as a result of the noise the Claimant was unable to rent out the Apartment. The Apartment was and is not habitable and accordingly the Claimant could not rent the property causing further loss and damage and lost rental income.”
    1. Further, at paragraph 37, he pleaded:
“The matters complained of have caused annoyance, discomfort, distress and loss of amenity to the Claimant who has been unable to occupy the property as he intended when he purchased it and is unable to rent the property out to a tenant.”
    1. After pleading the nuisance, he added, at paragraph 46:
“That breach is an ongoing breach causing the Claimant loss and damage.”
    1. Under the heading “PARTICULARS OF LOSS & DAMAGE”, he then pleaded the following particulars at paragraphs 47-51:
“47. The Claimant is entitled to a refund of the purchase price of the Apartment being the total sum paid on completion to the Defendants being £2,595,000.00 plus interest.

THE DEFENDANT’S APPLICATION

The defendant sought an order that the claimant file amended Particulars of Claim, failing which the action be struck out.  The application was compromised to some extent, with the claimant agreeing to file amended Particulars. However the argument centred on the costs of the application.

THE GROUNDS FOR THE DEFENDANT’S APPLICATION

Counsel for the defendant put forward a number of arguments that the particulars of claim were defective.

 

    1. Mr Blaker argues that the Defendants’ application has been conceded and that, since his clients were the successful parties, the general rule pursuant to r.44.2 is that they should recover their costs. Alternatively, he argues that the application was properly made and that the Particulars of Claim were very obviously defective. By his oral submissions, Mr Blaker focused on the following matters:
17.1 First, he argues that Mr Tejani has failed to show any causative link between the alleged breaches of contract and duty and losses.
17.2 Secondly, he complains that no expert evidence was provided to support the astonishing assertion that the apartment has no value.
17.3 Thirdly, he argues that Mr Tejani pleaded no details of the steps taken to mitigate his losses. Mr Blaker contends that the pleader should have set out the efforts made to market the apartment for sale and to find a tenant. Further, he asserts that Mr Tejani should explain the advice that has been obtained from selling or letting agents.
17.4 Fourthly, he argues that the Particulars of Claim contain broad-based allegations that are not supported by explaining the evidence upon which Mr Tejani relies. Consequently, Mr Blaker contends that his clients do not understand the case that they have to meet.
17.5 Fifthly, he says that the claim is obviously bad in that it seeks both to recover the original purchase price of the apartment and ancillary expenses and Mr Tejani’s rental loss. That, Mr Blaker argues, is double recovery.

 

THE JUDGE’S DECISION

Each of the defendant’s submissions were rejected. The primary ground being that the defendant’s arguments did not reflect the basic rules and principles relating to statements of case.

    1. The application notice sought to strike out paragraphs 47-51 of the Particulars of Claim. The settlement does not involve any strike-out and imposes no obligation upon the Claimant to remove those passages from his Particulars of Claim. He simply has an unfettered right to amend his pleading generally as to loss and damage. I do not accept that the Claimant has conceded the application and that the Defendants have secured the relief sought.
    2. I turn therefore to the merits of the underlying application. It was made pursuant to rules 3.4(2)(a) and (b) which provide:
“The court may strike out a statement of case if it appears to the court–
(a) that the statement of case discloses no reasonable grounds for bringing or defending the claim;
(b) that the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings; …”
    1. The principles are not controversial:
21.1 The whole or part of a statement of case may be struck out pursuant to r.3.4(2)(a) if it does not disclose a ground of claim or defence known to law (e.g. Price Meats Ltd v. Barclays Bank plc [2000] 2 All ER (Comm) 346) or where the court is otherwise certain that the claim or defence is bound to fail (Harris v. Bolt Burdon [2000] CP Rep 70Hughes v Colin Richards & Co. [2004] EWCA Civ 266[2004] PNLR 35).
21.2 As Clarke LJ (as he then was) observed in Royal Brompton Hospital NHS Trust v. Hammond [2001] EWCA Civ 550, at [104], the focus in applications under r.3.4(2)(a) is upon the statement of case rather than the evidence. In that respect, the approach differs from applications for summary judgment under Part 24. Accordingly, on this application, the court must assume the truth of the Claimant’s pleaded case.
21.3 While there are other categories of abuse that are not relevant to this application, the court may strike out Particulars of Claim under r.3.4(2)(b) where they are so badly drafted that they fail to identify the case that the defendant has to meet. In such cases, strike out is, however, very much a remedy of last resort and the court should usually first allow the claimant an opportunity to file a coherent and intelligible claim.
21.4 The hurdle is, as one would expect, high. Striking out is an exceptional course and most cases should simply be defended on their merits.
    1. In my judgment, the argument that paragraphs 47-51 of these Particulars of Claim should be struck out because they fail to plead the evidence relied upon is hopelessly misconceived. It entirely loses sight of the purpose of statements of case:
22.1 Rule 16.4(1)(a) provides that Particulars of Claim must include “a concise statement of the facts on which the claimant relies.”
22.2 Lord Woolf MR observed in McPhilemy v. Times Newspapers Ltd [1999] 3 All ER 775, at page 793A, that statements of case are required to “mark out the parameters of the case that is being advanced by each party.” He explained that a statement of case should identify the issues and the extent of the dispute between the parties, making clear the general nature of the case being advanced, but that the exchange of witness statements should avoid the need for extensive detail. Excessive particulars, he warned, risk obscuring rather than clarifying the issues in a case.
22.3 In Tchenguiz v. Grant Thornton UK LLP [2015] EWHC 405 (Comm)[2015] 1 All ER (Comm) 961, Leggatt J, as he then was, observed, at [1]:

“Statements of case must be concise. They must plead only material facts, meaning those necessary for the purpose of formulating a cause of action or defence, and not background facts or evidence. Still less should they contain arguments, reasons or rhetoric. These basic rules were developed long ago and have stood the test of time because they serve the vital purpose of identifying the matters which each party will need to prove by evidence at trial.”

22.4 It is important that parties properly distinguish between a concise statement of facts and recitation of the evidence upon which they seek to prove such facts. Every bar student is taught that they should plead facts and not evidence, but it is regrettably a distinction that is all too often lost sight of and is increasingly responsible for extraordinary prolixity in pleadings. In Essex County Council v. UBB Waste (Essex) Ltd (No. 1) [2019] EWHC 819 (TCC), I observed, at [28], that while the TCC does not follow the practice of the Commercial Court in requiring parties to make an application for permission to file a statement of case in excess of 25 pages in length “that does not give pleaders carte blanche to file prolix statements of case in this court.”
22.5 Not only is there no merit in the complaint that Mr Tejani did not plead the evidence in support of his case, but he was right not to do so.
  1. Equally, there is no merit in Mr Blaker’s submission that Mr Tejani should have pleaded the expert evidence that supported his claim. Not only do the Defendants again insist on evidence, but the parties cannot of course rely on expert evidence without the permission of the court: r.35.4. Exceptionally, paragraph 4.3 of Practice Direction 16 requires claimants in personal injury claims to serve a medical report with their Particulars of Claim. There is, however, no general rule requiring the service of expert evidence at the pleading stage.
  2. Further, there is no merit in the complaint that Mr Tejani did not plead the steps that he had taken to mitigate his losses. On analysis, Mr Blaker was again seeking evidence, but in any event it is of course for the Defendants to plead and prove any alleged failure to mitigate loss. Mr Tejani was under no obligation to plead anything about the issue in his Particulars of Claim, unless he sought damages for additional losses incurred in a reasonable attempt to mitigate his loss.
  3. More generally, I reject Mr Blaker’s overarching submission that his clients do not know the case that they have to meet. Whether it be a good case is a matter for trial, but the pleading makes clear the nature of the noise problem and that Mr Tejani claims that his apartment is as a result not fit for habitation, worthless and incapable of being let. One instinctively suspects that he overstates the position, but that is an issue for evidence and not a strike-out application under r.3.4. It is a perfectly intelligible case with which the Defendants can engage.
  4. Mr Blaker is right to observe that the current formulation of Mr Tejani’s losses appears to involve double counting and that he probably cannot recover both the value of the property, consequential expenses and interest and his alleged rental loss. I suspect it is more likely that at trial Mr Tejani will argue his rental loss in the alternative in the event that he fails to succeed on his primary case. That is not, however, a reason to strike out either formulation and Mr Blaker can perfectly easily plead his objection that the claim appears to seek double recovery in his clients’ Defence.
  5. Finally, there is no merit in the argument that Mr Tejani should pay costs because he has belatedly agreed to give further information. This was not an application for an order under Part 18. Indeed, it would have been premature to have sought an order for further information given that the Defendants only served their Part 18 request with their strike-out application.
  6. For these reasons, this was therefore a bad application that, in my judgment, would have been dismissed had it not been compromised. Accordingly, I reject the Defendants’ argument that they should have their costs. While I did not call upon Mr Berkley to deal with the merits of the Defendants’ claim for an immediate costs order, he made plain that he did not resile from the Claimant’s pre-hearing position that the proper order was for the Defendants’ costs in case, although he did seek a different order in respect of the costs of today. I remarked during the course of argument as to the surprising lack of ambition in such position, but – upon the Claimant’s express concession – I award the Defendants their costs of the application (but not this hearing) in the case, and will now hear counsel as to the discrete costs of this hearing.