ACTION FOR DATA BREACH SHOULD NEVER HAVE BEEN BROUGHT IN THE HIGH COURT: SMALL CLAIMS TRACK MOST PROBABLY THE APPROPRIATE VENUE

February 1, 2022 · by · in Case Management, Civil Procedure

In  Stadler v Currys Group Ltd [2022] EWHC 160 (QB)  HHJ Lewis (sitting as a Judge of the High Court) was critical of the claimant’s decision to issue proceedings for a data breach claim in the High Court.  Such proceedings are best litigated on the small claims track. If it were not for the existence of the Small Claims Track then the entire action may have been struck out as not worth the candle.

“… the defendant explained to the claimant’s solicitor that judges of this court have made clear recently that these sorts of modest value claim are not suitable for the High Court, or indeed the multi-track. It also drew the claimant’s attention to the obligation on ensuring cases are justly and proportionately managed in accordance with the overriding objective. It is regrettable that the claimant did not take on board this sound advice.”

THE CASE

The defendant had sold a television that previously belonged to the claimant. The defendant did not wipe out the claimant’s information from that tv.   Subsequently a purchaser of the tv purchased a movie for £3.49  by someone using the claimant’s Amazon account.  The defendant paid the claimant the £3.49 and £200 in vouchers.  The claimant then brought an action for damages.

THE HEARING

The claimant issued proceedings in the High Court. The defendant applied to strike out the claim.  Parts of the claim were struck out, however the claimant’s data protection claims were allowed to continue.

THE JUDGE’S CONCERNS

The judge allowed part of the claim to continue.
    1. I am, however, concerned that it would be disproportionate to allow such a low value claim to be litigated in the way that it is, with all the costs that arise out of High Court litigation. If this was a type of claim that would not be transferred to the County Court and the small claims track, for example for defamation, then it seems there would be good reasons for striking it out on Jameel grounds – the claim would simply not be worth the candle.
  2. In my judgment, this claim can, however, be managed in a way that is proportionate to its value through allocation to the small claims track. This would allow for it to be dealt with under what was intended to be an informal process, with limited additional work needed to prepare for a two or three-hour final hearing. Given this, applying Sullivan (supra), it is not appropriate for the claim to be struck out on Jameel grounds.
THE HIGH COURT WAS NEVER AN APPROPRIATE VENUE
Other matters
    1. The letter before action in this case informed the defendant that proceedings would be issued in the High Court and representations made that it be allocated to the Multi-Track due to the “complexity of the legal issues” and because the claimant will be seeking declaratory and injunctive relief.
    1. The letter before action also placed the defendant on notice that the claimant is funded by a post-April 2019 conditional fee agreement. The solicitors informed the defendant that their client “will be fully protected by ATE insurance all the way to trial with a staged policy premium. As this matter is a privacy claim, such premium will be recovered from you at the successful conclusion of this said case. The longer that this case is defended/not resolved, the more the said premium will increase”.
    1. In its reply, the defendant explained to the claimant’s solicitor that judges of this court have made clear recently that these sorts of modest value claim are not suitable for the High Court, or indeed the multi-track. It also drew the claimant’s attention to the obligation on ensuring cases are justly and proportionately managed in accordance with the overriding objective. It is regrettable that the claimant did not take on board this sound advice.
    1. There does not appear to be any reason for this claim to have been issued in the High Court. Whilst defamation claims must be issued in the High Court (with limited exceptions), the same is not true in respect of the causes of action pursued in this case.
    1. CPR PD7A para 2.9A provides:
(1) […]a claim relating to media and communications work (which includes any work which would fall within the jurisdiction of the Media and Communications List if issued in the High Court) may be started in the County Court or High Court; and paragraph 2.1 [the £100,000 minimum threshold] shall not apply to such a claim.
(2) Such a claim should be started in the High Court if, by reason of the factors set out in paragraph 2.4(1) to (3), the claimant believes that the claim ought to be dealt with by a High Court judge.
(3) If a claimant starts such a claim in the High Court and the court decides that it should have been started in the County Court, the court will normally transfer it to the County Court on its own initiative. This is likely to result in delay.
    1. CPR PD7A paragraph 2.4 provides that a claim should be started in the High Court if by reason of:
(1) the financial value of the claim and the amount in dispute, and/or
(2) the complexity of the facts, legal issues, remedies or procedures involved, and/or
(3) the importance of the outcome of the claim to the public in general,
the claimant believes that the claim ought to be dealt with by a High Court judge.
    1. Parties to civil claims are under a duty to ensure that proceedings are conducted in accordance with the overriding objective.
    1. This is a very low-value claim. Consumer disputes of equivalent complexity are heard every day in the County Court on the small claims track and do not need to be dealt with by a High Court judge.
    1. Whilst there will often be good reasons for including more than one cause of action in a claim, especially where there are differences between them in respect of proof of damage, or heads of loss, parties must always conduct litigation proportionately and in accordance with the overriding objective. By including multiple causes of action in respect of this low value claim, the claimant has increased the complexity of the proceedings unnecessarily.
    1. There has also been tactical skirmishing by both sides. The claimant has made more than one attempt to obtain default judgment despite an acknowledgement having been filed. The defendant issued a formal application seeking to take technical issues on service that were unmeritorious.
    1. This has resulted in the parties having already incurred significant levels of costs. The claimant’s costs in respect of these applications are close to £11,000, in addition to which there will be his costs of the substantive action. The defendant’s costs for the applications are around £5,500. This needs to be considered in the context of a claim that might end up being worth just a few hundred pounds, depending on the evidence.
Next steps
    1. The defendant’s initial response to this claim was to seek a declaration pursuant to CPR rule 11 that the court has no jurisdiction to try the claim or should not exercise any jurisdiction which it may have. The defendant’s challenge on jurisdiction was withdrawn at the start of the present hearing. As a result, the acknowledgement of service filed by the defendant ceases to have effect: CPR rule 11(7)(a).
    1. I will provide the defendant with a further period of 14 days in which to file a further acknowledgement if so advised, namely by 11 February 2022. If an acknowledgement is lodged, any defence shall be filed and served by 4pm on 25 February 2022. Directions questionnaires in form N180 shall be lodged by 4pm on 11 March 2022.
    1. It is agreed that I should now transfer this matter to the County Court. The claimant’s local court centre is Hastings. As noted at the start of this judgment, it appears to me that the matter should be allocated to the small claims track, although that will be a decision for the district judge upon receipt of the defence and directions questionnaires.

 

 

 

 

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