THE CLAIMANT HAD SIX WEEKS TO ISSUE AND SERVE THE CLAIM FORM AND WAS ONE DAY LATE: RELIEF FROM SANCTIONS REFUSED

In Halton Borough Council v Secretary of State for Levelling Up, Housing And Communities [2023] EWHC 293 (Admin)  HHJ Stephen Davies (sitting as a High Court Judge) refused a claimant’s application for relief from sanctions. This was a case where there was an obligation on the claimant to issue and serve within a six week period.  The claimant was several days late with service.  The court refused the application on the grounds that the extension had to be considered by analogy with CPR 7.6.  It also indicated that it would have refused the application if it had been held that the discretion had to be exercised under CPR 3.9.

“It left the filing of the claim form until one or two days before the last date for filing and service, which was plainly an unnecessary risk to take since it needed the co-operation of the court to obtain a service copy of the sealed claim form. It needed to obtain consent for service by email or a plan to serve by an effective alternative method at the last minute if it had to. Whilst there was a problem with a delay in receipt of the sealed claim form, that was not a significant delay and would not have caused a problem but for the claimant leaving it all too late in the first place. If the claimant had not, apparently, mistakenly believed at this point that it had a week to serve, it could have served in time on the claimant and the HSE by email and could have served in time on Viridor by first class post or by personal service.”

THE CASE

The claimant counsel sought a statutory review of an order for costs made against it by the planning inspectorate. The application had to be made and served within 6 weeks of the order being reviewed.  The application was issued in time but served late.

1. 1. Under s.288(1)(b) and (1A) TCPA any person aggrieved by a relevant costs order made in connection with any action on the part of the Secretary of State to which this section applies and who wishes to question the validity of that action on the grounds that: (i) the relevant costs order is not within the powers of this Act; or (ii) any of the relevant requirements have not been complied with in relation to that action, may make an application to the High Court.

1. Such application requires the permission of the court and an application for permission must be made before the end of the period of six weeks beginning with the day after the date on which the relevant costs order is made. By virtue of CPR PD54 paragraph 4.11 the claimant form must be served within the period of six weeks, unlike the general provisions relating to judicial review claims which require the claim form to be served within seven days of its issue.

HOW SERVICE OF THE CLAIM FORM CAME TO BE MISSED

The reason service was late was partially due to the email from the court going into internal quarantine and partly because of the claimant’s solicitors mistaken belief that there were seven days to serve after issue.  As it was proceedings were served one day late.

1. 1. The decision letters were issued on 27 July 2022. It followed that any s.288 application had to be brought within 6 weeks of the day following the costs order. The claimant says that this was 8 September 2022 whereas the defendant says that this was 7 September 2022. Both agreed that it is not decisive to the determination of the case which date is the correct one as, indeed, was the position in Corus. In the circumstances I did not hear argument on the point and proceed on the basis that it is not necessary for me to determine the point. Insofar as it does matter, on the basis of the limited consideration I have given the point I agree with the claimant that it was the 8 September 2002, being the last day of the 6 week period beginning on 28 July 2022.

1. 1. On 30 August 2022 the claimant notified the defendant of its intention to challenge the orders by way of a detailed letter before action, which: (a) made clear that the claim was going to be brought under s.288 rather than as a judicial review; and (b) ended by referring to the fact that the time-limit for so doing was 7 September 2022.

1. 1. On 6 September 2022 the claimant filed at court its claim for statutory review of the decisions, just within the 6 week time limit under s.288.

1. 1. On the same day the claim form was issued by the court. The court emailed the sealed claim form to the claimant for service the same day. However, the claimant’s evidence (which is not disputed) is that this email was not received by its in-house solicitor, even though it is acknowledged that a second email from the court sent later that day was received.

1. 1. Despite chasing calls that day and the following day it was still not received and, as established by the claimant’s evidence, it only came to the attention of its in-house solicitor when, at 14:27 hours on 7 September 2022, the claimant’s IT department forwarded it on to her, it having been placed into internal quarantine within the claimant organisation on original receipt for unexplained reasons.

1. 1. However, the claimant did not take immediate steps to serve the claim form by email, even though the defendant and the HSE had agreed to accept service by email and even though it had an email address for Viridor’s solicitors (although, as at 7 September 2022, they had not confirmed that they were authorised to accept service by email). The claimant also says that it could not have served the claim form by post on 7 September anyway because, as a result of budget cuts, there was only one postal collection at 12 noon which had gone before it received the sealed claim form that afternoon. However, if the claimant had appreciated the urgency it could either have arranged for the sealed claim form to have been delivered to the local post collection box or post office in time for last post that day or, if necessary, to have arranged for personal service at Viridor’s registered office.

1. 1. In fact, it did not take any steps to serve the claim form and supporting documents until they were sent to all three parties by email on 9 September 2022, when it also sent a copy by post to Viridor (since it still did not have confirmation from Viridor’s solicitors regarding email service). In her witness statement Ms Wilson-Lagan explains that, notwithstanding what had been understood to be the appropriate route of challenge by 30 August 2022, there was still some confusion internally and that she was still operating under the misapprehension that the claimant had 7 days from issue in which to serve. That was clearly wrong as regards a s.288 claim. She explains that it was only on taking advice from external counsel on 8 September that the true position was appreciated by her, after which steps were taken to serve the following day. She does not suggest that it would not have been possible to serve effectively, at least on the defendant and the HSE, by email on 8 September 2022. She says that there was a delay in instructing counsel due to work pressures and short staffing, especially in the week in question.

1. On 12 September 2022 (which was the first working day after Friday 9th) the claimant made the extension of time application and on 23 September 2022 it made the amendment application.

HOW SHOULD THE COURT EXERCISE ITS DISCRETION IN RELATION TO EXTENDING TIME FOR SERVICE OF THE CLAIM FORM?

The judge decided that the application had to be considered by analogy with CPR 7.6.

1. 1. It is common ground that in Corus it was decided that in relation to a s.287 challenge the decision fell to be made by reference to CPR 3.1(2)(a) and not CPR 7.6 because, on a proper construction, CPR 7.6 only applies to cases of service under CPR 7.5, and CPR 7.5 does not apply to statutory review claims. It is also common ground that in Good Law the decision was to precisely the same effect in relation to a judicial review challenge, arrived at by the same process of reasoning notwithstanding that Corus was not referred to or cited to the court in Good Law.

1. 1. However, in Good Law the defendant advanced an alternative argument which, on the face of the judgment in Corus, was not advanced by the defendant in that case. This was that even if CPR 7.6 did not directly apply, it fell to be applied by analogy. It is clear from the decision in Good Law that Carr LJ, who gave the first judgment, with whom both of the other members of the court, Phillips LJ and Underhill LJ agreed on this point, concluded that CPR 7.6 did indeed fall to be applied by analogy. Without indulging in excessive citation from her judgment, her reasoning can be summarised as follows:

(a) At [38] she identified “two broad contextual points … at the outset: first, the need for promptness and speed in judicial review claims generally, and procurement challenges in particular; and secondly, the importance of valid service of claim forms”. She expounded on these points in the following paragraphs and I need not refer to them specifically.

(b) At [79] she observed that the decisions in Denton and other such cases did not concern cases of late service of claims forms or other originating process and there was nothing to suggest that the courts in those cases had this particular category of cases in mind.

(c) At [80] she held that there was no good reason why the requirements of CPR 7.6 should not apply equally to a judicial review claim, and every reason why they should, given the greater promptness required in judicial review claims including the much shorter time for service. It would be “wholly counter-intuitive in those circumstances for the extension regime for judicial review claims to be more lenient than that applicable to Part 7 and Part 8 claims”.

1. 1. As to the first of the two broad contextual points, it cannot be disputed that the need for promptness is at least as important in statutory review cases as it is in judicial review cases. Although, as is well known, judicial review claims generally must be brought promptly, and at the latest within 3 months, in statutory review claims (and, indeed, in planning judicial review claims) the claim must be brought within the shorter period of 6 weeks. It is true, but not a basis for distinction, that in the public procurement context it is an even shorter period of 4 weeks.

1. 1. As to the second of the two broad contextual points, Carr LJ observed that valid service performed a special function, to be distinguished from other procedural steps, of subjecting the defendant to the jurisdiction of the court. Again, this applies as much to statutory review as to judicial review. Although Mr Hunter pointed to the difference between judicial review, where there is a separate time for filing and for service, and statutory review, where there is one single time for filing and service, nothing turns on that distinction in my view.

1. 1. As to the third of these points, it is plain that the same arguments apply to statutory review cases, not least because of the more demanding time limits both for issue and for service when compared to a typical judicial review case.

1. 1. In the circumstances, I entirely accept the defendant’s submission that, unless Corus is authority against, there is every reason why this court should follow the approach in Good Law in relation to a statutory review case.

1. 1. I have already noted that the decision on whether CPR 7.6 or CPR 3.1(2)(a) applied was argued and decided in exactly the same way in Corus as it later was in Good Law. There is no indication whatsoever that the second argument that CPR 7.6 should be applied by analogy was made in Corus, where the principal judgment was given by Laws LJ. Indeed, it is apparent from paragraphs 13 onwards that the argument based on the construction of CPR 7.6 was the only argument addressed in relation to CPR 7.6. Although Mr Hunter fastened on the reference in paragraph 13 as to whether it was “appropriate” to apply CPR 7.6, suggesting that this showed that a wider question was being addressed, as Mr Williams said it is apparent from paragraph 12 that this wording was simply referring back to the use of that word in CPR PD8 paragraph 2.1. Having disposed of this argument, Laws LJ proceeded at paragraph 21 to address the “second submission” that the first instance judge’s exercise of his discretion was flawed, but it is apparent that none of the arguments advanced involved an argument that he ought to have applied CPR 7.6 by analogy.

1. 1. It follows in my judgment that it cannot credibly be said that this point was expressly argued or decided in Corus.

1. 1. In his submissions Mr Hunter contended that the point was nonetheless implicitly decided as forming an essential basis for reaching the decision and, hence, that it formed part of the ratio decidendi of (in English, the reason for deciding) the case. He submitted that, by deciding the case on the basis that CPR 3.1.(2)(a) rather than CPR 7.6 applied, and by applying the principles established in relation to the exercise of the discretion in the former, it was an implicit part of the decision that CPR 7.6 had no part to play in the decision-making process.

1. 1. In their supplemental written submissions on this point counsel referred me to the following texts and cases:

(1) Cross & Harris, Precedent in English Law, 4th ed (1991), which at p.72 says: “The ratio decidendi of a case is any rule of law expressly or impliedly treated by the judge as a necessary step in reaching his conclusion, having regard to the line of reasoning adopted by him”.

(2) Kadhim v Brent LBC [2001] QB 955 (per Buxton LJ at [16]) and Youngsam v Parole Board [2020] QB 387 (per Nicola Davies LJ at [21], per Haddon-Cave LJ at [39] and per Leggatt LJ at [48]-[49]), where the statement in Cross & Harris was approved.

1. 1. Whilst ingenious, I am unable to accept Mr Hunter’s argument. In the absence of any reference that the point was raised or discussed, it cannot be assumed that the point was even considered, let alone decided, in Corus. As the defendant submitted, Laws LJ did not treat the proposition that CPR 7.6(2) was not to be applied by analogy as a “necessary step in reaching his conclusion”. Nor did he provide a ruling on this point, still less reasons to justify the court’s stance on this issue. It can confidently be concluded that he simply did not address his mind to the proposition.

1. 1. This is supported by the fact that at least one of the cases cited in relation to the exercise of the discretion, Hashtroodi v Hancock [2004] 1 WLR 3206, was a case which, as Laws LJ said at [21], related to CPR 7.6(2). If Laws LJ was proceeding on the basis that CPR 7.6 had no application to the instant case, whether directly or by analogy, it is difficult to see why he should have referred to this case, at least without acknowledging that it related to a CPR rule which had no direct or indirect application to the case under consideration.

1. 1. There is, I accept, the further point which may cut both ways, which is that at [25] he said that in his view “the power in CPR 3.1(2)(a) to extend time for service in a s.287 case should be used sparingly” on the basis that “the primary six-week timetable, absolute so far as issue of proceedings is concerned, demonstrates an important statutory policy that these matters be expeditiously dealt with. If the delay is at all substantial in such a case, the applicant will I think have a very large hill indeed to climb. The statutory policy is always to be considered, notwithstanding the importance, which I also accept, in the public interest that viable challenges to public decisions be ventilated in proceedings”.

1. 1. He made essentially the same point earlier in his judgment at [19], where he said that the discretion under CPR 3.2(1)(a) ought to be exercised in accordance with the overriding objective, which “will require them of course to have regard to the statutory policy that these cases be subject to minimum delay, a policy demonstrated by the absolute six-week time limit for issue of proceedings. On the other hand, they will have regard also to the general public interest in having viable challenges to decisions of public authorities ventilated in proceedings”.

1. 1. Whilst the defendant is able to say that this emphasis on the importance of adhering to the statutory time limit is consistent with the approach in Good Law, equally the claimant may argue that the reference to the general public interest of viable challenges to public decisions being ventilated in proceedings is inconsistent with the approach in Good Law since, under the approach in that case, such a factor would be excluded as not to be found within CPR 7.6 itself.

1. 1. However, Mr Williams’ answer to this point is to refer to the further passage in Cross and Harris at p161 where they say that the doctrine of stare decisis “…does not encompass rationes decidendi where it can be inferred that the deciding court did not address its mind to a proposition of law, even if that proposition was essential to its decision; and that inference can easily be drawn from the absence of any (or even any adequate) argument on the point in question”. He also points to the decision of Stanley Burton J in Victor Scrivens v Ethical Standards Officer [2005] EWHC 529 where, having referred to this passage, he said this:

” … That, apart from the words in parentheses and the statement of the facility with which the inference can be drawn, this is a correct statement of the law is confirmed by the judgment of the Court of Appeal in R (Khadim) v Brent London Borough Council [2001] 2 WLR 1674, in which it stated:

33. We therefore conclude, not without some hesitation, that there is a principle stated in general terms that a subsequent court is not bound by a proposition of law assumed by an earlier court that was not the subject of argument before or consideration by that court.

See too [34] to [37]. As appears from this statement, the principle is not restricted to propositions of law that were the subject of concession: it is sufficient that it was not the subject of argument or consideration. At [38] the Court of Appeal added:

38. Like all exceptions to, and modifications of, the strict rule of precedent, this rule must only be applied in the most obvious of cases, and limited with great care. The basis of it is that the proposition in question must have been assumed, and not have been the subject of decision. That condition will almost always only be fulfilled when the point has not been expressly raised before the court and there has been no argument upon it…”.

1. 1. I accept this submission. In my judgment, the argument that such public interest considerations should not even be considered, on the basis that such cases should be decided by reference only to the factors identified in CPR 7.6, was not even advanced, let alone decided in terms. It follows that I accept that this could not have formed part of the ratio decidendi.

1. 1. For completeness, as Mr Williams and Ms Hutton also submitted, and as Mr Hunter agreed, the ruling on the discretion point is not strictly binding anyway, because it is a decision on permission to appeal, on which point permission was refused.

1. 1. Moreover, as I have said, I have been referred to two decisions on the papers made by Lang J where she applied Good Law to a s.113 claim and s.288 claim respectively. Her decisions were both made on 4 July 2022, that in relation to the s.113 claim was made in Hill v Royal Borough of Windsor and Maidenhead (CO/1023/2022) and that in relation to the s.288 claim was made in West Suffolk Council v Secretary of State for Levelling Up, Housing and Communities (CO/1916/2022). It does not appear that Corus was cited to her, but otherwise they are comprehensive written decisions, explaining why in her view the approach in Good Law should apply to statutory reviews. If there were requests for oral reconsideration hearings and if such hearings took place no written judgment or transcript has been provided. It being clear that Lang J also decided that there was no material distinction between statutory review cases and Good Law, I should also follow her approach unless I was satisfied that her decisions were wrong.

1. 1. In my judgment, whilst I am not strictly bound to apply either Corus or Good Law, since: (a) the former did not decide that in a statutory review claim it was not permissible to apply CPR 7.6 by analogy; whereas (b) the latter did not decide that in a statutory review case, as opposed to the judicial review cases to which it directly referred, the court was required to apply CPR 7.6 by analogy, nonetheless since, as I have already said, there is no logical basis for treating statutory review cases any differently from judicial review cases on this point, and since Corus is not authority to the contrary, it would not be proper for me not to apply the approach in Good Law to the current case and I do so.

1. 1. Mr Hunter informed me that the Supreme Court has granted permission to appeal in relation to Good Law apparently, so he was informed by those involved in the case, both on the decision under CPR 6.15 (on which Phillips LJ dissented, but which is irrelevant for present purposes) and also on the point I am now considering. Of course, as he accepted, I must apply the law as it stands and not speculate as to what decision the Supreme Court might reach.

1. 1. For what it is worth I would, if unconstrained by authority, with very great diffidence confess to some misgivings as to whether it can be right to apply CPR 7.6 as applying by analogy to applications to extend time for service of a claim form in judicial review and statutory review cases, if that has the effect that the principles applicable to applications under CPR 3.1(2)(c) and to relief from sanctions are completely excluded. Since rule 3.9 requires the court to “consider all the circumstances of the case”, including – but not exclusively – the need “(a) for litigation to be conducted efficiently and at proportionate cost; and (b) to enforce compliance with rules, practice directions and orders”, it would seem to me to be inappropriate to hold that all considerations other than those to be found in CPR 7.6 should be completely excluded from consideration.

1. 1. However, it may very well be that any difference between these two competing positions is more apparent than real in any event. As the defendant submitted, the legal landscape applicable to out-of-time applications under CPR 3.1(2)(a) since Corus was decided has changed very dramatically, in that: (a) it is now accepted that the relief from sanctions approach in Denton is applicable to such cases; (b) CPR 3.9 as well as the overriding objective (at CPR 1.1(2)(f)) both now refer to the need to enforce compliance with rules, practice directions and orders; (c) the weight to be attached to the public interest in the public law claim ought to have correspondingly less weight (see for example the discussion in Good Law at paragraphs 70 and 71, albeit in the context of CPR 6.15).

1. This is of relevance when I determine, as I do, the application for an extension of time and for relief from sanctions on the alternative basis that the test is not as laid down in Good Law.

IF CPR 3 APPLIED – THEN RELIEF FROM SANCTIONS WOULD STILL NOT BE GRANTED

The judge held that even if the discretion was being considered under CPR 3 then the claimant’s application would still not succeed.

1. 1. As I have already recorded, the claimant realistically accepts that it cannot succeed on this basis and this concession is sufficient to dispose of issue 2 given my above conclusion. Assuming, however, that it is at least possible that the case may go further and it is necessary to know what I would have decided on the alternative basis, I deal with the application on that basis as well.

Under CPR 3.1(2)(c)

1. 1. Applying the well-established three stage test in Denton I must consider: (1) whether the breach is serious and significant; (2) why the default occurred and, in particular, whether there is a good reason for the default; and (3) all the circumstances of the case, so as to enable the court to deal justly with the application, including those factors mentioned in CPR 3.9(1)(a) and (b).

1. 1. Mr Hunter submitted that the breach was neither serious nor significant, given that service was effected within a day of the expiry of the statutory limitation period. I am unable to agree. Regardless of the shortness of the delay, it seems to me that any delay measured in a day or more in serving a claim for statutory review such as this cannot be other than serious and significant. That is because of the importance attached to service of the claim form within the period required by the statute. I am prepared to accept that a truly insignificant delay, measured in minutes, might be in a different position, but that is not this case.

1. 1. I do not consider that Mr Hunter can gain any assistance from the decision in Corus itself or from the subsequent decision of HHJ Behrens sitting as a Judge of the High Court in Harrogate Borough Council v Secretary of State for Communities & Local Government & Zammitt [2014] EWHC 1506 (Admin). All decisions in cases such as this turn very much on their own facts. Further, and insofar as relevant, the defendant can also point to the decision in Good Law where, applying Denton, the first instance judge had refused relief from sanctions in a case where the claimant had effected service (albeit not at the designated email address for service) within time and had effected valid service a day later, such that the case was even stronger on the merits than the instant case, but the appeal on the exercise of the discretion under CPR 3.1(2)(c) was unanimously dismissed.

1. 1. I must bear in mind both what Laws LJ said in Corus at paragraphs 19 and 25 (cited at paragraphs 45 and 46 above) and also what Carr LJ said in Good Law at [82], that even if the three-stage Denton test was applied, “the nature of the failure in question, namely invalid service of originating process (as opposed to a procedural failure once the court’s jurisdiction over the defendant is engaged), would be the relevant context” where “[the] failure to take all reasonable steps to serve would be the first and dominant feature”.

1. 1. As to the reasons for the default, I have explained them by reference to the evidence of the claimant’s solicitor at paragraphs 25 to 31 above.

1. 1. Although Mr Hunter submits that these reasons amount, individually or collectively, to good reasons for the late service, I am unable to accept this submission. They are explanations as to what happened and provide mitigation, in the sense that the default was plainly not intentional and all lawyers should have considerable sympathy with hard-pressed litigation solicitors who make mistakes which always look far worse in the cold light of subsequent court-room scrutiny than they would have done at the time.

1. 1. However, it cannot sensibly be disputed that these reasons were, individually and collectively, careless mistakes to make. That is especially so given that the claimant had legal advice from its in-house legal team with expertise in planning cases and which was able to call on external legal advice as and when it needed. The claimant, through its lawyers, plainly knew that the application, if it was a s.288 application, as it knew by 30 August if not before, was likely to be the case, had to be issued within 6 weeks of the decision. Further, either it also knew that the claim also had to be served within that time or, if it did not know, it had no good reason for not knowing.

1. 1. It left the filing of the claim form until one or two days before the last date for filing and service, which was plainly an unnecessary risk to take since it needed the co-operation of the court to obtain a service copy of the sealed claim form. It needed to obtain consent for service by email or a plan to serve by an effective alternative method at the last minute if it had to. Whilst there was a problem with a delay in receipt of the sealed claim form, that was not a significant delay and would not have caused a problem but for the claimant leaving it all too late in the first place. If the claimant had not, apparently, mistakenly believed at this point that it had a week to serve, it could have served in time on the claimant and the HSE by email and could have served in time on Viridor by first class post or by personal service.

1. 1. Finally, I turn to all of the circumstances of the case. This is again where the observations in Corus and in Good Law are of powerful significance. Enforcing compliance with rules and practice directions is of key importance in a case involving late service of a claim form. The claimant cannot now simply say, as perhaps he may have been able to pre-Denton, that a delay of a day or two in service and a prompt application for relief from sanctions in a public law case, where there is a public law interest in having the case resolved and no substantial prejudice to the defendant beyond the loss of the accrued limitation defence, means that the weight is in favour of granting relief from sanctions. A delay of even a day is serious because it means that the defendant has an accrued procedural limitation defence which will be lost if relief is granted. There is no good reason for the delay. It is no longer of any great significance that it is a public law case. Even if that might be a strong point in other cases, it is not in this case, which in reality is no more than a private law dispute between the claimant as the dissatisfied paying party under an order as to costs and the interested parties as the recipients of that order.

1. In the circumstances I am satisfied that there is no basis for granting relief from sanctions, even on the approach contended for by the claimant.

HOWEVER…

The claimant was given permission to amend the proceedings to be judicial review proceedings to allow the claim to be formulated on the basis of a different argument in relation to the jurisdiction to make such a costs order against the council.