A “BEGUILING APPARENT COST SAVING SHORT CUT” TURNED OUT TO BE A MISTAKE: PLEADINGS MAY WELL BE NECESSARY WHEN AN ACTION IS TRANSFERRED FROM PART 8 TO PART 7

There is a short passage in the judgment of HH Judge Davis-White KC in Chapman & Anor v Celtic Property Developments Ltd (Re Celtic Property Developments Ltd and Companies Act 2006) [2024] EW Misc 6 (CC) which reflects an issue that several other judges have commented on.  When an action is transferred from Part 8 to Part 7 it can be a mistake not to order the parties to serve pleadings.

“As is so often the case, a beguiling apparent cost saving short cut in place of following standard practice under the rules of court turns out, at the end of the day, to be a mistake.”

THE CASE

The judge was considering an action relating to the assignment of a debenture. The action had been issued using Part 8.   There were numerous disputes of fact and the matter was transferred to Part 7.  However when the transfer was made the court ordered that a witness statement stand in place of the claimant’s Particulars of Claim.  This led to major complications at the trial.

THE JUDGE’S COMMENTS ON THIS ISSUE

12. This claim was commenced, wrongly in my view, as a Part 8 Claim Form. There were clearly disputes of fact which made the appropriate regime to be Part 7 of the CPR and not Part 8. By Order dated 4 October 2022, the case was transferred to the Part 7 regime.

13. Unfortunately, at that time, it was ordered that a witness statement of Mr Chapman stand as particulars of claim. In my judgment that is usually not a convenient order to make and was not the best order to make in the context of these proceedings. Either particulars of claim are simple to draft, in which case there is no real prejudice in requiring them to be drafted; alternatively, the case is more complicated and proper particulars of claim are required for that reason. In this case, the relevant witness statement sets out (as one might expect) not just factual matters properly set out in particulars of claim but documents and other evidence which is not appropriately set out in particulars of claim and which then causes problems for the party pleading a defence and to the court when managing the case and conducting the trial. As is so often the case, a beguiling apparent cost saving short cut in place of following standard practice under the rules of court turns out, at the end of the day, to be a mistake.