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Cite as: [2014] EWHC 1032 (QB)

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Neutral Citation Number: [2014] EWHC 1032 (QB)
Case No: 2LS 40083


The Court House
Oxford Row
Leeds LS1 3BG
7 April 2014

B e f o r e :

His Honour Judge Behrens
sitting as a Judge of the High Court in Leeds



- and -




Robert Sterling (instructed by HGF Law LLP) for the Claimant
Andrew Clark (instructed by Turner & Wall LLP) for the Defendants
Hearing dates: 2nd and 7th April 2014



Crown Copyright ©

    Judge Behrens:

    1 Introduction

  1. This case is currently listed for a 5 day trial commencing on the 12th May 2014. It was listed for a pre-trial review on 2nd April 2014. However, the Defendants contend that the claim has been struck out as a result of the breach of an "unless" order made on 17th June 2013 and on 6th March 2014 obtained a default costs certificate resulting from that strike out. Accordingly there are a number of matters that need to be decided before determining whether the trial can proceed.
  2. In fact there are three interlinked applications by the Claimant and the Defendants:
  3. 1. An application dated 12th March 2014 by the Claimant to set aside the default costs certificate that was issued by the court on the ground that there was no basis for an order that the Claimant pay the Defendants' costs.

    2. An application dated 17th March 2014 by the Defendants for a declaration that the claim has been struck out as a result of breach of the "unless" order. In the alternative for an order that the claim form is struck pursuant to CPR 3.4(2)(c) on the ground that there has been non compliance with a number of orders in the proceedings including an unless order.

    3. An application dated 28th March 2014 by the Claimant for relief from sanctions on the ground that the Claimant is not in breach of any order and that it would be disproportionate and not in the interests of justice to strike out the claim or to impose any sanction on the Claimant.

  4. The applications are supported by 4 witness statements from Mr Webber (dated 12th March 2014, 28th March 2014, 1st and 4th April 2014), two witness statements from Mr Bower (dated 17th March 2014 and 3rd April 2014) and a witness statement from Mr Robinson (3rd April 2014). Mr Webber and Mr Bower are the solicitors with conduct of the matter on behalf of the Claimant and the Defendants respectively.
  5. A number of matters are common ground between the parties:
  6. 1. If the claim has not been struck out for breach of an "unless" order then the Defendants were not entitled to the default costs certificate and it must be set aside under CPR 47.12(1).

    2. The position is the same even if the court now strikes out the claim under CPR 3.2(4)(c). The Defendants were not entitled to a default cost certificate at the time they filed the request under CPR 47.9(4).

    3. If the claim has been struck out but the court grants the Claimant relief from sanctions so as to enable the action to continue it would be appropriate to set aside the default costs certificate because the Defendants may not obtain an order for costs at the trial. Such an order would result in a different order for costs from cases 1 and 2 above.

  7. If the claim has been struck out and the court refuses relief from sanctions there is a discretion under CPR 47.12(2) to set aside the default costs "if it appears to the court that there is some good reason why the detailed assessment proceedings should continue".
  8. There is, however, nothing in Mr Webber's evidence to justify the exercise of the discretion under this rule.
  9. The real issues between the parties are thus those contained in the applications of 17th and 28th March 2014. In order to consider those issues it is necessary to consider in summary form the issues between the parties and, in some detail, the procedural history of the action.
  10. 2 The nature of the claim.

  11. The Claimant is a manufacturer and supplier of medical equipment including an anaesthetic vaporiser known as Tec 3. Between February 2008 and his resignation on 30th March 2011 Mr Gostling was a director of the Claimant.
  12. In May 2011 Mr Gostling set up Acies Engineering Limited ("Acies"). He is a director and shareholder of Acies. A number of former employees of the Claimant are now employees of Acies. Acies has developed its own Tec 3 vaporiser.
  13. The Claimant alleges that the Defendants and the employees have made use of its confidential information in that development. They have used the Claimant's customer lists to contact its customers and have copied its manual.
  14. The claim is denied by the Defendants. They point out that the Particulars of Claim does not accurately define the confidential information which the Defendants are said to have used. They point out that the Tec 3 vaporiser was first developed by a different company and that the patents for the Tec 3 vaporiser lapsed some time ago. The technical data needed to build and design a Tec 3 vaporiser is in the public domain.
  15. Whilst it is admitted parts of the text and illustrations were copied from the Claimant's manual it is denied that there was any use of any confidential information belonging to the Claimant. Acies' rival Apollo product was developed through the reverse engineering of a product manufactured by one of the Claimant's rivals and the expertise of Mr Robinson (who has extensive experience in the field).
  16. The allegations of breach of duty are accordingly denied.
  17. 3 Procedural History

  18. The proceedings began with a hearing before Judge Kaye QC on 14th March 2012. Judge Kaye QC made an order preventing the Defendants from using the confidential information in the Claimant's manual, drawings or lists of customers. He also required the Defendants to delete any confidential information on any of their computers and ordered the Defendants to pay the costs of the application. He ordered an interim payment on account of costs in the sum of £7,000.
  19. The claim form was issued on 15th March 2012 accompanied by the Particulars of Claim. The Defence was filed on 5th April 2012. I have summarised the allegations in the pleadings.
  20. The order of 25th March 2013
  21. There was a telephone case management conference on 25th March 2013 attended by Counsel for the Claimant and the solicitor for the Defendants. District Judge Giles gave directions intended to lead to a trial between 9th September 2013 and 27th September 2013. Amongst other orders he directed standard disclosure by list by 10th April 2013, inspection by 24th April 2013 and witness statements by 22nd May 2013. As the proceedings had already been ongoing for more than a year District Judge Giles envisaged a relatively tight timetable in order to ensure an early trial.
  22. The problems in this case mainly revolve around disclosure. The Defendants filed their lists in accordance with District Judge Giles's order. However, the Claimant did not consider that the lists were adequate and made an application for specific disclosure. No list at all was filed by the Claimant.
  23. The order of 17th June 2013
  24. There was a further hearing before District Judge Giles on 17th June 2013. His order is central to the Defendants' submission that the claim has been struck out. By paragraph 4 of the order he adjourned the Claimant's application for specific disclosure until 24th July 2013 with an extended time estimate. By paragraph 5 he vacated the trial window and extended the times set out in the order of 25th March 2013 generally. By paragraph 6 the Claimant was ordered to pay the costs of the hearing assessed at £1,750.
  25. Paragraphs 1 to 3 of the order dealt with the Claimant's failure to comply with its disclosure obligations. Paragraph 1 extended the time for the Claimant's list of documents until 4 p.m 21st June 2013. Paragraph 2 extended the time for inspection until 5th July 2013. Paragraph 3 is the "unless" order relied on by the Defendants. It is in the following terms:
  26. In the event of the Claimant's default in compliance with paragraph 1 or paragraph 2 of this order the claim shall be struck out and the Defendant shall be entitled to the costs of the substantive proceedings, such costs to be agreed if possible but failing agreement to [be] the subject of detailed assessment on the standard basis.

  27. The Claimant complied with paragraph 1 of the order by serving its list of documents on 20th June 2013.
  28. On 26th June 2013 Mr Bower wrote to Mr Webber requesting inspection of documents 3, 4, 7, 10 – 288 and undertook to meet the reasonable copying costs involved.
  29. The Claimant was unhappy with the order of 17th June 2013. In particular it was concerned about providing copies of allegedly confidential documents to the Defendants. Accordingly on 3rd July 2013 the Claimant issued a Notice of Appeal against the order. On 4th July 2013 I granted permission to appeal on the papers. By paragraph 2 of the order I extended the time for inspection to 7 days after the determination of the appeal.
  30. The Defendants' invited me to reconsider and set aside paragraph 2 of my order. On 19th July I refused the application. I took the view that once permission to appeal had been granted it was sensible to halt the inspection process until after the appeal had been heard. An attempt by the Defendants to pursue an appeal to the Court of Appeal against my order was withdrawn by consent.
  31. The Order of 24th July 2013
  32. On 24th July 2013 District Judge Giles dealt with two matters. There was an application as to scope of the order for inspection. In particular the Claimant was not clear whether the order for inspection made on 17th June 2013 allowed argument on whether the inspection of confidential documents should be on a limited basis. District Judge Giles adjourned the application to be determined at the same time as the appeal. Second, District Judge Giles dealt with and acceded to the Claimant's application for specific disclosure. He ordered the Defendants to carry out a reasonable search and to serve a list and disclosure statement in respect of 38 classes of documents specified in the Schedule before 30th August 2013. He made provision for inspection and ordered the Defendant to pay the costs of the application. The order was not an "unless" order.
  33. The Order of 22nd August 2013
  34. The appeal and the adjourned application over inspection were listed before Judge Saffman on 22nd August 2013. By that time the Claimant had obtained a transcript of District Judge Giles's judgment of 17th June 2013. According to Mr Sterling the transcript made it clear that District Judge Giles had not ruled on the scope of the inspection that the Claimant was required to give. In those circumstances it was agreed that the appeal should be dismissed with costs and that only the application would be pursued.
  35. Judge Saffman made a number of directions. In paragraphs 2 and 3 he made a specific order in relation to the inspection of some (49) of the documents in the Claimant's list of documents.
  36. 2. The documents set out in the schedule hereto being some of the documents in the Claimant's list of documents dated 25th June 2013 shall be produced for inspection by the Claimant to:

    (a) [Mr Gostling]

    (b) [Mr Robinson]

    Subject in the case of Mr Robinson to him having signed, filed, and served an undertaking not to use or disclose to any person other than [Mr Gostling], [the Defendants'] legal advisers and any expert instructed by the Defendants any information contained within the documents set out in the schedule. Such undertaking shall be accompanied by an acknowledgment by the said Mr Robinson that breach thereof is a contempt of court in respect of which the court has power to order a term of imprisonment for up to 2 years and such undertaking and acknowledgment shall be accompanied by a certificate from a solicitor that the nature and consequences of the undertaking have been explained and understood by Mr Robinson.

    3. The inspection permitted by paragraph [2] shall take place at the Defendants' solicitors office in the presence of the Defendants' solicitor or a responsible employee of the solicitors and [Mr Gostling] and Mr Robinson shall not be entitled to take a copy of the documents produced and remove it or the original documents from the solicitors, nor shall [Mr Gostling] or Mr Robinson be permitted to remove from the solicitors' office any notes made by either of them relating to information in the said documents, and any notes taken shall be retained in the solicitors' file.

  37. The remainder of the order was designed to provide a new timetable to ensure a trial with a trial window between February and May 2014. Paragraph 4 was in the following terms:
  38. 4. The time for the production of the documents pursuant to paragraph 2 above and any further inspection requested shall be extended to 27th September 2013.

  39. It will be recalled that in the letter of 26th June 2013 Mr Bower had requested inspection of some 281 documents. Only 49 of these were covered by the procedure in paragraphs 2 and 3 of the order.
  40. The order went to extend the time for witness statements (25th October 2013), and expert reports (22nd November 2013) and provided for a pre trial review at the end of January 2014.
  41. The Defendants' disclosure
  42. The Defendants failed to provide the disclosure list by 30th August 2013 in accordance with the order of 24th July 2013. In paragraph 4 of his second witness statement Mr Bower explains that the task of collating all the documents within the 38 categories proved more demanding and time consuming than he had anticipated. On 30th August 2013 he wrote to Mr Webber apologising that he would not be in a position to serve the list by 4 p.m that day. He stated that it was intended that the list be served by 4 p.m on 4th September 2014.
  43. In fact the list was not served on 4th September 2013. Accordingly on 4th September 2013 the Claimant made an application for an "unless" order in relation to the failure.
  44. The list was provided on 12th September 2013. It was 25 pages long and listed some 682 documents. It contained a disclosure statement signed by Mr Gostling both on his own behalf and on behalf of Acies.
  45. As a result, on 8th October 2013 the application for the unless order was withdrawn on the basis that the Defendants paid the Claimant's costs.
  46. The letter of 13th September 2013
  47. On 13th September 2013 Mr Bower wrote to Mr Webber in the following terms:
  48. We refer to both the order made on 22nd August 2013 and our client's further list of documents to which we trust you may now have had an opportunity to give consideration. We are mindful that the order provides for inspection of documents to take place by Friday 27 September 2013 at the latest. We look forward to hearing from you with details of those documents of which your client requires inspection. In the interim we refer to our letter dated 26 June 2013 of which we attach a further copy and look forward to receiving copies of the documents detailed within it. For the avoidance of doubt we confirm that arrangements are in hand for Mr Robinson to provide a signed written undertaking which together with the required certificate from a solicitor will be filed with the Court and copies served on you.

  49. Mr Webber did not reply to the letter of 13th September 2013. There is no explanation for this failure in any of Mr Webber's evidence. In paragraph 18 of his sixth witness statement Mr Webber says:
  50. … it was my understanding on receipt of the request for "… copies …" of the Claimant's documents that it was the Defendants' solicitors [in] disregard of the restricted disclosure provisions and seeking to invite me to make a mistake and provide copies of documents subject to the restricted inspection conditions.

    If that really was Mr Webber's understanding it is to my mind remarkable that he did not choose to answer the letter in any way.

  51. More importantly the Claimant did not give any inspection of any documents prior to 27th September 2013. It did not provide copies of any of the 234 documents which were not the subject of paragraphs 2 and 3 of the order of 22nd August 2013. It is that breach that is relied on by Mr Clark as a breach of the "unless" order.
  52. Mr Robinson's undertaking
  53. Mr Robinson's undertaking and the solicitor's certificate were served on Mr Webber. It is, however, common ground that they were not served until shortly after 27th September 2013. Notwithstanding the service of those documents the Claimant has still not given inspection of any of the 49 documents which are subject to paragraphs 2 and 3 of the order.
  54. The Defendants' witness statements
  55. On 24th October 2013 Mr Bower served on Mr Webber the witness statements relied on by the Defendants in accordance with the order of 22nd August 2013. No witness statements were served by Mr Webber on behalf of the Claimant.
  56. Mr Webber's complaint over disclosure
  57. On 1st November 2013 Mr Webber wrote to Mr Bower complaining about the Defendants' disclosure. The letter did not condescend to particulars but alleged that the disclosure statement was unreliable, the search was inadequate and that there were important documents that had not been disclosed.
  58. In his fifth witness statement (1st April 2014) Mr Webber set out in more detail his complaints about the disclosure given by the Defendants. In summary:
  59. 1. In paragraph 8 he commented on the places where searches were carried out.

    2. In paragraph 9 he alleged that there is no specific disclosure regarding manufacture of the components parts for the assembly of particular component parts which make up the thermostatic control unit. Equally, there is no disclosure regarding documentation used by third parties.

    3. In paragraph 11 he alleged that Item 584 does not specify the nature of the technical drawings referred to in the delivery note

    4. In paragraph 12 he alleged that the Defendants have failed to disclose documents relating to the pressure, calibration temperature or other measurements when used to build the thermostatic control valves.

    5. He exhibited a witness statement from Mr Spence who had carried out a comparison and contrast between the Claimant's and the Defendant's vaporiser. He concluded that the two were identical. In his view identical technical information regarding the dimension of the component parts has been used to manufacture both sets of components.

  60. The Defendants have answered these allegations in the recent witness statements of Mr Bower and Mr Robinson:
  61. 1. Mr Bower draws attention to the large number of documents listed by the Defendants in their 4 lists. He points out that the number of technical documents disclosed by the Defendants is greater than those disclosed by the Claimant. He denies that the search or the disclosure was inadequate.

    2. In paragraphs 6 – 9 of his witness statement Mr Robinson asserts that documents relating to the thermostatic control unit have been disclosed. He refers to documents 414, 495, 403 and 408.

    3. In paragraph 10 Mr Robinson states that the technical drawing has been disclosed at item 406.

    4. In paragraph 11 Mr Robinson deals with the testing by R A Medical. He points out that they were instructed from the outset and has referred to documents 295 and 296 being test sheets dating back to October 2012 and at 649 an invoice dated 1st November 2012.

    5. In paragraph 12 he deals with Mr Spence's evidence. He asserts that the Defendants vaporiser was derived from reverse engineering.

  62. In his sixth witness statement (4th April 2014) Mr Webber set out his answers to the points made by Mr Robinson:
  63. In paragraph 4 he disputes that document 414 answers the criticism in paragraph 9 of his fifth witness statement. He repeats the criticism relating to the absence of documentation relating to building of the thermostatic control unit and the subassembly of the same.
  64. In paragraphs 5 and 7 Mr Webber deals with the position of R.A Medical and asserts that the Defendant fails to identify documentation that Mr Robinson now implies was in the possession of the third party. He also asserts that Mr Robinson has failed to refer to documentation that would support the assertion that R A Medical were engaged from the outset and suggests that there is a breach of Judge Kaye QC's order of 14th March 2012.
  65. In paragraphs 10 to 13 Mr Webber repeats his earlier criticisms that there has been no disclosure of documents regarding the building and assembly of a crucial component part of the vaporiser.
  66. In paragraphs 15 to 17 he makes further criticism of Mr Bower's witness statement. He suggests the search should have included the Defendants' laptop and PDA. He also suggests that there was other electronic media which should have been searched.
  67. Assertion that the claim is struck out
  68. On 4th November 2013 Mr Bower wrote to Mr Webber. Whilst taking issue with the allegations over the Defendants' disclosure he pointed out that the claim had been struck out following the breach of the "unless" order of 17th June 2013.
  69. On 5th November 2013 Mr Webber replied to Mr Bower. He took issue with the allegation that the claim had been struck out and asserted that the Defendants had failed to respond to the notice that the Defendants were in default in complying with the consent order for specific disclosure.
  70. In paragraph 8 of his second witness statement Mr Bower acknowledged that after the letter of 1st November 2013 he had been unwilling to maintain any further dialogue with Mr Webber over the extent of the Defendants' disclosure. It is his view that the issues have been rendered redundant by the strike out of the proceedings.
  71. On 4th February 2014 Notice of Costs proceedings was served by Mr Bower on Mr Webber. There was no response and the default costs certificate was duly issued on 6th March 2013.
  72. On 21st March 2014 Mr Webber purported to serve on Mr Bower 5 witness statements. Mr Clark suggested that those witness statements must have been prepared with the advantage of the knowledge of the contents of the witness statements served by Mr Bower in October 2013. Mr Sterling, on instructions, said that Mr Webber had not read the Defendants' witness statements when he prepared the Claimant's witness statements.
  73. 4 Was there an "unless" order in force.

  74. The first question to determine is whether there was in force an "unless" order in relation to the duty to give inspection on 27th September 2013. It is not in dispute that paragraph 3 of the order of 17th June 2013 was an "unless" order. Thus the failure to give inspection by 5th July 2013 would result in the claim being struck out. Mr Clark submits that my order of 5th July 2013 and Judge Saffman's order of 22nd August 2013 did not affect the sanction. All we did was to extend the date for compliance first to 7 days after the disposal of the appeal and second until 27th September 2013. Accordingly he submits that the sanction applied to a failure to comply with the extended date.
  75. Mr Sterling seeks to avoid the logic of Mr Clark's argument by pointing out that Judge Saffman did not impose a sanction expressly in the order of 22nd August 2013. He points out that Judge Saffman provided a completely new timetable to get the action to trial and that it would have been perfectly simple for him to impose a sanction if he had intended to do so.
  76. I cannot accept Mr Sterling's argument. To my mind the effect of the order raises a short question of construction. I have to determine the meaning which the orders would convey to a reasonable person with the background knowledge which would reasonably have been available to the parties at the time they were made. No doubt it would have been possible for Judge Saffman to have made a fresh order for inspection. If he had done that it would have been open to him to impose a sanction for non compliance. However that is not what Judge Saffman did. Rather than make a fresh order he extended the time in District Judge Giles's order. Thus he left District Judge Giles's order in tact but with an extended date for compliance. It follows, in my view that the sanction imposed by District Judge Giles also remained in force.
  77. It follows that the failure to give inspection by 27th September 2013 was subject to the "unless" order contained in paragraph 3 of the order of 17th June 2013.
  78. 5 Breach

  79. It seems to me to be perfectly plain that the Claimant was in breach of the order of 22nd August 2013. No inspection has been provided by the Claimant even now. Mr Clark submitted that the Defendants could only rely on the failure relating to the 232 documents not included in the paragraphs 2 and 3 procedure because he accepts that the undertaking and certificate envisaged by paragraph 2 was not served prior to 27th September 2013.
  80. I agree with Mr Clark that the Claimant was plainly in breach in respect of the 232 documents. There would appear to be no justification for failing to provide copies as requested in the letter of 13th September 2013. Mr Sterling tentatively suggested that the letter did not contain any undertaking to pay for the photocopying. However the undertaking was contained in the letter of 26th June 2013 and a copy of that letter was enclosed with the letter of 13th September 2013.
  81. Whilst it is in my view arguable that, the Claimant was also in breach in respect of the 49 documents I am content to deal with this application upon the basis of Mr Clark's submission. Mr Sterling suggested that the position is in some way affected by the letter of 13th September 2013. He referred to the fact that Mr Bower had requested copies of all of the documents in the list. He submitted that this was not the procedure envisaged by Judge Saffman's order. I do not accept that submission. There is nothing in the letter which affects the position of the 232 documents not subject to the procedure in paragraphs 2 and 3 of the order. There was thus nothing in the request for copies that was inconsistent with this. Furthermore, the final sentence of the letter shows that Mr Bower was making arrangements to obtain the undertaking from Mr Robinson and to provide the required certificate. I do not accept that the letter of 13th September 2013 was an attempt by Mr Bower to trick or mislead Mr Webber. If Mr Webber interpreted it as such he should have replied to the letter.
  82. In his skeleton argument and in his oral submissions Mr Sterling suggested that the Defendants were in breach of paragraphs 2 and 3 of the order by failing to provide the undertaking and certificate by 27th September 2013. I do not agree. There was no obligation on the Defendants to provide the certificates or undertaking at all. There was a restriction on inspection by Mr Robinson until such undertaking and certificate were filed and served.
  83. Mr Sterling also suggested that the Defendant's alleged breach of the order for specific disclosure was relevant. I agree with Mr Clark that it is not relevant to the issue whether the Claimant is in breach of the order. Whilst it is common ground that Mr Bower was 12 days late in providing the list he provided inspection within the time contemplated in the original order.
  84. In the light of the evidence filed by Mr Robinson and Mr Bower I am not satisfied that the Defendants are in continuing breach of the order. A number of points are relevant. It is not possible for me to rule on whether or not the Defendants have other documents in their custody, control or power which fall within the scope of District Judge Giles' order of 24th July 2013. Even if (as to which I make no finding) there are other documents which the Defendants ought to have disclosed it does not follow that there was a breach of the order of 24th July 2013. [See Realkredit Danmark v York Montagu reported in Westlaw at [1998] WL 104421 and Re Atrium [2013] EWHC 2882.]
  85. As Toulson LJ said in Realkredit the question is whether the list was made in good faith and still be described as a list. It would still be a list even if a subsequent application for specific discovery had elicited further documents. As already noted the list comprised some 682 documents. No detailed criticisms of the document were made until 1st April 2014. The criticisms were extremely limited and may have been answered in full by Mr Robinson. The list supplied by Mr Bower on 12th September 2013 was plainly a list and was made in good faith.
  86. Thus I am not satisfied that the Defendants were in breach of any order after 12th September 2013. It is also to be noted that the order of 24th July 2013 was not an "unless" order.
  87. 6 Effect of breach

  88. In Marcan Shipping v Kefalas [2007] 1 WLR 1864 the Court of Appeal made clear that in accordance with CPR 3 the sanction embodied in an "unless" order took effect without the need for any further order if the party to whom it was addressed failed to comply with it in any material respect. In paragraphs 34 to 36 of his judgment of Moore-Bick LJ said:
  89. In my view it should now be clearly recognised that the sanction embodied in an "unless" order in traditional form takes effect without the need for any further order if the party to whom it is addressed fails to comply with it in any material respect. This has a number of consequences, to three of which I think it is worth drawing particular attention. The first is that it is unnecessary, and indeed inappropriate, for a party who seeks to rely on non-compliance with an order of that kind to make an application to the court for the sanction to be imposed or, as the judge put it, "activated". The sanction prescribed by the order takes effect automatically as a result of the failure to comply with its terms. If an application to enter judgment is made under rule 3.5(5), the court's function is limited to deciding what order should properly be made to reflect the sanction which has already taken effect. Unless the party in default has applied for relief, or the court itself decides for some exceptional reason that it should act of its own initiative, the question whether the sanction ought to apply does not arise. It must be assumed that at the time of making the order the court considered all the relevant factors and reached the decision that the sanction should take effect in the event of default. If it is thought that the court should not have made an order in those terms in the first place, the right course is to challenge it on appeal, but it may often be better to make all reasonable efforts to comply and to seek relief in the event of default.
  90. The second consequence, which follows from the first, is that the party in default must apply for relief from the sanction under rule 3.8 if he wishes to escape its consequences. Although the court can act of its own motion, it is under no duty to do so and the party in default cannot complain if he fails to take appropriate steps to protect his own interests. Any application of this kind must deal with the matters which the court is required by rule 3.9 to consider.
  91. The third consequence is that before making conditional orders, particularly orders for the striking out of statements of case or the dismissal of claims or counterclaims, the judge should consider carefully whether the sanction being imposed is appropriate in all the circumstances of the case. Of course, it is impossible to foresee the nature and effect of every possible breach and the party in default can always apply for relief, but a conditional order striking out a statement of case or dismissing the claim or counterclaim is one of the most powerful weapons in the court's case management armoury and should not be deployed unless its consequences can be justified. I find it difficult to imagine circumstances in which such an order could properly be made for what were described in Keen Phillips v Field as "good housekeeping purposes".
  92. In all the circumstances I agree with Mr Clark that this claim has been struck out.
  93. 7 Relief from sanctions

  94. An application for relief from sanctions is, in the post Jackson era, governed by CPR 3.9 which provides:
  95. (1) On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need—

    (a) for litigation to be conducted efficiently and at proportionate cost; and

    (b) to enforce compliance with rules, practice directions and orders.

    (2) An application for relief must be supported by evidence.

  96. In 3 recent cases – Mitchell v Newsgroup Newspapers Ltd [2013] EWCA Civ 1537, Durrant v Chief Constable of Avon [2013] EWCA Civ 1624 and Thevarajah v Riordan [2014] EWCA Civ 14 – the Court of Appeal has sent out a clear message requiring a robustness of approach in granting relief from sanctions in the post Jackson era and the importance of the need for litigation to be conducted efficiently and at proportionate cost and to enforce compliance with rules practice direction and orders.
  97. In Mitchell the Court of Appeal upheld the decision of a Master who had refused to grant relief from sanctions in a case where a solicitor had failed to file a costs budget on time.
  98. In paragraphs 41, 45 and 59 of the judgment of the Court the Master of the Rolls said:
  99. If the non-compliance cannot be characterised as trivial, then the burden is on the defaulting party to persuade the court to grant relief. The court will want to consider why the default occurred. If there is a good reason for it, the court will be likely to decide that relief should be granted. For example, if the reason why a document was not filed with the court was that the party or his solicitor suffered from a debilitating illness or was involved in an accident, then, depending on the circumstances, that may constitute a good reason. Later developments in the course of the litigation process are likely to be a good reason if they show that the period for compliance originally imposed was unreasonable, although the period seemed to be reasonable at the time and could not realistically have been the subject of an appeal. But mere overlooking a deadline, whether on account of overwork or otherwise, is unlikely to be a good reason. We understand that solicitors may be under pressure and have too much work. It may be that this is what occurred in the present case. But that will rarely be a good reason. Solicitors cannot take on too much work and expect to be able to persuade a court that this is a good reason for their failure to meet deadlines. They should either delegate the work to others in their firm or, if they are unable to do this, they should not take on the work at all. This may seem harsh especially at a time when some solicitors are facing serious financial pressures. But the need to comply with rules, practice directions and court orders is essential if litigation is to be conducted in an efficient manner. If departures are tolerated, then the relaxed approach to civil litigation which the Jackson reforms were intended to change will continue. We should add that applications for an extension of time made before time has expired will be looked upon more favourably than applications for relief from sanction made after the event.
  100. On an application for relief from a sanction, therefore, the starting point should be that the sanction has been properly imposed and complies with the overriding objective. If the application for relief is combined with an application to vary or revoke under CPR 3.1(7), then that should be considered first and the Tibbles criteria applied. But if no application is made, it is not open to him to complain that the order should not have been made, whether on the grounds that it did not comply with the overriding objective or for any other reason
  101. The Master did not misdirect herself in any material respect or reach a conclusion which was not open to her. We acknowledge that it was a robust decision. She was, however, right to focus on the essential elements of the post-Jackson regime. The defaults by the claimant's solicitors were not minor or trivial and there was no good excuse for them. They resulted in an abortive costs budgeting hearing and an adjournment which had serious consequences for other litigants. Although it seems harsh in the individual case of Mr Mitchell's claim, if we were to overturn the decision to refuse relief, it is inevitable that the attempt to achieve a change in culture would receive a major setback.
  102. In Durrant the Court of Appeal allowed an appeal where a judge a granted relief against the failure to comply with an "unless order". The "unless order" related to the filing of witness statements and the sanction was that the Defendant would not be able to rely on any witness evidence not served in accordance with the order. In paragraph 38 of the judgment of the Court Richards LJ said:
  103. The judgment in Mitchell reiterated (at para 52) that this court will not lightly interfere with a case management decision. It quoted the observation of Lewison LJ in Mannion v Gray [2012] EWCA Civ 1667, para 18, that "it is vital for the Court of Appeal to uphold robust fair case management decisions by first instance judges". Equally, however, if the message sent out by Mitchell is not to be undermined, it is vital that decisions under CPR 3.9 which fail to follow the robust approach laid down in that case should not be allowed to stand. Failure to follow that approach constitutes an error of principle entitling an appeal court to interfere with the discretionary decision of the first instance judge. It is likely also to lead to a decision that is plainly wrong, justifying intervention on that basis too. We do not share Mr Payne's concern about this leading to an increase in appeals and thereby undermining the efficiency benefits of the Jackson reforms. As is stated at para 48 of the Mitchell judgment, "once it is well understood that the courts will adopt a firm line on enforcement, litigation will be conducted in a more disciplined way and there should be fewer applications under CPR 3.9. In other words, once the new culture becomes accepted, there should be less satellite litigation, not more".
  104. Thus, I am to assume that the sanction in District Judge Giles's order was properly imposed and also to adopt the robustness of approach indicated by the above decisions. The breaches in this case were not trivial. As I have indicated the Claimant has still not given inspection. As Mr Clark points out the original order for inspection provided for inspection on 24th April 2013 nearly a year ago. The letter of 13th September 2013 reminded Mr Webber of the obligation to provide copies before 27th September 2013. Mr Sterling submitted that because the Defendants were able to serve their witness statements in accordance with Judge Saffman's order of 22nd August 2013 there was no prejudice resulting from the Claimant's breach. I do not accept that submission. It seems to me to be self evident that a party will be prejudiced in the preparation of its case by the failure of his opponent to give inspection of the documents which support or hinder his case.
  105. In my view there is no good reason for the failure to give inspection of the 232 documents by 27th September 2013. In my view Mr Webber's unspoken belief that an attempt was being made to trick him into making a mistake is not a good reason. He should have raised the matter in a letter to Mr Bower. Equally, Mr Webber's belief that the Defendants had other documents in their possession control or power that ought to have been disclosed was not a good reason for the Claimant's breach of the order for inspection. Furthermore this application has not been made promptly. In his oral submissions Mr Sterling suggested that, as the question whether the Claimant had been struck out was in issue, it was for the Defendants to apply for a declaration that it had been struck out. I do not agree. No doubt it was open to the Defendants to make such an application, but, in my view, there was no obligation on the Defendants to do so. As Moore-Bick LJ made clear in paragraph 35 of Marcan it was for the Claimant, as the party who was potentially in default, to apply for relief from sanctions. No doubt the Claimant could have combined the application with an application for a declaration that the claim was not struck out. In addition to these matters there are a number of other factors which militate against the granting of relief. First, the Claimant was in breach of the original disclosure order and the order in respect of the filing of witness statements. Its witness statements were served 4 months late. Second, it seems to me to be inevitable that if relief is granted the trial date will be lost. It is clear that the Defendants wish to rely on expert evidence. There is, in my view, no realistic possibility that they will be able to get such evidence in time for a trial listed for 12th May 2014.
  106. In all the circumstances I have come to the conclusion that the application for relief against sanctions should be refused. This may seem harsh as the Claimant will now be denied a trial. It is however consistent with the order made by District Judge Giles and the firm line on enforcement required in the post Jackson regime. Whilst it is true that the three recent judgments from the Court of Appeal all postdate the breach in this case it might have been thought that the very clear judgment of Moore-Bick LJ in Marcan in 2007 should have been a clear warning on the risks involved in failing to comply with "unless" orders.
  107. 8 Conclusion

  108. It follows that I will declare that the claim is struck out and will refuse to set aside the default costs certificate.

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