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You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Woodward & Anor v Phoenix Healthcare Distribution Ltd [2019] EWCA Civ 985 (12 June 2019) URL: https://www.bailii.org/ew/cases/EWCA/Civ/2019/985.html Cite as: [2019] EWCA Civ 985 |
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ON APPEAL FROM BUSINESS AND PROPERTY COURTS,
Business List, (CHD)
His Honour Judge Hodge QC
(Sitting as a High Court Judge)
CH2018000086
Strand, London, WC2A 2LL |
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B e f o r e :
LADY JUSTICE ASPLIN
and
LADY JUSTICE NICOLA DAVIES
____________________
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Appellant |
|
- and - |
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Respondent |
____________________
Mr Andrew Onslow QC and Ms Hannah Glover (instructed by Mills & Reeve LLP) for the Respondent
Hearing date: 16th May 2019
____________________
VERSION
OF JUDGMENT APPROVED
Crown Copyright ©
Lady Justice Asplin:
The relevant background
"4. In my judgment, I characterised the Court of Appeal decision in Barton as being one of a number of cases wherevalidation
under CPR 6.15 had been refused upon the primary basis that, although de facto service had been effected, there was nothing other than de facto service to constitute good reason for
validation.
The majority decision in the Supreme Court seems to me to bear this out. The fact that the claimant in Barton was a litigant in person did not, in the
view
of the majority, provide a sufficient additional factor such as to give rise to a good reason for
validation.
Likewise, on the facts and on the
very
limited arguments deployed (see paragraph 22 of the Supreme Court judgment in Barton ) the conduct of the defendant's solicitors, in that case, did not amount to the playing of technical games.
5. It is true that Lord Sumption, giving the majority judgment, took theview
that the solicitors in Barton were not, even had they had the time to do so, under any duty to advise the claimant of his mistake as to service. The Supreme Court, however, was not asked to consider and did not consider, as I have been asked to, any developed argument, as to the impact and effect of the duty to further the overriding objective, as giving rise to a duty to the court to warn an opposing party of his, or her, mistakes. I do not regard the majority in Barton (and I do not think that the majority in Barton would have regarded themselves) as having given a definitive, or any, answer, in respect of that argument.
6. It is true, also, that, in endorsing the principles to be derived from Abela, Lord Sumption gave, it might be said, new, or greater, weight to the fact thatvalidation
might deprive a defendant of a limitation defence than has, perhaps, emerged from the earlier authorities. He was, however, at pains to say that the point was not, necessarily, decisive. As explained by Lord Briggs in his dissenting judgment, the point can, indeed, be put the other way; namely that, in a case where the de facto service fulfils all the objectives of good service, a refusal to
validate
may provide the defendant with a windfall.
7. In the current case, I consider that the de facto service effected by Collyer Bristow did fulfil all the objectives of good service (see, in particular, paragraphs 83 and 99 of my judgment and paragraphs 28 to 30 of the Supreme Court judgment in Barton ) and that, to the extent that something additional is required in order to give rise to a good reason tovalidate,
then that good reason was provided by the failure of Mills & Reeve, contrary, as I find, to its, or its client's, duty to further the overriding objective, to warn Collyer Bristow that its purported service was defective, such that good service could have been effected in time. It was that failure which constituted the deliberate playing of a technical game.
8. As I set out in my judgment, I do not think that the undoubted culpability of Collyer Bristow, in overlooking the fact that Mills & Reeve had not indicated that it had authority to accept service, outweighs Mills & Reeves conduct, in failing to draw Collyer Bristow's attention to its mistake. Had Mills & Reeve acted as it should have done, Collyer Bristow's mistake would not have precluded good service being effected in the lifetime of the Claim Form.
9. For the same reason, I do not think that, in this case, the fact, thatvalidation
will, or may, deprive
Phoenix
of a limitation defence, should preclude
validation.
Had Mills & Reeve acted as it should have done, good service would have been effected in time. In that context,
validation
does no more than to preclude
Phoenix
from procuring a windfall."
"170. In my judgment, the culture introduced by the CPR does not require a solicitor who has in no way contributed to a mistake on the part of his opponent, or his opponent's solicitors, to draw attention to that mistake. That is, in my judgment, not required by CPR 1.3; and it does not amount to 'technical game playing'.
171. Looking first at CPR 1.3. . .
172. None of that, in my judgment, requires the court to impose on a party a duty to inform an opposing party of an error which has been made, even if there is still time for the opposing party to cure that error.
173. I agree with theview
of Judge Pelling that a defendant's solicitors are under no duty to correct errors by the claimant's solicitors even if they know, or suspect, they have been made, at least in a case where they have in no way contributed to those errors. I do not regard Judge Hacon, in Abbott, as taking any different
view.
Judge Hacon prefaced the observations relied upon by the claimants in the present case with the clear acknowledgment that parties to litigation are plainly not obliged to inform the opposing side of its mistakes, in the sense of steps taken, or positions adopted, which appear not to be in that other side's best interests. Each side must look after itself. I accept Judge Hacon's qualification to that general proposition. The overriding objective does require parties to take reasonable steps to ensure, so far as is reasonably possible, that there is a clear, common understanding between them as to the identity of the issues in the litigation, and also as to related matters, including procedural arrangements. But that requires there to have been a genuine misunderstanding that has arisen between the parties regarding a significant matter.
174. In this case, there is no such significant matter to which the defendant or its solicitors had in any way contributed. If one looks at Judge Hacon's recital of the terms of the relevant correspondence, at paragraphs 11 through to 14 of his judgment, one can see quite readily how the judge found that the defendant's solicitor came to consider that his opposite number had wrongly interpreted the offer that had been made to him to extend time for service. At paragraph 38, Judge Hacon recorded that the defendant's solicitor had discussed the uncertainty of what his opposite number had agreed to with the defendant, his client, and a decision had been made to take no steps to clear up any misunderstanding. The present case is different because the defendant and its solicitors had not contributed to the misunderstanding. It was akin to the case considered by Judge Pelling, where the defendants' solicitors had in no way participated in correspondence which had given rise to any misunderstanding. Where the Master, in my judgment, fell into error was in taking theview
that it was incumbent upon a litigator, or his client, to dispel a misunderstanding in circumstances where, as the Master had found at paragraph 91, the mistake had not been of the defendant's making, or that of his solicitors, and had arisen in a situation which did not call for a response."
"194. . . .There is nothing to suggest that Lord Sumption would have taken theview
that, in refusing to authorise its solicitors to do so, the defendant would have been acting in breach of the overriding objective of the Civil Procedure Rules. I accept that there is no reference in Lord Sumption's judgment to CPR 1.3, or to the argument that has been advanced by Mr Penny to this court, and which succeeded before the Master. Nevertheless, I consider it inconceivable that Lord Sumption would have taken the
view
that it was inappropriate for the defendant to have refused to authorise the giving of advice of the kind under consideration if he had regarded it as inconsistent with the defendant's duties under the overriding objective."
Grounds of appeal
Relevant CPR Provisions
"1.3 - Duty of the parties
The parties are required to help the court to further the overriding objective."
It is well known that the overriding objective of the CPR is one of "enabling the court to deal with cases justly and at a proportionate cost" (CPR 1.1(1)) and that dealing with a case justly and at proportionate cost includes, so far as is practicable, the matters set out at CPR 1.1(2) (a) – (f) which include at (b), "saving expense", at (d) "ensuring that the case is dealt with expeditiously and fairly" and at (f) "enforcing compliance with rules, practice directions and orders". Furthermore, CPR 1.2 provides that:
"1.2 - Application by the court of the overriding objective
The court must seek to give effect to the overriding objective when it –
(a) exercises any power given to it by the Rules; or
(b) interprets any rule subject to rules 76.2, 79.2 and 80.2, 82.2 and 88.2."
The court must further the overriding objective by actively managing cases (CPR 1.4(1)) and active case management includes the matters set out at (a) – (l) of CPR 1.4(2). They include at (a) "encouraging the parties to co-operate with each other in the conduct of the proceedings".
"6.15.- Service of the claim form by an alternative method or at an alternative place
"(1) Where it appears to the court that there is a good reason to authorise service by a method or at a place not otherwise permitted by this Part, the court may make an order permitting service by an alternative method or at an alternative place.
(2) On an application under this rule, the court may order that steps already taken to bring the claim form to the attention of the defendant by an alternative method or at an alternative place is good service."
Nature of the exercise to be undertaken by this court
Discussion and Submissions
"8. The Civil Procedure Rules contain a number of provisions empowering the court to waive compliance with procedural conditions or the ordinary consequences of non-compliance. The most significant is to be found in CPR 3.9, which confers a power to relieve a litigant from any "sanctions" imposed for failure to comply with a rule, practice direction or court order. These powers are conferred in wholly general terms, although there is a substantial body of case law on the manner in which they should be exercised: see, in particular, Dentonv
TH White Ltd (De Laval Ltd, Part 20 defendant) (Practice Note) [2014] 1 WLR 3926 (CA), esp at para 40 (Lord Dyson MR and
Vos
LJ), Global Torch Ltd
v
Apex Global Management Ltd (No 2) [2014] 1 WLR 4495 (SC(E)). The short point to be made about them is that there is a disciplinary factor in the decision whether to impose or relieve from sanctions for non-compliance with rules or orders of the court, which has become increasingly significant in recent years with the growing pressure of business in the courts. CPR rule 6.15 is rather different. It is directed specifically to the rules governing service of a claim form. They give rise to special considerations which do not necessarily apply to other formal documents or to other rules or orders of the court. The main difference is that the disciplinary factor is less important. The rules governing service of a claim form do not impose duties, in the sense in which, say, the rules governing the time for the service of evidence, impose a duty. They are simply conditions on which the court will take cognisance of the matter at all. Although the court may dispense with service altogether or make interlocutory orders before it has happened if necessary, as a general rule service of originating process is the act by which the defendant is subjected to the court's jurisdiction.
9. What constitutes "good reason" forvalidating
the non-compliant service of a claim form is essentially a matter of factual evaluation, which does not lend itself to over-analysis or copious citation of authority. This court recently considered the question in Abela
v
Baadarani [2013] 1 WLR 2043. That case was
very
different from the present one. The defendant, who was outside the jurisdiction, had deliberately obstructed service by declining to disclose an address at which service could be effected in accordance with the rules. But the judgment of Lord Clarke of Stone-cum-Ebony JSC, with which the rest of the court agreed, is authority for the following principles of more general application:
(1) The test is whether, "in all the circumstances, there is good reason to order that steps taken to bring the claim form to the attention of the defendant is good service" (para 33).(2) Service has a number of purposes, but the most important is to ensure that the contents of the document are brought to the attention of the person to be served (para 37). This is therefore a "critical factor". However, "the mere fact that the defendant learned of the existence and content of the claim form cannot, without more, constitute a good reason to make an order under rule 6.15(2)" (para 36).(3) The question is whether there is good reason for the Court tovalidate
the mode of service used, not whether the claimant had good reason to choose that mode.
(4) Endorsing theviews
of the editors of Civil Procedure (2013),
vol
i, para 6.15.5, Lord Clarke pointed out that the introduction of a power retrospectively to
validate
the non-compliant service of a claim form was a response to the decision of the Court of Appeal in Elmes
v
Hygrade Food Products plc [2001] EWCA Civ 121; (2001) CP Rep 71 that no such power existed under the rules as they then stood. The object was to open up the possibility that in appropriate cases a claimant may be enabled to escape the consequences for limitation when a claim form expires without having been
validly
served.
10. This is not a complete statement of the principles on which the power under CPR rule 6.15(2) will be exercised. The facts are toovaried
to permit such a thing, and attempts to codify this jurisdiction are liable to ossify it in a way that is probably undesirable. But so far as they go, I see no reason to modify the
view
that this court took on any of these points in Abela
v
Baadarani. Nor have we been invited by the parties to do so. In the generality of cases, the main relevant factors are likely to be (i) whether the claimant has taken reasonable steps to effect service in accordance with the rules and (ii) whether the defendant or his solicitor was aware of the contents of the claim form at the time when it expired, and, I would add, (iii) what if any prejudice the defendant would suffer by the retrospective
validation
of a non-compliant service of the claim form, bearing in mind what he knew about its contents. None of these factors can be regarded as decisive in themselves. The weight to be attached to them will
vary
with all the circumstances."
"22. Mr Elgot repeated before us the submission that he made in the Court of Appeal that Berrymans had been "playing technical games", with his client. However, the sole basis for that submission was that they had taken the point that service was invalid. Since they did nothing before the purported service by e-mail to suggest that they would not take the point, this does nothing to advance his case. After the purported service by e-mail, there is nothing that they could reasonably have been expected to do which could have rectified the position. The claim form expired the next day. Even on the assumption that they realised that service was invalid in time to warn him to re-serve properly or begin a fresh claim within the limitation period, they were under no duty to give him advice of this kind. Nor could they properly have done so without taking their client's instructions and advising them that the result might be to deprive them of a limitation defence. It is hardly conceivable that in those circumstances the client would have authorised it.
23. Naturally, none of this would have mattered if Mr Barton had allowed himself time to rectify any mishap. But having issued the claim form at thevery
end of the limitation period and opted not to have it served by the Court, he then made no attempt to serve it himself until the
very
end of its period of
validity.
A person who courts disaster in this way can have only a
very
limited claim on the court's indulgence in an application under CPR rule 6.15(2). By comparison, the prejudice to Wright Hassall is palpable. They will retrospectively be deprived of an accrued limitation defence if service is
validated.
If Mr Barton had been more diligent, or Berrymans had been in any way responsible for his difficulty, this might not have counted for much. As it is, there is no reason why Mr Barton should be absolved from his errors at Wright Hassall's expense."
"40. In respectful disagreement with Lord Sumption JSC, I do not regard the fact thatvalidation
would deprive the defendant of an accrued limitation defence as a factor militating against
validation
(or for that matter in favour of it). The defendant's solicitors were aware of Mr Barton's attempt to serve them before the expiry of the claim form. The acquisition of a limitation defence would have been, in the words of Simon Brown LJ in the Elmes case (at 13), a windfall."
"The purpose of service of proceedings, quite obviously, is to bring proceedings to the notice of a defendant. It is not about playing technical games. There is no doubt on the evidence that the defendant is fully aware of the proceedings which are sought to be brought against him, of the nature of the claims made against him and of the seriousness of the allegations."
See paras 37 and 38.
Conclusions:
(i) CPR 1.3 and the limitation defence
(ii) Technical game playing
(iii) Good reason - Courting disaster
Lady Justice Nicola Davies:
Lord Justice Bean: