Article 342 of the new Code of Civil Procedure and “substantial breaches” in the conduct of proceedings: is this the much sought-after rule that will enable the courts to sanction undesirable procedural conduct more easily?
Article 342 of the new Code of Civil Procedure (“C.C.P.”) is new law and addresses “substantial breaches” in the conduct of proceedings:
“342. The court, after hearing the parties, may punish substantial breaches noted in the conduct of the proceeding by ordering a party to pay to another party, as legal costs, an amount that it considers fair and reasonable to cover the professional fees of the other party's lawyer or, if the other party is not represented by a lawyer, to compensate the other party for the time spent on the case and the work involved.” (Our emphasis)
Based on the comments of the Justice Minister, this provision is in line with the prevailing rule regarding sanctions for abuse of procedure, governed by article 54 C.C.P.
There are, however, at least two elements that distinguish article 342 C.C.P. from article 54 C.C.P.
Firstly, under articles 51 and 54 C.C.P. a proceeding may be qualified as abusive and a sanction may be imposed at any time, while under article 342 the proceeding must be essentially completed before noting that such breaches occurred in the conduct of the proceeding.
Secondly, the sanctions under article 54 are imposed following an abuse of procedure, whereas article 342 uses a separate test, that of “substantial breaches” in the conduct of the proceedings.
The legislator does not define the notion of “substantial breach” nor is the scope of the term “substantial” specified. The word “substantial” implies a breach of a certain degree of seriousness. It is, however, logical to believe that this concept cannot be associated with a standard as high as that of abuse of procedure, given that the legislator does not speak in vain. While the substantial breach in the conduct of the proceedings must be serious enough to be sanctioned, it does not have to be serious to the point of being abusive, since sanctions already exist under the abuse of procedure regime to remedy such misconduct.
Although the new C.C.P. has entered into force, there are still no leading cases that define or apply the concept of substantial breach. The courts, however, have issued several comments that offer interesting lines of thought.
For example, failing to timely disclose the grounds for disavowing an expert could constitute a substantial breach in the conduct of the proceedings. Tardiness in filing a motion to amend could also be considered a substantial breach in the conduct of proceedings, and could result in the party having to pay part or all the professional fees of the other party’s lawyer.
At first glance, it seems appropriate to use the notion of “substantial breach” to sanction undesirable procedural discrepancies, while avoiding the often demanding burden of proving an abuse of procedure.
It will be interesting to see how article 342 C.C.P. will be applied by the courts in the coming months.