BACKGROUND

In Caljan Rite-Hite Ltd v Sovex Ltd [2011] EWHC 669 (Ch) Mr Justice Kitchin has given a useful judgment on the requirements for transfer of a case from the High Court of England and Wales to the Patents County Court (PCC) under the PCC’s new procedural rules.  

Caljan Rite-Hite Ltd’s claim was for rectification of the UK trade marks register to substitute Caljan for Sovex Ltd as proprietor of the mark SOVEX. Caljan contended that it was the legal and beneficial owner of the mark, while Sovex denied the claim, saying that it had acquired ownership of the mark in good faith and in ignorance of Caljan’s claim to title.  

Sovex applied to the High Court to have the action transferred to the PCC in order to take advantage of the new procedural regime.

DECISION

Kitchin J noted that the new regime in the PCC is designed for smaller, less complex actions to provide cheaper, speedier and more informal procedures so that small and medium sized enterprises and individuals are not deterred from innovation by the potential costs of litigation to protect their rights.

Key elements of the new regime are

  • Concise statements of case setting out all the facts and arguments, verified by statements of truth
  • No, or limited, disclosure
  • No, or limited additional factual or experts’ evidence
  • Where possible, determination of the claim solely on the basis of the parties’ statements of case and oral submissions
  • Limited cross-examination
  • Trials of no more than two days
  • Scale costs only
  • Costs on liability of no more than £50,000.

Practice Direction 30 of the Civil Procedure Rules sets out what the High Court should consider when deciding whether to order transfer.

The first consideration for Kitchin J was whether a party can only afford to bring or defend a claim in the PCC. Sovex submitted abbreviated accounts showing its poor financial state. However, the evidence (which included a cash injection from its directors and shareholders in 2010) did not establish that Sovex would be unable to defend the proceedings if a transfer was refused.

Kitchin J rejected Caljan’s argument that to impose the new regime on cases that had begun in the High Court before 1 October 2010 when the new rules came into force (as was the case here) would be unfair because a party might already have incurred costs. These are, however, matters that the High Court will consider in deciding whether to transfer, but they provide no basis for concluding that the new procedural regime should not apply.

The other considerations concern the value of the claim, the complexity of the issues and the estimated length of the trial.  

Kitchin J concluded that the issues were not straightforward and that their resolution inevitably would require disclosure, witness statements and cross-examination, with a real prospect of the trial lasting more than two days. Consequently, the Court would not be able to determine the case on the basis of