Conducting litigation in United Kingdom - England & Wales (England & Wales)

Litigation

What is the structure of the civil court system?

The civil court system is made up of a number of courts and tribunals, which range from specialist tribunals such as the employment tribunal, the county courts, through to the High Court, the Court of Appeal and the Supreme Court. A claim will be issued or heard in one of these courts or tribunals depending on the nature, value and status of the claim.

There are approximately 130 county courts (including combined courts), each of which hears cases in certain geographical catchment areas. Cases in the county court will ordinarily be heard where the defendant resides. Money claims with a value up to and including £100,000 and claims for damages for personal injury with a value up to £50,000 must be started in the county court. These thresholds are subject to exceptions (eg, claims falling within a specialist court, which raise questions of public importance, or which are sufficiently complex so as to merit being heard in the High Court). Equitable claims up to a value of £350,000 must also be started in the county court. The above thresholds indicate that parties are encouraged to commence proceedings in lower courts where possible, albeit that complex, high-value litigation is unaffected.

The Civil Procedure Rules (CPR) clarify which county court must hear specialist claims, such as probate, intellectual property and claims in certain insolvency proceedings.

The High Court has three divisions: the Queen’s Bench Division, the Chancery Division and the Family Division.

As of April 2019, there were approximately 73 judges in the Queen’s Bench Division and 15 judges in the Chancery Division. The Family Division consists of 19 High Court judges in addition to the President of the Family Division, who all have exclusive jurisdiction in wardship.

The Queen’s Bench Division deals with most claims in contract and in tort.

The Chancery Division deals with claims involving land, mortgages, execution of trusts, administration of estates, partnerships and deeds, corporate and personal insolvency disputes, companies work, as well as with some contractual claims (there is some overlap with the Queen’s Bench Division in respect of contractual claims).

There are specialist courts within the High Court, including the Commercial Court, the Admiralty Court and the Technology and Construction Court in the Queen’s Bench Division, and the Bankruptcy Court, Companies Court and Patents Court in the Chancery Division.

In addition, in October 2015, a specialist Financial List was created to handle claims related specifically to the financial markets. The objective of the Financial List is to ensure that cases that would benefit from being heard by judges with particular expertise in the financial markets or that raise issues of general importance to the financial markets are dealt with by judges with suitable expertise and experience. A test case scheme was piloted in the Financial List until September 2017. Under this scheme, parties could seek declaratory relief without the need for a cause of action. Now, a claim may be brought on the basis that it raises issues of general importance to the financial markets. Interested parties may intervene in the proceedings. There is also a general rule that parties bear their own costs. Claims in the Financial List may be started in either the Commercial Court or the Chancery Division.

As of July 2017, the Business and Property Courts were launched as an umbrella for the specialist courts and lists of the High Court and some of the work of the Chancery Division, and include, the Technology and Construction Court, the Commercial Court, the Mercantile Court, the Admiralty Court, the Financial List, the Companies and Insolvency Court, the Patents Court, the Intellectual Property and Enterprise Court and the Competition List.

The Civil Division of the Court of Appeal hears appeals from the county courts and from the High Court.

An extensive review of the structure of the civil court system commissioned by the Lord Chief Justice has been undertaken by Lord Justice Briggs and was published in July 2016 (the Briggs Report). The report sets out a number of recommendations to modernise the current system (in particular, to encourage the development of digital systems to transmit and store information and to create easier access to justice for individuals and small businesses) and suggests urgent measures to ease the current workload of the Court of Appeal.

As a result of the Briggs Report, a number of changes to the appeals process came into force on 3 October 2016. These include changes to the route of appeal so that, subject to certain exceptions, appeals from both interim and final decisions in the county court now lie with the High Court instead of the Court of Appeal. More recently, the HM Courts & Tribunals Service (HMCTS) is undergoing a court reform programme scheduled for completion in 2023, which aims to introduce new technology in order make the court system more efficient and accessible to the public. As part of these reforms, it is now possible to apply via HMCTS online services for a divorce, money claim, or appeal to the tax tribunal.

Another of the key suggested changes of the Briggs Report is the creation of an online court that would deal with simple claims up to a value of £25,000. The intention is that this would be a largely automated system that would be used by litigants in person without needing to instruct a lawyer. Whether this will be a separate court, or a branch of the county court remains under discussion.

In November 2015, Electronic Working was introduced at the Royal Courts of Justice at the Rolls Building, London as the Electronic Working Pilot Scheme. The Scheme was amended in November 2017 and extended in April 2018 until 6 April 2020. Also under discussion is the increase of the threshold for issuing a claim in the High Court to £250,000, with a further increase to £500,000 at a later stage, as well as applying this threshold to all types of claims. However, at the time of writing no such changes have been announced.

In March 2019 the first video hearing of an application to set aside a default judgment was held under the Video Hearings Pilot Scheme pursuant to Practice Direction 51V. The pilot scheme under CPR PD 51V commenced in November 2018 and will operate for one year.

The Supreme Court is the final court of appeal. It hears appeals from the Court of Appeal (and in some limited cases directly from the High Court) on points of law of general public importance.

The Judicial Committee of the Privy Council, which consists of the Justices of the Supreme Court and some senior Commonwealth judges, is a final court of appeal for a number of Commonwealth countries, as well as the United Kingdom’s overseas territories, Crown dependencies and military sovereign bases.

What is the role of the judge and the jury in civil proceedings?

Judges are appointed by the Judicial Appointments Commission, an executive, non-departmental public body sponsored by the Ministry of Justice. The application process involves qualifying tests and independent assessment and candidates must meet the eligibility and good character requirements.

A Judicial Diversity Committee was set up in 2013 with the aim of promoting diversity on the bench. The 2018 Judicial Diversity statistics report that 29 per cent of court judges and 46 per cent of tribunal judges are female. Of those judges who declared their ethnicity, the percentage who identify as Black, Asian and Minority Ethnic is 7 per cent in courts, and 11 per cent in tribunals.

Civil cases are generally heard at first instance by a single judge. Exceptions include claims for malicious prosecution, false imprisonment, and exceptionally, if a court so orders, defamation. In these cases, there is a right to trial by jury.

While the introduction of the CPR in 1999 has, to some extent, altered the role of the judge in civil proceedings by encouraging the court to take a more interventionist management role, the civil justice system remains adversarial. Accordingly, the judge’s role during the trial is generally passive rather than inquisitorial. Lord Denning pointed out in Jones v National Coal Board [1957] 2 QB 553 that ‘the judge sits to hear and determine the issues raised by the parties, not to conduct an investigation or examination on behalf of society at large’.

Nevertheless, the case of Kazakhstan Kagazy Plc & Ors v Zhunus (Rev 1) [2015] EWHC 996 (Comm) emphasises the courts’ increased involvement in scrutinising the conduct of parties during proceedings. In that case, Walker J gave guidance on the approach expected from parties to commercial litigation, which included advice that ‘solicitors and counsel should take appropriate steps to conduct the debate, whether in advocacy or in correspondence, in a way which will lower the temperature rather than raise it’.

Judges in England and Wales have a fundamental duty under the English common law doctrine of stare decisis to interpret the law with regard to precedent. In practice, this means that a court should follow previously decided cases that considered similar facts and legal issues, so as to ensure (as far as possible) consistency in the administration of justice.

What are the time limits for bringing civil claims?

Most limitation periods are laid down by the Limitation Act 1980 (as amended). The general rule for claims in contract and in tort is that the claimant has six years from the accrual of the cause of action to commence proceedings. Exceptions include the torts of libel, slander and malicious falsehood for which there is a one-year limitation period. The limitation period for making a personal injury claim is three years.

In contract, the cause of action accrues on the date of the breach of contract, whereas in tort it accrues when the damage occurs (unless the tort is actionable without proof of damage).

The limitation period for a claim under a deed is 12 years from the breach of an obligation contained in the deed.

Usually, if the limitation period for a claim has expired, the defendant will have a complete defence to the claim. However, where any fact relevant to the claim has been deliberately concealed by the defendant, or where an action is based on the alleged fraud of the defendant, the limitation period does not commence until the concealment or fraud is actually discovered, or could have been discovered with reasonable diligence.

Are there any pre-action considerations the parties should take into account?

The parties must consider the potential impact of their behaviour at the pre-action stage of any dispute, and consider at an early stage which of the rules governing pre-action conduct apply to the prospective legal claim under consideration.

They should comply with the relevant pre-action protocol or, where a pre-action protocol is silent on the relevant issue or there is no specific pre-action protocol for the type of claim being pursued, a party should follow directions in the Practice Direction on Pre-action Conduct and Protocols (PDPACP). There are potentially serious consequences of failing to comply with the PDPACP, including significant costs penalties.

Pre-action protocols outline the steps that parties should take to seek information about a prospective legal claim and to provide such information to each other. The purpose of pre-action protocols is to encourage an early and full exchange of information about prospective claims, and to enable parties to consider using a form of alternative dispute resolution (ADR), narrowing down or settling claims prior to commencement of legal proceedings. They also support the efficient management of proceedings where litigation cannot be avoided.

There are currently 15 protocols specific to certain types of proceedings; for example, construction and engineering disputes, professional negligence claims and defamation actions. As a general rule, the parties should consider carefully which protocol is most applicable to their proceedings. The Pre-Action Protocols are routinely updated to reflect best practice and are supplemented, from time to time, by pilot schemes or other similar provisional proceedings.

During pre-action exchanges, parties are typically provided with information about each other, which may amount to ‘personal data’ for the purposes of the General Data Protection Regulation (EU) 2016/679 (GDPR). Parties should be aware of their obligations under the GDPR in this regard, and seek appropriate counsel where necessary. In cases not covered by any approved protocol, the PDPACP provides general guidance as to exchange of information before starting the proceedings. Although the PDPACP is not mandatory and only states what the parties should do unless circumstances make it inappropriate, parties will be required to explain any non-compliance to the court, and the court can always take into account the parties’ conduct in the pre-action period when giving case management directions and when making orders as to costs and interest on sums due. The PDPACP typically applies to all types of claim save for a few limited exceptions.

Prior to the commencement of proceedings, a prospective party may apply to the court for disclosure of documents by a person who is likely to be a party to those proceedings.

An extra weapon in the claimant’s armoury is the Norwich Pharmacal order. Such order can be sought where the claimant has a cause of action but does not know the identity of the person who should be named as the defendant. In such circumstances, the court may order a third party who has been involved in the wrongdoing, even if innocently, to disclose the identity of potential defendants or to provide other information to assist the claimant in bringing the claim.

How are civil proceedings commenced? How and when are the parties to the proceedings notified of their commencement? Do the courts have the capacity to handle their caseload?

Proceedings are commenced by the issue of a claim form, which is lodged with the court by the claimant and served on the other party (see below).

There are various prescribed versions of the claim form, depending on the types of claim being issued. The claim form provides details of the amount that the claimant expects to recover, full details of the parties and full details of the claim, which may be set out either in the claim form itself or in a separate document called the particulars of claim. The claim form and particulars of claim must be verified by a statement of truth, which is a statement that the party submitting the document believes the facts stated in it to be true.

Claimants must take care that the particulars of claim comply with the CPR and with court guidelines as they may be otherwise subject to an adverse costs order, or, if they are found to be sufficiently irrelevant, incomplete or in breach of the rules, struck out (Ventra Investments Ltd (In Liquidation) v Bank of Scotland Plc [2017] EWHC 199 (Comm)).

A fee is payable, on submission of the claim form, which varies based on the value of the claim. For claims above £10,000, the court fee is based on 5 per cent of the value of the claim in specified money cases (subject to a maximum of £10,000). Claims exceeding £200,000 or for an unspecified sum are subject to a fee of £10,000. In certain circumstances, court fees can be reduced for persons who fulfil the relevant financial criteria, such as those with a low income or low savings. Court fees may also be slightly reduced for the online submission of a claim form, applicable for any money claims up to a value of £100,000.

As of 25 April 2017, issuing claims and filing documents in the Chancery Division, Commercial Court, Technology and Construction Court, Mercantile Court and Admiralty Court (the Rolls Building Courts) is only possible through the online filing system, CE-File. As of 20 April 2019 it is mandatory for all professional users issuing claims in the Business and Property Courts regardless of location. However, online issuing and filing is optional for claims in the Queen’s Bench Division in London from January 2019. Under the courts’ CE-Filing system, parties can file documents at court, including claim forms, online 24 hours a day, every day. For a claim form to be ‘served’ on the defendant, a claimant must take steps as required by the rules of the court to bring the documents within the relevant person’s attention. Service is effected via a number of methods, depending on the location of the defendants. Defendants domiciled in England and Wales will normally be served via post (but other methods of service, such as service upon a defendant in person, are available). A recent Supreme Court case (Barton v Wright Hassall LLP [2018] UKSC 12) serves as a reminder to prospective claimants to follow the rules on service set out in the CPR. In that case, the Court of Appeal refused to validate service by email on the basis that the fact that the claim had been effectively brought to the notice of the defendants was not sufficient reason to validate. The Supreme Court upheld the Court of Appeal’s decision.

A claim form must be served within four months of filing if it is to be served within the jurisdiction and six months if it is to be served outside the jurisdiction.

Defendants domiciled in the EU will normally be served by way of the EU Service Regulation (1393/2007), which provides a mechanism whereby the English courts sanction a form of registered postal service within the EU. Certain formal requirements (such as translation of the claim documents) must be complied with when using this method of service.

It is unclear what the effect of the UK’s withdrawal from the European Union will be on the service of claim forms within the EU. However, it is clear that during the designated transition period, the effect of the withdrawal agreement will be that the EU Service Regulation will continue to apply. The Service of Documents and Taking of Evidence in Civil and Commercial Matters (Revocation and Saving Provisions) (EU Exit) Regulations 2018 (Regulations) were laid before Parliament on 30 November 2018 and state that the EU Service Regulation will be revoked on the day the UK ceases to be a member of the EU. On 13 February 2019, the draft Civil Procedure Rules 1998 (Amendment) (EU Exit) Regulations 2019 were published and provide that changes will be made to the CPR governing the service of documents outside the jurisdiction. Where a defendant is domiciled outside the EU, a claimant may be required to obtain permission from the court to serve the claim outside of the jurisdiction, after which a claimant must follow the rules of service laid down by applicable conflict of laws rules (eg, the Hague Convention).

Court permission to serve proceedings outside the jurisdiction is not required in certain circumstances, including where, although neither of the parties are domiciled in England and Wales, they have agreed to the jurisdiction of the English courts (whether exclusively or not). Permission is also not required where proceedings involving the same cause of action have already been commenced in another member state, but the parties have agreed to an exclusive English jurisdiction clause. These rules are set out in Regulation (EU) No. 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters (Brussels Regulation (Recast)) and the CPR. Similarly, these rules will be affected by Brexit. On 4 January 2019, the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 were introduced, which will, in the event of a no-deal Brexit, revoke the Brussels Regulation (Recast) and amend the legislation implementing into domestic law various agreements relating to the jurisdiction of the English courts. The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 will come into force on the day the UK ceases to be a member of the EU, unless otherwise deferred, amended or revoked. On several occasions, it has been held that service of court documents via social media platforms, such as Twitter or Facebook, is acceptable, as long as certain requirements are fulfilled (such as the claimants showing that they have attempted service by more conventional means, or that there was good reason for them not doing so).

The courts, and in particular the Court of Appeal have been experiencing capacity issues that have had an impact their ability to list disputes in a timely manner. This issue has been addressed in the Briggs Report, which recommends, among other things, the creation of an online court for low value claims and an increased focus on ADR (see question 1).

What is the typical procedure and timetable for a civil claim?

If the defendant wishes to dispute the claim, he or she must serve a defence. In most cases (though the timetables differ between different courts), the defendant has at least 28 days from service of the particulars of claim to serve his or her defence, as long as an acknowledgement of service is filed within 14 days after service of the particulars of claim.

The timetable for service of a defence may be extended by agreement between the parties or, where the court agrees to such extension, following application by the defendant.

The court will allocate the case to either the small claims track, the fast track or the multitrack depending on various factors, including the financial value and complexity of the issues in the case. The court may allocate the case before or at the first case management conference (CMC).

The CMC enables the court to consider the issues in dispute and how the case should proceed through the courts. At the CMC, the court makes directions as to the steps to be taken up to trial, including the exchange of evidence (documentary disclosure, witness statements and expert reports). The court will fix the trial date or the period in which the trial is to take place as soon as is practicable.

Cases can come to trial as quickly as six months from issue of the claim form. Often, however, complicated cases, such as those with an international aspect or of high value will be given a trial date or ‘window’ that is typically up to two years after the CMC.

Following a successful pilot scheme in the Rolls Building Courts, the Shorter Trial Scheme became permanent in the business and property courts nationwide from 1 October 2018. Under this scheme, suitable cases are expected to reach trial within approximately eight months following the CMC, and have judgment handed down within six weeks after conclusion of the trial. The maximum length of the trial is four days including time set aside for the judge to read into the materials. The scheme is designed for cases that do not require extensive disclosure or witness or expert evidence. Under the Shorter Trial Scheme, the costs management provisions of the CPR do not apply and an abbreviated, issue-based, approach is taken towards disclosure with no requirement for parties to volunteer adverse documents for inspection.

The Flexible Trial Scheme has also become a permanent fixture within the business and property courts, with parties being able to adapt procedures by agreement to suit their particular case and proceedings.

The aim of both pilot schemes is to achieve shorter and earlier trials for commercial litigation, at a reasonable and proportionate cost.

Can the parties control the procedure and the timetable?

Under the CPR, responsibility for case management belongs largely to the court and the judge enjoys considerable powers, including control over the issues on which evidence is permitted and the way in which evidence is to be put before the court.

Nevertheless, there is some scope for the parties to vary by agreement the directions given by the court, provided that such variation does not affect any key dates in the process (such as the date of the pre-trial review or the trial itself). In certain business disputes, the parties also have the option of bringing proceedings under the Flexible Trials Scheme (see question 6) which allows the parties to adapt various procedures by agreement.

The CPR impose a duty on parties to assist the court in active case management of their dispute.

Compliance with rules and sanctions for non-compliance

Following the Jackson Reforms, it is extremely important to comply with all rules and orders the court prescribes as any errors and oversights will not be easily overlooked, and it may be difficult to obtain relief from sanctions imposed for non-compliance.

The Court of Appeal decision in Mitchell v News Group Newspapers Ltd [2013] EWCA Civ 1537 was the high point in the court’s tough new approach to granting relief from sanctions, with parties being refused relief for minor procedural breaches.

However, the test was set out by the Court of Appeal the following year in the leading case of Denton v TH White Ltd [2014] EWCA Civ 906. Under this three-stage test, the court will consider the seriousness of the failure to comply, why the default occurred, and will evaluate all the circumstances of the case to enable the court to deal justly with the application for relief. The underlying rationale behind the restatement of this test was to reinforce the understanding among litigants that the courts will be less tolerant of unjustifiable delays and breaches of court orders.

Although the courts continue to take a strict approach when deciding whether to grant relief from sanctions, parties will most likely not be allowed to take their opponents to court for minor procedural breaches. The court will not refuse relief from sanctions simply as a punitive measure (Altomart Limited v Salford Estates (No. 2) Limited [2014] EWCA Civ 1408).

Nevertheless, strict adherence to the timetable is required by all parties, lest the court impose costs sanctions. The High Court decision in Kaneria v Kaneria [2014] EWHC 1165 (Ch) (as applied recently in Peak Hotels and Resorts Ltd v Tarek Investments Ltd [2015] EWHC 2886 (Ch)) has clarified that an extension will not be granted simply because it was requested. The Court of Appeal has further clarified that it will not readily interfere with a first instance order imposed in respect of non-compliance with court orders or time limits, time extensions and relief from sanctions, where the first instance judge has made that order having exercised their discretion in relation to a case management decision (The Commissioner of the Police of the Metropolis v Abdulle and others [2015] EWCA Civ 1260).

However, under the CPR, parties have the flexibility to agree short time extensions in certain circumstances without needing to seek court approval, provided they do not impact on any hearing date.

Significant or tactical delays will not be tolerated. Notable examples include the High Court judgment in Avanesov v Shymkentpivo [2015] EWHC 394 (Comm) and the Court of Appeal judgment in Denton v White.

Parties should also be cautious when attempting to take advantage of the other party’s breach. In Viridor Waste Management v Veolia Environmental Services [2015] EWHC 2321 (Comm), a defendant refused to consent to an extension of time for service of the particulars of claim (which had been brought to the attention of the defendant but had not been properly served) where a new claim would have been time-barred. The court penalised the defendant in indemnity costs for seeking to take advantage of the claimant’s mistake.

Lastly, amendments to the CPR in force as of 6 April 2017 provide that a claim or counterclaim is liable to be struck out if the trial fee is not paid on time.

Costs management

The CPR also imposes various costs management rules to promote effective case management at a proportionate cost. Parties to all multitrack cases valued under £10 million, for example, are required to comply with additional rules, in particular the preparation of a costs budget. However, cost management rules do not apply to proceedings under the Shorter Trials Scheme unless agreed to between the parties and subject to permission by the court.

Any party that fails to file a budget in time will be treated as having filed a budget in respect of applicable court fees only, unless the court orders otherwise, restricting the party’s ability to recover costs in the event of a successful outcome. In the recent case of BMCE Bank International plc v Phoenix Commodities PVT Ltd and another [2018] EWCH 3380 (Comm), the court confirmed that failure to file a costs budget is a serious and significant breach for which there has to be very good reason. In this case the claimant’s solicitors filed the costs budget two weeks late and without explanation on the morning of the CMC, and when questioned by the judge, it was determined that the partner with conduct of the claimant’s claim had been abroad on business. The court found that this was not a good enough reason to consider granting relief.

For cases valued at £10 million or more, the court may exercise discretion as to whether a costs budget is required. The parties can also apply for an order requiring costs budgets to be served (see Sharp v Blank [2015] EWHC 2685 (Ch)).

From 6 April 2016, budgets for claims worth £50,000 or more should be filed no later than 21 days before the first CMC pursuant to CPR 3.13(1)(b).Where the claim is for less than £50,000, the budgets must be filed and served with the parties’ directions questionnaire (pursuant to CPR 3.13(1)(a)). There will also be a requirement to file ‘budget discussion reports’ that indicate what is agreed and disagreed in terms of proposed budgeted figures, no later than seven days before the first CMC.

Under costs management rules, parties must exchange budgets and come to an agreement on them. However, it should be noted that budgets may nevertheless be scrutinised by the court to ensure they are proportionate and reasonable.

In CIP Properties (AIPT) Ltd v Galliford Try Infrastructure Ltd and others [2015] EWHC 481, the judge reduced a claimant’s budget by over 50 per cent on the basis that it was not reasonable, proportionate or reliable. In addition, the claimant was criticised for including too many assumptions and caveats in its budget as this was deemed to be calculated to provide maximum room to manoeuvre at a later stage. Advisers should therefore be aware of the importance of filing accurate and proportionate budgets in view of the court’s wide costs management powers.

Recent cases have suggested that a costs budget of about half the amount of the claim is proportionate (see, for example, Group Seven Ltd v Nasir and others [2016] EWHC 520 (Ch), although the judge in that case made clear that there is no mathematical relationship between the amount of the claim and the costs incurred when it comes to deciding what is proportionate).

Parties should also approach the preparation of a costs budget carefully as current case law is not consistent as to whether retrospective permission to revise the budget will be granted. Revision of a budget because of an error is extremely difficult.

Evidence - Disclosure Pilot Scheme

From 1 January 2019, the business and property courts introduced a mandatory Disclosure Pilot Scheme (DPS) (subject to limited exceptions) pursuant to Practice Direction 51U (PD 51U). The pilot scheme will operate in business and property courts in Birmingham, Bristol, Cardiff, Leeds, Liverpool, London, Manchester and Newcastle and will have a significant impact on the disclosure process within civil proceedings and the overall case management (see below).

Under the DPS it appears that it is still necessary for parties to comply with requirements under the Practice Direction - Pre-Action Conduct and Protocols or any relevant specific pre-action protocol that may apply. However, the DPS also introduces important steps that parties must take before proceedings have commenced, and establishes certain duties owed by the parties to the court, referred to as the Disclosure Duties. The Disclosure Duties are continuing duties that last until the conclusion of the proceedings, and include ensuring that parties take all relevant steps to preserve documents within their control that may be relevant to any issue in these proceedings and undertaking to search for documents in a responsible and conscientious manner to fulfil the purpose of such a search. Disclosure Duties also apply to the parties’ solicitors, whose duties include, among other things, taking reasonable steps to preserve documents within their control that may be relevant to any issue in proceedings.

Under the DPS, parties are required to take reasonable steps to preserve documents in their control that may be relevant to any issue in proceedings as well as providing specific detail on what is required in terms of document preservation. Such requirements include an obligation to send a written notification in any form to all relevant employees and former employees that identifies documents or classes of documents to be preserved and notifying the recipient that they should not delete or destroy documents. There is also a requirement for each party’s legal representatives to notify their clients of the need to preserve documents, and obtain written confirmation from their clients that they have discharged their obligations under the DPS with regard to document preservation.

The DPS also introduces the concept of Initial Disclosure, which involves each party providing to all other parties an Initial Disclosure List of Documents. The list is to be provided simultaneously with the statement of case, and will list the key documents on which a party has relied, and that are necessary to enable the other parties to understand the claim or defence that they have to meet. There are several circumstances where Initial Disclosure is not required, most notably when the parties request Extended Disclosure.

Extended Disclosure may be used in situations where the court is persuaded that it is appropriate to fairly resolve one or more of the Issues for Disclosure as identified by the parties. Extended Disclosure involves five ‘Models’ of disclosure. The Models range from an order for no disclosure to the widest form of disclosure (requiring production of documents that may lead to a train of enquiry).

A further aspect of the DPS is the replacement of the Electronic Documents Questionnaire in its current form by a ‘Disclosure Review Document’ (DRD). Parties should complete a joint DRD to list the main issues for the purposes of disclosure, exchange proposals for ‘Extended Disclosure’, and share information about where and how documents are kept. The parties are required to complete a DRD prior to the CMC (see below) which lists all Issues for Disclosure to be decided in the proceedings and decides which of the five Models for Extended Disclosure is appropriate to achieve a fair determination of those issues.

Is there a duty to preserve documents and other evidence pending trial? Must parties share relevant documents (including those unhelpful to their case)?

As discussed above, the DPS is now in operation and governs the disclosure process for any proceedings commenced in the business and property courts on or after 1 January 2019. For disclosure in any proceedings in any other court (or proceedings commenced prior to 1 January 2019), the existing CPR provisions remain in force.

The CPR provides that as soon as litigation is contemplated, the parties’ legal representatives must notify their clients of the need to preserve disclosable documents. ‘Document’ is widely defined by the CPR as ‘anything in which information of any description is recorded’, which includes electronic communications and metadata. Accordingly, it is very important that parties consider document retention and new document creation carefully from the outset. The process of disclosure allows the parties to formally state which specific documents or more generally which types of documents exist or have existed.

Once an obligation to disclose documents has arisen, the party has an obligation to disclose all relevant documents (both paper and electronic). This is an ongoing obligation until the proceedings are concluded; therefore, if a document that should be disclosed comes to a party’s notice during the proceedings, he or she must notify the other party.

If a document is destroyed during the course of proceedings, or even when litigation is in reasonable prospect, the court may draw adverse inferences from this fact. For cases participating in the DPS, parties are now under an express duty to preserve documentation.

Although the CPR includes a ‘menu’ of disclosure options, in practice the usual order made by the court is for standard disclosure. This requires a party to carry out a reasonable search for documents and disclose all the documents on which the party relies, or which adversely affect its own case, adversely affect another party’s case, or support another party’s case.

A party’s duty of disclosure is limited to documents that are or have been in its ‘control’, which includes documents that a party has a right to possess or to inspect. For cases that are proceeding under the DPS, a party’s duty of disclosure is defined under the Disclosure Duties and the Model for disclosure chosen pursuant to the Disclosure Review Document.

A party to whom a document has been disclosed has a right to inspect that document except where the document is no longer in the control of the party who disclosed it, or where that party has a right or a duty to withhold inspection of it (eg, if the document is privileged), or where it would be disproportionate to permit inspection of the particular category of documents. Inspection is a separate procedural step to disclosure and is the process by which the party who has disclosed a document allows the other parties to view the originals or provide copies of any documents disclosed.

A ‘disclosure report’ must be filed and served by the parties not less than 14 days before the first CMC. The disclosure report must be verified by a statement of truth and must contain information regarding the nature of the documents to be disclosed, their whereabouts and estimates of the costs involved in giving standard disclosure (including electronic disclosure). For cases that are proceeding under the DPS, the disclosure report is replaced by the Disclosure Review Document.

There is also a requirement that the parties convene, at a meeting or by telephone, at least seven days prior to the first CMC to seek to agree a disclosure proposal. For cases that are proceeding under the DPS, the parties should attempt to reach agreement on the appropriate Model of Disclosure to decide each Issue prior to the filing of the Disclosure Review Document, which should take place not less than five days before the CMC.

The CPR give the courts significant powers over the conduct of the disclosure process. For example, under CPR 31.5 the court has flexibility to reduce the scope of disclosure to ensure proportionality and generally further the overriding objective of dealing with cases justly and at a proportionate cost. Extensive disclosure is limited both in the Shorter Trial and the Flexible Trial Schemes (discussed above).

The court also has the power to impose alternatives to the standard disclosure process. For example, the court may order wider-ranging disclosure of documents (likely to be rare) or dispense with disclosure altogether (only likely to be appropriate in the most straightforward cases). Ultimately, the court can make any order for disclosure it considers appropriate.

Are any documents privileged? Would advice from an in-house lawyer (whether local or foreign) also be privileged?

The disclosing party may withhold documents protected by legal privilege from inspection by the other party or the court.

Legal professional privilege covers two principal categories: legal advice privilege and litigation privilege.

Legal advice privilege attaches to confidential communications between a client and his or her lawyer for the purpose of giving and receiving legal advice.

This includes advice from foreign and in-house lawyers, provided that they are legally qualified (eg, not accountants providing tax law advice), and are acting as lawyers and not as employees or executives performing a business role.

Only communications with the ‘client’ are protected, and the meaning of ‘client’ has been construed narrowly in an important case in which communications between a lawyer and some employees of the client company were held to fall outside legal advice privilege. This decision has been criticised by practitioners as being unduly narrow, and has been rejected in the Hong Kong Court of Appeal. In England and Wales, the narrow approach remains binding and has been confirmed in Re RBS (Rights Issue Litigation) [2016] EWHC 3161 (Ch).

The privilege is not limited to advice regarding a party’s rights and obligations, but extends to advice as to what should prudently and sensibly be done in the relevant legal context.

In 2015, the High Court took a wide approach to legal advice privilege, by confirming that elements of documents that do not ordinarily attract privilege will nevertheless be privileged if it can be shown that they formed part of the ‘necessary exchange of information’ between lawyer and client, the object of which was giving legal advice as and when appropriate (Property Alliance Group Ltd v Royal Bank of Scotland Plc [2015] EWHC 3187 (Ch)).

Litigation privilege attaches to communications between client and lawyer or between either of them and a third party if they came into existence for the dominant purpose of giving or receiving legal advice or collecting evidence for use in litigation. The litigation must be pending or in reasonable contemplation of the communicating parties.

However, legal professional privilege will be negated by an abuse of the normal solicitor-client relationship under the ‘iniquity principle’ (ie, when communications are made for wrongful, that is, fraudulent, purposes). In JSC BTA Bank v Ablyazov [2014] EWHC 2788 (Comm), the iniquity caused by the litigant’s concealment and deceit in relation to his or her assets put the advice outside the normal scope of professional engagement and justified an order for disclosure of documents that would otherwise have attracted legal professional privilege.

Legal professional privilege had been in a relative state of flux following a controversial High Court decision by Andrews J in the case of Director of the Serious Fraud Office v Eurasian Natural Resource Corporation Ltd [2017] EWHC 1017 QB (ENRC). The High Court decision in that case narrowed considerably the scope of legal professional privilege in the circumstances of internal investigations in finding that documents created during the course of an internal investigation prior to the commencement of criminal proceedings by the Serious Fraud Office (SFO) were not privileged and should be made available for inspection. On appeal, the Court of Appeal overturned the High Court’s decision concluding that litigation privilege did apply to the documents in question, as they had been created by ENRC for the dominant purpose of resisting or avoiding criminal proceedings. The court held that businesses need to be able to investigate possible wrongdoing without the fear of creating material that may potentially incriminate them in later proceedings (once the investigation has concluded).

Prior to the Court of Appeal decision, Andrews J’s determination on litigation privilege in the High Court was regarded as controversial, and was not accepted in the subsequent case of Bilta (UK) Ltd (In Liquidation) v Royal Bank of Scotland [2017] EWHC 3535 (Ch). In his judgment, Sir Geoffrey Vos, Chancellor of the High Court, distinguished that case from ENRC on its facts. He appeared to reject the proposition that documents created to try and settle the litigation, and for the purpose of being shown to the other side, could never attract litigation privilege.

There are other grounds of privilege, including in respect of documents that:

• contain ‘without prejudice’ communications between the parties, intended to resolve the dispute;
• pass between a party to legal proceedings and a third party where both parties share a common interest in the proceedings (for instance, third-party litigation funders);
• pass between co-parties to legal proceedings;
• would tend to incriminate a party criminally; or
• would be adverse to the public interest.

Do parties exchange written evidence from witnesses and experts prior to trial?

Parties must exchange written statements of evidence prior to trial. Ordinarily, at the CMC, the court gives directions regarding the exchange of written witness statements and experts’ reports, including the number of expert reports that each party is entitled to rely on as evidence, the subject matter that should properly be considered in expert evidence, and the date by which parties should file any relevant witness and expert evidence.

If a witness statement is not served within the time specified by the court, the witness may not be called to give oral evidence at trial unless the court gives permission.

Where the parties wish to rely on expert evidence on a particular issue, the courts have the power to appoint a single joint expert. The single joint expert will be instructed to prepare a report for evidence on behalf of two or more of the parties instead of each party appointing their own expert witnesses.

Similarly, a party who fails to apply to the court to rely on an expert’s report will require the court’s permission to call the expert to give evidence orally or use the report at trial. This is likely to have adverse cost consequences for the party that failed to seek the permission of the court at the CMC.

The courts have express powers to identify or limit the issues for witness evidence, identify which witnesses may give evidence and limit the length of witness statements. In addition, parties seeking permission for expert evidence to be adduced will have to identify the issues the evidence will address and provide a cost estimate. The court may also cause the recovery of experts’ costs to be limited, in accordance with the emphasis on proportionate cost pursuant to the overriding objective.

How is evidence presented at trial? Do witnesses and experts give oral evidence?

Factual and expert witnesses are generally called to give oral evidence at trial.

Their written statements will normally stand as evidence-in-chief, so the witness does not need to provide oral evidence on the matters set out in their statement. However, a witness who provides any oral evidence has the opportunity, if granted the court’s permission, to amplify his or her witness statement and give evidence relating to new matters that have arisen following service of the witness statement on the other parties. The opposing party can cross-examine the witness, following which the party calling the witness has the opportunity to re-examine that witness. The witness may also be asked questions by the judge.

At the trial, the judge may also allow both parties’ experts’ evidence to be heard together (ie, ‘concurrent expert evidence’, also known as ‘hot-tubbing’) by way of a judge-led process, although in practice this has not been readily embraced by the courts. Revised provisions governing the procedure for hot-tubbing came into force on 22 November 2017. Among other changes, these provisions permit the court to set an agenda for hearing expert evidence, which may be on an issue-by-issue basis.

A party may rely on a witness statement of fact at trial even where a witness is not subsequently called to give oral evidence. The relevant party must inform the opposing parties, who may apply to the court for permission to call the witness for cross-examination. Where a party fails to call a witness to give oral evidence, the court is likely to attach less weight to his or her statement and in certain circumstances may draw adverse inferences from the witness’s failure to give oral evidence.

What interim remedies are available?

The court has wide powers to grant the parties various interim remedies including interim injunctions, freezing injunctions, search orders, specific disclosure and payments into court. Interim remedies are governed by CPR Part 25.

Interim measures are often used to prevent the dissipation of assets or evidence, and usually English courts will only make orders relating to property within the jurisdiction. However, in exceptional circumstances, the English court will make a worldwide freezing injunction if the respondent is unlikely to have sufficient assets within the jurisdiction to cover the applicant’s claim. The English court may also grant interim relief (typically in the form of freezing injunctions) in aid of legal proceedings anywhere in the world.

When seeking a freezing injunction (or indeed, any interim remedy) on a without notice basis, applicants must comply with the duty of full and frank disclosure. This duty requires that all material issues must be presented to the court in a full and fair matter, including those issues that are adverse or detrimental to the applicant’s position or interests. In the recent case of Fundo Soberano de Angola & ors v. Jose Filomena dos Santos & ors [2018] EWHC 2199 (Comm), the English High Court confirmed that the duty of full and frank disclosure is a serious and onerous obligation that applies to applicants and their legal advisers alike who, together, must make the fullest inquiry into the central elements of their case. Parties should consider this duty very carefully before making any interim application on a without-notice basis.

On 17 July 2014, the European Account Preservation Order (EAPO) Regulation entered into force, creating a new procedure under which a creditor is entitled to apply to a member state’s national court to freeze monies in any EU bank account held by a debtor, up to the value of its debt. The provisions are applicable in participating member states as of 18 January 2017.

The UK decided to opt out of the EAPO Regulation, meaning that courts of England and Wales will not issue EAPOs, and bank accounts held in the jurisdiction will not be subject to EAPOs from other EU member states. Nonetheless, a UK entity’s accounts held in any of the 26 participating member states will be subject to the EAPO Regulation, and therefore may be frozen. The effect of Brexit on the EAPO Regulation and the role of the Regulation in civil proceedings in England and Wales following Brexit remains to be seen.

What substantive remedies are available?

Common remedies awarded by the courts are damages (the object of which is to compensate the claimant, rather than to punish the defendant), declarations, injunctions (mandatory or prohibitory), specific performance (a form of mandatory injunction), and orders for the sale, mortgaging, exchange or partition of land. Punitive damages, aiming to punish the defendant, may be available in very limited circumstances, for instance in cases involving oppressive action or deliberate torts. Interest may be payable on pecuniary awards.

What means of enforcement are available?

Once a judgment has been obtained from a court in civil proceedings in England and Wales, the judgment can be enforced in a variety of ways. If the judgment is for a payment of a sum of money and the debtor has assets that can be easily obtained and sold for value, the court can issue a writ or warrant of control to command an enforcement officer to take control of and sell the debtor’s goods.

A third-party debt order can be obtained and operates to prevent funds reaching the debtor from a third party by redirecting them to the credit instead.

The court can enforce a charging order that imposes a charge over the debtor’s interest in any land, securities or funds. This usually acts to prevent the debtor from selling any land with a charge over it without first satisfying the creditor. This is most effective when the debtor is the sole owner of any applicable assets.

An attachment of earnings can be employed by the court, which would order that a proportion of the income of the debtor be deducted like a tax from the debtor’s salary by the employer and paid to the creditor until any relevant debt is satisfied. Alternatively, a creditor can employ a variety of insolvency procedures such as a bankruptcy or winding-up order.

Are court hearings held in public? Are court documents available to the public?

The general rule is that hearings take place in public. However, the court can order that a hearing (or part of it) be held in private in some circumstances, such as where the court considers it necessary ‘in the interests of justice’ (for example, where notice to the other party would defeat the purpose of the application, such as applications for urgent freezing injunctions). The court can also order a hearing to be heard in private if the hearing involves matters relating to matters of national security.

Non-parties can obtain any statement of case filed after 2 October 2006 without permission of the court or notification to the parties.

Statements of case include the claim form, the particulars of claim, the defence, the reply to the defence, and any further information given in relation to any of them, but not documents aimed at confining the issues. The meaning of ‘statement of case’ in this context was examined in Various Claimants v News Group Newspapers Ltd [2012] EWHC 397 (Ch), in which the judge distinguished between a particulars of claim (which constitutes a statement of case), and a notice to admit and the response to such notice (neither of which constitutes a statement of case). Accordingly, it was held that a third party was not entitled to copies of the notice to admit nor the response under CPR 5.4C(1).

Permission of the court may be sought to obtain copies of other documents or court records on the court file. Documents attached to a statement of case, witness statements, expert reports, skeleton arguments, notices to admit and response and correspondence between the parties and the court can be obtained by non-parties if the court grants permission. However, in Cape Intermediate Holdings Ltd v Dring (Asbestos Victims Support Group) [2018] EWCA Civ 1795, the Court of Appeal confirmed that the definition of ‘court records’ is narrow in scope. Although it is worth considering that in R (on the application of British American Tobacco (UK) Ltd) v Secretary of State for Health [2018] EWHC 3586 (Admin) the court emphasised that the court should exercise its power presumptively in favour of disclosure.

A party can also apply for an order restricting a non-party from obtaining a copy of a statement of case, but any such order is confined to statements of case.

Copies of judgments and orders made in public are available without permission of the court. Supreme Court hearings, and legal arguments and the delivery of the final judgment in Court of Appeal hearings, are allowed to be broadcast live. The Supreme Court has a live streaming service, and an on-demand archive of past hearings that can be viewed online.

In addition, as of 6 April 2016, skeleton arguments (anonymised in family proceedings) are provided to accredited reporters in cases being heard in the Court of Appeal.

Does the court have power to order costs?

Generally, the unsuccessful party will be required to pay the costs of the successful party. However, the court has wide discretion to order which party costs are payable by, the amount of those costs and when they are to be paid. Even where costs are reasonably or necessarily incurred, if they are deemed disproportionate then the court may nevertheless disallow them. CPR Part 44 details the general costs rules that apply in civil proceedings in England and Wales.

In determining the way in which it makes costs orders, the court will have regard to all circumstances, and specifically the conduct of the parties before and during the proceedings, as well as any efforts made before and during the proceedings to resolve the dispute.

In particular, the courts allow parties to make certain pre-trial settlement offers that are expressly taken into account in relation to costs at any subsequent trial, namely, where the settlement offers are rejected. These rules are set out in Part 36 CPR.

Where a defendant makes a ‘Part 36 offer’ that is rejected, if the claimant does no better at trial, the claimant will generally not recover its costs after the period within which it was possible to accept the Part 36 offer (known as the ‘relevant period’), and will be liable to pay the costs incurred by the defendant after the relevant period, and interest on those costs.

If a claimant makes a Part 36 offer that is rejected, and the claimant succeeds either in obtaining an amount equivalent to or better than the Part 36 offer, the claimant is entitled to an enhanced-costs award (that is, a higher rate of recovery, plus interest on both costs and damages up to 10 per cent above the base rate). In addition, the court can impose an additional penalty on the defendant, requiring an additional payment of damages up to a maximum of £75,000.

Once the court has made an order as to costs, the general rule is that the amount to be paid will be determined by an assessment process unless an amount is agreed to by the parties. The assessment process can be either on a summary or detailed basis. Summary assessment requires the parties to focus on the cost of proceedings as they progress, with the aim of increasing settlement chances if the parties are aware of the ongoing costs of litigation. Detailed assessment usually takes place after an order for costs is made and thus involves an assessment of costs at the conclusion of proceedings. In relation to hearings that last no more than one day (and cases allocated to the fast track) the general rule (as set out in Practice Direction 44 9.2) is that a summary assessment should occur at the conclusion of the hearing unless there is good reason not to do so.

Subject to the points above, when it comes to making a costs order the court will stipulate an assessment of the successful party’s costs on either the ‘standard’ or ‘indemnity’ basis:

• on the standard basis, the court will examine whether the costs were reasonable and reasonably incurred, as well as proportionate to the matters at issue; whereas
• on the indemnity basis, the court resolves any doubt it has regarding disproportionate costs in favour of the successful party, which results in a higher award to the successful party.

However, the court will not allow costs that have been unreasonably incurred.

A claimant may be required to provide security for the defendants’ costs for several reasons. The most common grounds for obtaining an order for security for costs are where:

• the claimant is ordinarily resident out of the jurisdiction; or
• the claimant is a limited company and there is reason to believe that it will be unable to pay the defendants’ costs if ordered to do so.

In each case, the court must be satisfied that it is just to make an order for security for costs. There are many factors that the court may consider, such as whether ordering security would unfairly stifle a genuine claim. When considering whether to refuse to order security on such ground, the court must also be satisfied that, in all the circumstances, it is probable that the claim would be stifled (Pannone LLP v Aardvark Digital Ltd [2013] EWHC 686 (Ch)).

It is important to note, generally, that a party’s conduct in litigation will be considered carefully by the court when exercising its discretion to award costs in line with the Denton principles (see question 7).

Additionally, from 6 April 2017 the court may record on the face of any case management order any comments it has about the incurred costs that are to be taken into account in any subsequent assessment proceedings.

However, in the Financial List test case scheme (see question 1), a test case proceeds on the basis that each party bears its own costs.

Are ‘no win, no fee’ agreements, or other types of contingency or conditional fee arrangements between lawyers and their clients, available to parties? May parties bring proceedings using third-party funding? If so, may the third party take a share of any proceeds of the claim? May a party to litigation share its risk with a third party?

English law permits conditional fee agreements (CFAs) in relation to civil litigation matters, whereby a solicitor’s fees (or part of them) are payable only in specified circumstances. Usually, the solicitor receives a lower payment or no payment if the case is unsuccessful, but a normal or higher than normal payment if the client is successful.

However, for CFAs to be enforceable, certain formalities must be observed. The success fee must represent a percentage uplift of fees charged (rather than a percentage of damages secured), and such uplift cannot exceed 100 per cent of the normal rate. These agreements are becoming less unusual in commercial cases.

One reason conditional fee arrangements are still relatively rare in complex commercial cases is the difficulty in defining the concept of ‘success’ to incorporate an outcome other than simply winning the case.

The success fee element of the party’s costs is not recoverable from the losing party subject to limited exceptions (eg, in cases where the CFA was entered into before 1 April 2013, in insolvency-related proceedings where the CFA was entered into before 6 April 2016, and in publication and privacy proceedings where the CFA was entered into before 6 April 2019). As of 6 April 2016, success fees are no longer recoverable in insolvency-related cases and as of 6 April 2019, success fees are no longer recoverable in publication and privacy proceedings.

A third party may fund litigation in return for a share of the proceeds of the claim, if successful. If the claim fails, the third party may be liable for the successful defendant’s legal costs. Such agreements are upheld provided that they are not contrary to public policy. The common law principles of champerty and maintenance must also be considered when third party litigation funding is used, for fear of ‘sullying the purity of justice’.

The case law in this area is developing, and there is still scope for uncertainty. Excalibur Ventures LLC v Texas Keystone Inc and others [2016] EWCA Civ 1144 is a notable case in which the Court of Appeal upheld the lower court’s decision ordering the third-party funders to pay costs on the indemnity basis.

In the recent case of Montpelier Business Reorganisation v Armitage Jones [2017] EWHC 2273 (QB), the court ordered a third-party costs order against the 50 per cent shareholder of an insolvent claimant. As the claimant was unable to meet its costs liability, the order was granted on the basis that the shareholder had funded the litigation with a non-arms-length loan, had clearly exercised control over the litigation and stood to gain had the claimant been successful. The court’s willingness to make third-party funders liable for the conduct of funded parties could have consequences for the funding market; funders are likely to be more careful as to whom they choose to fund, and the cost of such funding is likely to increase.

In addition to investing in a claimant’s case, third parties may also invest in litigation by way of a payment from a defendant in exchange for taking on a share of the financial risk (both in respect of the claim and legal costs). This type of arrangement, in our experience, is very rare, and developments will be monitored with interest. It is only likely to feature in high-value litigation in which a defendant prefers to make a payment to an investor to reduce its overall litigation risk. Such arrangements may offer significant investment opportunities to professional funders in an industry that continues to evolve.

Lawyers may enter arrangements involving a success fee that is directly attributable to the amount of damages recovered by the client (a contingency fee). These arrangements are known as damages-based agreements (DBAs) and are regulated.

The recovery of the contingency fee is dependent on both the success of the claim and the recovery of sums awarded from the defendant. The solicitor’s legal fees are only paid in the event of ‘success’ (as defined in the DBA), and not during the case.

A DBA must not provide for a payment inclusive of VAT that is more than 25 per cent of the relevant sums recovered in personal injury cases, 35 per cent in employment matters and 50 per cent of the sums ultimately covered in all other civil litigation cases. These caps are only applicable to proceedings at first instance and the figures are a percentage of the amount actually received by the successful party, not a percentage of any order or agreement to pay.

Successful parties should be able to claim from the losing party some or all of their costs on the conventional basis, but must not exceed the DBA fee itself. The successful client will use the recovered costs and damages to discharge the DBA (or part thereof). It is noteworthy that DBAs have come under significant criticism from both the Bar Council and the Law Society, and very few solicitors are entering into DBAs.

In November 2014, the government announced that it did not intend to make any adjustment to the DBA regulations to expressly permit hybrid DBAs (where additional forms of litigation funding can be coupled with a DBA to fund a case), to discourage litigation behaviour based on a low-risk, high returns approach.

The government is currently in the process of drafting a new set of DBA regulations. In the meantime, the Law Society has suspended work on a model DBA and it advises that, until the DBA regulations are amended, care should be taken when entering these agreements. The Law Society has also published information which indicates that barristers are not prepared to risk entering into a damages-based agreement even if the case is deserving, leading to questions regarding access to justice in civil proceedings in England and Wales.

Is insurance available to cover all or part of a party’s legal costs?

Insurance is available for litigation costs. There are two types of legal expenses insurance policies:

• before the event policies - such policies are typically taken out with an annual premium and provide cover for some or all of the client’s potential costs liabilities in any future disputes. They are not usually relevant to major commercial litigation; and
• after the event (ATE) policies - such policies typically cover a party’s disbursements (such as counsel and expert fees) and the risk of paying an opponent’s legal fees if the insured is unsuccessful in the litigation.

ATE policies may cover the insured’s own legal expenses, although this is less common.

If an ATE insurance policy is entered into on or after 1 April 2013, the insurance premiums will no longer be recoverable from the losing party. There are limited exceptions to this rule for claims involving insolvency (provided the policy was taken out before 6 April 2016), publication and privacy proceedings, and personal injury related to mesothelioma.

Additionally, ATE insurance premiums are no longer recoverable from the other side in insolvency proceedings if the insurance policy was entered into on or after 6 April 2016.

In publication and privacy proceedings, the recoverability of ATE insurance was expected to be abolished but these plans have subsequently been delayed indefinitely. In December 2018, the government announced that it was abandoning plans set out in its 2013 costs consultation and instead the recoverability of ATE insurance premiums will remain.

In mesothelioma claims, the recoverability of ATE insurance has also been delayed until a review of the likely effect of any abolition of recoverability of premiums has been carried out.

The legality of the recoverability of CFAs and ATE premiums pre-April 2013 has been tested in the Supreme Court case of Coventry v Lawrence [2015] UKSC 50. In that case, the Supreme Court was asked to decide whether the pre-April 2013 recoverability of ATE premiums and success fees was incompatible with human rights, specifically the right to a fair trial under article 6 of the European Convention on Human Rights. The Supreme Court decided it was not incompatible, thus preventing an estimated potential 10 million appeals out of time.

May litigants with similar claims bring a form of collective redress? In what circumstances is this permitted?

Class actions are most commonly brought in personal injury, negligence, product liability, competition and consumer disputes, but now increasingly so in commercial cases. In recent years, there has been a marked increase in interest in class action litigation in England and Wales.

There are several mechanisms for pursuing collective redress:

• representative actions - where a claim is brought by or against one or more persons as representatives of any others who have the ‘same interest’ in the claim;
• group litigation orders (GLO) - the court can make a GLO under CPR 19 where a number of claims give rise to ‘common or related issues of fact or law’;
• representative damages actions for breach of competition law; and
• collective actions - claims that can ‘conveniently’ be addressed in the same proceedings by being brought jointly, being consolidated, or having one or a small number of claims run as a ‘test case’, which can then be used to resolve similar claims.

These collective action mechanisms are generally conducted on an opt-in basis, which means that individual claimants must elect to take part in the litigation. Currently, there is no direct equivalent in England and Wales to the US opt-out model of class action. However, litigation funding continues to attract a high profile.

In addition, the Consumer Rights Act, the main provisions of which came into force on 1 October 2015 (and which came fully into effect in October 2016), allows for collective proceedings to be brought before the Competition Appeal Tribunal (CAT) for redress of anticompetitive behaviour, including both opt-in and opt-out. The opt-out collective action regime allows competition claims to be brought on behalf of a defined set of claimants except those who have opted out, albeit that third-party funders are barred from bringing collective actions.

Since competition collective actions have been permitted, there had previously not been a claim certified as suitable to proceed. In Dorothy Gibson v Pride Mobility Products [2017] CAT 9, an application was withdrawn following an unfavourable judgment rendering any possible class too small. However, in April 2019, the Court of Appeal revived a £14 billion proposed class action lawsuit against Mastercard (heard at first instance as Merricks v Mastercard Inc [2017] CAT 16), which was brought following a 2007 decision by the European Commission that multilateral interchange fees charged between banks in relation to Mastercard transactions involved a breach of EU competition law. The case will now be referred to the Competition and Appeals Tribunal, who will decide whether to certify the consumers’ claim before the proposed class action can proceed to trial. If the case does proceed to trial, then it will be one of the first cases to be filed using the class action regime in England and Wales.

The issue of collective redress is continuing to attract interest and controversy. Businesses in the UK continue to be concerned about the new opt-out collective actions for alleged breaches of consumer or competition law, especially as the class action market is likely to continue to increase over the coming years.

On what grounds and in what circumstances can the parties appeal? Is there a right of further appeal?

An unsuccessful party may appeal from the County Court to the High Court, from the High Court to the Court of Appeal, and from the Court of Appeal to the Supreme Court (as applicable). Permission to appeal generally must be obtained either from the lower court at the hearing at which the decision to be appealed was made, or from the relevant appeal court provided time limits are adhered to. In instances involving appeal to the Supreme Court, an appellant may apply directly to the Supreme Court for permission to appeal if permission is refused from the Court of Appeal.

For permission to be given, the appeal must have a real prospect of success, or there must be another compelling reason for the appeal to be heard. The Civil Procedure Rule Committee (CPRC) decided to increase the threshold for permission to appeal to the Court of Appeal, so as to require a ‘substantial prospect of success’. However, that decision was rescinded at the March 2017 CPRC meeting and it was agreed that no further action be taken.

The appeal court will not allow an appeal unless it considers that the decision of the lower court was wrong in law, or was unjust because of a serious procedural or other irregularity in the proceedings.

One of the key areas of concern highlighted by the Briggs Report is the workload of the Court of Appeal, which has increased dramatically over the past six years. Following the recommendations of the Briggs Report for easing the burden on the Court of Appeal, the Access to Justice Act 1999 (Destination of Appeals) Order 2016 changed the routes of appeal so that, subject to some exceptions, appeals from both interim and final decisions in the County Court will lie to the High Court instead of the Court of Appeal.

What procedures exist for recognition and enforcement of foreign judgments?

The procedure necessary to recognise and enforce a foreign judgment in England and Wales depends on the arrangements made with the foreign country in question. Examples of these arrangements include the Brussels Regulation (Recast) and the Hague Convention on Choice of Court Agreements (which came into force on 1 October 2015). The enforcement of judgments that are not subject to relevant arrangements is governed by common law.

As of 10 January 2015, the CPR have been amended in line with the Brussels Regulation (Recast) (see also question 5) to remove requirements for a declaration of enforceability when enforcing a judgment from a court of another EU member state.

The procedure for making an ‘adaptation order’, whereby a legal remedy contained in a foreign judgment but unknown to the law of England and Wales may be adapted, for the purposes of enforcement, to a remedy known in English law, has also been included.

As discussed above, to address uncertainty over the future applicability of the Brussels Regulation (Recast) and other EU legislation following Brexit, the Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations 2019 were introduced by Parliament in March 2019. The Regulations will, in the event of a no-deal Brexit, revoke the Brussels Regulation (Recast) and amend the legislation implementing various agreements into domestic law relating to the jurisdiction of the English courts. The Civil Jurisdiction and Judgments (Amendment) (EU Exit) Regulations will come into force on exit day, unless otherwise deferred, amended or revoked.

Are there any procedures for obtaining oral or documentary evidence for use in civil proceedings in other jurisdictions?

Where a witness located in England and Wales refuses to provide evidence for use in civil proceedings in another jurisdiction, the parties may request that the English courts grant an order requiring production of the evidence. The procedure for obtaining such an order differs depending on the jurisdiction in which the proceedings are taking place:

• requests for evidence for use in EU member states (except Denmark) are processed according to EC Regulation No. 1206/2001 of 28 May 2001. The procedure under the Regulation is highly centralised and permits the transmission of requests for evidence directly between designated courts in each EU member state (except Denmark); and
• requests for evidence for use in all other jurisdictions are processed according to the Evidence (Proceedings in Other Jurisdictions) Act 1975, which gives effect to the Hague Convention of 1970 on the taking of evidence. An application must be accompanied by evidence and a letter of request from a court in the jurisdiction of the proceedings. The letter of request is submitted either to an agent in this country (usually a solicitor) or the senior master of the Supreme Court, Queen’s Bench Division. The solicitor or Treasury Solicitor (as applicable) will make the application to the High Court for an order giving effect to the letter of request.

English law applies to the granting (or refusal) and enforcement of the request.