Failure to comply with court directions: claimant only had himself to blame

Amin v Whitechapel Resources Ltd (QBD) Lavender J, 13/7/2017

In this case, the court was required to consider the three stage test set out in Denton v TH White Ltd [2014] EWCA Civ 906, in respect of relief from sanctions. This was not a casualty claim but the same considerations are applied by the courts in all cases where a party seeks relief from sanctions where there has been non-compliance with a court order, rule or practice direction.

The facts

The claimant provided accounting services to the defendant property development company. A dispute arose and a claim was issued for outstanding fees. A defence to the claim was filed and as a result, the claimant solicitors then amended the claim.

The court provided directions for when an amended defence and counterclaim were to be served and for when the claimant was to reply to the amended defence and counterclaim. The defendant served their amended defence and counterclaim in accordance with court directions but the claimant failed to serve a reply and their solicitors came off the court record.

Following the claimant failing to provide disclosure and to serve a witness statement, the defendant warned that judgment would be sought on the counterclaim and that damages would be claimed for breach of contract. Prior to the pre-trial review, the claimant instructed new solicitors and filed a witness statement. The defendant applied for the claim to be struck out and for judgment in default on the counterclaim.

At the hearing of the defendant’s application, the judge noted that the trial window would be lost and the claimant had not made an application for relief from sanctions. Also, it was specifically stated that the claimant had only himself to blame for failing to comply with court directions. As a result, the claim was struck out and judgment in default was awarded on the counterclaim.

The claimant appealed against this decision submitting that the judge had been wrong to decide that the case could not proceed in the trial window. Also, the claimant submitted that the judge should not have commented that the claimant only had himself to blame and failed to properly consider all the circumstances of the case and whether it was proportionate to strike out the claim.

Decision

The High Court held that the judge had been entitled to find that the case could not proceed in the trial window. It was noted that the trial window was only six weeks away and the claimant had provided no disclosure, witness statements or defence to the counterclaim. It was specifically stated that the judge had been entirely justified when observing that the claimant only had himself to blame and had correctly applied the three stage test set out in Denton v TH White Ltd [2014] EWCA Civ 906.

In respect of the first stage, the High Court noted that there had been serious and significant breaches and in relation to the second stage, it was concluded that the claimant had no good reason for the breaches. Whilst, in respect of the third stage, the High Court concluded that the judge had directed himself correctly when considering all the circumstances of the case and had considered whether there were means of getting the case back on track and whether it was proportionate to strike out the claim.

The High Court held that the judge had plainly addressed alternative options and had given reasons for rejecting them. It was concluded that the judge had addressed the correct matters and asked the correct questions. As a result, the claimant’s appeal was dismissed.

What this means for you

This case serves as a reminder of the importance of complying with court orders, rules and practice directions. In the event that there has been a failure to comply then an urgent application should be made for relief from sanctions.

Here, the claimant was in breach of court directions but failed to make an application for relief from sanctions despite there being undue delay and the defendant warning him that they would be looking to strike out the claim and to obtain judgment in default on the counterclaim.

It should be noted that the claimant’s breaches were considered serious and significant and there was no good reason for them. Also, at the time of the hearing the claimant was still not in a position to file and serve his defence to the counterclaim despite the fact that the trial window was only six weeks away.

This case may have been decided differently had the claimant urgently made an application for relief from sanctions when he first became aware that he would not be able to comply with the court’s directions. Also the judge could have possibly been more lenient had the claimant served his reply, disclosure documents and witness evidence prior to the hearing and without further delay.