England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(Mr Justice Gray)

		Royal Courts of Justice Strand London WC2 Thursday, 15th November 2001

1. LORD JUSTICE PILL: This is an appeal against an order of Gray J made on 19th January 2001. The judge refused to remove a stay which, by operation of the rules, had operated upon a claim for damages made by Mr. Peter John Moon, the appellant, against Kent County Council and Geoffrey Malcolm Waters, the respondents. The claim is for malicious prosecution. The writ was issued on 29th October 1992.
2. The appellant had been charged before the Crown Court with an offence of false accounting. An important witness in that prosecution was Mr. Waters, an employee of the respondent Council. At the conclusion of Mr. Waters' evidence before the Maidstone Crown Court the judge directed the jury to enter verdicts of not guilty on all counts against the appellant. That was on 13th July 1998. There was therefore a substantial delay before the writ in these proceedings was issued but the proceedings were commenced well within the limitation period. Reasons have been offered as to why the delay occurred. All that that passage of time means, as Mr. Suttle, counsel for the appellant, accepts is that when a claim is commenced late it increases the onus upon the claimant to pursue his claim with reasonable speed.
3. In January 1993 the respondents sought to strike out the claim and succeeded before a Deputy High Court judge. The appellant appealed against that finding. The hearing before this court was deferred because of the relevance of a case before the House of Lords. In the event, on 15th February 1996 the Court of Appeal allowed the appellant's appeal, reinstated the claim, and at the instance of the appellant's counsel gave directions as to the future conduct of the claim. Unfortunately those directions were not complied with, either by the appellant or by the defendants. The failure to comply was striking. There was, for example, a delay of over two years on the appellant's behalf, between April 1996 and June 1998, before a list of documents was served, and there was a delay of well over three years, between May 1996 and September 1999, before the appellant's witness statement was served. It has been submitted on the appellant's behalf by Mr. Suttle that, notwithstanding the long passage of time, there was progress, albeit at what counsel described as a deplorably slow rate.
4. The automatic stay eventually applied because the case had not been brought before a judge for a period of one year. It operated on 25th April 2000 and it was on the following day, the 26th April, that the court issued a notice of hearing by way of a case management conference. That turned, first, into an application to remove the stay. It was that application which Gray J refused in January 2001. There is also before the court an application to re-amend the statement of claim. That of course arises only if the appellant is successful in having the stay removed. The hearing before the judge was of full length and all relevant matters were considered. It is submitted on the appellant's behalf that the judge was fundamentally mistaken in holding that the matter could not fairly be tried. It is further submitted that in all the circumstances it would not be fair if the defendants escaped altogether from this claim.
5. During the hearing before the judge, an offer was made not to pursue the claim by way of special damage. Counsel, upon a consideration at the hearing of the material available, felt obliged to concede that the claim for special damage could no longer be pursued on the ground that it could not fairly be tried.
6. A judge has a broad discretion in matters of striking out. This court will intervene only if the judge has plainly misdirected himself upon the Civil Procedure Rules or upon the material before the court he has reached a conclusion which, in the view of this court, is not tenable. The judgment is a detailed one. It is a careful judgment, and it appears to me that the burden upon the appellant in seeking to have it reversed is a heavy one. I can see no misunderstanding by the judge of the Civil Procedure Rules or of their effect or any misunderstanding by him of the material before the court.
7. I deal with specific points made by Mr. Suttle on the appellant's behalf, having first referred to the case of Biguzzi v Rank Leisure Plc to which counsel has referred us. Mr. Suttle has referred to cases decided before the Civil Procedure Rules came into effect, such as Choraria v Sethia [1998] CLC 625, in which this court was finding its way towards a procedure whereby claims could be struck out for abuse of process when prejudice to the defendant had not been established. In Biguzzi v Rank Leisure PLC [1999] 1 WLR 1296 this court, Lord Woolf MR presiding, gave guidance as to the approach to be followed when issues such as the present issue were before it under the CPR. Lord Woolf stated at page 1933, and I refer to a part of the passage with the statement of principle:

"Under rule 3.4.(2)(c) a judge has an unqualified discretion to strike out a case such as this where there has been a failure to comply with a rule. The fact that a judge has that power does not mean that in applying the overriding objectives the initial approach will be to strike out the statement of case. The advantage of the CPR over the previous rules is that the court's powers are much broader than they were. In many cases there will be alternatives which enable a case to be dealt with justly without taking the draconian step of striking the case out.

Under the court's duty to manage cases, delays such as have occurred in this case, should, it is hoped, no longer happen. The court's management powers should ensure that this does not occur. But if the court exercises those powers with circumspection, it is also essential that parties do not disregard timetables laid down. If they do so, then the court must make sure that the default does not go unmarked. If the court were to ignore delays which occur, then undoubtedly there will be a return to the previous culture of regarding time limits as being unimportant."

8. Lord Woolf then went on to consider the alternative ways in which the court can make it clear that courts will not tolerate delays. He added that:

"The courts are not confined to considering the relative positions of the parties. They have to take into account the effect of what has happened on the administration of justice generally. That involves taking into acccount the effect of the court's ability to hear other cases if such defaults are allowed to occur. It will also involve taking into account the need for the courts to show by their conduct that they will not tolerate the parties not complying with dates for the reasons I have indicated."

9. Mr. Suttle has also referred to the decision of this court in Khalili v Bennett [2000] EMLR 996, in which Hale LJ stated at paragraph 46:

"But the overriding principle is justice. . . . It may, therefore, no longer always be appropriate for defendants to sit back and wait for the claimant to do nothing when there are several steps that they themselves could have taken to have the matter disposed of earlier."

10. In my judgment, the judge in this case has analysed, clearly and in a way which I find entirely acceptable, the delays which occurred, the responsibility for them and their relevance to the issue before him. He concentrated, rightly in my judgment, upon the delays which occurred following the directions given by the Court of Appeal in February of 1996. I do not regard the defaults by the defendants which occurred in this case as casting doubt upon the entitlement of the judge to take the decision he did. The judge concluded at page 13:

"Mr. Suttle observes that the defendants were equally delinquent. I accept that to the extent that there was no unilateral service by the defendants of their documents or their witness statements. However, it does not appear to me that in any positive sense the defendants contributed to the delay. In those circumstances I find myself driven to the conclusion that there was in this case a wholesale and total disregard by the claimant of the Rules of Court and of the directions given by the Court of Appeal against a background where the case cried out for expeditious handling by reason of the delay which had already occurred."

11. The judge nevertheless went on to consider whether there could be a fair trial of the action and treated that as a discrete matter which had to be satisfied if the stay were not to be removed. The judge stated at page 15A:

"But, on the authorities, delay, however excessive, is not enough in itself to warrant the dismissal or stay of an action. It is necessary for me to be satisfied that there resulted an inability for there to be a fair trial of the action."

12. Before commenting on that statement, I refer to the points made before this court by Mr. Suttle in his attempt to challenge that finding. His detailed argument has attached weight to the existence of two documents at B332 and 338, which were disclosed by the respondents only late in 1998 and were not inspected on behalf of the claimant until early 1999. It is partly in reliance on those documents that the appellant seeks to re-amend the statement of claim. It was first submitted that it was only the late disclosure of those documents which permitted the claim as now framed to be put. The claimant should not be struck out when it was only when he had had an opportunity to consider those documents that the case could properly be framed. The first of the documents is a note dated 8th April 1987 following discussions between representatives of the County Council and the police:

"The police are still pursuing the charges but the onus is on us [that is the Council] to produce watertight evidence if the case is to go to court. This will require going through the weigh bills in fine detail to remove any doubt about their accuracy."

13. The second document is dated 20th May 1987 and is a note to the County Treasurer, headed "suspected irregularity Trident Passenger Limited". That was a company with which the appellant was closely involved. The note included these sentences:

"In brief Audit believe that the evidence strongly suggests intended fraud. The police are considering a charge of false accounting. The total amount overclaimed is believed to be £261. Small though this is, Highways are anxious to push for a prosecution as they do not want Trident to re-emerge perhaps as a new company and to have to be considered for further contracts as the law requires."

14. Upon analysis, the impact of those documents is very substantially less than that first contended on behalf of the appellant. The first document reveals what is a common state of affairs, that even though it is the police who bring a prosecution, they are entirely reliant upon evidence, both oral and documentary, which comes from witnesses other than police witnesses. That is commonplace.
15. The second document provides nothing more than a belief of fraud on behalf of Trident Passenger Services, a belief which, it must be said, was found in the criminal court to be entirely unjustified. The last sentence of the passage to which I have referred is, however, no more than a statement of the obvious. It was accepted that Mr. Waters was doing his best on behalf of his employers. Doing that might involve protecting them, if he believed that there was fraud by Trident Passenger Limited, from having further contracts with that company. When the matter was explored with Mr Suttle he conceded, and rightly so in my judgment, that he could not suggest that these documents altered the nature of the appellant's case against the respondents. It is clear that the basis of the case was well known to the claimant long before those documents were disclosed and no fresh case was created by those documents. That is clear from the judgment of McCowan LJ, allowing the appeal against the striking out by the Deputy Judge, when he stated at page 16 of the transcript:

"The essence of the case pleaded against Mr Walters is that he made deliberately false charges against the appellant. . . . In my judgment there is evidence in what Mr. Walters did and said and in particular in the revelation which he made for the first time at the trial of the appellant from which he could have reasonably concluded that he had deliberately made a false claim against the appellant."

16. McCowan LJ went on to state that Mr. Walters' motives may have been no more than to impress his employers with his keenness and efficiency in their cause.
17. In that context the late disclosure of the two documents relied on cannot, in my judgment, be a relevant factor in the decision which now has to be taken. Mr. Suttle did make the point that the documents suggest that the earlier attempt to strike out had been on a false basis. I do not see merit in that submission for the reasons I have given, having considered the documents. I am satisfied that they can have no bearing upon the outcome of this appeal.
18. What does emerge from the judgment of McCowan LJ is that, in the view of the court on that occasion, the appellant has what Mr. Suttle describes as a good arguable case. I also approach the present appeal on the basis that, if he were to succeed, it is arguable that total damages would be substantial. That is not accepted by Mr. Blackford on behalf of the respondents.
19. However, Mr. Blackford has indicated that he is prepared for the case to be dealt with on the basis on which the judge decided it. It was because the special damage claim was only withdrawn at a late stage that the judge did not consider the argument that the claim was only a small one. It was only by way of respondent's notice that the point was taken that once the special damage claim disappeared the claim was a modest one. I am prepared to approach the present appeal on the basis that, by reason of the possibility of damages, including aggravated and exemplary damages, the application should be considered on the basis that the claim has a substantial potential value.
20. As to the question of prejudice, Mr. Suttle submits, first, that the respondents have never claimed that they are prejudiced by the delay. Second, he submits that the material is all in documents which have been known to the defendants, and other witnesses they may wish to call, for many years. It is submitted that, in the circumstances of this case, there is no prejudice to the respondents and that there can be a fair trial of the action. The judge's findings on this issue were these:

"I have nevertheless come to the conclusion that the delay which has occurred is such that it is no longer possible to have a fair trial of the issues which arise and that in all the circumstances it would be unfair to permit this action to go to trial.

There are two main reasons for this conclusion. Firstly, at the heart of the case lies the allegation of malice against Mr Walters and against other officers of the defendant local authority. The case is pleaded in the following way in the re-amended statement of claim at paragraph 15."

21. The judge understandably set out an allegation based on the lately disclosed documents to which I have referred, though it is clear that other points were made. The judge continued:

"That is an exceedingly grave charge to level against Mr. Walters and his colleagues. I ask myself if it is fair to Mr. Walters and to the defendants that a judge should be asked to determine, 14 years after the event, the state of mind and motivation of Mr Walters and his colleagues. Whilst I accept that extant documents will demonstrate what calculations were and were not done, I do not believe that it would be possible to have a fair determination of questions, such as why Mr Walters did what he did and what his intentions and state of mind at that time were. It may be, in addition, that there will be difficulty in determining, so long after the event, who was in reality the prosecutor, given the role played by the claimant's partner, Mr Edgecombe, and indeed by the police themselves, but that is a subsidiary consideration."

22. [Mr. Suttle placed reliance, as he was entitled to do, on the first of the documents to which I have referred, upon the question of who the prosecutor was.]
23. Upon the facts of this case I find that reasoning of the judge wholly persuasive. It appears to me that he applied the correct test, considered the appropriate evidence and reached a conclusion which he was entitled to reach.
24. The judge went on to deal with the second main reason, which was that a fair trial is no longer possible. In relation to the claim for special damages, that is now conceded, so that that basis for the finding to that extent disappears. Mr. Suttle seeks to rely upon the offered withdrawal of that part of the claim to demonstrate, by reference to Biguzzi, that this is a case where there need not be a strike out and where the stay can be removed. There is an alternative approach. The claim for special damages is withdrawn but the claim for general damages may proceed. I do not regard that reasoning as sound in the circumstances of this case. If it is just to strike out the action as a whole, it does not become unjust to strike out what remains of it. The fact that a part of the action is already withdrawn does not make the ground on which it was struck out any less forceful in this case.
25. Before concluding my judgment, I should refer to the suggestion, made on the appellant's behalf, that his solicitor was let down by the court, or that the failure to have the matter before a judge before the deadline had passed was due to the inefficiency of the court. I readily accept the difficulties of the claimant's solicitor who, we are told, is a sole practitioner and who was a new solicitor who had not been in the matter throughout and who had problems in ensuring that his client had legal aid. The judge was minded to accept that there was an element of misfortune in the way that the claim was not brought before a judge before the deadline expired. I would not be disposed to put it any more strictly against the solicitor or the appellant, but refer to the matter only because of the rather strong suggestion made that in some way officers of the court have caused or contributed to the misfortune.
26. An application to the court should not have been left until the last minute. It was pursued shortly before Easter. One of the relevant letters was sent on the Monday of the week leading up to Easter. It is a truncated week and the last week of term. I accept for present purposes (this appears from attendance notes) that comments could have been made by a court officer to the appellant's solicitors. That did not in the circumstances of this case relieve the appellant's solicitor, acting either personally or by means of a London agent, from ensuring that during that week the matter was brought before a judge. Subject to the supervision of the court, it is for the parties and their solicitors to manage litigation. I do not accept, on the material placed before us, that in this case there has been any relevant let down or inefficiency on the part of court officials who are and can be expected to be extremely busy, especially during the last week of term. They cannot be expected to make arrangements which ought to be made by the parties or their solicitors.
27. There were substantial delays in this case. The judge emphasised those which followed the judgment of the Court of Appeal. Then there is that between April 1999 and April 2000. There is no satisfactory explanation as to why steps were not taken in the action. The judge's conclusion, which I have read, was, in my judgment, entirely justified upon the evidence. The evidence falls far short of persuading me that this is one of those cases where it can be said that the conclusion of the judge is one with which this court should interfere.
28. I add only this reservation. It should not be assumed to be the case that, whatever conduct there has been on the part of a litigant by way of ignoring orders of the court or failing to comply with them, there is inevitably an additional duty upon a party seeking to uphold a stay or to strike out an action to prove prejudice or that there could not be a fair trial. It is right to say that the doing of justice is at the heart of decisions in this part of the law, as in all parts of the law. It appears to me to follow, both on the formulation of the rules, including rule 3.9, and from what Lord Woolf MR stated in Biguzzi, that there will be cases in which, in the interests of justice, a claim should be struck out (or a stay not removed) for failure to comply with court orders. Whether in this case the judge would have been entitled to strike out on that ground alone does not arise. He was entitled to strike out, having considered the history of the matter in considerable detail and with fairness and clarity, and he was entitled to refuse to remove the stay on the basis that he did. For those reasons I would dismiss the appeal.
29. LORD JUSTICE ROBERT WALKER: I agree. In his written and oral submissions Mr. Suttle has skilfully and determinedly put forward all that could possibly be argued in support of the appeal. The appellant may have been unfortunate in some respects, but he has failed to show any serious error in the judge's approach to the exercise of his discretion under the Civil Procedure Rules. I attach very little importance to the judge's admitted error on the point about a split trial and the abandonment of the claim for special damage. The judge correctly referred to and was guided by rule 3(9) of the Civil Procedure Rules. So we ought not to interfere with the judge's view. As Lord Woolf MR said in Biguzzi v Rank Leisure plc [1999] 1 WLR 1926, 1934, speaking of the new Civil Procedure Rules:

"Under that approach judges have to be trusted to exercise the wide discretions which they have fairly and justly in all the circumstances, while recognizing their responsibility to litigants in general not to allow the same defaults to occur in the future as have occurred in the past. When judges seek to do that, it is important that this court should not interfere unless judges can be shown to have exercised their powers in some way which contravenes the relevant principle".

30. I would therefore dismiss the appeal.
31. MR. JUSTICE LADDIE: I agree.
Order: Appeal dismissed; section 11 order made.