England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE MANCHESTER COUNTY COURT
(His Honour Judge Holman)

		Royal Courts of Justice Strand London WC2 Thursday, 22nd November 2001

1. LORD JUSTICE LATHAM: I will ask Lord Justice Kay to give the first judgment.
2. LORD JUSTICE KAY: This appeal relates to an action in the Manchester County Court in which the claimant seeks damages for personal injuries arising out of a road traffic accident. Judgment was entered for damages to be assessed as long ago as 14th February 1992. On 28th November 2000 His Honour Judge Holman made an order striking out the claimant's claim for special damages. On 19th February 2001 the judge refused, without an oral hearing, an application for relief from sanctions pursuant to Part 3.9 of the CPR and refused to rectify administrative defects pursuant to Part 3.10 of the CPR. The claimant now appeals against the orders of both 28th November 2000 and 19th February 2001, with permission from Lord Justice Laws.
3. The accident giving rise to this action happened as long ago as 11th February 1988. The applicant promptly, on 2nd March 1988, consulted the first set of solicitors in a chain that he has subsequently instructed. No writ was issued until 24th January 1991, when the three-year limitation period had all but elapsed. Judgment in default of defence was signed on 14th February 1992. Thus from that date the only issue was one of quantum.
4. The injuries suffered by the claimant were serious and included a fracture to his back and posterior ligament damage in the region of the fourth and fifth vertebrae of his cervical spine. The claimant has been left with permanent disability and is at a severe disadvantage on the open labour market. Treatment for the spinal condition was ongoing. In February 1996 he underwent surgery to his cervical spine. Counsel for the claimant in his skeleton argument says of this operation that it happened "as recently as February 1996". That the description "recently" can be used in relation to events now more than five years ago highlights the approach that the Woolf reforms hoped to eradicate.
5. It is said on behalf of the claimant that during the early part of 2000 the medical position appeared to have become settled and that accordingly his solicitor obtained a final medical report, which was served on the defendant, as was a schedule of special damage totalling approximately £175,000. On 21st February 2000 the defendants indicated that they wished to have the claimant re-examined by their consultant. This was not arranged immediately and it was not until 27th June that they indicated that their consultant had been instructed to carry out the re-examination. In the meantime, no step had been taken in the proceedings between 26th April 1999 and 25th April 2000, which had resulted in the matter coming before a judge.
6. In consequence of paragraph 19(1) of the practice direction supplementing Part 51 of the CPR the action was automatically stayed. The claimant's solicitor in his statement acknowledges that this failure was a result of an oversight on his part. On 25th May 2000 the claimant made an application under paragraph 19(2) for the stay to be lifted. The application was supported simply by the evidence contained in Part C of the application notice. No detailed statement was served explaining the failure to take any step during the relevant 12-month period, nor did the facts as they appeared on the application notice deal with that period.
7. On 23rd June 2000 District Judge Fairclough considered the case on the papers. As a result, he made an order in the following terms: "The matter be listed for hearing to be dealt with by way of telephone conference."
8. Then he went on to specify the date and time for that to take place.
9. One of the issues that has been raised before us is whether or not that in some way amounted to the district judge removing the stay. That, I am satisfied, cannot be the position. What the district judge was providing was that the matter before him, which was the application to remove the stay, should be heard by way of telephone conference. Although a telephone conference is not a term referred to in the Rules, the practice direction to Part 23 at 6.1 contains the provision:

"The court may order that an application or part of an application be dealt with by a telephone hearing."

10. It seems clear to me that that is exactly what the district judge was ordering, whether it was appropriate or not: namely, that this application should be dealt with by way of a telephone hearing, and that would of course use what are commonly known as telephone conferencing facilities. It therefore seems to me clear that neither expressly nor by implication was he in any way purporting to deal with the application. It is quite clear from the practice direction that normally there will be no order that an application be dealt with by way of a telephone hearing unless all the parties have consented to such an order (see the practice direction at 6.2). No explanation is available as to why the district judge thought it appropriate, nor is it suggested that all the parties had consented.
11. When the defendant's solicitors learned of the order made by the district judge they objected to it and, as a result of negotiations and discussions that took place thereafter, the telephone hearing did not take place and an order was made for an oral hearing of the application at court. That oral hearing came before Deputy District Judge Cooke on 16th August 2000. The deputy district judge raised the question of the sufficiency of the evidence that had been put forward on behalf of the claimant and whether it did indeed explain that which was required before the stay could be removed. He questioned whether there needed to be an adjournment. Counsel then appearing for the claimant (not Mr Oakes, who appears before us today) took the view that the matter should proceed. In fact, both he and counsel for the defendant urged the deputy district judge to proceed. In those circumstances, not surprisingly, that is what happened.
12. During the course of the hearing it must have become apparent to counsel that the course he had taken was not the wisest of courses and so, nearing the conclusion of argument, he altered his stance and applied for an adjournment. The deputy district judge exercised his discretion at that stage and refused to grant an adjournment. He made it clear that he had offered the opportunity for an adjournment at the beginning, but counsel had chosen to proceed without an adjournment. He therefore took the view that it was unreasonable to expect an adjournment to be granted towards the end of the hearing. Accordingly, the deputy district judge proceeded and decided that he would lift the stay but only to a limited extent.
13. That limitation came about in the following circumstances. Counsel for the defendant had indicated that the lifting of the stay was not opposed so far as general damages were concerned, but that it was opposed so far as special damages were concerned. In those circumstances the deputy district judge came to the conclusion that there was no basis for lifting the stay so far as special damages were concerned, but he made an order lifting it to the extent of the concession, i.e. in respect of general damages.
14. The claimant appealed against that decision. Unfortunately, no proper record of the events before Deputy District Judge Cooke had been agreed and so none was available when the matter was heard. The appeal came before Judge Holman on 28th November 2000. It is clear that the judge was not impressed from the very outset by the conduct of the litigation. When told that the case related to a road traffic accident in 1988, he declared that he was "speechless already". Shortly after that, he said, "It is a shambles, putting it bluntly, is it not?" I, for my part, fully understand his frustration with the progress of this case.
15. The judge then queried the basis of the hearing before him: was it to be a rehearing or a review? He was required to do that because of the transitional provisions contained within the new Rules. Counsel told him that the parties had agreed that it should be a review. Mr Oakes, now acting for the claimant, urged the judge that the deputy district judge was wrong not to grant an adjournment to file further evidence. He further contended that such evidence as was before the deputy district judge should, having regard to the prejudice otherwise to be suffered by the claimant, have justified removal of the stay in its entirety. The judge concluded that the deputy district judge was entitled to refuse the application for an adjournment. Counsel had been offered the opportunity at the outset to apply for such an adjournment, but had rejected the suggestion, and his belated request simply came too late. The judge concluded, further, that there was insufficient evidence put forward that could justify removal of the stay. In particular, there was no evidence at all to explain events from April 1999 to April 2000.
16. Having indicated that he would refuse the appeal, the judge then indicated that he was minded to strike out the claim for special damages, exercising his general powers of case management under the Rules. Mr Oakes submitted that such a course would not be justified in the circumstances. He contended that there would be material that could be put before the court which would justify removal of the stay in its entirety. He submitted that a further opportunity ought to be granted to the claimant to put that evidence before the court. That opportunity would be denied if in fact the claim for special damages was struck out rather than stayed.
17. The judge delivered a short judgment, the relevant part of which reads:

"Following on from the dismissal by me of the claimant's appeal against the District Judge's order in August, I have to consider what to do with the claim other than in respect of general damages. At the moment, the remainder of the claim simply stands stayed. I have discussed with Mr Oakes, and invited submissions from him on the issue of whether to leave the stay as it is, or to bite the bullet and to strike out the claim to the extent that the stay has not been lifted. Mr Oakes has enjoined me to leave the stay as it is and contemplates that there may yet be an application, again by the claimant, to lift the stay in relation to the special damages which appear in the schedule served earlier this year, supported by the proper evidence needed for the court to decide whether to exercise its powers to grant relief under rule 3.9. I have a balancing exercise to perform. I recognise that there is potential prejudice to the claimant because the schedule of special damages totals some £175,000 but, against that, this relates to an accident which occurred in 1988, where proceedings were issued in 1991 and judgment entered in 1992, and no effective steps to progress the action taken for many, many years thereafter.

The court is perfectly entitled, in my judgment, to draw the inference that a fair trial in relation to special damages is no longer possible. Reference has already been made to the potential difficulties which the defendant would face in terms of investigating a number of facets of the claim for special damages at this distance in time. In my judgment, looking at the overriding objective and applying it in its fullest sense, and, balancing the interests of the parties, and the need to protect the defendant so far, as well as the claimant, in the context of a fair trial, I conclude that the only proper course of action is to strike out the remaining parts of the claim."

18. Accordingly, he made that order.
19. Thereafter, in February 2001, an application was made to the court to grant relief from the sanction imposed by the judge and in effect to permit the claim for special damages to be resurrected. The judge saw the application in advance of the hearing, considered it on the papers and came to the conclusion that what in effect he was being asked to do was to allow an appeal from his earlier order. He declined and indicated that, if there was to be a challenge, there should be an appeal to this court. That is exactly what has happened. The appeal was lodged, claiming that the striking out was wrong and further claiming that the judge was wrong not to reconsider the matter when it was taken back before him.
20. Mr Oakes, who has argued the matter as well as it could possibly be argued in all the circumstances, concedes that there have been many failings by the lawyers who have represented the claimant in these proceedings. He has acknowledged fault where it stands and recognises that difficulties arise as a result of that.
21. Taking each step in the proceedings, it seems to me that the deputy district judge was entirely right to conclude, on the evidence available at the time, that this matter had not been put before him in a way that would justify more than the lifting of the stay that was conceded. The matter went before Judge Holman. It would have been a further opportunity for evidence to be placed before the judge to rectify the position, but no steps were taken to that effect. Having recorded that Mr Oakes appeared on that occasion, it is only fair to him to record that he himself came into the matter only very shortly before that hearing and he had no opportunity to change the course of events because it was too late by the stage when he was aware of the deficiencies in the case.
22. It seems to me that the judge was bound to reach the conclusion on the appeal that he did and that he was equally bound to go on and consider what should happen from that point on. There were, realistically, two options open to him. The first was the one that he chose, namely to strike out the claim for special damages; the second was to make an order that would strike it out but afford a further opportunity for an application to remove the stay to be made, no doubt limiting that to a very short period of time. At the end of the day, Mr Oakes has to submit to this court that the judge should have taken that second course. He points to the one matter that can sensibly be argued in relation to that, namely the extent of the prejudice that will be suffered by the claimant if such a substantial part of his claim is in fact struck out. He submits that there is little further prejudice that will have resulted from the delay at the very end of this period over and above the delay that there had been since the time of the accident in any event.
23. I, for my part, share the view of Judge Holman, namely that there has to come a point in any litigation when a judge says, "Enough is enough". Here, there had been opportunities to remedy matters. Those opportunities should have been seized in a realistic way by putting proper evidence before the court that would have enabled it to take a different course. The failure to do so had to be seen against a background of a claim which on any view was by then very, very stale. Nothing of any effect was done. There was an appeal that gave a further opportunity for things to be remedied. The shortcomings had not been remedied by the time the matter came before the judge, and I consider that he was right to come to the conclusion that the time had come to strike out that aspect of the case.
24. For those reasons I would refuse this appeal.
25. LORD JUSTICE LATHAM:I agree.
26. I would simply like to pay tribute to Mr Oakes' arguments in support of this very difficult appeal. Like my Lord, it seems to me that the only issue at the end of the day was whether or not he could persuade us that the prejudice suffered by his client should have permitted a further chance. This case shows that there must come a time when no more chances can be offered.
27. Accordingly, the appeal is dismissed.
Order: appeal dismissed with costs.