England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE A2/2003/1208
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM MANCHESTER DISTRICT REGISTRY
(MR JUSTICE MOSES)

		Royal Courts of Justice The Strand London
		19 January 2004

Monday 19 January 2004

THE LORD CHIEF JUSTICE:

1. The issue in this case is whether it is an abuse of the process of the court for a claimant who has commenced proceedings, where those proceedings raise an issue covered by a group litigation order ("GLO"), who is refused permission, to join the GLO out of time to proceed with his claim, notwithstanding that refusal.
2. The background to this appeal is that the defendants, the Nugent Care Society, successfully applied to Moses J on 15 May 2003 for an order that the claimant's claim be struck out as an abuse of the court's process pursuant to CPR 3.4.2(b) and/or the court's inherent jurisdiction. Moses J also refused the claimant's application to adjourn in order to obtain further evidence as to the claimant's capacity to manage his litigation. The latter point has not been the subject of argument on this appeal.
3. The case has a considerable history. In the 1970s a number of young men who were then residing at different institutions were the subject of indecent assaults and other inappropriate acts. As a result of complaints which were made, information became available to the police that young men who were in the care of the defendants were complaining of such abuse.
4. The claimant made a statement to the police at Warrington suggesting that on 16 February 1995 he had been subject to abuse while in the defendants' care. He subsequently made a claim to the Criminal Injuries Compensation Board in about February 1996 and that claim was upheld in 2000. In the meantime other individuals who alleged that they had been treated in this way commenced a group action in 1997. In respect of that group action an order in due course was made by the then Chief Justice establishing a GLO. That GLO was the subject of directions which were given by Douglas Brown J on 16 December 1998. The group action was entitled "The North-West Child Abuse Cases".
5. 5. In the directions which Douglas Brown J gave he provided a cut-off date by which claimants would have to join the group action. That date was 31 May 1999. He also gave other directions, including a date by which individual statements of particulars had to be given, and that date was 30 September 1999.
6. On 1 October 1999, District Judge Fairclough, who was one of the two district judges given responsibility for giving management directions in relation to those actions to which the GLO applied, extended time for the compliance with Douglas Brown J's order for certain claimants. 31 December 1999 was the last date for the individual defences.
7. The claimant, having succeeded in obtaining an award from the Criminal Injuries Compensation Board, commenced proceedings with a claim form on 17 December 2001. Previously in September 1998 he had obtained a medical report. The date on which he commenced his proceedings was approximately two-and-a-half years subsequent to the cut-off date provided for joining the GLO. The proceedings were served on 23 January 2002. Two days later the claimant made an application for permission to join the group action. That application came before District Judge Fairclough who dismissed the application on 21 February 2002. In his judgment the district judge identified perfectly appropriate reasons for taking the course that he did. However, permission to appeal against his decision was given to the claimant on 17 June 2002. That appeal came before Poole J on 18 July 2002. It was one of a series of appeals that were before the judge on that occasion and it appears that, having heard the judgment given by Poole J in respect of other decisions which had been made in the group action, the claimant decided not to proceed with his appeal and accordingly the district judge's order stood.
8. On 20 December 2002 the defendants made an application that the claimant's claim should be struck out as an abuse of the court's process or under the court's inherent jurisdiction. That is the application which was successful before Moses J and which leads to this appeal in respect of which the single judge has given permission to appeal to this court.
9. The provisions which are contained in the Civil Procedure Rules dealing with group litigation were an innovation which was introduced by an amendment to the rules made in 2000. It was the experience of the courts that if litigation involving a substantial number of claimants was to be managed in the appropriate way, it was essential that there should be some procedure which provided the courts with very wide powers to manage the proceedings. It was in the court's interest for the proper dispatch of other litigation that the court should have those powers. It was also in the interests of litigants that the courts should have those powers because it would enable the court to deal with this sort of litigation in a more efficient and economic manner than would otherwise be possible. It would enable the court to provide more expeditious justice. It is therefore of the greatest importance to the proper conduct of litigation before the civil courts that, where the court decides that there should be a GLO (and that decision requires the directions of the Chief Justice), that that decision is supported by the courts.
10. In giving his judgment Moses J was very conscious of the issues to which I have just referred. He dealt with the issues which were before him with very considerable care. In due course he gave a judgment which is a model for the clarity with which it is expressed. He started by dealing with the particular circumstances of the claimant's claim. He pointed out that no explanation of any cogency or weight whatever had been put forward for the delay in issuing the claim form by the claimant prior to the cut-off date.
11. Having dealt with the claimant's individual circumstances he went on to deal with the position more generally. In the course of so doing he said:

"15. It is an abuse for this claimant to seek to bring individual proceedings at the time he does, having failed in his application to join the group action? Secondly, even if it is an abuse, is it a proportionate response of this Court to prevent him bringing any action at all, because that would be the result of an order to strike out in pursuing his claim and seeking to vindicate his rights as a result of the treatment he suffered in the care home.

16. The starting point must be that there is no obligation upon a Claimant to join a group action. There is nothing within the rules that requires a claimant to do so. However, the overriding objective is the CPR, and the rules in relation to group actions themselves, do have the consequence that an individual may be prevented from joining a group at a later date than that which is specified in the group directions, or in issuing separate proceedings, if such may be the result, unfairness or injustice may ensure, not only to the litigants in the group action, but in relation to litigants generally, having regard to the overriding objective, and if the effect of preventing him from pursuing his claim would not be disproportionate (see the comment at paragraph 19.13.1, page 406 of the White Book 2003). The starting point must be the decision of District Judge Fairclough in refusing this claimant permission to join the group action out of time. He had regard to the effect on resources and time that would be engaged should the claimant be allowed to join the group action so long after the time he ought to have sought to join it in the absence of any cogent explanation for the delay. He took the view that if he joined, the claimant's joined, the claimant's joinder would be bound to have an effect upon the group action.

17. In my judgment, that effect can hardly be significantly less, were he to bring proceedings outside the group action...."

He went on to set out the disadvantages of not adhering to the requirements of a GLO. He indicated that he accepted the evidence of Mr Spencer, filed on behalf of the defence, indicating that there will be adverse effects upon the defendants' limited resources in meeting the claims as a result of those resources having to be diverted to deal with an individual parallel claim brought by the present claimant. He then added:

"21. There is, in my judgment however, a more general point. It is true that there is no obligation, as I have said, upon a claimant to join a group action. But if he does not do so, but is aware of it, then he does run the risk of being deprived of the opportunity to bring independent action should it be unjust and unfair if he would be permitted to do so. This claimant, specifically, is seeking to join the group action, accepted that there would be prejudice to that group action, and I refer to the quotation I have already cited at paragraph 12 which was part of the argument in support of his joining the group action. After all, he thought it was to his own benefit that he should join the group action, to the benefit of defendants, and to the benefit of the Court. That is no less true now than it was then.

22. The whole purpose of group actions is designed to enable resources to be directed where they can best be directed both for the advantage of the parties and of the courts. Were a claimant who had sought, but been disappointed, in his application to join a group action, permitted to bring separate action without any good reason other than a way of overcoming his previous failure to join a group action, but to the system of group actions, seems to me to be plain.

23. One has also only to contrast the position of this claimant with the position of other claimants, no doubt suffering under similar tragic circumstances to that which the claimant appears to have suffered, to see that that is a relevant issue and a significant issue in considering the fairness and justice of the case. Those who joined the group action but failed to comply with orders, have been deprived of the opportunity of pursuing their claims; their claims have been struck out. Some were allowed extensions; others were not and indeed the judge commented upon that and the need to maintain the discipline of the pursuit of the group action when he, Poole J, considered an appeal from the District Judge.

24. The result of not striking out this claim would be to give an advantage to this claimant over and above those whose cases at least had the merit of joining the group action at the appropriate time. If it was right to strike out some of their cases because they had failed to comply with time limits, it seems difficult to see why they should not be allowed now to be in exactly the same position as this claimant and bring individual actions."

12. Moses J subsequently indicated that the fundamental basis upon which he was striking out the action derives from the fact that this claimant unsuccessfully sought to join the group action, failed because of delay and the effect upon the group action, and yet sought to launch proceeding independently in a parallel manner when the same effect would occur in relation to the group action brought on behalf of others. That statement of Moses J has to be amended to reflect the fact that the claimant had already commenced proceedings to join the group action before the application to strike out was made.
13. Finally, Moses J considered whether striking out the claim was a disproportionate response. As to that he said that he could identify no method of preserving the integrity of the group action and its proper conduct while permitting the claimant to proceed. He said at paragraph 29:

".... if I were to refuse this application, any further directions in relation to the proper conduct of the matter would be bound to be subject, in fairness to the defendant and other litigants involved, to the same restraints and restrictions and time limits as those involved in the group action. Yet District Judge Fairclough, in his unappealed judgment, has already pointed out that would not be possible."

14. Of the many points made by Moses J in the course of that judgment, at first sight perhaps the most powerful argument would be that claimants who were part of the group action and who did not comply with the directions given by Douglas Brown J had their actions struck out for not so doing. I have no doubt that if those claimants were to begin a separate action, having had their previous action struck out, that could indeed be an abuse of process. However, on consideration it seems to me that there is a significant distinction between a claimant who becomes part of a group not complying with a direction given by a judge (as happened as to directions here by Douglas Brown J) and the position of the claimant. In the former case the claimants had disobeyed an order of the court, whereas in the case of the present claimant he had never been subject to an order of the court which he had disobeyed.
15. The provisions contained in Part 19 of the CPR dealing with group litigation have no requirement which would enable a court to make an order requiring a claimant to join a group action if the claimant chose not to do so. A claimant is perfectly entitled to decide to bring an action without taking that step. The fact that he has that right does not mean, however, that there are no good reasons why he should join a GLO which covers issues which will be involved in his litigation. If a claimant does not join such a GLO when it would cover his proceedings, then he is nonetheless subject to the management powers of the court. If he brings the proceedings in parallel to a GLO, the court is fully entitled to manage the proceedings which he brings in a way which takes account of the position of those who have joined the GLO. This is intended should generally happen in the case of proceedings which are suitable for the regime which the GLO creates. Those litigants who join the group action are entitled to have their interests (whether they are claimants or defendants) given higher priority than those of a defendant who does not take that course. This is because of the fact that they are likely to be large in number, but also because by joining the group action they are co-operating with the proper management of the proceedings, whereas the litigant who does not take that course is not so doing. The general sentiments expressed by Moses J in his judgment which I have cited are statements which I would firmly endorse.
16. However, notwithstanding that, I have come to the conclusion that Moses J wrongly decided that the claimant's action had to be dismissed. In my judgment that is so, first of all, because to dismiss the claimant's case was a disproportionate reaction to his failure to take the steps which he should have taken at an earlier date which would have resulted in his becoming part of the group litigation. However, while that is so, it is also necessary to consider whether his claim could have been dismissed if he had commenced his proceedings and not then applied to join the group litigation. In my judgment, on the material available, this was not a situation where it would then have been appropriate to dismiss his claim as an abuse of the process of the court. In considering any such application the court would have taken into account the delay which had occurred before the commencement of his proceedings, but the court would only strike out the proceedings if there had been delay which, taking into account the background, could properly be described as abusive after the proceedings had been commenced. Otherwise the situation was one where, if the proceedings were to be brought to an end they would normally have to be brought to an end because of the claimant's failure to comply with the requirements of the Limitation Acts and the periods prescribed for bringing proceedings, bearing in mind the generous discretion which courts have to set aside those limitation periods in appropriate cases. In this case the issue of limitations is not before us, and it was not in the lower court, suggested that the proceedings could have been struck out for non-compliance with the limitation requirements. Accordingly, on the grounds of delay alone it would not be possible to have made an order bringing the proceedings to an end. For that draconian order to be made requires a clear case and there was certainly no clear case here.
17. It is also necessary to consider whether other action could be taken by the courts to protect the position of the defendant if he was faced with separate and parallel proceedings by the claimant. In my view in this case it is important that the position of the defendant is fully recognised. However, while fully recognising that position, it is my view that the court could take steps which would fairly protect the defendant. In particular the court may make an order staying the claimant's action until after the completion of the group action (or at least until after the completion of part of that action). In addition, if the court were to impose a stay, it may identify conditions upon which it would be prepared to remove the stay. Those conditions might include a requirement that the claimant should be bound by generic decisions in the group action so far as they affect the claimant's case.
18. Finally, the court has very wide powers in regard to costs. It may make an order to protect a defendant (in the event that a costs order was made against the defendant) from having to pay any costs in addition to those which the defendant would have had to pay even if the claimant had been a party to the group action.
19. Having regard to the steps which the court may take to protect the position of a defendant (only some of which steps have been specifically identified), I regard it as disproportionate to have dismissed the claimant's claim. I would therefore allow this appeal, restore the claimant's claim, and impose a stay in respect of that claim until an application is considered by Holland J, brought by the claimant for directions as to the future management of the claimant's claim. Holland J is the High Court Judge in charge of the group action and he is in the ideal position to decide what orders need to be made. He should decide at what stage of the proceedings it would be appropriate for the claimant's claim to come before the court. He may, for example, decide that although District Judge Fairclough's decision was correct at the time that it was made, because of the delay that has taken place in the group action since that time it would be sensible for the claimant's case now to become part of the group action. I venture no opinion as to this. I leave the matter entirely to Holland J.
20. There are no doubt alternative steps which may be taken by the judge, to which I have not referred. Counsel should, so far as it is practicable for them to do so prior to the hearing before the judge, indicate the directions which they seek in order that a result can be achieved which meets the justice of this case. I would allow the appeal and order accordingly.
21. LORD JUSTICE TUCKEY: I agree.
22. LORD JUSTICE WALL: I also agree.

ORDER: (Not part of judgment)

Appeal allowed; appellant to have half of the costs of the appeal, to be subject to a detailed assessment if not agreed (to be dealt with at the end of the litigation); the order for costs in relation to the hearing below to be set aside.