England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM Leeds County Court
His Honour Judge Grenfell
6LS90101

		Royal Courts of Justice Strand, London, WC2A 2LL
		20th October 2006

Waller LJ:

1. On 26^th June 2006 (subject to the approval of the Head of Civil Justice), HH Judge Grenfell made a Group Litigation Order covering ten common or related issues of fact or law the first two of which will provide a context for considering the points raised on this appeal.:-

"(i) the liability of the British Coal Corporation (BCC)/their successors the Department for Trade and Industry (DTI) for chronic knee injury suffered by their employees as a result of underground work in mines between 1949 and 1994, where chronic knee injury means disabling symptoms of the knee joint(s) resulting from damage to the menisci and/or osteoarthritis, but does not include bursitis. In particular the following common issues arise.

(ii) Does underground mine work cause chronic knee injury and, if so, what work/activities/working conditions cause or contribute to such injury?"

2. As issue (i) makes clear the DTI is the successor to the liabilities of the British Coal Corporation and the National Coal Board to whom I shall refer for convenience as "British Coal". The application for such an order was made by solicitors acting for 5 miners, all members of NACODS (South Wales). Those 5 had yet to bring proceedings, but it was common ground that proceedings alleging liability on the DTI for chronic knee injury would be commenced by those 5 against the DTI alone. It was further common ground between those acting for the applicants and the DTI that when, as would be likely, many other miners brought proceedings and sought to place the same on the register envisaged by the GLO, those proceedings would also be against the DTI alone.
3. The fact that the proceedings are likely to be against the DTI alone gives rise to the issue on this appeal. During the relevant period over which it will be asserted by miners that they contracted chronic knee injury, British Coal employed contractors to fulfil many tasks in the mines. The contractors, who have formed a group known as the Coalmining Contractor Companies (CMC), themselves employed individual miners and many miners were during the relevant period employed both by British Coal and such contractors. The claimant miners according to those representing the present 5, do not intend to join any of those contractors as defendants in proceedings, and their primary reason for not seeking to do so is because their advisers take the view that they have a case against British Coal whether British Coal was employer or not, and because of the increased costs and the risk as to costs, which will be incurred if such contractors are joined.
4. Miners have in the past brought proceedings in relation to industrial injuries which have been the subject of GLOs – proceedings concerned with vibration white finger (VWF) and chronic obstructive pulmonary disease (COPD). In those instances the contractors have not been joined in the main proceedings, but they have been faced with contribution claims by the DTI where the DTI has been found liable or accepted liability. For example in the COPD litigation involving many millions of pounds, where the DTI lost certain test cases, the DTI entered into a claims handling agreement with those representing the miners, which was devised for the purposes of establishing the legitimacy of claims and their quantum. It was an agreement applied by the DTI in relation to many thousands of miners, many of whom had not originally brought proceedings. The DTI sought contribution from the CMC contractors. In the contribution proceedings CMC accepted the findings made in the judgment in the test actions against the DTI; I do not know whether they ever considered doing otherwise, but albeit they were not parties to the test cases, those cases having lasted some 12 months and been the subject of a lengthy and detailed judgment by Turner J, their choice was perhaps limited and obviously a sensible one.
5. The contribution proceedings still involved a number of complex issues and lasted from 17^th June 2003 to 13^th February 2004. Sir Michael Turner (as by then he had become), in a judgment over 150 pages in length, found that CMC were liable to contribute on the grounds they were in breach of duty, and on the grounds that pursuant to the contracts with the DTI to a certain "extent" they were bound to indemnify the DTI. Most critically he found that CMC were bound by the Claims Handling Agreement.
6. CMC feel they were disadvantaged by not being involved in the VWF and the COPD litigation at the main trial stage. In relation to the chronic knee injury litigation CMC wish to be involved in the litigation from the outset. Thus before HH Judge Grenfell representations were made on behalf of CMC that the issues identified as being those the subject of the GLO should be broadened so that CMC could be involved from the outset. In the skeleton argument of Mr Maxwell QC and Mr Patrick Limb before us it is put this way:-

9. The correct approach to group litigation and the making of a GLO requires the court to consider whether there are " . . . claims which give rise to common or related issues of fact or law (the "GLO issues")" – see CPR Rule 19.10.

10. The GLO issue formulated by the claimants and cited by the learned judge a paragraph 12 of his judgment includes:-

"(ii) Does underground mine work cause chronic knee injury and, if so, what work/activities/working conditions cause or contribute to such injury?"

11. CMC and their insurers plainly have an interest in that issue. Their men did the same work, mainly development work, as comparable BCC employees.

12. In formulating the GLO issue in such a manner claims concerning contractors ought to be included. Exclusion of such claims creates an artificial line of demarcation.

13. At the stage of setting up the GLO, it is imperative that claims which give rise to common or related issues of fact or law are within the scope of the GLO. The exclusion of contractors is therefore inappropriate.

7. The claimants resisted any broadening of the issues and resisted any idea that CMC should be entitled to be involved in any trial establishing the liability of the DTI. That resistance was based on a fear as to the way in which a trial would escalate (a) if CMC or any member company sought to argue points on employer liability which were being fought by the DTI in any event, or (b) if the DTI and CMC or any member company were to fight in the main trial issues relating to the extent to which one or other of them had responsibility as employer or occupier of the mines or (c) the complex contribution or indemnity issues which arose in the COPD Part 20 proceedings. The resistance was also based on the increased risk as to liability for costs if CMC or any member company were joined as a defendant in addition to the DTI.
8. The DTI's attitude was also to resist the joinder of CMC or the broadening of the issues on essentially the same grounds as those representing the claimants. But in addition the DTI argued before the judge and before us through Mr Jay QC (and it is fair to say Mr Allen QC for the claimants adopted this argument before us without expanding on it) that there was no power under the CPR at this stage to allow CMC or any CMC to become a party. The argument was that the DTI had not yet joined any CMC member as a Part 20 party and unless it did so there was no power in the court to allow any CMC member to become a party to a GLO. He relied on the language of CPR 19.10 and 19.11 which he said were in terms which precluded the court from making any GLO which would allow issues to be broadened so as to include "potential" part 20 defendants. The language of CPR 19.10 and 19.11(it is right to say) does not appear to contemplate a GLO covering Part 20 issues. He did accept however that if a CMC member were to be joined in proceedings later either as a co-defendant by a claimant or as a Part 20 defendant by the DTI, there would be power to make a GLO which included issues involving that CMC member. This he found difficult to justify on the language of Part 19.10 or 19.11 on their own, but, he submitted, it was a matter of common sense. However his submission was that since neither the claimants nor the DTI intended to join any CMC member prior to the trial in which the DTI's liability would be considered, the court had no power to make a GLO which brought in any CMC member at this stage.
9. The submissions of Mr Jay for the DTI and Mr Allen remained constant and consistent both before us and before HH Judge Grenfell. Before us Mr Maxwell's arguments did not, with respect to him, remain either constant or consistent. He was (I accept) hard pressed by the court, and it may be important for the future conduct of this litigation and possibly future cases in which GLOs have to be considered just to reflect some of the points debated.
10. Mr Maxwell was at first closer to the arguments of Mr Jay as to the powers of the court, and was advocating a broadening of the issues against the eventuality of a CMC member being joined as defendant or against the eventuality of a CMC being joined in the proceedings once issued. But his submission was that until there were proceedings issued and until a CMC was a party the powers of the court in relation to GLOs could not be exercised so as to include issues as between DTI and a CMC member. It was in this context that he was inclined to submit that the court should order the DTI to issue Part 20 proceedings against CMC or presumably a CMC member in one of the proceedings which was yet to be commenced against the DTI. Mr Maxwell was inclined at one stage to accept Mr Jay's submission that the CMC could not have any interest unless they were joined as parties to one of the cases either by a claimant or by the DTI.
11. Under pressure from the court he retreated from that position, and ultimately submitted that, under Part 19.2, there was power in relation to any proceedings to join a party on that party's application where that party had an interest in any issue. Part 19.2 reads as follows:-

"(1) This rule applies where a party is to be added or substituted except where the case falls within rule 19.5 (special provisions about changing parties after the end of a relevant limitation period).

(2) The court may order a person to be added as a new party if -

(a) it is desirable to add the new party so that the court can resolve all the matters in dispute in the proceedings; or

(b) there is an issue involving the new party and an existing party which is connected to the matters in dispute in the proceedings, and it is desirable to add the new party so that the court can resolve that issue

(3) The court may order any person to cease to be a party if it is not desirable for that person to be a party to the proceedings.

(4) The court may order a new party to be substituted for an existing one if –

(a) the existing party's interest or liability has passed to the new party; and

(b) it is desirable to substitute the new party so that the court can resolve the matters in dispute in the proceedings."

12. Part 19.2 seems to provide a very wide power to enable parties who may be affected by a finding in any proceedings to be joined. That the power was intended to be wide is supported by the paragraph of the Practice Direction quoted by the judge in a passage of his judgment set out below. The matter remains within the discretion of the court, but in my view if a miner brought proceedings against the DTI where the miner had also been employed by a CMC member and where the likelihood was that at some stage the DTI, if found liable, would pursue that CMC member on a Part 20 claim, the court has the power under part 19.2 to allow the CMC member to be joined. I emphasise that it would be a power which the court would have the discretion whether to employ or not, and accordingly I do not suggest a CMC member would have the right to be joined.
13. I would indeed go further in accordance with Mr Maxwell's final submission and accept that if the miners chose at the outset only to bring cases where there was no CMC connection in an attempt to avoid their joinder, but the court formed the view that ultimately miners who did have some CMC employment, would seek to obtain compensation from DTI in reliance on that decision and possibly some claims handling agreement similar to that agreed in the COPD litigation, so that CMC were at risk of Part 20 proceedings in such cases, the court would have the power to allow CMC into the proceedings.
14. But the above is all on the basis that proceedings are on foot. Does it make any difference if (as in this case) there are no proceedings on foot but the court is considering a GLO by reference to threatened proceedings? It seems to me that the court must have all the same powers when considering whether to make a GLO as it would have if proceedings were on foot. It must be entitled to look at the proceedings which at that stage are threatened, and take a view as to whether, for example, a Part 20 defendant will be joined or whether if no party to the litigation is going to join that party, the court should do so in the exercise of its discretion under Part 19.
15. This was my view during argument as I made plain. After the hearing I was provided with the judgment of Sir Michael Turner in the COPD contribution proceedings and noticed his citation from a judgment of Steyn LJ (as he then was) in AB v John Wyeth [1993] 4 Med LR 1 at page 6 where he said:-

". . . The procedural powers of a judge in control of a group action are not tied to transitional procedures. Subject to the duty to act fairly, the judge may and often must improvise: sometimes that will involve the adoption of entirely new procedures. The judge's procedural powers in group actions are untrammelled by the distinctive features of the adversarial system. The judge's powers are as wide as may be necessary to control the litigation fairly and efficiently. (emphasis added)"

16. I appreciate that that citation related to a period prior to the CPR expressly dealing with group actions but I presume that the CPR are not intended to constrain the powers of the court to control litigation fairly, and the dictum seems to support the view that I have expressed.
17. The judge was also of the view that the court's powers to join parties were very wide. He cited paragraph 1.1 of the Practice Direction relating to the Addition and Substitution of Parties, which is distinct from the Practice Direction relating to GLOs, but which on any view he rightly construed as providing guidance as to whether parties could be joined at their own instigation and as providing him with the power to make a GLO including issues covering potential Part 20 parties. However, he felt it was not right to broaden the issues and join CMC or any member company at this stage. He left it open to reconsider the matter at a later stage. He put the matter this way:-

"17. The starting point is paragraph 1.1 Practice Direction – Addition and Substitution of Parties:

"Parties may be removed, added or substituted in existing proceedings either on the court's own initiative or on the application of either an existing party or a person who wishes to become a party."

18. It is clear that all relevant parties should be included in the proceedings. I am satisfied that I have the power to join any parties who are not hitherto part of the proceedings. In this respect, for the present I have the difficulty that the contractors' interests remain potential. Further I must balance those potential interests with the additional likely costs of their being involved, particularly at this stage. I am not persuaded at this stage that the potential interests of the contractors conflict with those of the DTI in resisting the generic issues that have been identified. As Mr Jay, counsel for the DTI puts it, if the DTI successfully defends in relation to the central issue as to whether the NCB/BCC were liable in negligence or statutory duty, there will be nothing for the contractors to litigate. In my view, should that result, then considerable costs will have been saved. In the event, that the claims are successful on that central issue, then it is by no means clear that the DTI would seek to join the contractors, presumably on the basis that the NCB/BCC was primarily responsible for the safety of mineworkers underground, a responsibility exercised throughout at the lowest managerial level by their Deputies."

18. The judge in those paragraphs is defining his powers and then exercising a discretion. The question for this court is whether he misdirected himself or, even if this court might have acted differently, whether "he has exceeded the generous ambit within which reasonable disagreement is possible". See Brooke LJ in Tanfern v Cameron Macdonald Practice Note) [2001] 1 WLR 1311 para 32 citing Lord Fraser in G v G (Minors Custody Order)[1985] 1 WLR 647 at 652.
19. For the reasons already given I do not think he misdirected himself as to his powers. As for discretion, whether considered now or later, the question whether it is right to allow CMC or any member to become a party, and take part in the main trial on liability is an exercise in holding the balance between (1) the interests of CMC in resisting a finding of liability against British Coal whether as employer or otherwise, and any disadvantage they may suffer from not being at the main trial on liability if at some stage they were to be made Part 20 defendants; (2) the interests of the claimants who seek to bring these proceedings and will not, on the information that the court has at present, seek to hold CMC liable, but will be put to extra expense by any lengthening of the trial process if CMC is present fighting the liability issue vis à vis the claimants and fighting contribution issues as between DTI and CMC; and (3) the interests of the DTI who do not wish CMC joined but wish to preserve the right to bring Part 20 proceedings relying on Section 1(4) of the Civil Liability Act 1978 which gives them 2 years from any judgment on liability to bring such claims.
20. I have already quoted the judge's reasons for not acceding to CMC's application. So far as the DTI's interests are concerned, the judge clearly took the view, on what he knew at that time, that there was no reason to think that the DTI would not fight liability fully and properly, and that they did have a legitimate concern over costs in their own interests. It could be suggested (and indeed was by Mr Maxwell) that the DTI's attitude is perhaps suspect, in that the claimants say that, if CMC are joined, the whole litigation would be impossible because funding would not be available. Why (it could be said) does not the DTI support the joinder of CMC, particularly as CMC would then be bound in law by any findings made at the trial? Could the answer be that they feel they have a better chance of ultimately succeeding in any contribution proceedings if CMC have not been given the chance to contest the main trial? Are they pinning their faith on what happened in the COPD proceedings, i.e. on the fact that once faced with findings made at a long trial the CMC have little option but to accept them, even if in law they are strictly not bound?
21. Mr Jay resisted any suggestion that the DTI were acting in some sort of Machiavellian way, and he submitted that the judge accepted (and thus we should accept) that the DTI had a legitimate concern over costs. The judge took the view (on what he knew at the time) that the DTI would fight liability properly, and there was nothing to suggest that that was not an entirely proper view. As Mr Jay said, it would not be attractive for the DTI to support CMC's position simply to try and make the claimants' position impossible from a funding point of view. He accepted that in contribution proceedings, if they took place, it might well be that as a practical matter CMC may well not re-fight issues fought out between the DTI and the claimant miners, but strictly he also accepted they would not in law be bound by the findings of a judge in proceedings to which they were not a party.
22. However, putting the position of the DTI on one side for the moment, the judge's view on costs saving was clearly not directed at the DTI alone. Those acting for the present claimants say they have no interest in joining CMC at this stage, and believe that other claimants when they join will not seek to make CMC or any member liable. If that remains the position, those claimants clearly have a powerful point against CMC's joinder if that joinder would increase the costs of a trial in any event and in particular to an extent where funding the litigation even as against the DTI would be jeopardised.
23. Mr Maxwell pointed to previous proceedings where a CMC member had been joined – a claimant called Mathewson brought proceedings against the DTI and a contractor. Those proceedings were struck out and have not been reinstated. But if the GLO is confirmed by the Head of Civil Justice, it remains possible that other proceedings may be brought by Mathewson. If a CMC member were to be joined to fresh proceedings that might throw a different light on matters but at present that seems, from what the court has been told, unlikely.
24. It is right to add that, following prompting from the court, Mr Maxwell was instructed to make an offer in relation to costs to protect claimants. The thrust of the offer was to accept that, if no claimants made a claim against CMC, and if, of the claims made, the proportion of claimants who also had CMC employment was "not significant", the court could make it a condition of CMC's involvement that the claimants should not bear CMC's costs, and should recover the extra costs of CMC being involved from CMC.
25. If that offer had been made before the judge, I do not think it would have affected his view. It is not an offer easy of operation, and might be said to be seeking to bind the court to exercise its discretion on costs on a somewhat uncertain basis. In my view the Judge would still have concluded that at this stage, it would be wrong to broaden the issues, and that only if a stage came when factors dictated that the matter should be looked at again e.g. if some claimants did join a CMC member, or possibly if the majority of claimants were employees of contractors, that would be the time to reconsider CMC's position, and whether some term to protect the claimants against costs would be appropriate.
26. The judge very properly has said that the matter should be kept under review. The court will be better able to assess whether its initial view was correct when proceedings have been properly pleaded by claimants and registered under the GLO and the court has seen the defences pleaded. Mr Allen for the claimants indicated that the likelihood is that the main head of liability of the DTI will be alleged to be on the basis of regulations or common law duties not flowing from the DTI as employers i.e. a liability based not on a contract of employment as would be the case against a contractor. He however accepted that liability as an employer would be likely to be alleged as well. He also suggested that if the DTI were liable, the question whether the DTI were entitled to contribution would to a large extent depend on contractual issues of no concern to the claimants as it did in the COPD litigation. On that basis I would not give any encouragement to those representing CMC that it will ever be appropriate to contemplate them being a party and represented in the main trial on liability as against the DTI, or more particularly, that it should ever be contemplated that contribution issues should be part of the main trial, but the judge was clearly right to postpone the making of any decision to join them until the court has a much clearer picture of what is alleged against the DTI and how many claimants there are who were also employees of CMC members.
27. So that CMC themselves can keep matters under review it might be thought appropriate at the next Case Management Conference to direct that once the register has been finalised, the names of the claimants and such pleadings as CMC reasonably require be provided to CMC's advisers on payment by CMC of the costs of so doing.
28. As by now will be clear, I take the view that the judge's exercise of discretion cannot be impugned, and I would dismiss the appeal.

Lord Justice Longmore : I agree

Lord Justice Maurice Kay: I also agree