ON APPEAL FROM THE HIGH COURT OF JUSTICE
MR JUSTICE ROTH
Strand, London, WC2A 2LL
B e f o r e :
LORD JUSTICE LLOYD
LORD JUSTICE WILSON
| WALID KHATIB
|- and -
|(1) RAMCO INTERNATIONAL
(2) PERHOME LTD
(3) TRANS-ATLANTIC INTERNATIONAL TRADING (TIT) INC
(4) TECHNICAL MANAGEMENT & SERVICES CO
(5) HYDRAULIC POWER TECHNOLOGY TEXAS INC
(6) LOUISIANA INC
(7) RAMADAN BEN ISMAIL
James Gibbons (instructed by Fuglers) for the Respondents
Hearing date: 31 March 2011
Crown Copyright ©
Lord Justice Lloyd:
"In my submission, if one stands back, as one is supposed to, and looks at this case and says: "Well, actually my client will have to pay £300,000 [said to be the estimated amount of the Defendants' costs of the proceedings as a whole] without having the merits decided", the other side have pointed to no prejudice really except the costs, some of which they have recovered. At the end of the day, my Lord, my submission is that the balance is in favour of my client. If this is a balancing exercise the behaviour of my client has not been perfect in any sense. He has not complied on occasions – we say not intentionally. At the end of the day the balance is in his favour."
"I should have said that in the light of the lateness of the hour I am not delivering a fuller judgment analysing each of the points set out in Stolzenberg. I referred to it compendiously, but I shall add the comment in case this matter should go further."
"However, in looking at the general interests of the administration of justice there must be concern that the repeated leaving of matters to the last minute, as evident in the preparation by the claimant of the application before me, and that this longstanding claim, based on an oral agreement of 1989, would now have a very late trial. Nonetheless, there is always a difficulty for the court where the costs that are outstanding, despite delays and breaches of its orders, have in the end been paid and the consequence of the sanction is that the claimant would be shut out from having a trial on the merits. Unsurprisingly, that is a matter that [Counsel] emphasises. I, of course, bear that in mind and appreciate the effect that this will have if the sanction remains on Mr Khatib's claim. However, he is the claimant. In my judgment, where an "unless" order is made it places a particular imperative upon a party to obey. If they do not obey and cannot properly explain their non-compliance, they bring the result upon themselves, as Lord Justice Ward observed in Hi-Tec Ltd v Coventry City Council  1 WLR 1666 at 1667:
"If a party intentionally or deliberately flouts the order he can expect no mercy"."
"In my judgment, it cannot simply be said that because the claimant is prevented from having a trial of his claim on the merits and the costs have, very belatedly, been paid, any non-compliance with an "unless" order must therefore be outweighed by his own interests."
"The circumstances in which a court may be asked to make a decision of this kind are infinitely varied. This is why the rule instructs the court to consider all the circumstances of the particular case, including the nine listed items. On the other hand, the rule would lose much of its praiseworthy purpose of encouraging structured decision-making if courts did not consciously go through the exercise of considering all the items on the list when determining how, on balance, it should exercise its discretion. Provided it does so, and in this way ensures that the risk of omitting any material consideration is minimised, it is most unlikely that an appeal court will interfere with its decision. If it fails to do so, an appeal court may not be able to detect that it has taken all material matters into account, and it may be obliged to exercise its discretion afresh for this reason."
"at the end of the day, the right approach is to stand back and assess the significance and weight of all relevant circumstances overall, rather than to engage in some form of 'head-counting' of circumstances."
"The dictum of Mance LJ makes it clear that although the court must go through each of the matters in the list in CPR 3.9 as a separate and distinct exercise the result is not ascertained by adding up the "score" of either side on each point. If that were the right method, there would be a danger of double-counting. The object of CPR 3.9 is to ensure that all the right questions are asked. That produces "structured decision-making". In addition to going through the subparagraphs of CPR 3.9, the court must ask itself if there are any other circumstances that need to be taken into account. However, having done all this, the court is then also required to stand back and form a judgment to the aggregate of the relevant circumstances that have been identified in going through the list to see whether it is in accordance with the overriding objective in the CPR to lift the sanction. This overall "look see" is simply the overriding objective in action."
"Moreover, compliance with orders of the court is not a question of judicial amour propre. It goes to the essence of the rule of law that parties subject to the court's jurisdiction … should comply with the court's orders. The gravity of the matter of non-compliance is plainly increased where the non-compliance results from a conscious decision, as in this case. It follows, as Ward LJ said in Hytec Ltd v Coventry City Council  1 WLR 1666 at 1674 to 1675, that "if a party intentionally or deliberately … flouts the order, he can expect no mercy." He has to persuade the court that in all the circumstances the injustice to him outweighs the interests of the administration of justice and the injury to the other party."
Lord Justice Wilson
Lord Justice Carnwath