England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM EXETER COUNTY COURT
HHJ COTTER Q.C.
OEA02407

		Royal Courts of Justice Strand, London, WC2A 2LL
		21st. December 2012

Dame Janet Smith:

Introduction

1. This appeal is concerned with the granting of relief from sanctions under CPR Part 3 Rule 9. It is a second appeal, brought with the permission of Sir Scott Baker from the order of HH Judge Cotter QC dated 4 May 2012.

The facts

2. On 26 September 2007, Dominic James Beever suffered personal injuries in a road traffic accident. In December 2007, his solicitors intimated a claim against Ryder PLC. In January 2008, Ryder's solicitor admitted liability. During 2008 and early 2009, the claimant's solicitor served some medical evidence and interim payments totalling £25,000 were made. Until spring 2009, it appeared that the claim to be advanced was to be of moderate size. However, in May or June 2009, the claimant ceased work, allegedly due to the deteriorating condition of his back which he claimed had been damaged in the accident. In April 2010, the claimant instructed new solicitors, Michelmores, who soon afterwards requested a further interim payment. Morgan Cole, solicitors for Ryder PLC refused to consider this until a schedule of loss had been served. It appears that they were becoming concerned that the claim was growing unjustifiably. They arranged surveillance of the claimant. In August 2010, Morgan Cole sent a Part 36 offer accompanied by surveillance reports and copies of the medical reports they had obtained. The offer was neither accepted nor refused by the claimant. Proceedings were issued on 22 September 2010. The claim was provisionally limited to £50,000 but it was explained that the medical evidence was not yet complete and the value of the claim might have to be reviewed. In November 2010, Michelmores wrote to Morgan Cole to say that the claimant was undergoing pain management treatment. They requested that, in order to save costs, there should be no further correspondence for the time being. Morgan Cole replied that their client was entitled to know how the claimant valued his claim and whether the part 36 offer had been rejected.
3. Proceedings were served just in time on 22 January 2011. The schedule of loss accompanying the particulars of claim was incomplete; in particular, the care costs were not quantified. No doubt Michelmores' explanation for this would have been that the claimant's medical condition was not yet stable and the prognosis remained unclear. In any event, it was now clear that the claim advanced exceeded £500,000 and that the parties were a very long way apart. The claimant was claiming that the accident had caused serious, long lasting harm to his back. He had had to give up work and was now permanently unfit for his previous work as a mechanic; nor could he manage physical work such as gardening; he sometimes had to use a wheelchair; he required care and assistance. In due course, his claim was to be advanced at about £2.5 million. The defendant's position was that the accident had caused only minor soft tissue injuries from which the claimant had made a full recovery within 3 months. His alleged later deterioration was false; he was a malingerer, seeking to exaggerate his claim for financial gain. The issues were stark.
4. Under CPR 26.3(6), the parties were required to file and serve an allocation questionnaire by 4 March 2011. Michelmores failed to do so and, on 7 March 2011, the court, of its own motion, ordered that, unless the questionnaire was served by 14 March the claim would be struck out. Michelmores filed and served a questionnaire on 10 March but it was incomplete in that it did not contain a schedule of costs to date and an estimate of future costs as required by section 6 of the Practice Direction to Part 43 in respect of multitrack cases. That was to prove an unfortunate omission. On 14 March, Morgan Cole wrote to the court pointing out this omission but did not copy the letter to Michelmores.
5. On 15 March 2011, judgment for the claimant was entered with damages to be assessed. The court made an order for standard disclosure of documents by 11 April 2011 and service of factual witness statements by 9 May 2011. Michelmores were late with their list of documents and were chased on 18 April 2011, but they had complied with the order by 4 May. On 9 May, Morgan Cole asked for certain documents from the list.
6. By 9 May 2011, Michelmores had not served their witness statements and had not sought an extension of time. A case management conference (CMC) took place on 19 May at which the court ordered service of witness statements by 7 June. The trial was listed for 4 days starting within the week commencing 16 January 2012. There was an order for the exchange of expert evidence by 17 August 2011. Each party was to be permitted to instruct an expert in six different disciplines. So 12 experts were envisaged. This was not a straightforward case.
7. On 24 May 2011, Ms Taggar, who had the care of the case at Morgan Cole, wrote to the court complaining that the claimant had not served a schedule of costs. She did not copy her letter to Michelmores or tell them about it; nor did she lodge an application for an order. On 2 June 2011, there was an exchange of emails about the evidence of care experts and Morgan Cole pressed for the disclosure of documents.
8. 7 June came and went with no witness statements from the claimant and no request for an extension of time. However, the following day, when Morgan Cole chased both statements and documents, an extension was agreed until 15 June. It was also agreed to postpone the whole issue of care experts for the time being.
9. On 14 June 2011, acting on its own motion, but possibly prompted by Ms Taggar's letter dated 24 May, the court ordered Michelmores to file and serve the costs schedule by 5 July.
10. The following day, 15 June 2011, the witness statements were due but were not served. Following correspondence, an extension was agreed until 24 June but Michelmores missed that date as well and Morgan Cole threatened an application for an order debarring the claimant from relying on any witness evidence. The statements were served on 29 June.
11. The costs schedule was not served by 5 July; nor was an extension of time requested.
12. During August, there was correspondence between the parties about the exchange of further medical evidence. Neither side was ready to disclose. In particular, the defendant had not been able to arrange an appointment for the claimant to see its orthopaedic expert until 7 September. It was agreed that exchange should be delayed until mid-September.
13. On 10 August, Ms Taggar wrote to the court complaining about the claimant's failure to serve the costs schedule. She did not copy that letter to Michelmores or tell them about it. Nor did she apply for the court to make an order. On 18 August 2011, of its own motion, and without giving Michelmores any opportunity to be heard or make representations, the court made an order that, unless the costs schedule was filed and served by 31 August 2011, the claim would be struck out.
14. On 19 August, Mr Finneran, the solicitor in charge of the file at Michelmores, went on annual holiday. The 'unless' order arrived at Michelmores' office on 22 August. As it happens, the draft costs schedule, which Mr Finneran had commissioned from a costs draftsman some time earlier, arrived by email on Sunday 21 August. In Mr Finneran's absence, responsibility for the file had been left with Mr Neil Hunt. During the week of 22 August, there were several communications between Ms Taggar and Mr Hunt about two matters, the payment of expenses for the claimant's attendance at a medical examination and the date of an appointment for the claimant to see the defendant's care expert, which appointment had been put back, by agreement, for two months. Although there were several communications, it appears that Ms Taggar did not ask after the costs schedule; indeed no mention was made by either Ms Taggar or Mr Hunt of the fact that an 'unless' order was about to expire and the claim be struck out. That was unfortunate as, had Mr Hunt been alerted, he may well have been able to comply with the order before time expired. On 31 August, Mr Finneran was still on holiday; the costs estimate was not served and the claim was struck out.
15. Mr Finneran returned to the office on 5 September 2011 and found out what had happened. On 8 September, he applied for relief from sanctions pursuant to CPR 3.9. The application was accompanied by the costs schedule and a supporting witness statement from Mr Finneran.
16. Mr Finneran requested a 30 minute telephone appointment. On 13 September, an appointment was given for 2 November and on 14 September, notice was sent to the parties. It was not until 13 October that Ms Taggar wrote to the court asking for a longer hearing with the parties present. On 24 October, that letter was placed before a district judge, who, without consulting Mr Finneran, vacated the 2 November appointment and arranged a new one for 7 December. Mr Finneran requested an earlier date because (optimistic as he was as to the outcome of his application) he was concerned that the trial date in January might be lost. Meanwhile, he was anxious to continue with the preparation and exchange of evidence. Ms Taggar refused any further exchange of medical evidence on the ground that the claim was struck out. Nonetheless, Michelmores served their medical and expert evidence at the end of October. In early November, Ms Taggar wrote to the court pointing out that the claimant now wanted to instruct an accommodation expert and said that, if permission were granted, the defendant would wish to instruct such an expert as well. She was of the view that the hearing date was already inevitably lost. For one thing, the existing experts had not yet met.
17. The application for relief duly came on before Deputy District Judge Melville-Shreeve on 7 December 2011. He received witness statements from Mr Finneran and Ms Taggar and heard counsel for both sides. The hearing lasted 2.5 hours. At the end, the judge refused relief and the action remained struck out. I will refer to his reasoning in due course. The claimant appealed and the appeal came on before HH Judge Cotter QC on 23 March 2012. On 4 May 2012 he allowed the appeal and restored the action to life. The second appeal by the defendant (now the appellant) came before this court on 26 October 2012.

The law

18. It is was not disputed before this court that the correct approach to an application such as came before the DDJ is for the judge to consider each of the factors listed in CPR Part 3.9 and to make any necessary findings of fact. He should then stand back, consider all the relevant circumstances of the case (which obviously include but are not necessarily limited to the CPR 3.9 factors) and should exercise his discretion, bearing in mind the over-riding objective to deal with the case justly under CPR 1. His task is to decide whether it is proportionate to grant or refuse relief.
19. CPR 3.9 is headed 'Relief from sanctions'. It provides:

(1) On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order the court will consider all the circumstances including

(a) the interests of the administration of justice;

(b) whether the application for relief was made promptly;

(c) whether the failure to comply was intentional;

(d) whether there is a good explanation for the failure;

(e) the extent to which the party in default has complied with other rules, practice directions, court orders and any relevant protocol;

(f) whether the failure to comply was caused by the party or his legal representative;

(g) whether the trial date or the likely trial date can still be met if relief is granted;

(h) the effect which the failure to comply had on each party;

(i) the effect which the granting of relief would have on each party.

20. As to the exercise of the discretion, in Hansom and others v Makin and Wright [2003] EWCA Civ 1981, Mance LJ (as he then was) said at paragraph 20:

"Indeed, 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 Deputy District Judge's judgment and Judge Cotter's comments upon it

21. After a brief exposition of the facts, the deputy district judge (the DDJ) noted the wide disparity between the two valuations of the claim and declared that for present purposes he would assume that the case was worth something nearer the claimant's figure than the defendant's. That approach has not been criticised. The claimant's solicitor believed himself to be conducting a weighty and complex claim and his actions had to be judged in that context. The DDJ also observed that the 'draconian penalty' of striking out had been imposed as the result of the expiry of an 'unless' order and that the application for relief from sanction was the first judicial consideration of the circumstances.
22. The DDJ then considered each of the Rule 3.9 factors in turn. Under (a), the interests of the administration of justice, he observed that a four day multi-track hearing had been lost and "at least in theory" wasted. Quite what significance he attached to this theoretical waste is not clear. In any event, as Judge Cotter was later to observe, no doubt from his position as Designated Civil Judge for the Devon and Cornwall group of courts, the pre-trial arrangements at the court were such that the removal of this case from the trial window would not have inconvenienced the court at all. It seems from later passages of his judgment that the DDJ regarded the loss of the trial date as being due entirely to the claimant's default and that this was a powerful factor in his decision. Judge Cotter thought the DDJ was wrong to attribute the whole of the fault for the loss of the trial date to the claimant. He had overlooked the effect of Ms Taggar's delay in challenging the time estimate of 30 minutes for the hearing of the application for relief. Had she complained earlier, said Judge Cotter, the application would probably have been heard earlier and the risk to the trial date would have been reduced.
23. Reverting to the DDJ's judgment, under sub-rule (b) he expressed the view that the application for relief had not been made promptly. He said that time ran from 31 August when the 'unless' order expired and the sanction took effect and not (as the claimant has submitted) from 5 September when Mr Finneran returned from holiday. He said that there was no excuse for any delay at all in making the application where the claim was large and important. Judge Cotter was critical of the DDJ's approach to this issue. He considered that the delay of a few days in making the application, following Mr Finneran's return from holiday, was not significant given the range of matters he would have to attend to at that time.
24. As to (c) and whether the default in respect of the costs schedule was intentional, the DDJ concluded that it was not, but later added that Mr Finneran seemed not to attach great importance to the provision of a costs schedule; in effect, I think he felt that Mr Finneran had been cavalier in his attitude to the need for a costs schedule.
25. Under (d), the DDJ was of the view that Mr Finneran had not provided any satisfactory explanation for the failure. He had mentioned that he had instructed a costs draftsman. He had suggested that there was little point in providing 'repeated estimates'. I can understand that the DDJ thought that remark quite inappropriate. First it was irrelevant as this was the first and only costs estimate required. Second, the remark did suggest a cavalier attitude on Mr Finneran's part. The DDJ also considered counsel's oral explanation for the delay which was that the case had not been properly handled in the office while Mr Finneran was away on holiday; the 'unless' order had been overlooked. As the DDJ remarked, that was not a good explanation. I think that Judge Cotter agreed with these observations.
26. Under (e) the DDJ considered Mr Finneran's claim, as set out in his witness statement, that there had been no previous 'unless' order against the claimant. That was inaccurate in that there had been a previous 'unless' order. Mr Finneran had also drawn attention to the one occasion on which the defendant had failed to comply with a requirement to serve evidence. The suggestion was that both parties had failed to comply with rules and orders; the fault was not all on one side and the claimant had been struggling to ensure that the trial date was met. It is not surprising that the DDJ was unimpressed by this submission. Mr Finneran had said nothing about the various ways in which he had failed to comply promptly with other orders. The DDJ went through the history and counted six defaults. He was plainly very critical of Michelmores. He was also rejected Mr Finneran's suggestion that the defendant was partly responsible for the delay and the loss of the hearing date. As I have said, Judge Cotter was critical of this aspect of the DDJ's judgment because he considered that, in the light of Ms Taggar's conduct after 8 September, at least part of the responsibility for the loss of the trial date lay with her. Judge Cotter was also concerned that the DDJ had not taken account of the point made by Mr Levene for the claimant that, although there were several defaults, in fact the claim was proceeding at a good pace. Most of the defaults had been remedied within a few days or a few weeks at most. The proceedings had been served only in January 2011 and, by August 2011, were on course for a trial date in January 2012. Looked at in the round, this was not a case in which the claimant's solicitors were seriously holding up the proper progress of the case.
27. After noting that the failure to comply in the present case was entirely the fault of the solicitors and not at all attributable to the claimant himself (sub-rule (f)), the DDJ turned at paragraph 27 of his judgment to consider sub-rule (h), "the effect which the failure to comply had had on each party". At first sight it appears that he had missed out sub-rule (g), the question whether the trial date could still be met if relief were granted. However, he had already expressed his view that the trial date had been lost, as the result of the default and strike- out, coupled with the delay in fixing a hearing for the relief of sanctions, which he attributed entirely to the fault of the claimant.
28. At paragraph 27 of his judgment, the DDJ first observed that the failure to comply had had a dramatic and draconian consequence for the claimant in that his claim had been struck out. He seems there to have had in mind not the consequence of the failure to comply with the order (sub-rule (h)) but rather the effect of a refusal to grant relief (sub-rule (i)). He then recorded, without comment, the claimant's submission that the defendant had had a 'windfall'. I think that the gist of that submission was that the defendant had escaped liability to pay damages in a case where it was admittedly at fault. That too seems to have been a matter for consideration under sub-rule (i). He then said that the effect on the defendant was "not quite as simple as that". He discussed the loss of the trial date, which he described as having a 'very severe' effect on the defendant. He did not say why. He concluded this paragraph by accepting that "the failure is more severe for Mr Beever than for, effectively, the defendant's insurers". Somewhat confusingly, the DDJ then dealt with sub-rule (i) and reverted to sub-rule (h) in paragraph 29 of his judgment where he said that the effect of the default on the claimant was not so severe because he had a claim in negligence against his solicitors which would be of a similar value. He then accepted that the claim "would not perhaps be of quite the same value". On the other hand, he said, the defendant's position was stark; either it would or would not be facing a £2.5 million claim.
29. Judge Cotter was critical of this analysis. He did not mention the confusion to between sub-rules (h) and (i) to which I have drawn attention. He thought that the DDJ had understated the difficulties of the claimant in bringing a professional negligence claim against a solicitor where the underlying claim was complex and malingering was alleged. The effect of the loss of professional privilege had to be considered. Judge Cotter thought that the DDJ had understated the difficulties inherent in finding new solicitors and obtaining funding; there would be significant delays. In short, Judge Cotter thought that the DDJ had erred in his assessment of the effect of the refusal of relief on the claimant; Judge Cotter thought it would be little short of devastating. In so observing, he was in fact dealing with the issue under sub- rule (i) rather than (h).
30. When dealing with sub-rule (i), the DDJ observed very briefly that, if he granted relief the defendant would be back in the action facing a £2.5 million claim and the claimant would be in the same position as he had been before, subject to the delay of a few months due to loss of the trial date. Judge Cotter did not comment on this.
31. At paragraph 35, the DDJ reminded himself, correctly, that he must stand back, look at all the surrounding circumstances and ask whether it was proportionate that the claim should remain struck out. He listed the factors which he regarded as relevant to this consideration. He said that there were professional litigators on both sides, in a 'massive and important' case. There had been repeated errors, not just one. The claimant would be able to recoup from the solicitor's insurers. The trial date was irretrievably lost, largely although not entirely because of the breach. (I note in passing that this was somewhat inconsistent with his previously expressed view that responsibility for this lay entirely with the claimant). He said that, if he were to reinstate the claim, the steps still to be taken could not be achieved before the 16 January. He then stated that he was taking a robust view. Case management decisions had to be treated with respect. The more important a case was, the more important it was for the case management decisions to be give the most careful attention. The case had been struck out because the claimant had failed to give a costs estimate and the DDJ had seen no argument to persuade him to reinstate it.
32. In concluding that the DDJ had been wrong, Judge Cotter said that the DDJ had erred in his assessment of the rule 3.9 factors in the ways in which I have set out above. He was also of the view that, although the DDJ had stated that he must stand back, review the circumstances and consider the proportionality of the sanction, he had not in fact done so. Judge Cotter thought that it had not been properly open to the DDJ to reach the conclusion that he did. He listed the factors which he thought should have been taken into account when considering proportionality. He mentioned that this was a high value claim; there was no deliberate act in breaching a court order; there had been no substantial delay caused by the breach of the 'unless' order alone. He considered that to throw the claimant into an action against his solicitor was a 'hugely serious' step and that in all the circumstances it would not be fair or proportionate to refuse relief. He allowed the appeal and reinstated the action.
33. For the sake of completeness, I should mention that, at an early stage of his judgment, Judge Cotter had expressed his concern about and disapproval of the practice of solicitors who write to the court pointing out a failure to comply with a rule of court or the breach of an order rather than applying to the court for a further order or for the imposition of a sanction for the prior failure or breach. In effect, the complaining party was inviting the court to act of its own motion. Judge Cotter noted Ms Taggar's explanation as to why she had adopted this course in the present case; it saved the cost of an application. But, as the judge noted, the order could then be made (and was in this case made) without the offending party being heard. Any order made of the court's own motion ought to state that the party against whom it was made may apply to have it set aside. However, in the present case, the orders made of the court's own motion had not included that rubric. These issues were to play a prominent part in the submissions made to this court. It should be noted that they had not been raised before the DDJ, largely because, in her witness statement prepared for the hearing before him, Ms Taggar had not included any reference to her letters to the court drawing attention to the claimant's failure to comply with the order to provide a costs estimate. The result was that neither the DDJ nor the claimant's team was aware that those letters had been written. That only came to light shortly before the hearing before Judge Cotter.

The appeal to this court – submissions

34. In a case where there have been two decisions, which have been decided in opposing ways and where both parties have at some stage been the appellant, it may be confusing to call the parties appellant and respondent. For that reason, I shall continue to refer to the parties as claimant and defendant.
35. Not all the grounds of appeal advanced in writing were pursued with any vigour by Mr John Leighton Williams QC for the defendant in his oral argument. For example, the first ground was that Judge Cotter had failed to review the DDJ's decision as he should have done; instead he had considered the matter afresh. I shall deal with this ground of appeal immediately. It is entirely clear to me that Judge Cotter well knew that his function was to review the DDJ's decision and he did so. However, once he had concluded that the DDJ had erred, as it is clear that he did, his function was to consider the matter afresh.
36. The real thrust of Mr Leighton Williams' submissions was that the DDJ's analysis was correct and that Judge Cotter should not have interfered with it. Also, having decided to consider the matter afresh, Judge Cotter himself erred in his assessment of the evidence and his weighing of the various factors when considering proportionality.
37. Mr Leighton Williams criticised Judge Cotter's view that the delay in making the application for relief had been insignificant. The DDJ had been right to hold that the application had not been made promptly. He also alleged that Judge Cotter had failed to take account of the DDJ's holding that Mr Finneran was cavalier about the need to provide a costs estimate. The judge had failed to take into account that there was no acceptable explanation for the default. He had also failed to take into account the history of defaults. He had been over-sympathetic to the submission advanced on behalf of the claimant that the effect of the striking out order and the refusal of relief was to give the defendant a 'windfall' escape from liability.
38. Mr Leighton Williams also submitted that Judge Cotter had laid far too much emphasis on the question of who had been responsible for the loss of the trial date. The DDJ had been entitled to hold that the loss of the trial date was the claimant's fault because the action had been struck out for breach of the 'unless' order. Also he had been entitled to take that into account in the exercise of his discretion. The judge should not have entered into a discussion about what the various judges should have ordered so as to enable the hearing date to be kept. The judge was wrong to assume, as he implicitly did, that the application for relief could have been heard over the telephone. It was the claimant's fault that the hearing date was lost and that was a factor which the DDJ had been entitled to take into account.
39. Finally, Mr Leighton Williams submitted that the DDJ had been right to adopt a robust attitude towards the claimant's defaults. This was in accordance with the spirit and intention of the CPR and also with the dicta of the court in Fred Perry (Holdings) Ltd v Brands Plaza Trading Ltd and Another [2012] EWCA Civ 224.
40. Mr Patrick Lawrence QC for the claimant submitted, first, that Judge Cotter had been right to attach significance to Ms Taggar's failure to copy her letters to the court to Michelmores. Her letters were in the nature of 'quasi applications' and should have been copied to Michelmores. Her failure to do so had amounted to a breach of paragraph 7.2 of the Practice Direction to Part 29 which requires a party who intends to apply to the court for a sanction to be imposed to warn the other party of his intention to do so. The result was that the 'unless' order was made without Michelmores having any opportunity to be heard. This was a breach of the primary precept governing the administration of justice that no order should be made to the prejudice of a party without being given the opportunity to be heard: see Moat Housing Group South Ltd v Harris [2006] QB 606. Mr Lawrence submitted that, if Mr Finneran had known that he was facing an application to strike out, he would have been able to press the costs draftsman for the schedule and the order would probably have been complied with, either before the 'unless' order was made or soon afterwards. I mention now that Mr Leighton Williams' response to this was that notifying Mr Finneran in advance would have been of no effect; his attitude was so cavalier that he would still have failed to provide the schedule in time.
41. Second, Mr Lawrence submitted that Judge Cotter had been right to say that, although there had been a number of defaults on the claimant's side, these had not resulted in any serious delay in the conduct of the action. The action, which had only begun in January 2011, was on course for a hearing date in January 2012 which, given the complexity of the matter, was satisfactory.
42. Third, Mr Lawrence submitted that the DDJ had seriously underestimated the prejudice which the claimant would suffer if his action remained struck out and he was obliged to take action against Michelmores. Not only would there be delay and probably some difficulty in obtaining funding, the claimant would be gravely disadvantaged because he would be bringing an action against a solicitor who had the advantage of knowing all those matters which had been subject to legal professional privilege in the first action. In a case in which malingering had been raised as an issue, this might well be a grave disadvantage. There would not be equality of arms in the second action. In addition, where malingering was alleged, a claimant would wish the result of the action to vindicate him from that slur; if this claimant had to sue Michelmores, the action would be dealt with on a percentage risk basis and the claimant would lose the opportunity of vindication.
43. Finally, Mr Lawrence submitted that it was contrary to the public interest and to the interests of the good administration of justice that courts should too readily make a strike out order or an order which might rapidly lead to strike out. The courts should be careful to strike out a claim or to refuse relief only where it was properly justified. Too great a willingness to strike out claims was bound to lead to further costly and time consuming litigation, as had happened here.

Discussion

44. I will say at once that, in my view, this appeal should be dismissed, broadly for the reasons given by Judge Cotter. I accept that some criticism may be made of Judge Cotter's observations, as Mr Leighton Williams has submitted, but in my judgment, these criticisms are not such as to undermine his conclusion. Indeed, I consider that there are additional reasons, not clearly articulated by the judge, why his conclusion was correct.
45. In my view, Judge Cotter was entitled to hold that the DDJ had fallen into error and therefore that he must exercise his discretion afresh. I consider that Judge Cotter was right to say that the DDJ had not properly balanced the various relevant factors when standing back to consider whether it would be proportionate to refuse relief from the sanction of strike out. He was right in saying that the DDJ had taken a mistaken view of the gravity of the delay in making the application for relief. I accept that the DDJ was right to say that the delay ran from 31 August, rather than 5 September when Mr Finneran returned from holiday. No doubt he was right to say that Michelmores had had no excuse for failing to deal with the 'unless' order while Mr Finneran was away. But, to my mind, Judge Cotter was right to say that the delay of a few days in making the application was not of great significance. Further, I consider that the DDJ had focussed strongly on the claimant's various defaults, yet without considering whether those defaults had had a significant effect on the progress of the action or had significantly prejudiced the defendant. In particular, I note that no reference was made to the fact that the claimant served the schedule of costs with his application for relief. Thus, although the defendant had no doubt been prejudiced to some extent by the overall delay in receiving the costs estimate, the delay after the expiry of the 'unless' order was of only 8 days. It seems to me that the DDJ was so concerned to take a robust view that he failed to bring into account the matters which sounded in the claimant's favour. He underestimated the effect on the claimant of the loss of his right to damages from the appellant in respect of which there had been an admission of liability. He underestimated the disadvantages to the claimant of having to sue his own solicitor. I think also that he overestimated the importance of the loss of the trial date causing what he described as severe prejudice to the defendant.
46. In summary, I consider that Judge Cotter was entitled to interfere with the DDJ's decision for the reasons he gave. I mention in passing that the DDJ did not expressly mention the overriding objective. I am aware that, when that omission was put to him in the course of an application for permission to appeal, he said that he had had it mind. Indeed, he may well have done in that he did remind himself that he had to stand back to look at all the circumstances and to consider whether it was proportionate to refuse relief from the strike out. That may be said to be very close to considering whether it was just to refuse relief. In short, although it is probably wise for judges to mention the overriding objective expressly when they are about to exercise their discretion on a matter of this kind, because it reminds them of the need to deal with the case justly, I do not think that this DDJ should be criticised for his failure to do so.
47. Even if I had not thought that Judge Cotter's criticisms of the DDJ were justified, I would still have thought that he was entitled to exercise his discretion afresh. That was because the DDJ had been unaware of and therefore unable to take account of a highly relevant factor, namely the fact that Ms Taggar had failed to copy to Michelmores her letters to the court and, in particular, her letter dated 10 August 2011. I am not prepared to say that this was a breach of paragraph 7.2 of the Practice Direction to Part 29, as submitted by Mr Lawrence. That paragraph is concerned with the procedure to be followed when a party is about to make an application for the imposition of a sanction. It does not directly apply where a party is seeking only to invite the court to make an order of its own motion. But, on any view, Ms Taggar's failure to copy her 'invitation' letters to Michelmores was a breach of good practice. The DDJ had been unaware of this failure because the claimant's team were themselves unaware of it and because Ms Taggar did not mention those letters in her otherwise detailed chronology submitted to the DDJ. The DDJ's ignorance of that factor alone would in my view be sufficient to entitle Judge Cotter to consider the matter afresh. Further, when the defendant's failure to copy those letters to the claimant was coupled with the decision of the court, on 18 August 2011, to make an 'unless' order of its own motion without giving the claimant the opportunity to be heard or to even to make written representations, the circumstances created a powerful argument for the grant of relief. These were highly relevant factors falling outside the ambit of the CPR 3.9 factors. It follows that they were not only relevant to Judge Cotter's right to interfere but also relevant to the exercise of his own discretion.
48. Although I have said that I think that this appeal should be dismissed, I do accept that Judge Cotter's own approach was less than ideal. Where a judge on the first appeal concludes that the judge below has erred and that he must exercise his discretion afresh, I think that the judge should consider the various CPR 3.9 factors for himself and then explain his own assessment of the significance and weight of all the relevant circumstances. Judge Cotter's approach was to criticise some aspects of the DDJ's judgment, make some observations of his own, conclude that the DDJ had erred and then to move straight to his own conclusion. The result was that it was not clear what Judge Cotter thought about some of the factors and not clear to what extent some of his observations had influenced his decision. For example, Mr Leighton Williams complained that Judge Cotter had laid far too much emphasis on who had been responsible for the loss of the trial date. It is true indeed that he discusses this point at some length. Yet it is not clear whether, in the end, he thought it greatly mattered. Nor is it clear how important he thought was the failure to warn Mr Finneran about the 'invitation' letters or the court's own decision to make an 'unless' order of its own motion without giving the claimant an opportunity to be heard.
49. I propose therefore to go through the various factors myself, extracting what I understand to be Judge Cotter's attitude to each of them and, on occasions making some observations of my own. I will then explain why I consider that Judge Cotter's conclusion was in fact right.
50. Under CPR 3.9(a), the court has to consider the interests of the administration of justice. The DDJ thought that what mattered here was that the court had been inconvenienced by the loss of the trial date and the potential waste to the court of a 4 day hearing slot. It seems that Judge Cotter also thought that was what sub-rule (a) was driving at but disagreed with the DDJ because he thought that the hearing slot would not in fact be wasted. I do not suggest that the loss of court time is not a relevant factor but it does seem to me that 'the interests of the administration of justice' are concerned with wider and potentially more important issues than simply the loss of court time. I would not wish to propose a list of factors which might be relevant to the interests of the administration of justice but I do suggest that they might well include such matters as the right of access to the courts and the importance of doing justice between the parties. It will be in the interests of the administration of justice that a party does not lose his right of access to the courts without good reason. One good reason why he might have to lose it could be that, for some reason, possibly on account of delay, possibly on account of the destruction of documents or other tampering with evidence, it has become impossible to have a fair trial. I would have thought that under (a) in the present case, it would be relevant to observe that the claimant had a judgment on liability and that there had not been such delay or other conduct as might jeopardise a fair trial. Those factors would, in my view, sound in favour of the grant of relief, rather than its refusal on account of the loss of a four day hearing slot.
51. Under (b) the DDJ thought that the application for relief had not been made promptly and thought it an important factor. Judge Cotter thought that the delay was insignificant. The delay was of 8 days. There was no good reason for that delay but, in itself, it could not have caused real prejudice to the defendant. I think Judge Cotter was entitled (indeed right) to say that the delay was not significant.
52. Under (c), I think that both judges were properly of the view that the failure to comply was not intentional. The DDJ thought that Mr Finneran's attitude towards the provision of a costs estimate was cavalier. His attitude did him no credit. Judge Cotter did not comment upon this and it is not clear whether he thought it important; presumably he did not. I would accept that a cavalier attitude may well be relevant and could be important; but I do not think that such an attitude should be treated as a significant factor in support of the refusal of relief unless it has either had an effect on the progress of the case or has caused a party to suffer some disadvantage. In short, a cavalier attitude of itself, while unattractive, is not necessarily a significant factor.
53. In the present case, the delay in providing the costs schedule had not caused any real prejudice of which the defendant complained. Nor had it delayed the progress of the action. That is not to say that a costs schedule is not important. It has two main purposes. One is to enable the parties to make fully-informed decisions on Part 36 offers. However, the powers of the court on making a costs order are wide and allowance can be made at that stage for any prejudice that a party has suffered as the result of the delayed service of a costs schedule. The costs schedule also enables a defendant's insurer to estimate an appropriate reserve and thereby manage its financial affairs. However, I do not think that, in the absence of evidence, it should be assumed that the delay in service of a costs schedule could have a seriously prejudicial effect on a defendant. I think therefore that the DDJ was wrong to treat this factor as significant. It is not clear to me what significance Judge Cotter attached to it.
54. Under (d), both judges agreed that there was no good explanation for Mr Finneran's failure to provide the costs estimate in time. He had had plenty of time in which to do so before the 'unless' order was made. Once the order had been made, it was unfortunate that he was away on holiday but a firm the size of Michelmores ought to have had proper cover arrangements in place. It is, however, some slight mitigation that Ms Taggar did not mention the existence of the rapidly expiring 'unless' order in her discussions about this case with Mr Hunt during Mr Finneran's absence.
55. When considering, under (e), the extent to which the claimant had complied with other rules or orders, the DDJ was plainly much annoyed by Mr Finneran's false claim that there had been no previous unless order, his suggestion that the defendant had also been at fault and his attempt generally to minimise the extent to which he himself had been at fault. Mr Finneran's evidence did him no credit at all. But I do consider that the DDJ was wrong to tot up the number of the claimant's failures and treat them as very serious without considering the effect which these failures had had on the conduct of the action. In my view, Judge Cotter was right to note that, although there were a number of failures to comply with time limits and orders, the failures were short-lived and the action was proceeding very well.
56. It was common ground that the only observation which could be made in respect of (f) was that the fault was Mr Finneran's and not the claimant's. The importance of this, in the context of an action which has been struck out, is that the claimant will be able to sue his solicitor - a factor which sounds against the granting of relief from the sanction - but also that the claimant will or may suffer prejudice in losing his rights against the original tortfeasor – a factor which sounds in favour of relief. There is plainly some overlap between this factor and sub-rule (i) and it matters not under which heading these matters are considered.
57. Under (g), the court is required to consider whether the trial date could still be met, if relief were granted. Both judges assumed that that it could not be and both were deeply interested in why the trial date had been lost and whose fault that was. The DDJ thought that its loss was due entirely (or almost entirely) to the fault of Mr Finneran. Judge Cotter thought that the trial date need not have been lost if Ms Taggar had more quickly objected to the inadequacy of the hearing time requested by Mr Finneran and if the district judge who had dealt with the listing had made greater efforts to provide an early date. Both judges appear to have overlooked the fact that there had already been some slippage of the timetable due to an agreement between the parties to delay the service of the reports of the care experts. There was also a problem in that, in late October, the claimant's team had decided that they wished to instruct an expert in accommodation needs. They required permission and, if they obtained it, the defendant was going to instruct its own expert in that field. No judge had yet decided whether permission ought to be granted. If it were to be granted, some delay would be inevitable and the hearing date would be lost regardless of any other factor. Further still, as Ms Taggar had pointed out to the court, the existing experts had not yet met and the hearing date was inevitably lost. It does seem to me that the hearing date was quite likely to have been lost regardless of the claimant's failure to supply the costs estimate and the expiry of the 'unless' order. That being so, the argument about fault generally and Ms Taggar's delay in particular seems to have grown out of proportion. The hearing date might well have had to be delayed by, say, 3 months, in any event. In the context of a case of this complexity, that is not a serious problem, so long as the need for a postponement is recognised well in advance, as it was here, so that court time is not lost at the last moment. So, although Mr Leighton Williams may well be right to say that Judge Cotter should not have dealt with this issue as he did, I do think he was right to give it little or no weight in his final assessment.
58. I come now to (h) and "the effect which the failure to comply had on each party". It seems to me that the DDJ did not properly consider this factor and Judge Cotter did not realise that he had not done so. It seems to me that the DDJ misunderstood the purpose of subparagraph (h). I consider that (h) is intended to deal with the effect of the default on the parties in their conduct of the claim, rather than with the effect of the consequences of the default on the overall position of the parties. This default had not affected the claimant in any way. The purpose of (h) in this case was for the court to consider the extent to which the defendant had been prejudiced in its conduct of the case by the failure to provide a costs schedule at the right time. How important was that schedule to the defendant? How damaging to it was the failure to supply it at the proper time? Originally it ought to have been produced in March 2011 but the default which led to the strike-out was a failure to provide it by 31 August. It was in fact provided on 8 September. I have already explained why a costs schedule is required and why it may be important. A delay of 8 days in the provision of a costs schedule is unlikely to be important and was not in this case. The delay of 6 months (from March to September 2011) is potentially more serious although there was no evidence of its gravity. The delay in service of the schedule after the making of the 'unless' order resulted in the claim being struck out and the trial date being lost. However, it is not clear to me why the loss of a trial date should be regarded as having a 'very severe' effect on the defendant. In short, I think that the DDJ fell into error in his paragraph 27. I think he confused the purpose of (h) which is concerned with prejudice within the conduct of the case with the purpose of (i) which is concerned with the wider effect of the decision on relief from sanction on the on the parties' general interests. In my view, neither judge assessed factor (h) adequately. My view is that the defendant may have suffered some prejudice as the result of the overall delay in service of the costs schedule (which could be largely rectified at the stage of making a costs order) but none to speak of in respect of the 8 days after expiry of the 'unless' order. I do not think that factor (h) could weigh significantly in the defendant's favour.
59. Sub-rule (i) is concerned with the effect on each party of the grant or refusal to grant relief. It is here that the court may wish to consider the degree of prejudice which the claimant will suffer if he is obliged to take action against his solicitor. The DDJ's assessment of the prejudice to the claimant was confused. Judge Cotter thought that the refusal to grant relief would have a devastating effect on the claimant. I myself would not have expressed myself quite as strongly as did Judge Cotter, although I certainly accept that the prejudicial effect on the claimant would be severe if relief were refused. There would be the disadvantage of having to find another solicitor and to arrange funding, the inevitable delay in recovering damages and some disadvantage (to a degree which I find impossible to assess) in finding himself suing a party who has previously had access to legally qualified materials.
60. The prejudice to the defendant if relief were to be granted is, in one respect, easy to assess; as the DDJ pointed out, the defendant was either liable for a potentially large sum of money or it was not liable at all. The effect of grant or refusal of relief was a stark as that. Neither judge discussed the implications of this issue in the wider context of the interests of justice. As a general rule, it is in the interests of justice that a tortfeasor should be held directly for the damage he has caused rather than that the claimant's solicitor who has made an error or series of errors should have that responsibility transferred to him on a risk or chance basis in satellite litigation. Of course, there are times when that must happen (for example when a fair trial is no longer possible) but, in my view, the courts should not cause that to happen unless there are sound reasons for it.
61. Having considered each of the sub-rules, I observe that there appear to be sound reasons why relief should be granted and no very strong reason why it should be refused. True, there are several points of criticism of Michelmores' conduct of the claim, which was not as it should have been. However, it does not seem to me that those criticisms, even when considered collectively, amount to the kind of conduct which would justify striking out the action when its overall (not grave) effects on the action are considered together with the severe prejudicial effect on the claimant of the refusal of relief.
62. In addition to the factors which have been considered under CPR 3.9, it is in my view, germane to consider the circumstances in which the 'unless' order came to be made. When Mr Finneran failed to serve the costs schedule by 5 July 2011, Ms Taggar wrote to the court on 11 August but did not copy her letter to Mr Finneran. That was wrong; Mr Finneran did not know that the court was about to consider making an order which might result in the claim being struck out. I recognise of course that the court has the power to make an order of its own motion but, particularly where there is a possibility of a 'strike-out unless' order, it is far preferable for an application to be taken out, in which case notice of the application must be served on the opposing party. The saving of costs is not a good reason for adopting the informal process used in this case. True, costs would be incurred but the claimant would be ordered to pay them and almost certainly to pay them immediately. If, contrary to the view I have expressed, a court regards it desirable to make an 'unless' order without the issue of an application, the court should surely be slow to make such an order without giving the party affected the opportunity to be heard, as happened here. In short, I deprecate the practice followed here. The CPR are intended to make solicitors comply with orders or to face the consequences with their eyes open. They are not intended to create traps for the unwary or slightly incompetent. In my view, these circumstances are highly relevant to the exercise of the court's discretion on the grant of relief.
63. For the reasons I have given I consider that Judge Cotter reached the right conclusion. He did not make it clear that he had taken into account the circumstances to which I have just referred. Nor did he expressly consider the wider aspects of the interests of justice to which I have referred a little earlier. He may well have had both matters in mind. In any event, they serve only to reinforce the grounds of his decision.
64. I would dismiss this appeal.

Etherton LJ:

65. I agree.