England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
MERCANTILE COURT
HHJ Mackie QC

		Royal Courts of Justice Strand, London, WC2A 2LL
		12th December 2014

Lord Justice Richards :

1. The matters before us relate to case management decisions by His Honour Judge Mackie QC, sitting in the Mercantile Court, in a case which the judge described as "one of the least manageable I have ever tried to manage".
2. The case arises out of the termination of a joint venture agreement by which the claimant was to market and sell caravans and lodges to be pitched at the defendant's site. There is a dispute as to whether the agreement was terminated consensually or because the defendant repudiated it. Each party alleges that the other failed to account for payments received in respect of transactions entered into during the period of the agreement. The claimant seeks the value of stock which was at the defendant's premises when the agreement ended and which the defendant refused to allow the claimant to collect. There are claims for loss of profit. The claimant values its total claim at over £500,000, whilst the defendant values its counterclaim at over £200,000.
3. By orders dated respectively 6 December 2013 and 7 February 2014 the judge dismissed applications by the defendant that the claim be struck out for, among other things, failure to comply with the timetable laid down by an earlier order as regards disclosure, service of a schedule of account, and exchange of witness statements. The following matters arise:

i) The defendant's appeal against the order of 6 December 2013. Permission to appeal was granted by Briggs LJ. The claimant applied to set aside the grant of permission. The set-aside application was listed for hearing together with the appeal and was not formally abandoned before us but the issues in it were subsumed within the substantive issues on the appeal.

ii) The defendant's application for permission to appeal against the order of 7 February 2014, listed before us on the basis that the appeal would follow immediately if permission was granted. The issues are closely related to those arising in relation to the order of 6 December 2013.

iii) The defendant's application for permission to amend the grounds of appeal against the order of 6 December 2013 so as to add a detailed allegation (briefly advanced in the application for permission to appeal against the order of 7 February 2014) that the judge was biased or prejudiced against the defendant and should have recused himself from further involvement in the proceedings.

4. It is convenient to retain the first instance terminology of "claimant" and "defendant" rather than referring to "respondent" and "appellant" respectively.
5. The defendant has been represented throughout by its director, Mr Neil Morgan. Although he is a non-lawyer, he has displayed a considerable knowledge of the relevant rules and authorities, to which he says he has devoted many hours of reading for the purposes of the appeal, having previously been wholly unfamiliar with them. The claimant has been represented throughout by counsel (Mr Daniel Saoul before Judge Mackie, Mr Michael Buckpitt before us).

The relevant procedural history

6. The claim was issued, and a defence and counterclaim was filed, in June 2012. All the case management has been done by Judge Mackie. I will not attempt a full procedural chronology but will pick out what appear to me to be points of particular relevance.
7. The order the judge made at the first effective CMC, on 25 January 2013, included provisions that (i) standard disclosure was to be made by 12 April 2013 and inspection was to be completed by 7 days thereafter; (ii) the claimant was to file and serve by 10 May 2013 a schedule of account setting out the transactions claimed to have been conducted pursuant to the agreement and identifying the monies paid or payable to each party in connection with each such transaction; (iii) the defendant was to serve a counter-schedule of account by 24 May 2013; (iv) signed statements of witnesses of fact and any required hearsay notices were to be exchanged by 21 June 2013; and (v) the trial was to be fixed for a date not before 30 August 2013, with a time estimate of 4 days.
8. At the second effective CMC, on 23 April 2013, the judge heard, among other matters, an application by the defendant for a strike-out and/or summary judgment in respect of the claimant's allegations of repudiatory breach of contract. The judge dismissed the application and ordered the defendant to pay the claimant's costs of that and a further application, summarily assessed in the total sum of £4,900, by 7 May 2013. That triggered secondary applications:

i) The defendant applied to the Court of Appeal for permission to appeal against that part of the judge's order. Permission was refused on the papers in January 2014. We are told that the hearing of the oral renewal has been stood out pending determination of the matters now before us. In conjunction with the application for permission to appeal, the defendant sought a stay of execution of the costs order. No stay was granted. The defendant has nevertheless failed to comply with the order.

ii) On 10 June 2013 the claimant filed an application that the defence and counterclaim be struck out unless the defendant paid the costs of £4,900 within 7 days of the hearing of the application.

9. The order made by the judge at the CMC on 23 April also included variations to the timetable laid down in the 25 January order, including provisions that (i) standard disclosure be made by 27 May 2013; (ii) the claimant's schedule of account be filed and served by 21 June 2013; (iii) the defendant's counter-schedule of account be filed and served by 5 July 2013; (iv) witness statements be exchanged by 2 August 2013; and (v) the start date of the trial (which had been fixed for 9 December 2013 pursuant to the previous order) be adjourned to 13 January 2014.
10. On 14 May 2013, that is before the 27 May deadline for standard disclosure, Mr Morgan sent an email to the claimant's solicitor, Mr Winter, identifying various categories of documents the disclosure of which the defendant demanded. In a reply dated 7 June, Mr Winter said that the claimant "will deal with disclosure as soon as possible in the conventional way by serving our client's List of Documents". By an email on 10 June Mr Morgan repeated that full and frank disclosure was required of all documentation within the categories previously identified. On 11 June, on receipt of the claimant's application for a strike-out for non-payment of the costs ordered on 23 April, Mr Morgan sent a further email, in the course of which he said this about disclosure:

"On the subject of applications, you should note that we have not so far applied for your claim to be struck out because you have failed to comply with the disclosure deadline order. This is simply because you would then rush to complete disclosure before any deadline of any unless order and provide everything. However, we want you to take your own sweet time. You take as much time as you like. We have no doubt that you and your client are trying to shred documents / destroy documents / hide documents as fast as you possibly can. Just be aware of what the consequences will be if we catch you. And we are going to be trying really hard to catch you."

In his submissions to us, Mr Morgan sought to explain all that by saying that he was expecting the claimant's disclosure to be made very soon in any event. But whatever he intended, the message conveyed by the email was that the timing of disclosure was not a matter of concern to the defendant.

11. Mr Morgan's email of 11 June also attached the defendant's own list of documents by way of (late) compliance with the disclosure provision in the order of 23 April. Mr Winter replied by letter of 12 June acknowledging receipt of the defendant's list, apologising for the delay in serving the claimant's list (which was attributed to Mr Winter's other commitments) and stating that he would seek to serve it as soon as possible. That was the last communication between the parties on the subject of disclosure until the end of September or early October. Further exchanges between them in July related to the claimant's application for a strike-out for non-payment of the costs order.
12. The communications from Mr Morgan included some unpleasant and abusive language which was subsequently the subject of adverse comment by Judge Mackie. It is not directly relevant to the issues before us and I do not need to deal with the explanation that Mr Morgan gave us for his behaviour. He was restrained and courteous in his conduct of the defendant's case at the hearing of the appeal.
13. The claimant says that by letter dated 30 September 2013 it sent its list of documents to the defendant, offered inspection or the provision of copies of those documents, and requested copies of all the documents disclosed on the defendant's list. The defendant says that it did not receive such a letter. A follow-up letter from the claimant was sent by email on 8 October, also enclosing the schedule of account which under the judge's order had been due by 21 June.
14. On 9 October Mr Morgan sent an email to Mr Winter stating:

"We have not received any disclosure / list of documents from you. Judge Mackie's order of 23 April 2013 required you to give disclosure by 27 May at the latest. You did not do so. You are in fundamental and very serious breach of the court order and now more than 4.5 months out of time. The timetable ordered by the court has completely gone. We presumed you had abandoned your meritless and fabricated claim because it is meritless and fabricated and because we had not heard from you."

The email intimated an intention to apply to strike out the claim "for all the reasons previously given, plus the very serious breach of the order". It also stated that, as previously advised, Mr Morgan was presently involved in other proceedings and "will not do anything with this matter until mid-November at the earliest" as he had no available time.

15. In a response on the same day, Mr Winter sent further copies of the letters of 30 September and 8 October. He did not accept that Mr Morgan was unable to deal with these proceedings in the immediate future and said that "At the very least, you should be able (a) to make arrangements to provide us with copies of your documents and (b) to indicate when you intend to provide a Counter-Schedule and to exchange witness statements", none of which should take a significant amount of time. He also stated that the claimant would be inviting the court to list as soon as possible the application for a strike-out for non-payment of the costs previously ordered. On 16 October 2013 he wrote to the court to request a listing of the claimant's strike-out application and a renewed CMC.
16. On 21 October 2013 the defendant applied for the claimant's claim to be struck out "because of the deliberate and fundamental failure to comply with the Order dated 23 April 2013 requiring disclosure by 27 May 2013". The application notice continued:

"The defendant had not heard from the claimant for so long that it was assumed that the claimant's meritless and fabricated claim had been abandoned. However by email timed at 15.15 on 9 October 2013, the claimant sent its purported disclosure list. This was 4.5 months too late. The court timetable has completely gone. There has been a fundamental and fatal failure to comply with the Court Order. In addition, it is plain and obvious from a cursory examination of the list that the claimant has deliberately not disclosed a large number of documents when the defendant has already made clear to the claimant what disclosure was required …."

The notice also complained that the claimant had disclosed documents that had no relevance whatsoever to the proceedings. It went on to state that in the alternative to striking out the entire claim "the claim of 'repudiatory breach' should be struck out because the claimant's disclosure directly proves that the claimant has absolutely no means of evidencing this part of the claim". It was alleged that "the claim, as repeatedly stated, is an abuse, it is a meritless and fabricated claim and should be struck out".

17. We were told that in the absence of a request by the defendant for inspection of the documents on the claimant's list, the claimant sent copies of those documents to the defendant in electronic form on 28 November 2013.
18. The various outstanding applications came before the judge on 6 December 2013. The judge's reasons for the order made on that occasion are considered later in this judgment. The order itself included the following: (i) the claimant's application to strike out the defence and counterclaim for non-payment of the £4,900 costs ordered on 23 April 2013 was dismissed; (ii) the defendant's application to strike out the claim (treated as an application in the alternative for summary judgment on the claim) was dismissed; (iii) applications by the defendant for specific disclosure and security for costs were stood over with liberty to apply; (iv) the defendant was to file and serve its counter-schedule of account, in the form of an amended version of the claimant's schedule of account, by 20 December 2013; (v) the defendant was to provide copies of its disclosed documents by 27 December 2013; (vi) the parties were to exchange witness statements by 7 February 2014; and (viii) the trial was adjourned from 13 January 2014, to be relisted to be heard not before 1 March 2014.
19. On 22 January 2014 the defendant made a further strike-out application, on grounds of (i) the failure to comply with the order of 23 April 2013 as regards disclosure, service of the schedule of account and exchange of witness statements; (ii) deliberate non-disclosure of documents; (iii) the absence of documents or evidence to support the claimant's pleaded claim; and (iv) the claimant's alleged "faking and fabricating documents to try and support its claim and new claims". The application notice requested that if the claim was not struck out, the court should order specific disclosure and set a revised timetable for the defendant to provide copies of its disclosed documents to the claimant and for exchange of witness statements. The defendant also applied for Judge Mackie to recuse himself from any further involvement with the proceedings, on the ground that he was prejudiced against the defendant.
20. Those matters came before the judge on 7 February 2014. Again, I will consider later the reasons for the order he made on that occasion. The order itself included the dismissal of the defendant's applications (i) to strike out and/or obtain summary judgment, (ii) for specific disclosure, and (iii) to disqualify the judge from adjudicating on the proceedings. The date for the defendant to provide the claimant with copies of its disclosed documents was extended to 31 January 2014 and the date for exchange of witness statements was extended to 2 May 2014. Provision was made for service of amended pleadings. Various costs orders were made. It was also ordered that the defendant "shall not be permitted to issue any further applications in these proceedings until such time as it has satisfied the costs orders made against it on 23 April 2013".
21. Further amendments have subsequently been made to the timetable. A revised date of 27 April 2015 has been set for the commencement of the trial, with a time estimate of 5 days.

The hearing on 6 December 2013

22. Judge Mackie began the hearing on 6 December 2013 by expressing "some provisional views about some of the things which we have to deal with". First, he said that notwithstanding the defendant's application for permission to appeal against the orders he made earlier (i.e. the order of 23 April 2013), all the existing orders so far remained in force. Secondly, his provisional view was that it would not be just to order that the defendant be debarred from defending for non-payment of the costs order. Thirdly, he noted the failure to comply with the timetable as regards disclosure, schedule and counter-schedule of account, and witness statements. He said that even if the parties had agreed to extend time they should have applied to the court for an order. He stressed the importance of parties complying with time limits, referring to the then recent decision in Mitchell v News Group Newspapers Limited [2013] EWCA Civ 1537, [2014] 1 WLR 795. He said that the claimant's reasons for the delay were not good enough: if there had been a problem about preparing for trial in time or with procedural steps there should have been an application to the Court to deal with it. The defendant similarly had not participated in that process. The judge said that the culture the court was seeking to foster was one "by which both sides take a common sense and practical approach, minimising interlocutory disputes and working in a mutually efficient manner towards the date fixed for trial". That had not happened in this case. It appeared that the claimant had been remiss but the defendant had gone along with it. In the judge's view it was not practicable or just to have a trial in January 2014.
23. The detailed submissions proceeded against that backdrop. The claimant's counsel pressed the application for a strike-out for non-payment of the costs. The judge refused the application, primarily "because of the lamentable failure by the Claimants, and the Defendant, to comply with orders that were carefully considered and made by me with a view to ensuring that a trial space in January was met with".
24. The next issue considered was that of disclosure. The claimant's counsel had already sought to explain the delay in the claimant's disclosure by the fact that the claimant itself was a relatively small company, its solicitor (Mr Winter) had been involved in a substantial trial of another case, and the scope of disclosure was substantially wider than anticipated when proceedings were issued. He had also relied on the fact that the claimant had been seeking a hearing of its own strike-out application. When disclosure came to be addressed as a separate issue, the thrust of the claimant's argument was that full disclosure had now been made by the claimant; the defendant's disclosure had itself been two weeks late, on 11 June (in an email which also told the claimant to "take as much time as you like"), but it was impossible to tell whether disclosure was adequate because the defendant had failed to permit inspection or to provide copies of its documents despite several requests to do so. Mr Morgan, on behalf of the defendant, took issue with whether the claimant's disclosure had been made on 30 September rather than 9 October. He advanced extended argument as to the inadequacy of the claimant's disclosure and as to the specific disclosure that the defendant was seeking.
25. Attention then turned to the defendant's strike-out application. Mr Morgan started with the contention that there had been a flagrant and fundamental failure by the claimant to comply with the court's order as regards disclosure, schedule of account and witness statements, and took issue with the claimant's reasons for the failure. But he moved rapidly to his submissions that the claim was fabricated and unsupported by evidence and should be struck out for that reason. In due course the judge interrupted those submissions, stating that what Mr Morgan was saying about false evidence involved serious allegations of dishonesty which were matters for trial, not for interlocutory decision.
26. The judge then gave a ruling as follows:

"1. There could be no clearer indication of why it is that I am not going to decide this aspect of the application today than the fact that when invited to sit down, Mr Morgan was insisting that the other side have fabricated documents. I have no idea whether the other side have fabricated the documents or not. I have no idea whether Mr Morgan has fabricated documents or not. Those are matters which can only be decided at trial. It is simply not the sort of application that can be dealt with without evidence. Further, in substance, the application to strike out is a rerun of the application I refused last spring. Mr Morgan was unhappy with my decision and has taken it to the Court of Appeal. I will not repeat the exercise.

2. Secondly, in the exercise of my case management powers I am determined that this case will get to fruition so I am going to decline to deal with applications that might have been entertained in the normal run of cases. That is particularly so in the dire position where I am about to vacate a trial that was only a few weeks off. Squabbling between the parties has taken up too much court time already. This is unfair to other court users.

3. There is also an application to strike out based on a failure to give disclosure. I cannot evaluate it because there is a fundamental difference of evidence between the parties even as to when, for example, the claimants gave their disclosure. The application needs to be refined and made more specific if it is to be pursued.

4. I am not going to strike out this case, given the fact that both parties have a share of the blame. The Claimant's default has cost it a trial date it was very keen to keep. It seems to be disproportionate to scrap the case altogether. I am not going to strike it out on the basis that it discloses no cause of action or one of the other grounds given by Mr Morgan. Nor, given the complex position on disclosure and the fault of both parties, am I going to strike it out because disclosure has not been given."

The hearing on 7 February 2014

27. It was in the course of the hearing on 7 February 2014 that the judge described the case as one of the least manageable he had ever tried.
28. The defendant's further strike-out application of 22 January 2014 was one of the matters considered by the judge at that hearing. In his submissions to the judge in support of the application, Mr Morgan relied on four matters: (i) the claimant's delay in making disclosure and in service of the schedule of account, drawing for this purpose on the Mitchell decision and contending that the delay had resulted in the loss of the trial date; (ii) the contention that the claimant had failed to disclose a large number of documents; (iii) the contention that there was no evidence to support the pleaded claim; and (iv) the contention that the claimant had fabricated documents.
29. The judge gave the following reasons for dismissing the application:

"2. Mr Morgan brings another application to strike out. It is fair to say that this application takes a different form from that made in April 2013. For some time he was making applications on the basis that the claimant could not win while making very serious allegations about the claimant's conduct. For the reasons I gave at the time, that application was hopeless because by the very nature of the seriousness of the allegations being made a trial was required. Permission to appeal was refused by a judge of the Court of Appeal.

3. On this occasion the application to strike out is based on the claimant's admitted failure to comply with directions. The existence and extent of that failure were canvassed at the hearing in December and I am not going to repeat what will be on the transcript of my observations at that time. The claimant was in breach of directions and seriously so. The defendant was also in serious breach of the directions. The claimant was correct in submitting that the defendant had refused or declined to submit to an inspection of documents and had not produced a counter-schedule. The claimant's breach of directions was also in circumstances where the defendant had itself made no efforts constructively to take the case forward. Further, the defendant was and remains in breach of the court's order to pay costs to the claimant arising from a previous failed application. Mr Morgan seeks to excuse that latter point on the basis that he had put in an appellant's notice. As I think he knows by now, simply putting in an appellant's notice does not suspend the obligation to pay costs. In the absence of a stay from me or the Court of Appeal, that is a continuing obligation. Finally I have regard to the whole acrimonious history of this sorry piece of litigation for which, as I see it, the defendant is more to blame than the claimant.

4. The spirit of Mitchell and the considerations in that case have rightly been drawn to my attention by Mr Morgan. I bear in mind, as I believe I did at the last hearing, that this was not a relief from sanctions application as such, but that the Mitchell considerations were still relevant and important. I also bear in mind that the claimant did suffer a serious sanction. The claimant lost the trial date in January 2014 which it had very keenly wanted to keep and which the defendant very much wanted to postpone. As a result the claimant has lost counsel of its choice.

5. The application for strike out, so far as it relates to the failure to give relevant disclosure, overlaps with the points that I have already considered. The application or applications are refused."

30. Having dealt with other issues, the judge turned to the defendant's application that he recuse himself from further involvement in the case. In rejecting the application he went out of his way to reassure Mr Morgan that he had no bias against the defendant. He said this:

"I do not think it is appropriate for me to try to defend my conduct paragraph by paragraph. I have been a judge since December 1988 [part-time until 2004, full-time thereafter]. I do not recall having had an application to remove me from a case for bias before. That does not mean that this application should fail, but it is unfamiliar territory for me. I regularly have litigants in person before me and am unaware of having a bias against them. Mr Morgan is not strictly a litigant in person. Mr Morgan is a director of Tallington Lakes Ltd. He conducts proceedings on its behalf and documents produced in the past suggest that he is paid for doing so. Mr Morgan is very experienced in conducting High Court litigation. This case has been bedevilled with a variety of difficulties. There are times when I have been critical of Mr Morgan and there are times, not least this morning, when I have been critical of Mr Saoul. To the extent to which my criticism has not been justified, I apologise to both sides but there has been no suggestion that I have got some financial interest in this case or displayed some other form of bias. Mr Morgan has given no reason why, having decided innumerable cases over many years involving all manner of people, I should develop a bias against his company. So far as I am aware, just as I have made decisions that Mr Morgan does not like, I have made decisions that the claimant does not like."

31. No doubt to provide Mr Morgan with further reassurance, the judge added a postscript to the transcript, referring to the work he had done over the years in assisting litigants in person and in the pro bono field, work which had been recognised by the award of a CBE in 2004. He suggested that all this pointed against any general bias in favour of lawyers and against litigants in person.

The defendant's submissions on the appeal and application for permission to appeal

32. The defendant's main case on the appeal and the application for permission to appeal is that, in the application of the principles laid down at the relevant time in Mitchell and subsequently restated in Denton v TH White Limited [2014] EWCA Civ 906, [2014] 1 WLR 3926, the judge should have struck out the claim on the ground of the claimant's serious breach of court orders, specifically its failure to comply with the timetable laid down in the order of 23 April 2013 for disclosure, service of a schedule of account and exchange of witness statements. The judge was wrong to proceed on the basis that the defendant was also in serious breach; but if there was a serious breach on the defendant's part, the proportionate and correct decision would have been to strike out both the claim and the counterclaim, bringing the entire case to an end, rather than allowing the case to continue to trial. Whilst putting the focus of the defendant's case on the failure to comply with the timetable laid down by the court, Mr Morgan also made reference to the topic of alleged fabrication of documents, upon which he had relied before the judge as a ground for strike-out.
33. Mr Morgan placed a lot of weight on rule 32.10 of the Civil Procedure Rules ("CPR") even though no reference had been made to it in argument before the judge or in the grounds of appeal to this court. Rule 32.10 provides that "if a witness statement or a witness summary for use at trial is not served in respect of an intended witness within the time specified by the court, then the witness may not be called to give oral evidence unless the court gives permission". Mr Morgan submitted that since the claimant had not served any witness statements within the time specified in the court's order of 23 April 2013 and had not applied for, let alone been granted, relief from the sanction laid down by the rule, it was debarred from calling any witnesses at trial; and without witnesses it had no case, so that the claim should have been struck out. He relied on the analysis of rule 32.10 in Chartwell Estate Agents Ltd v Fergies Properties SA and Another [2014] EWCA Civ 506, whilst seeking to distinguish that case in terms of outcome: he argued that the Court of Appeal in Chartwell upheld the grant of relief from sanction for breach of rule 32.10 by reference to factors that were absent in the present case. He also sought to distinguish Durrant v Chief Constable of Avon & Somerset Constabulary [2013] EWCA Civ 1624, paragraphs 54-55, where a strike-out application by the claimant was refused in circumstances where the defendant, by reason of a failure to comply with an "unless" order with the same effect as rule 32.10, was unable to call witness evidence of his own but was still in a position to challenge the claimant's credibility at trial.
34. A separate part of the defendant's case is the allegation that the judge was biased or prejudiced against it and should have recused himself. This is touched on briefly in the grounds of appeal against the order of 7 February 2014 but is elaborated in an amendment, for which permission is sought, to the grounds of appeal against the order of 6 December 2013. The application is based on objections to various decisions made by the judge, including those now under challenge before us, and to observations made by the judge in the course of hearing the applications or by way of reasons for the decisions. The examples given consist mainly of passages from the transcripts on 6 December 2013 and 7 February 2014 which I have quoted or summarised above. These are alleged to be examples of "unmissable prejudice" which "has been pernicious, longstanding and oppressive". Mr Morgan complained to us that the judge awarded the claimant costs when the defendant lost an application but did not award the defendant costs when the claimant lost an application. He also submitted that the judge was unduly ready to accept what the legal professionals said, "even though they manipulated the truth". Despite the extreme terms in which the allegation of bias is expressed, Mr Morgan said at the hearing before us that it "probably does not go to very much" and that it might be better not to decide it; but he did not withdraw it.
35. I should mention in addition that the grounds of appeal also take issue with the costs orders made on 6 December 2013 and 7 February 2014. The defendant's case in relation to costs is largely, though not wholly, dependent on its case in relation to the strike-out applications and was not developed further by Mr Morgan at the hearing before us.

Discussion

36. I will deal first with the allegation of judicial bias or prejudice, since if that were well founded the various other matters under appeal would have to be remitted for rehearing by another judge.
37. I am satisfied that the allegation is totally without merit. The case is put in terms of actual bias but I have also treated the allegation as one of apparent bias, applying the test of whether the circumstances ascertained by the court "would lead a fair-minded and informed observer to conclude that there was a real possibility … that the tribunal was biased" (see Porter v Magill [2001] UKHL 67, [2002] 2 AC 357, at page 494 paragraph 102, approving the test in In re Medicaments and Related Classes of Goods (No 2) [2001] 1 WLR 700). I have considered the orders made by the judge in the course of 2013 and have read the transcripts of proceedings, including judgments, on 6 December 2013 and 7 February 2014. I cannot see in them anything that provides the remotest support for a case of actual or apparent bias. Whether the judge was right or wrong in the decisions reached in this difficult exercise of case management (a matter considered below), it is clear that he addressed the issues conscientiously and fairly. Any complaint about the decisions themselves was properly the subject of an application for permission to appeal, not an application for the judge to recuse himself. I have referred above to the fact that the judge went out of his way to reassure Mr Morgan that he had no bias against the defendant. It was not necessary for the judge to do this but the fact that he did so, and the terms in which he did so, are illustrations in themselves of his fair-minded approach to the case.
38. I turn to consider the challenge to the judge's dismissal of the defendant's strike-out applications.
39. In relation to that, I reject at once the defendant's arguments based on the effect of CPR rule 32.10. The case below was not put on the basis of that rule and it is too late to advance such a case on appeal. The applications to the judge were for a strike-out, which fell to be considered under CPR rule 3.4. A strike-out was said to be justified by a fundamental failure to comply with the court-ordered timetable, and for that purpose the failure to meet the deadline for service of witness statements was run together with the failure to meet the deadlines for disclosure and for service of a schedule of account. No point was taken to the effect that by virtue of rule 32.10 the failure to serve witness statements in time affected the ability of the claimant to call witnesses at the trial or that this would leave the claimant with no case and should lead in turn to a strike-out or summary judgment. If a point of that kind had been taken, it would have led to express consideration of whether relief from the sanction under rule 32.10 should be granted to the claimant in respect of the failure to serve witness statements in time and, if relief from sanction was refused, to consideration of the claimant's position at trial if it was unable to rely on witness evidence, which is itself an issue on which the claimant might have wished to adduce evidence in addition to making submissions. It would also have been necessary to consider whether relief from sanction should be granted to the defendant, which was also in default as regards service of witness statements for trial, albeit it could argue that it was unable to finalise witness statements pending receipt of the claimant's disclosure. Mr Morgan referred to statements served previously by the defendant in connection with an interlocutory application but in my view they did not constitute compliance with the orders of 25 January and 23 April 2013, which were concerned with the exchange of witness statements for use specifically at trial.
40. A further relevant factor is that the defendant's own application of 22 January 2014 requested that if the claim was not struck out the court should set a revised timetable for, among other matters, the exchange of witness statements. That had the effect of turning attention away from rule 32.10 and inviting an extension of time for service of witness statements by both parties. In practice, having refused the strike-out application, the judge set a revised timetable as requested. With the setting of a revised timetable, any issue under rule 32.10 arising out of non-compliance with the previous timetable fell away. To put the matter another way, if relief from sanction for non-compliance with the previous timetable was required, it was granted in practice to both parties by the extension of time inherent in the new timetable, though nobody was thinking in those terms at the time.
41. I do not accept that it was incumbent on the judge in the circumstances to take a point on rule 32.10 that was not taken by the parties; and given the way the case was actually put before the judge, and the different considerations that would have arisen if the case had been put on the basis of rule 32.10, it is plainly too late to put the case in terms of that rule for the first time on appeal.
42. That brings me to the case for strike-out as actually advanced before the judge. Again I need to dispose of some preliminary matters before concentrating on what seem to me to be the central issues. The provisional views the judge expressed at the beginning of the hearing on 6 December 2013 show that he had well in mind that one basis of the application was the claimant's failure to comply with the court-ordered timetable as regards disclosure, schedule of account and witness statements. In the course of the hearing, however, he became understandably distracted by the other ways in which the defendant's case was being put. Although Mr Morgan's oral submissions to the judge started with the claimant's failure to comply with the timetable, they moved rapidly to allegations of fabrication, in relation to which the judge rightly said that they involved serious allegations of dishonesty which were matters for trial, not for interlocutory decision. The judge also referred to the application as a rerun of the application he had previously refused, which was true in part but only in part. In any event, given the way the argument was being developed, the judge was entitled to cut Mr Morgan short. The result, however, was that the primary basis of the strike-out application, by reference to non-compliance with the timetable, did not receive on that occasion the consideration it deserved. The judge also gave a weak reason why he could not evaluate that aspect of the application at the time: the difference of evidence between the parties as to when the claimant gave disclosure related to a period of two weeks, which was of limited significance in the context of the delay of over four months which had occurred on any view.
43. Had the matter rested there, the judge's decision might have been open to legitimate criticism for failure to deal sufficiently with the strike-out application. The fact is, however, that he left the door open for a further strike-out application on the specific basis of non-compliance with the timetable; a further application was duly made; and it received full consideration on 7 February 2014, with the judge referring back as appropriate to what happened on 6 December 2013. In the circumstances the earlier decision needs to be read together with the later decision and no useful purpose is achieved by considering it in isolation.
44. The judge treated the principles in Mitchell as "relevant and important" even though the question in this case was whether to impose the sanction of a strike-out for non-compliance with a court order, not whether to grant relief under CPR rule 3.9 from an existing sanction. In my judgment, that was the correct approach. The factors referred to in rule 3.9, including in particular the need to enforce compliance with court orders, are reflected in the overriding objective in rule 1.1 to which the court must seek to give effect in exercising its power in relation to an application under rule 3.4 to strike out for non-compliance with a court order. The Mitchell principles, as now restated in Denton, have a direct bearing on such an issue. It must be stressed, however, that the ultimate question for the court in deciding whether to impose the sanction of strike-out is materially different from that in deciding whether to grant relief from a sanction that has already been imposed. In a strike-out application under rule 3.4 the proportionality of the sanction itself is in issue, whereas an application under rule 3.9 for relief from sanction has to proceed on the basis that the sanction was properly imposed (see Mitchell, paragraphs 44-45). The importance of that distinction is particularly obvious where the sanction being sought is as fundamental as a strike-out. Mr Buckpitt drew our attention to the recent decision of the Supreme Court in HRH Prince Abdulaziz Bin Mishal Bin Abdulaziz Al Saud v Apex Global Management Ltd [2014] UKSC 64, at paragraph 16, where Lord Neuberger quoted with evident approval the observation of the first instance judge that "the striking out of a statement of case is one of the most powerful weapons in the court's case management armoury and should not be deployed unless its consequences can be justified".
45. Subject to that important qualification, I turn to consider the application of the Mitchell principles to this case. Mr Morgan rightly concentrated on the three-stage approach articulated in the Denton restatement of the Mitchell principles: although the judge, deciding this case long before Denton, did not deal with the matter in that structured way, his reasoning can readily be accommodated within it.
46. As to the first two stages, I think it clear that the claimant was in serious breach of the court-ordered timetable and that, despite the excuses advanced, there was no good reason for the breach, at least as regards the delay in disclosure and service of a schedule of account; and it seems to me that the judge proceeded on that basis.
47. As to the third stage, namely consideration of all the circumstances of the case, the position was more complex. The relevant circumstances included the fact that the defendant had also been in breach of the court's orders. It had been late (though not seriously late) in serving its own list of documents and had subsequently failed to provide copies of its disclosed documents despite requests to do so. It had not produced a counter-schedule of account in response to the claimant's (admittedly late) schedule. It had not served its witness statements, and whilst it was entitled to wait for receipt of the claimant's disclosure before finalising its witness statements, it had done nothing further even after disclosure. I bear in mind Mr Morgan's explanation that by the time that the claimant made disclosure he was heavily committed on another matter, but the fact remains that there were defaults on the defendant's side and that these matters had to be the subject of further specific directions in the orders of 6 December 2013 and 7 February 2014. Importantly, the defendant was also in continuing breach of the costs order of 23 April 2013. Mr Morgan took issue with the judge's description of the defendant's breaches as "serious" but in my view the judge was entitled to make that overall assessment of them.
48. An overlapping consideration was that, as the judge found, the defendant had made no efforts constructively to take the case forward. The most obvious example of that was Mr Morgan's email of 11 June 2013 indicating that the defendant would not apply for a strike-out or unless order in respect of the claimant's late disclosure but that the claimant could "take as much time as you like" (see paragraph 10 above). As I have said, the message conveyed to the claimant was that the timing of disclosure was not a matter of concern to the defendant. That was plainly a consideration militating strongly against a strike-out when the defendant later turned round and sought one. Indeed, the defendant's conduct in applying for a strike-out rather than working constructively towards trial following the claimant's disclosure and service of a schedule of account smacks of the opportunism and lack of cooperation that were roundly criticised by the court in Denton (at paragraphs 40-43). The judge also referred more generally to "the whole acrimonious history of this sorry piece of litigation for which, as I see it, the defendant is more to blame than the claimant". Having been in charge of the case management throughout, he was well placed to form that assessment, and I see no reason to doubt its accuracy.
49. It is true that the January 2014 trial date was lost and that the loss of a trial date can be a weighty consideration in considering the seriousness of a breach. I am not persuaded that the trial date would have been lost if the defendant had acted promptly following the claimant's disclosure and service of a schedule of account, though again I bear in mind Mr Morgan's explanation that at that time he was heavily committed on another matter. The fact is, however, that the judge had due regard to the fact that the trial date had been lost, whilst expressing the view that in the particular circumstances this impacted more on the claimant than on the defendant. He was plainly concerned about the loss of the trial date but he showed a commendable determination to bring this difficult case to fruition by way of trial as soon as possible.
50. In the light of those considerations, I am satisfied that the judge approached the issues before him correctly and was entitled to dismiss the defendant's applications for a strike-out. I reject Mr Morgan's submission that if the judge considered that both parties had been in serious breach he should have struck out both the claim and the counterclaim. The only relevant strike-out applications before the judge were those made by the defendant, and for the reasons I have given he was entitled to dismiss them. The question of striking out the counterclaim did not arise for consideration. In any event the judge's decision to allow the case to proceed to trial was a proportionate response to the history with which he was faced.
51. I should mention for completeness that I see no basis for interfering with the judge's various costs orders, all of which were made in the reasonable exercise of his discretion.

Conclusion

52. For the reasons I have given I would dispose of the matters before us as follows:

i) I would dismiss the defendant's appeal against the judge's order of 6 December 2013. The claimant's application to set aside the grant of permission to appeal falls away.

ii) In order to put all the strike-out issues on the same footing, I would grant the defendant permission to appeal against the judge's order of 7 February 2014 in so far as it dismissed the strike-out application but I would then dismiss the appeal against that order. I would otherwise refuse permission to appeal against the order of 7 February 2014.

iii) I would refuse the defendant's application to amend the grounds of appeal against the order of 6 December 2013 so as to introduce the allegation of bias.

Lord Justice McCombe :

53. I agree.

Lady Justice Sharp :

54. I also agree.