UK: "Mitchell Has Been Misunderstood And Is Being Misapplied"

The world of civil procedure recently 'celebrated' 100 post-Mitchell decisions. Six months of satellite litigation, increasing time, costs and uncertainty. Not exactly the vision Sir Rupert Jackson had.

Today in Court 71, judgment in three appeals against post-Mitchell case management decisions was handed down.

All appeals were brought pursuant to CPR3.9 (relief from sanctions) which provides that:

In Denton & Others v T H White Limited & De Laval Limited, the claimant was allowed to serve witness statements late, with the consequence that the trial had to be adjourned. The defendant appealed against this relief from sanctions.

In Decadent Vapours Limited v Bevan & Others, the claimant appealed against refusal of relief from sanctions for failure to pay court fees by a deadline set in a court order.

In Utilise TDS Limited v Davies & Others, the claimant appealed against refusal of relief from sanctions for two failures – it was 45 minutes late filing a costs budget, and 13 days late in complying with an order requiring it to notify the court of the outcome of negotiations.

The Court of Appeal acknowledged that the guidance given in Mitchell, "while substantially sound", had been heavily criticised "and needs to be clarified". The Judge said that Mitchell "has been misunderstood and is being misapplied". He went on to explain the new 3-stage test:

The first stage: identify and assess the seriousness or significance of the failure

Acknowledging that the "triviality" test has given rise to some difficulty, the focus of the enquiry should not be on whether the breach is trivial, but rather on whether it is serious or significant.

The assessment should not involve a consideration of other unrelated failures which have occurred in the past, just "the seriousness and significance of the very breach in respect of which relief from sanctions is sought".

If a judge concludes that a breach is not serious or significant, then relief will usually be granted. If however the court decides that the breach is serious or significant, then the second and third stages assume greater importance.

The second stage: why did the failure occur?

The Court held that "it would be inappropriate to produce an encyclopaedia of good and bad reasons for a failure to comply".

The third stage: evaluate all the circumstances of the case, so as to allow the court to deal justly with the application

The judgment makes it clear that some judges have adopted an "unreasonable approach" to CPR3.9(1). Decisions reached by the courts below are described as "unduly draconian" or "unduly relaxed" – both of which are approaches which the Jackson reforms were intended to discourage.

What next, then?

Parties are expected to co-operate.

1. Parties should agree reasonable requests for extensions (a reference to the new 28- day "buffer agreement" ); and
2. Parties should not unreasonably oppose applications for relief from sanctions.

In both cases, unreasonable refusals will lead to "heavy costs penalties" and "paying the costs of the application will not be sufficient".

Parties will be expected "to work together to make sure that, in all but the most serious cases, satellite litigation is avoided even where a breach has occurred" and "the court will be more ready in the future to penalise opportunism".

Opinion

There was a sense among practitioners that Mitchell would clarify everything. We were given to understand that if you could characterise your breach as trivial, then all would be well. But unfortunately you don't need a lawyer to tell you that if you line ten of them up, they will all give you a different definition of "trivial".

Triviality has been replaced with "seriousness and significance".

I am reasonably confident that those same ten lawyers will still give you ten different definitions.

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