WHAT DIFFERENCE DOES IT MAKE? – ‘Mitchell’ criteria do not apply to ‘in-time’ applications to extend time

pi_andrew_wilson Andrew Wilson

In an important ‘post-Mitchell’ decision, the High Court in Kaneria v Kaneria [2014] EWHC 1165* has emphasised the importance of parties who cannot comply with deadlines applying for an extension before the deadline expires. Crucially, in such cases, the relief from sanctions provisions and ‘Mitchell’ criteria do not apply.

The case concerned an unfair prejudice petition brought under the Companies Act 2006, but the principles set out in the judgment apply to all types of civil proceedings. In the case itself the Respondents to the Petition sought extensions of time to serve their Defences. The reason given was the unavailability of counsel. Initially agreement for such extension was sought from the Petitioner, but when that was refused an application to extend time under CPR 3.1(2)(a) was made, crucially some three days before the original time for service of the Defences expired.

The Petitioners argued that either the full Mitchell criteria, or at very least a ‘watered-down’ version, should apply to such an application. They also pointed out that this was in effect a relief from sanctions application given that if the Court refused to grant the extension sought then the Respondent would have no pleaded Defence to the Petition.

That argument was rejected by the Court. It held that the ‘pre-Jackson’ decision of the Court of Appeal in Robert v Momentum Services Ltd [2003] EWCA Civ 299 remained good law. Namely, that an ‘in-time’ application for extension of time was not and should not be treated as an application for relief from sanction.

Furthermore, that whilst the new overriding objective would apply to consideration of the application, subparagraph (f) (‘enforcing compliance with rules, practice directions and orders’) was not to be given paramount importance, unlike in a ‘Mitchell’ relief from sanction application.

The Court also noted the considerable time and expense (estimated in excess of £80,000) that had been incurred in dealing with the contested application, and having reviewed the authorities observed:

“The consistent message from these authorities is that a party who needs more time for a procedural step in existing proceedings should not just ignore the problem but should ask the other side for consent, and if consent is not forthcoming, should make an in-time application for an extension; and conversely that the other side should respond positively and in a spirit of co-operation to reasonable requests for consent rather than “cry foul” and seek to take opportunistic advantage of the other party’s difficulties.”

Applying the overriding objective to the facts of the case, the Court pointed out that an extension of time would not affect the overall timetable of the case, and nor, had it been consented to, would have cost either side anything other than a few letters. Whilst ‘rigorous scrutiny’ of the reasons given for the need for an extension ‘exposed some shortcomings’ this did not justify a refusal, in particular given the consequences such refusal would have. Whilst the Court accepted that the absence of significant prejudice to one party was not reason to extend regardless of other considerations, it was still of relevance. Accordingly, the ‘in-time’ application to extend time was granted.

It can be seen therefore, that the considerable post-Jackson and post-Mitchell commentary, emphasising the importance of seeking and if necessary applying for extensions before a deadline expires, has been born out and remains extremely important.

[* The full judgment can be found on Bailii at http://www.bailii.org/ew/cases/EWHC/Ch/2014/1165.html ]

                                                                                                                                                      ANDREW WILSON

                                                                                                                                                      BARRISTER

                                                                                                                                                     (Follow Andrew on  

                                                                                                                                                     Twitter – @pibarrister)

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One comment

  1. […] Andrew Wilson, of Zenith Chambers, discusses the Kaneria case in What difference does it make? […]

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