THE WRATH OF MITCHELL CONTINUES

– THE EFFECT OF 2 TRIVIAL BREACHES ON AN APPLICATION FOR RELIEF FROM SANCTIONS by Catherine DuffyImage

In Utilise TDS LTD v Neil Cranstoun Davies [2014]EWHX 834 (Ch) the High Court considered whether a 2nd trivial breach of a court order could result in the 1st trivial breach being viewed as non-trivial, justifying the refusal of relief from sanctions.

 

Background

  1. The case was allocated to the multitrack and directions were given ordering the parties to agree directions if possible and file the agreed directions.

The breaches

  1. On receiving the agreed directions, on 2nd October 2013, the District Judge ordered the parties to attempt to settle, the claimant was to notify the court in writing of the outcome of negotiations.

 

  1. The District Judge noted that the costs budget had not been filed and directed the parties to do so by 4:00pm on 11th October 2013. The defendants filed their costs budget within the deadline; however the Claimant filed its cost budget by fax at 4:41pm on 11th October 2013.

 

 

  1. In November 2013 the District Judge ordered that as the claimant had failed to file its costs budget in time, CPR 3.14 should apply and the claimant’s costs budget was treated as extending only to court fees.

Application for relief from sanctions

  1. The claimant made an application for relief from sanctions under CPR r 3.9 on the basis that the breach was trivial. The District Judge held that the breach was not trivial and refused the application. After considering the case of Mitchell v News Group Newspapers Ltd [2013] EWCA Civ 1537 the Judge stated that the claimant had given no reason for its non-compliance. Further this was not an isolated breach because the Claimant had failed to comply with the order requiring it to update the court as to the outcome of negotiations.

Appeal

  1. The claimant argued that the District Judge had erred in giving excessive weight to the breaches and further the late filing of the costs budget by less than 45 minutes was a trivial breach entitling it to relief from sanctions. The claimant also argued that the District Judge had erred in taking into account the failure to notify the court of the outcome of negotiations, as that breach was trivial.

District Judge’s decision to refuse relief from sanctions upheld

  1. Judge Hodge Q.C. upheld the District Judge’s decision to refuse relief from sanctions. After the District Judge made her order on 2nd October 2013, the parties were bound to (a) apply to vary it or set it aside under CPR r 3.1(7); (b) appeal from the order; (c) comply with it. The parties had chosen to comply with the order, but the claimant had failed to comply within the prescribed time. The claimant was therefore in breach of the order and, absent of the grant of relief, CPR r3.14 automatically applied.

 

  1. Judge Hodge Q.C. stated that viewed in isolation, the breach in filing the costs budget 45 minutes late was a trivial breach. However a court might take other breaches into account when determining whether a breach attracting a sanction was trivial. The District Judge was able to consider the quality and magnitude of the breach in the context of the claimant’s non-compliance with another aspect of the court’s order, namely the requirement to notify the court of the outcome of negotiations. Looked at separately, each of the breaches might have been trivial, but viewed together, the District Judge had been entitled to enquire whether any good reason had been shown for the non-compliance. On the evidence before her no good reason was shown. In those circumstances, what would otherwise have been a trivial breach was rendered non-trivial.

 

TIPS

–          The court can take the number of breaches into account, even if when viewed in isolation, they are trivial.

–          An explanation for the breach should be provided.

–          Make an application for relief PROMPTLY!

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2 comments

  1. Not sure about that Neutral Citation. Slip rule applies?

  2. […] Catherine Duffy of Zenith Chambers discusses the effect of two trivial breaches on an application for relief from sanctions in The wrath of mitchell continues. […]

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