Relief from sanctions- Be sensible or be prepared to pay

 elliot_kay_piBy Elliot Kay

Viridor Waste Management Ltd v Veolia ES Ltd [2015] (unreported)

Summary

The Claimant was awarded costs on the indemnity basis when the Defendant had taken unreasonable advantage of the Claimant’s late service of its particulars of claim in the hope of obtaining a windfall strike-out when it was obvious that relief from sanctions was appropriate.

 

The Case

The Claimant commenced proceedings seeking the recovery of £27 million from the Defendant arising out of changes to the way in which landfill tax was levied on waste management companies. In turn the Defendant issued separate proceedings seeking £32 million from the Claimant on the same basis.

The Claimant served its claim form four days prior to the expiry of the four month validity period. Thereafter, the parties agreed to a 28 day extension for the service of the particulars of claim and agreed to stay the proceedings on those terms to explore settlement. The deadline for the particulars became 14th January 2015.

The Claimant filed its particulars of claim in time. However, owing to an administrative error the particulars were sent to the Defendant one day late and by second class post. The particulars arrived at the offices of the Defendant’s solicitors on 15th January 2015- one day after the deadline.

The Defendant complained that the service was not effective as the particulars had been served by second class post. The Claimant re-effected service by hand, email and first class post on 19th January 2015. The Defendant refused to consent to the Claimant’s application for an extension of time for the service of the particulars and instead applied to strike out the Claimant’s claim.

The application came before Mr Justice Popplewell. The Defendant argued that any delay, be it hours or minutes, was a significant and serious breach of the CPR (or in this case, a Court order) and that breach was made worse by the generous extension which had already been permitted for the service of the particulars of claim.

Popplewell J did not consider it necessary to determine when the Defendant’s solicitors had properly been served with the particulars. Rather, he identified the important feature of this case which was that the Defendant’s solicitors had been in possession of the particulars by lunchtime on 15th January 2015- less than 24 hours after the expiry of the extended deadline. In assessing the seriousness of the breach it was one which was almost without consequence; it had no real impact on the course of the litigation, the course of other litigation, other court users or the court diary (save for the instant application). Popplewell J commented that the guidance from Denton was clear- the breach in this case was not serious or significant and it was obvious that relief should be granted. In the hope of obtaining a windfall strike out the Defendant had tried to take unreasonable advantage of a minor mistake which was of no significance. The Defendant’s conduct had caused further delay and the need for a further hearing which had impacted on other court users. The application was described as being, “unreasonable and opportunistic”, and the Defendant was ordered to pay the Claimant’s costs on the indemnity basis.

This case highlights the need to approach applications for relief from sanctions sensibly. The Court will not tolerate wilfully obstructive behaviour and will mark any such conduct with adverse costs orders. This author can’t help but feel like he has written similar guidance previously…..(https://zenithpi.wordpress.com/2014/10/06/relief-from-sanctions-some-further-guidance/)

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3 comments

  1. […] Elliot Kay on relief from sanctions and Be sensible of be prepared to pay. […]

  2. […] Elliot Kay discussed the dangers of taking an unreasonable stance on relief from sanction in Relief from sanctions – Be sensible or be prepared to pay […]

  3. […] Kay discussed the dangers of taking an unreasonable stance on relief from sanction inRelief from sanctions – Be sensible or be prepared to pay (June […]

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