Blake Morgan clients succeed in the Court of Appeal

Posted by Delme Griffiths on
On 5 July 2017 judgment was handed down by the Court of Appeal in the latest authority considering compliance with Unless Orders and applications for relief from sanction.

Blake Morgan acted for the Respondents to the Appeal who successfully argued that the appeal should be dismissed.

The background concerns three linked unfair prejudice petitions.

The Respondents to those petitions, who were the Appellants in the Appeal ("the Appellants"), had previously failed to provide a response to our clients' Part 18 Request on two separate occasions: they failed to comply with a consent order which required a response by 21 March 2014 and a subsequent Unless Order which required a response by 22 April 2014. 

As a consequence the Appellants' Points of Defence stood struck out.

Following the hearing of their application for relief from sanction, the Appellants were granted conditional relief which required compliance with two conditions: first, that they pay our clients' costs on the indemnity basis; and secondly that they provide a full response to the Part 18 request within 21 days, failing which the Points of Defence would remain struck out.

In purported compliance with the order a response was served.  However, it did not constitute a full response such that we issued an application on behalf of our clients for a declaration from the Court that the Points of Defence remained struck out on the basis that the conditions of relief had not been met.  The Appellants opposed that application, arguing that what had been served was a full response, and applied for a second time for relief from sanctions.

They failed on both counts.

The matter went before Mr Justice Simon on 23 and 24 March 2015 who held that the failures in the provision of responses were not excusable and went to the heart of the allegations made against the Appellants.  Further, a significant number of responses were not simply insufficient, they were evasive. He therefore found that: "I am satisfied that the Respondents have not given full and complete responses to each and every request made." He went on to dismiss the second application by the Appellants for relief from sanction.

As a consequence, the Appellants' Points of Defence remained struck out.

The Appellants' appeal against that decision was heard by Lord Justice Longmore and Lady Justice Sharp on 27 June 2017.

Whilst the Appellants sought to argue that their application for relief from sanction before Mr Justice Simon should not be construed as a second request for relief given the relevant procedural background, the Court of Appeal rejected that contention and found that the application heard by Mr Justice Simon was indeed a second application for relief. 

This had the effect that Mr Justice Simon "could not and should not entertain a second application after the application before the first judge had failed … unless there has been a material change of circumstances."

A similar situation had arisen in the case of Thevarajah v Riordan [2016] 1 WLR 76 in which Lord Neuberger held that:

"… as a matter of ordinary principle, when a court has made an interlocutory order, it is not normally open to a party subsequently to ask for relief which effectively requires that order to be varied or rescinded, save if there has been a material change in circumstances since the order was made."

This shows the necessity for a party, who has already made one application for relief from sanctions, to show a material change of circumstances before he can make a second such application.

However, Lord Neuberger left the door slightly ajar by indicating that a party may not have to establish a material change of circumstances if the particular action was not a "normal" case.

In this appeal, the Court of Appeal found that there had been no material change of circumstances. It was accordingly found that this was not a case "in which relief against sanctions could or should be granted in view of the history of the litigation and the form of the relief order."

In relation to the tentative words of Lord Neuberger as to the possibility that a case may be considered to be not "normal", whilst the Appellants tried to rely upon this it formed no part of the Grounds of Appeal and was accordingly rejected.

The appeal was accordingly dismissed and our clients were awarded their costs.

If there is any aspect of this case that you would like to discuss then please do not hesitate to contact either Paul Caldicott or Delme Griffiths.

See: Griffith v Gourgey [2017] EWCA Civ 926

About the Authors

Delme is a Senior Associate in our Dispute Resolution division specialising in contractual claims, based in the Cardiff office.

Delme Griffiths
Email Delme
029 2068 6199

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Paul is a specialist corporate restructuring and insolvency Solicitor in our Business Support & Insolvency team based in Cardiff.

Paul Caldicott
Email Paul
029 2068 6181

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