Modifications to Mitchell in Denton v TH White Limited

Posted by Christian Hazelton on

Following the linked appeals in Denton v TH White Ltd [2014] EWCA Civ 906, the Court of Appeal has provided further guidance on the courts' interpretation of CPR Rule 3.9 when considering applications for relief from sanctions.

A party in litigation may apply to the court for relief from any sanction imposed against them as a result of their failure to comply with any rule. Following the Jackson reforms, CPR 3.9 revised the considerations the court should be mindful of when considering an application for relief from sanctions. Now under CPR 3.9, the court will take into account all circumstances of a case, including the need for litigation to be conducted both efficiently and cost proportionately, and the need to enforce compliance with rules, practice directions and orders.

How the courts should interpret these considerations was set out by the Court of Appeal in Mitchell v News Group Newspapers Limited [2013] EWCA Civ 1537. Noting the deliberate shift in emphasis in CPR 3.9, the Court held that the two CPR 3.9 considerations should be regarded as of paramount importance. If the non-compliance could be deemed "trivial", the court should usually grant relief. If the non-compliance could not be considered trivial, the non-complying party must show good reason for its non-compliance. Absent any good reason, relief likely would not be granted by the court.

This set a high threshold for parties seeking relief from sanctions and concerns were raised that such a threshold could result in disproportionate penalties being imposed even where the non-compliance would have little practical effect on the litigation, thereby increasing costs of the litigation. Furthermore, it could be argued that the weight placed on the CPR 3.9 factors is incompatible with the overriding objective, whereby the court should take equal account of all relevant factors.

Given the uncertainty surrounding the application of the Mitchell test, the Law Society intervened in Denton v TH White Ltd and requested the Court of Appeal provide further guidance on interpreting CPR 3.9. This case concerned three linked appeals raising common issues regarding CPR 3.9 in which the Court elected to restate the approach to rule 3.9 and set out guidance to be adopted when Judges consider an application for relief from sanctions in the form of a three stage process.

  1. Firstly, the court should consider whether the non-compliance identified is serious or significant in nature.
  2. Secondly, the court should consider why the non-compliance occurred.
  3. Thirdly, the court must evaluate "all the circumstances of the case". It is at this stage that the two CPR 3.9 factors should be given particular (although not necessarily paramount) importance.

It is hoped that the restated Mitchell test will lead to a greater willingness of the courts to grant relief from sanctions in cases where the non-compliance does not jeopardise or disrupt the litigation or its timetable. However, the court has made it clear through both Mitchell and Denton that, following the Jackson reforms, the court will take a hard line to ensure the "culture of compliance" is maintained where non-compliance is serious or significant and has occurred for no good reason.

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Christian is a Solicitor in the Corporate and Commercial teams, based in our Southampton Office.

Christian Hazelton
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