Case Note:  Kimathi & Others v The Foreign and Commonwealth Office Judgment was handed down in Kimathi & Ors v The Foreign and Commonwealth Office [2017] EWHC 939 (QB) on 27 April 2017. In his judgment, Mr Justice Stewart considered in detail the third limb of the test set out in the case of Denton v White Limited and De Laval and others [2014] EWCA Civ 906 (the “Denton test”) that the Court should apply when considering granting relief from sanctions.

 

Background

The matter arose out of litigation subject to a group litigation order (‘GLO’), made on 4 November 2013, where the Court’s permission was required to add any further claims to the register.

In June and July 2016, evidence from the Test Claimants was heard, which was followed by various applications between July and September 2016. Then, on 30 November 2016, 33 Applicants (who formerly instructed GT Law, a firm which entered administration in October 2015) applied to the Court to be added as to the group litigation after the cut off date and thereby sought relief from sanctions. In the event, 32 live applications were before the Court.

 

The High Court’s Approach

The Court was clear that the application had to be considered under CPR 3.9 and it therefore followed that the “Denton test” applied. It was also clear to Mr Justice Stewart that the failure to apply in time to be added to the group litigation was serious and significant and that there was no good reason for the default.

The Court then considered the approach to be taken in dealing with the third stage of the Denton test and gave guidance as follows [paragraph 46]:

“Having reached this point, Denton mandates that the application for relief from sanctions will not automatically fail because the Court will consider "all the circumstances of the case, so as to enable it to deal justly with the application." I have to give particular weight to the need (a) for litigation to be conducted efficiently and at proportionate cost and (b) to enforce compliance with rules, practice directions and orders. Also (c) the promptness of the application is a relevant circumstance to be weighed in the balance along with all the circumstances. Finally, (d) I have to take into account the seriousness and significance of the breach (stage 1) and any explanation (stage 2). The more serious or significant the breach, the less likely it is that relief will be granted unless there is a good reason for it.”

With regard to a), the Court accepted that the breach did not prevent the effective conduct of litigation insofar as the personal injury claims were concerned but prima facie rejected the argument in respect of the estate claims. In relation to b), Mr Justice Stewart went on to note that that the ‘old lax culture of non-complaince is no longer tolerated’.

The promptness of the application under c) was considered at length and Mr Justice Stewart noted that the register closed two-and-a-half years before the application was issued. The Court found that some 12 months were lost for reasons which could be categorised as the responsibility of the former or current representatives of the Applicants. The prejudice to the Applicants that may result from the GLO claims succeeding but their application to be added being denied was also recognised by Mr Justice Stewart.

In regard to d) the Court held:

“I now turn to factor (d) set out in paragraph 54 above. I repeat that the breach was serious and significant. That makes it less likely that relief will be granted unless there is a good reason for the breach. I have dealt with that second stage in some detail and have found there is no good reason. I have considered above the circumstances of the case and especially those to which I need to give particular weight. All these circumstances have been considered, in accordance with CPR rule 3.9(1) so as to enable the Court "to deal justly with the application". I have come to the clear conclusion that relief from sanctions should not be granted.”

 

Commentary:

This decision does not contradict previously reported authorities but is significant, as it emphasises that the need for the application to have been made promptly and the potential impact on costs were not outweighed by the potential prejudice that may result to the Applicants.  This judgment serves as a reminder of how difficult it is for late applications for relief to succeed. 

The judgment of Mr Justice Stewart also shows that the policy of the courts in dealing with applications under CPR 3.9 will remain one of low tolerance towards non-compliance.

 

Bence Leb

17 May 2017