The Court of Appeal has handed down an overall judgement for three relief from sanction appeals. The collective hearing of these matters was made in an attempt to resolve the mixed interpretation of the approach used inMitchell v. News Group Newspapers Ltd  to relief from sanctions, and how that case has impacted on the application of CPR 3.9.
Below is a brief recap of the cases heard in this appeal:
Denton and Others v TH White – The original Claimant was granted relief from sanctions after the late filing six additional witness statements, and the resulting request to vacate the impending trial. The Appellant argued that, had the Judge properly considered CPR rule 3.9, it would have been apparent that this was a more than a trivial breach and so relief should not be applied.
Decadent Vapours Ltd v Bevan – The Appellant’s claim was struck out after they failed to submit the Court fee on time. Instead they posted payment of the fee on the due date, and further delays were incurred before it was processed.
Utilise TDS Ltd v Davies and Others – The Appellant was denied relief from sanctions on the basis that two breaches individually regarded as trivial amounted to a non-trivial breach.
The submissions for each case were heard between 16th and 18th June 2014, with Counsel for the Law Society and Bar Council also invited to intervene. It now seems that, following their consideration of the three cases, the Court of Appeal believes the application of the Mitchell principle on the use of CPR 3.9 has been ‘misunderstood’ and ‘misapplied’.
The original judgements given in these three cases show how the Courts have done little to address the increasingly uncooperative behaviour adopted by parties to litigation. Lord Justice Dyson MR and Lord Vos, sitting alongside Lord Justice Jackson, in their judgment pointed out that this opportunistic behaviour of taking advantage of errors by the other party leading to some level of advantage is improper and should not be encouraged by the wrongful application of CPR 3.9. Needless to say, some recent appeals have succeeded in an attempt to restore a sense of reasonableness to the parties’ behaviour (Hallam Estates Ltd v. Baker ).
In an attempt to resolve the Courts’ inconsistent approach to the application of CPR 3.9 following the judgment in the Mitchell case, the Court of Appeal has incorporated the two stage test set out in that judgment into a new, three stage, test.
Stage One: This first stage correlates with CPR 3.9(1). However, to remove the questionable application of the term ‘trivial’ (which is not noted in the Rule but was used in Mitchell), the Court of Appeal has instead directed that the sitting Judge should first consider whether the failure to comply was ‘serious’ or ‘significant’ in impacting the litigation. The Court commented that use of the word ‘trivial’ has created some confusion, and the new terminology seeks to prevent parties from becoming weighed down in unwarranted debates of just how exactly a trivial breach could still possibly impact the efficiency of a case. If the Court decides that the breach was neither serious nor significant, it is not likely to spend further time on the latter two stages of the test.
Stage Two: The second stage gives reference to why exactly the fault occurred. This is not expressly mentioned in CPR 3.9 however, should it be established at the first stage that the breach was serious or significant, the reasons behind the breach should then be taken in account.
Stage Three: When it has given consideration to the seriousness and significance of the breach followed by the reasons for it, the Court will go on to the third stage of the test. Stage three again applies the wording of CPR 3.9, and directs the Judge to consider the facts of the specific case being heard and whether 3.9 can apply. This stage takes a wider view of the whole case, taking into account past behaviour of those responsible for the failure to comply and the impact and proportionality of this failure on future stages of the case.
Orders, Practice Directions and circumstances differ from case to case, and the final stage of this test aims to find a middle ground in the widespread rulings that have previously been made. Dyson and Vos comment that the rulings in Decadent and Utilise were ‘draconian’ and that the Judge in Denton adopted an ‘unduly relaxed approach’. Such extreme opposites in the application of CPR 3.9 need to be resolved.
All three Appeals were allowed on 4th July 2014, with Jackson directing that ‘the new rule 3.9 is intended to introduce a culture of compliance, because that is necessary to promote access to justice at proportionate cost’.
The new CPR 3.9 is not intended to be a zero tolerance method, and parties should hereafter adopt a more reasonable level of cooperation. This new three stage test should enable the lower Courts to properly consider all relevant issues in an application for relief from sanctions.
It has taken some time – to the detriment of numerous unsuspecting litigants – but this outcome will hopefully signal a return to a more common sense approach, with parties who fail to cooperate with each other running the risk of costs orders against them. Too little, too late for some, but for the majority hopefully a welcome relief.