27 November 2014Print This Post

Supreme Court stresses importance of compliance with court orders

Neuberger: importance of obeying orders is self-evident

The Supreme Court yesterday emphasised the importance of compliance with court orders as it dismissed an appeal by a Saudi prince who failed to personally sign a witness statement in breach of an unless order.

The court’s president, Lord Neuberger, said that “the importance of litigants obeying orders of court is self-evident. Once a court order is disobeyed, the imposition of a sanction is almost always inevitable if court orders are to continue to enjoy the respect they ought to have”.

He continued: “And, if persistence in the disobedience would lead to an unfair trial, it seems, at least in the absence of special circumstances, hard to quarrel with a sanction which prevents the party in breach from presenting (in the case of a claimant) or resisting (in the case of a defendant) the claim.

“And if the disobedience continues notwithstanding the imposition of a sanction, the enforcement of the sanction is almost inevitable, essentially for the same reason.”

Prince Abdulaziz v Apex Global Management Ltd & Anor (Rev 2) [2014] UKSC 64 considered what approach courts should take when deciding whether to stay a default judgment entered following breach of an unless order.

A member of the Saudi Arabian royal family failed to comply with an order that he personally sign a statement of truth on a disclosure statement, on the grounds of a Saudi Arabian protocol that members of the royal family should not become personally involved in litigation.

Default judgment was consequently entered against him in a claim for US$6m. His applications to vary the original order, set aside the judgment, and obtain relief from sanctions were all unsuccessful. The Court of Appeal upheld all three decisions.

Giving the lead judgment dismissing the appeal against the Court of Appeal’s ruling, with Lord Clarke dissenting, Lord Neuberger found that the three lower court decisions were unassailable and that there were no special factors.

He said: “It is difficult to have much sympathy with a litigant who has failed to comply with an unless order, when the original order was in standard terms, the litigant has been given every opportunity to comply with it, he has failed to come up with a convincing explanation as to why he has not done so, and it was he, albeit through a company of which he is a major shareholder, who invoked the jurisdiction of the court in the first place.

“One of the important aims of the changes embodied in the Civil Procedure Rules and, more recently, following Sir Rupert Jackson’s report on costs, was to ensure that procedural orders reflected not only the interests of the litigation concerned, but also the interests of the efficient administration of justice more generally.”

Lord Neuberger rejected specific arguments that the sanction was disproportionate – saying it was hard to maintain an argument that although each decision on the way to the final result was unassailable, the final result was wrong on the grounds of proportionality – and that the prince had a very strong case.

“In my view, the strength of a party’s case on the ultimate merits of the proceedings is generally irrelevant when it comes to case management decisions of the sort [in this case],” he said.

The one possible exception could be where a party has a case whose strength would entitle him to summary judgment, he added.

Lord Neuberger said that more generally the Supreme Court should be “very diffident about interfering with the guidance given or principles laid down by the Court of Appeal”.

By Neil Rose

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