The High Court this week granted libel specialists Carter-Ruck relief from sanctions after an assistant solicitor “misread” the Civil Procedure Rules and was almost four months late in sending out a funding notice.
Applying the decision in Denton, Mr Justice Warby accepted that in this case the breach was “not a serious or practically significant one” because Carter-Ruck had sent a letter, before the claim form was issued, containing all the information which should have been set out in the notice.
“Relief from sanctions should not be granted lightly,” Warby J said. “The requirement to serve notice of funding is an important one. No defendant should be exposed to the risk of an additional liability of which they have no, or no adequate notice.
“There is a purpose to the requirement of the rules that notice should be given in a particular form to specified persons at a particular stage in the action.
“It helps to ensure that all the right information is provided in advance to other parties against whom a claim might be made, or who have a legitimate interest in knowing the potential costs involved in the litigation.”
Mr Justice Warby was ruling in a libel action brought by chairman of the Commons energy select committee Tim Yeo MP, over claims in The Sunday Times that he coached a paying client before they gave evidence to the committee.
Ruling in Yeo v Times Newspapers  EWHC 2853 (QB), Warby J said Carter-Ruck represented Mr Yeo under a conditional fee agreement, backed by ATE insurance. The ATE policy provided cover in respect of Mr Yeo’s potential costs liability of up to £100,000, with staged premiums.
Warby J said Andrew Stephenson, a consultant at Carter-Ruck, asked the solicitor to make sure when he filed the claim form that “whatever needed to be done by way of notification of the CFA had been done”.
The court heard that Times Newspapers was notified of the funding position and the insurance policy by a letter in December 2013, which contained all the information which should have been set out in the form.
However, Warby J said Form N251 was not filed or served when the claim form was issued in March 2014. “The assistant solicitor misread the CPR and mistakenly thought that the December 2013 letter represented compliance,” Warby J said.
“On Friday 11 July 2014 the omission was brought to Mr Stephenson’s attention by his assistant solicitor and on his instructions she filed and served form N251 on Monday 14 July 2014.”
Warby J said the claimant’s application for relief from sanctions was not opposed by the other side, and he accepted that in this instance the breach was “not a serious or practically significant one”.
“I can deal shortly with stages two and three of the Denton approach,” he continued. “The reason the breach occurred was an error by the assistant solicitor and not a deliberate decision. The error was promptly rectified once noticed. The impact of the oversight on the efficient and proportionate conduct of litigation was negligible, consisting principally of the need to make this application which was made promptly, and the additional costs incurred for which Mr Yeo has undertaken to compensate [Times Newspapers].”
Earlier in the ruling, he rejected an application by Times Newspapers for the case to be heard by a jury.