The Court of Appeal today issued a “clear message” to litigators by dismissing the appeal by MP Andrew Mitchell against the ruling that his failure to meet the rules in his Plebgate libel action meant his budget was limited to the court fees and no more.
In a much-anticipated ruling, the court – made up of the Master of the Rolls Lord Dyson, Lord Justice Richards and Lord Justice Elias – said that although the decision may seem “harsh” in the individual case of Mr Mitchell’s claim, “if we were to overturn the decision to refuse relief, it is inevitable that the attempt to achieve a change in culture would receive a major setback”.
The Master of the Rolls, Lord Dyson, said: “We hope that our decision will send out a clear message. If it does, we are confident that, in time, legal representatives will become more efficient and will routinely comply with rules, practice directions and orders.
“If this happens, then we would expect that satellite litigation of this kind, which is so expensive and damaging to the civil justice system, will become a thing of the past.”
In August Master McCloud refused relief from sanctions  in the case brought by the former Cabinet minister against News Group Newspapers for The Sun’s coverage of the ‘Plebgate’ affair.
The case was begun under the pre-1 April defamation costs management pilot, and in June the master issued the sanction for two breaches of practice direction 51D: a failure to engage in discussion with the defendant as to budgets and budgetary assumptions, and a failure to file a budget seven days before the case management conference.
The case was leapfrogged to the Court of Appeal, which today gave guidance on the new rule 3.9 (relief from sanctions), which obliges a court to consider the need for litigation to be conducted efficiently and at proportionate cost and to enforce compliance with rules, practice directions and court orders.
The court said that these two factors should be of “paramount importance and be given great weight” by judges when considering applications for relief, over any other circumstances of the case.
It also highlighted the importance of considering the needs and interest of all court users when managing an individual case; here Master McCloud had had to vacate a half-day that had been allocated to deal with asbestos claims to list the application for relief.
The court said the starting point is that the sanction was properly imposed. There will usually be relief for trivial breaches – where there has been “a failure of form rather than substance; or where the party has narrowly missed the deadline imposed by the order but has otherwise fully complied with its terms”.
If the breach is not trivial, then it will be for the defaulting party to persuade the court to grant relief. This will be if there is a “good excuse” – which will generally be one beyond the control of the party – but “mere overlooking a deadline, whether on account of overwork or otherwise, is unlikely to be a good reason”.
The court said: “Solicitors cannot take on too much work and expect to be able to persuade a court that this is a good reason for their failure to meet deadlines…
“We should add that applications for an extension of time made before time has expired will be looked upon more favourably than applications for relief from sanction made after the event.”
This “more robust approach” will mean that from now on, relief from sanctions should be granted “more sparingly than previously”, the court said, warning those lawyers who had hoped that Jackson would not change the litigation culture that they were wrong.
“We accept that changes in litigation culture will not occur overnight. But we believe that the wide publicity that is likely to be given to this judgment should ensure that the necessary changes will take place before long.”
While accepting that there was force in some of the claimant’s criticisms of Master McCloud’s judgment, the Court of Appeal said “they do not go to the heart of the master’s reasoning”.
The court said: “The defaults by the claimant’s solicitors were not minor or trivial and there was no good excuse for them. They resulted in an abortive costs budgeting hearing and an adjournment which had serious consequences for other litigants.”