High Court ruling clouds tough line on relief from sanctions

Shipping case: failure to comply was not intentional

The new rule on relief from sanctions should not be applied so strictly that a refusal would be disproportionate and give the defendants an unjustified windfall, the High Court has ruled.

According to the Lawtel report of Rayyan Al Iraq Co Ltd v Trans Victory Marine Inc, Mr Justice Andrew Smith found that an oversight that led to the claimant’s solicitors serving particulars of claim two days after the expiry of the 28-day period allowed by the CPR was in all the circumstances the clearest case for allowing an extension of time.

It is the second recent example of the High Court tempering its approach to relief from sanctions following Mr Justice Walker granting relief in a case of human error.

The cases follow other rulings where a harder post-Jackson approach was taken and risk adding to the uncertainty over how vigorously the new CPR will be enforced.

Having missed the deadline, the claimant in Rayyan – a shipping case – asked the defendant to agree to the necessary extension of time and applied to the court when that was refused.

The report said the judge found that had the claimant applied for an extension before the 28-day period expired, it would almost certainly have been dealt with on paper and granted.

The post-1 April relief from sanctions rule (3.9) requires the court to consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need for litigation to be conducted efficiently and at proportionate cost, and to enforce compliance with rules, practice directions and orders.

Andrew Smith J said that although the checklist that had previously appeared in rule 3.9 had disappeared, the matters mentioned in it remained of relevance.

Lawtel reported: “It had been said of the change in the rule that there was a concern that relief against sanctions was being too readily granted and that under the new, more succinct rule litigants who substantially disregarded court orders or the requirements of the CPR would receive significantly less indulgence than hitherto.

“However, the change in the rule or in the attitude of the courts did not mean that relief should be refused where that would be a disproportionate response and would give the defendants an unjustified windfall.

“The slight delay had not affected the administration of justice and the application for an extension was made promptly. The failure to comply was not intentional and an explanation had been given. The mistake was regrettable but not egregious. The court did not view with favour the suggestion that the claimant should be left to a claim against their professional advisers…

“In all the circumstances the case for an extension of time was clear. The solicitors’ error should have been inconsequential and the application should have been dealt with at minimal expense on paper. The defendants' attempt to exploit the error was regrettable.”



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