Gale v Superdrug Stores Plc

A court deciding whether a party may withdraw an admission must consider all the circumstances and balance the prejudice to each side. The adequacy of the explanation for the change is relevant, but it is neither a threshold requirement nor conclusive.

A party resisting withdrawal must produce clear and cogent evidence of prejudice. Delay may support an inference of prejudice, but a general assumption is insufficient when set against the injustice of preventing an arguable defence. Disappointment caused by the revival of a disputed issue carries little weight and should not be treated as a major form of prejudice.

An employee brought a personal injury claim after being struck by the door of a delivery van at work. The employer's insurers admitted liability in correspondence, made an interim payment and negotiated quantum for approximately two years. After proceedings were issued near expiry of the limitation period, the employer served a defence denying liability and alleging contributory negligence.

A district judge struck out the defence as an abuse of process. His Honour Judge Wroath dismissed the employer's appeal, giving particular weight to the weakness of its explanation, delay and the employee's disappointment. The employer appealed to the Court of Appeal. The central issue was how the discretion to permit withdrawal of an admission should be exercised under the principles applicable to Order 27 rule 3 of the Rules of the Supreme Court.

1. By a majority, the appeal was allowed. Waite and Millett LJJ held that the defendants should be permitted to withdraw the admission. Thorpe LJ dissented.

2. Waite LJ held that the discretion was a general one requiring consideration of all the circumstances and a balance between the prejudice suffered by each side. The explanation for a change of position was merely part of the overall picture. Unlike an application arising from breach of a procedural rule, withdrawal of an admission did not require a satisfactory explanation as a preliminary condition.

3. The plaintiff had produced no specific evidence that the admission made it more difficult to prove liability. Delay could permit an obvious inference of prejudice, but the judge had relied only upon a general assumption. That was insufficient when weighed against the clear prejudice of preventing the defendants from advancing an arguable defence on which they had received fresh legal advice.

4. The plaintiff's disappointment was understandable and could be considered, but the judge had wrongly elevated it into a major head of prejudice. Litigation could not be fairly conducted if disproportionate weight were attached to the parties' feelings. A party resisting withdrawal must produce clear and cogent evidence of prejudice before the ordinary freedom to change a litigation position is restrained.

5. Millett LJ agreed that the same principles governing amendment of pleadings applied to withdrawal of an admission. An admission should ordinarily be withdrawable where the application is made in good faith, raises a triable issue with a reasonable prospect of success and causes no prejudice incapable of adequate compensation. Those requirements were satisfied: the defence was strongly arguable, there was no strategic manoeuvring and undertakings protected the plaintiff against relevant financial prejudice.

6. Thorpe LJ would have dismissed the appeal. He considered a cogent explanation important, regarded the county court's decision as within the boundary of its discretion and emphasised the public interest in firm control of strategic manoeuvring.

7. The orders striking out the defence were discharged.

1. Court of Appeal: By a majority, allowed the defendants' appeal and discharged the orders striking out the defence.
2. Portsmouth County Court: His Honour Judge Wroath dismissed the defendants' appeal from the district judge on 1 November 1994.
3. Portsmouth County Court: District Judge Gale struck out the defence as an abuse of process on 2 October 1994.