HFC Bank Plc v HSBC Bank Plc

When judgment has been reserved, the parties and their professional advisers must inform the court immediately of any development that may make delivery unnecessary, including a possible settlement. The duty concerns the proper and efficient use of court resources, not merely inconvenience to the judges. Under Part 1 of the Civil Procedure Rules, the overriding objective includes allocating an appropriate share of the court’s resources, the court must give effect to that objective, and the parties must help the court to do so. The duty applies both at first instance and on appeal. It may arise before settlement is concluded, at least when a meeting to explore settlement has been arranged.

HFC Bank Plc v HSBC Bank Plc brought a passing off claim concerning the alleged similarity between the names of the claimant and the defendant, formerly Midland Bank plc. The High Court of Justice, Chancery Division, dismissed the claim after an expedited trial on 30 July 1999 and refused permission to appeal. The Court of Appeal later granted permission and expedited the appeal. After the hearing and while judgment was reserved, the parties reached a compromise. The appeal therefore came before the court for dismissal by consent, together with consideration of the parties’ failure to notify the court promptly that settlement negotiations might make judgment unnecessary.

1. Disposition. The appeal was dismissed by consent after the parties reached a compromise before the reserved judgments were delivered. The court accepted the parties’ apologies and took no further action concerning the delay in notification.
2. Duty to notify. Lord Justice Nourse, giving the judgment of the court, stated that where judgment has been reserved it is the duty of the parties and their professional advisers to inform the court immediately when they become aware of any development which may make delivery of judgment unnecessary. The duty arose, at the latest, on 3 February, when the meeting between the parties’ holding companies had been arranged. The parties were not entitled to wait until settlement had been concluded.
3. Basis of the duty. The foundation of the duty is the requirement that the court’s resources be deployed properly and efficiently. The point applies equally where judgment is reserved at first instance and where it is reserved in the Court of Appeal.
4. Procedural rules. The duty had always existed, but was expressly imposed by Part 1 of the Civil Procedure Rules. Rule 1.1 identifies the appropriate allocation of court resources as part of dealing with cases justly; rule 1.2 requires the court to give effect to the overriding objective; and rule 1.3 requires the parties to help the court further that objective. The court made the consent order dismissing the appeal in the agreed terms, subject to a minor amendment.

1. Court of Appeal (Civil Division): Permission to appeal was granted after an earlier refusal on the documents. Following settlement while judgment was reserved, the court made a consent order dismissing the appeal: [2000] EWCA Civ 461.
2. High Court of Justice, Chancery Division: Mr Justice Lloyd dismissed the passing off action on 30 July 1999 and refused permission to appeal.