Hansom & Ors v Makin & Anor

An application to lift an automatic stay imposed by transitional procedural rules must be determined under the relief-from-sanctions framework. The court must consider all relevant circumstances and assess their significance overall, without counting factors mechanically or counting the same matter twice.

The continuing possibility of a fair trial is often highly material, especially where the default amounts to inefficiency rather than flagrant or persistent misconduct. It is not an overriding condition which compels relief. The court may consider other prejudice, including the burden of unresolved litigation on professional defendants, but must assess such prejudice on the evidence and balance it against the claimant’s detriment if relief is refused.

Four claimants brought professional negligence proceedings concerning advice which had led them to discontinue earlier claims arising from alleged abuse while in local authority care. Their proceedings became automatically stayed under Part 51 of the Civil Procedure Rules 1998 because they had not come before the court during the prescribed transitional year.

Master Ungley refused to lift the stays, and struck out three of the actions. HHJ Previté QC, sitting as a deputy High Court judge, upheld that exercise of discretion. The claimants appealed, contending principally that relief should be refused only where there was a substantial risk that a fair trial was impossible. The further issue was whether errors and omissions in the decisions below required the discretion to be exercised afresh.

1. Appeals allowed and automatic stays lifted. Lord Justice Mance, with whom Lord Justice Keene and the President agreed, held that the automatic stays should be lifted on stringent terms preventing further delay.

2. An automatic stay under Part 51 of the Civil Procedure Rules 1998 was a sanction for failure to comply with a rule. An application to lift it therefore engaged rule 3.9. The listed considerations had to be examined where relevant, but the court ultimately had to stand back and assess the weight of all the circumstances. It should neither count factors numerically nor count the same matter twice.

3. In this transitional context, the relevant initial failure was the omission to bring the action before the court during the year ending 25 April 2000. The subsequent delay in seeking relief was principally relevant to promptness and to the overall consequences of granting relief. Particular care was required because several parts of rule 3.9 were designed for conventional breaches rather than automatic transitional stays.

4. The substantial-risk test stated in Taylor v Anderson [2002] EWCA Civ 1680 did not govern every application to lift an automatic stay. That case concerned a strike-out application, the application to lift the stay was raised only on appeal, the test had been conceded, and the court had not been referred to Woodhouse v Consignia plc [2002] EWCA Civ 275. Although the possibility of a fair trial would often be highly material, it could not invariably be decisive under rule 3.9.

5. The Master’s discretion was flawed. He misused the overriding objective as a measure of the claimants’ expedition, gave excessive weight to inadequately evidenced or limited prejudice from the litigation remaining outstanding, and omitted the detriment which refusal would cause. That detriment included a possible further loss-of-chance discount if the claimants were forced to sue their later solicitors for failing to pursue the present professional negligence claims.

6. Exercising the discretion afresh, the shared expectation that the actions would remain pending while related proceedings were resolved, the parties’ continuing conduct during 2001, the absence of identified evidential prejudice, the continuing possibility of a fair trial, and the claimants’ potential double discount together tipped the balance in favour of relief.

1. Court of Appeal (Civil Division): Allowed the claimants’ appeals and lifted the automatic stays, subject to stringent terms concerning the future conduct of the proceedings: [2003] EWCA Civ 1801.
2. High Court, Queen’s Bench Division: HHJ Previté QC, sitting as a deputy High Court judge, upheld the Master’s refusal to lift the stays.
3. Master: Master Ungley refused to lift the stays in all four proceedings and struck out three of the actions.