Shawton Engineering Ltd v DGP International Ltd & Anor

When transferring a substantial trial, the court must apply the overriding objective and give proper weight to convenience, expense and prejudice, including business disruption. Preserving a trial date cannot by itself outweigh those considerations. A court acting on its own initiative may transfer proceedings without hearing the parties only where it has all material needed to decide fairly. If the required considerations were not addressed, the appellate court may reconsider the balance afresh.

The claimant brought a claim exceeding £1.5 million for repudiatory breach of contract and negligence. After repeated delays, an adjourned trial and an amended expert case, the Technology and Construction Court transferred the proceedings administratively from Liverpool to London so that the trial date could be retained.

The defendants objected on grounds of inconvenience, substantial additional expense and disruption to their business. His Honour Judge Mackay refused their application to review the transfer. The central issues were whether the transfer had been made fairly without prior representations, and whether the judge had properly considered the mandatory matters governing transfer, including convenience, expense and prejudice.

The Court of Appeal unanimously allowed the appeal. The transfer order was discharged, the case management conference and trial date were vacated, and the case was transferred to Salford for listing in the week commencing 11 October 2004, with an estimated hearing length of nine weeks. Costs here and below were agreed at £9,000.

1. Transfer and balancing considerations. Latham LJ held that, although appellate interference with case management decisions is unusual, the administrative transfer of a nine-week trial from the North West to London required careful consideration of possible prejudice to both parties. Convenience, calculable expense and the incalculable disruption to the appellants’ business were material considerations. The claimant identified no specific prejudice beyond delay, and that contention carried little weight given its responsibility for earlier adjournments and the abandoned trial.
2. Failure to apply the relevant criteria. In applying the overriding objective and Order 33(2), the overwhelming considerations were convenience and expense. The judge’s reasons did not show that he had properly directed himself to those matters, even after the review hearing. The Court was therefore entitled to look at the matter afresh, and the balance favoured trial in the North West.
3. Orders made on the court’s own initiative. Peter Gibson LJ agreed that the court had power under CPR 30.3 to transfer the case and under CPR 3.3(4) to make an order without hearing the parties. However, where a transfer would materially affect a lengthy trial, the court should proceed without representations only if it was very certain that the mandatory matters required no assistance from the parties and that it possessed all material needed to decide fairly under the overriding objective.
4. Procedural safeguard. Peter Gibson LJ further noted that the original order failed to comply with rule 3.3(5)(b), which required a statement of the affected party’s right to seek to have the order set aside, varied or stayed. That omission may have contributed to the application being slightly out of time. Nourse LJ agreed with the judgment and relief.

1. Court of Appeal (Civil Division): In [2003] EWCA Civ 1956, unanimously allowed the defendants’ appeal, discharged the transfer order and directed transfer of the case to Salford.
2. Queen’s Bench Division, Liverpool District Registry, Technology and Construction Court: His Honour Judge Mackay refused the defendants’ application to review the administrative transfer of the proceedings from Liverpool to London.