Sir John Fitzgerald Ltd v Macarthur

Under CPR 39.3(5), a party absent from trial may obtain relief only by showing prompt action, a good reason for non-attendance, and a reasonable prospect of success. These are necessary, but not necessarily sufficient, conditions; the court retains a discretion. Whether there is a good reason requires an assessment of all the evidence and circumstances, viewed in the round and consistently with the overriding objective. Procedural default must be assessed in context. Late compliance by the other party and uncertainty about whether a trial will proceed may provide a good reason for non-attendance. Security for costs or payment into court should be ordered cautiously. Mere procedural breaches or a seemingly weak case do not suffice; there must ordinarily be regular flouting of procedure or want of good faith, with proper regard to access to justice.

The claimant obtained judgment in the Reading County Court against the defendant after his defence was struck out under CPR 39.3(1)(c) because he did not attend the trial. The judge proceeded on the claimant’s evidence and entered judgment for £85,744 plus interest. The defendant, who had emigrated to Australia, had repeatedly sought clarification and an adjournment, while the claimant had served important evidence late and had not served the trial bundle in accordance with the court’s order.

The defendant appealed out of time. The High Court treated the relevant ground as an application under CPR 39.3(3) to set aside the judgment. The central issues were whether the defendant had acted promptly, had a good reason for non-attendance, and had a reasonable prospect of success, and whether any order should be conditional on security.

1. Relief under CPR 39.3. The defendant’s appeal was treated, with the claimant’s agreement, as an application to set aside the orders under CPR 39.3(3). The three requirements in CPR 39.3(5) were necessary conditions, but satisfaction of them did not remove the court’s discretion.
2. Promptness. The defendant acted promptly in filing his Appellant’s Notice six weeks after judgment. He was a litigant in person abroad and had reasonably sought a transcript to understand what had occurred at the hearing. Promptness is judged by all the circumstances and requires reasonable celerity, not an inflexible time limit.
3. Good reason for absence. The first-instance judge had asked whether an adjournment was necessary, rather than whether there was a good reason for non-attendance. His conclusion was materially flawed. The claimant had served its principal witness statement one working day before trial, served further evidence even later, and had failed to serve the trial bundle as ordered. Against that background, the defendant was reasonably uncertain whether the trial would proceed and whether it could fairly be conducted. His decision not to incur the expense of attending from Australia until the position was clarified was genuine and honest and amounted to a good reason.
4. Reasonable prospect of success. The claimant conceded this requirement. The court therefore did not determine it, although it noted that the pleaded issue of inducement was distinct from whether the claimant had been induced to enter the contract, since the alleged reliance concerned payment of the deposit and balance.
5. Security. The court declined to require security for costs or payment into court. The defendant’s procedural failures did not demonstrate regular flouting or want of good faith. The apparent weaknesses in the defence did not justify a conditional order where a reasonable prospect of success had been conceded, and the court had to remain alert to the risk of impairing access to justice.
6. Other grounds and disposition. The absence of telephone facilities did not establish a serious procedural irregularity under CPR 52.11(3)(b). An appeal against the order entering judgment on the merits would lie to the Court of Appeal because that was a final decision, so the High Court had no jurisdiction to entertain that ground. The orders striking out the defence and entering judgment were set aside under CPR 39.3. The matter was to proceed to trial with all due expedition.

• Reading County Court: On 3 September 2007, HH Judge Elly struck out the defendant’s defence under CPR 39.3(1)(c) for failure to attend and entered judgment for the claimant for £85,744 plus interest and costs.
• High Court (Queen’s Bench Division): Permission to appeal was granted by Roderick Evans J on 12 May 2009. The High Court treated the principal challenge as an application under CPR 39.3(3), set aside the orders striking out the defence and entering judgment, declined to determine the merits appeal over which it lacked jurisdiction, and directed that the case proceed to trial.