Wagner International AG & Ors v Earlex Ltd

An application to try a preliminary issue should be assessed by reference to the overall justice and efficiency of the proposed procedure. Relevant considerations include whether it will dispose of an issue, reduce costs or delay, depend on agreed facts, risk fettering a fair result, assist settlement, or be overtaken by amended pleadings. A point presented as one of law is unsuitable for preliminary determination where the defence is incompletely pleaded and substantial factual issues may arise. In an unusual patent case, the court may require fuller pleading of an innocence defence before deciding whether any preliminary issue is appropriate.

The claimants sought a preliminary trial of the defendant’s alleged innocence under section 62(1) of the Patents Act 1977 in patent infringement proceedings. They argued that the issue was a pure question of law based on limited facts concerning patent marking, notification and the parties’ relationship.

The defendant said that its case had not been fully particularised because further information had been requested prematurely, and that the innocence issue might be linked to a negligence claim against its patent attorney. The court had to decide whether to order a preliminary issue and what consequential directions were appropriate.

1. The application for a preliminary trial was refused. Applying the criteria identified in Steel v Steel, the court considered whether the proposed issue would dispose of an aspect of the case, reduce costs and preparation, be capable of determination on agreed facts, avoid unfair fettering, assist settlement, remain necessary, avoid being overtaken by amended pleadings, and be just and right.
2. The proposed issue was not a pure question of law. The defendant’s response to further information had expressly reserved fuller particulars, and the pleading did not purport to state the whole innocence case. Substantial factual issues might therefore arise, including issues connected with the patent attorney’s negligence claim.
3. Although an early determination might clarify the commercial significance of the claim and assist settlement, it would not avoid the main trial and might require the negligence action to be revived. The risk of inconsistent judgments and the incomplete state of the pleading meant that ordering a preliminary issue would not be just and right.
4. The defendant was directed to plead its case under section 62 of the Patents Act 1977 in proper detail, though not at evidence-level detail. The claimants were ordered to pay 90 per cent of the defendant’s assessed costs of the application, summarily assessed at £9,500, namely £8,550, payable within 28 days.