Ryder Plc v Beever

Relief from an unless order requires the court to consider each factor in CPR 3.9, stand back and assess all relevant circumstances, and decide whether refusal of relief is proportionate. A default should not be treated as significant merely because it reflects a cavalier attitude or forms part of a numerical history of breaches. The court must examine its actual effect on the conduct and fairness of the litigation. It must distinguish prejudice caused by the default from the wider consequences of refusing relief. Where a claim has already established liability, and the default has caused little litigation prejudice, striking out may be disproportionate. The circumstances in which an unless order was made, including failure to warn the affected party and making the order without an opportunity to be heard, may be highly relevant.

The respondent suffered serious injuries in a road accident for which the appellant had admitted liability. His claim developed into a high-value, complex damages claim. His solicitors failed to serve a required costs schedule. Following complaints made privately to the court by the appellant’s solicitors, the court made an unless order of its own motion. The claim was struck out when the schedule was not served by the deadline.

A deputy district judge refused relief from sanctions under CPR 3.9. On first appeal, HH Judge Cotter QC allowed the appeal and restored the claim. The appellant brought a second appeal. The central issue was whether the first appellate judge was entitled to interfere and whether relief from the strike-out sanction was proportionate in all the circumstances.

Appeal dismissed. The first appellate judge had been entitled to conclude that the deputy district judge had erred and to exercise the discretion afresh. The appellate function was initially to review the decision below; once material error was found, the judge had to reconsider the matter himself.

1. Under CPR 3.9, the court must consider each listed factor, make necessary findings of fact, stand back, assess all relevant circumstances and apply the overriding objective in CPR 1. The ultimate question is proportionality.
2. The delay in applying for relief was eight days. Although unexplained, it caused no real prejudice and was not significant. A history of defaults must be assessed by its effect on the progress of the action, not by counting breaches. A cavalier attitude may be relevant, but is not significant without an effect on progress or disadvantage to another party.
3. The effect of a default under CPR 3.9(h) concerns prejudice in the conduct of the claim. The wider consequences of granting or refusing relief fall under CPR 3.9(i). The costs schedule could have been important, but the evidence showed no substantial prejudice from the delay, particularly the eight-day delay after the unless order.
4. Under CPR 3.9(g), loss of the trial date should not be given disproportionate weight where it was likely to have been lost for other reasons, including timetable slippage and the need to consider further expert evidence.
5. Under CPR 3.9(i), refusal would severely prejudice the claimant through delay, funding difficulties and the disadvantage of suing his own solicitors. Although granting relief exposed the defendant to a substantial claim, justice generally favoured liability being determined directly between claimant and tortfeasor rather than transferred to solicitors on a risk basis.
6. The court’s own-motion procedure was a powerful additional consideration. A party intending to seek a sanction should ordinarily make an application and give notice. If an unless order is made without an application, the affected party should ordinarily have an opportunity to be heard. The saving of costs did not justify the informal procedure. The circumstances did not create a trap for the unwary.

Collectively, the defaults did not justify striking out a claim whose overall effect on the litigation was not grave and whose refusal of relief would cause severe prejudice. The appeal was dismissed.

• Court of Appeal (Civil Division): appeal dismissed. The court upheld the restoration of the claim and held that the first appellate judge was entitled to exercise the discretion afresh.
• Exeter County Court: Deputy District Judge Melville-Shreeve refused relief from sanctions and the action remained struck out.
• Exeter County Court: HH Judge Cotter QC allowed the claimant’s appeal on 4 May 2012 and restored the action to life.