Barnes v Black Horse Ltd

A court may stay proceedings under CPR 3.1(2)(f) where an imminent decision of the Supreme Court is likely to determine or materially narrow the issues requiring trial. The discretion must be exercised in accordance with the overriding objective, with particular regard to proportionality, the costs already incurred, prospective costs, court resources, and the parties’ respective prejudice. A stay may be justified even where some factual issues would remain, if awaiting the appellate decision is likely to focus the evidence and avoid unnecessary trial or appellate costs. The stay should ordinarily be immediate where interim case-management steps would serve no useful purpose.

Black Horse applied to stay the Barnes and McIlquham actions, both concerning alleged mis-selling of payment protection insurance. The claims included allegations concerning the cost of the premiums and undisclosed commission, engaging the unfair relationship provisions of the Consumer Credit Act 1974 and, in some cases, the former extortionate credit bargain regime.

The applications were made pending the Supreme Court’s forthcoming decision in Harrison v Black Horse, following the dismissal of the appeal by the Court of Appeal. The central issue was whether the expected Supreme Court decision was sufficiently relevant, and the parties’ positions sufficiently proportionate, to justify delaying trial.

1. Stay granted. Both actions were stayed immediately pending the Supreme Court’s decision in Harrison v Black Horse. The order included the usual permission to apply if circumstances materially changed.
2. The court’s power under CPR 3.1(2)(f) had to be exercised consistently with the overriding objective in CPR 1.1(2)(b). Proportionality was especially important because the sums claimed were modest compared with the costs already incurred and the costs estimated to trial.
3. The Supreme Court’s decision was likely to address the unfair relationship regime generally, including the significance of premium costs and commission. It might also affect the former extortionate credit bargain regime. Its impact was therefore likely to extend beyond the precise facts of the appeal and could determine or narrow substantial parts of the present claims.
4. Waiting was likely to save costs, avoid an unnecessary trial, reduce the risk of duplicated appellate proceedings, conserve court time, and provide a focused basis for deciding what evidence and factual findings would be required. The fact that some factual issues would remain did not remove that advantage.
5. The claimants showed no specific or material prejudice from delay. Any financial loss could be addressed through statutory interest, and their funding arrangements meant that they were not required to defray substantial costs in advance. Article 6 did not prevent the stay, particularly given the history of delay and the absence of evidence that further delay would cause evidential prejudice.
6. Further case-management directions would not materially advance either action. Witness statements might require revision after the Supreme Court’s decision, and there was no practical difficulty in arranging an early trial if the claims remained live.