Phaestos Ltd & Anor v Ho

A split between liability and quantum is a case-management decision requiring adequate information about the loss claimed. The court must be able to understand the alleged loss, its causation, and the legal basis on which each claimant seeks recovery. A split may be inappropriate where liability issues themselves require examination of financial performance, market conditions, or other matters bearing on quantum. A party pursuing a substantial claim cannot continue without comprehensive and comprehensible particulars of loss. The court may reconsider deferring aspects of quantum after proper particularisation and a focused application.

The claimants brought substantial claims against former employees arising from their dismissal and alleged breaches of contract, confidentiality obligations and duties. The defendants counterclaimed for a profit share, bonuses and other relief. The proceedings had been transferred to the Technology and Construction Court, and the claimants proposed a split trial dealing with liability before quantum.

The court considered whether the claims and counterclaims were sufficiently particularised, whether liability issues overlapped with quantum, and whether practical and procedural considerations justified deferring quantum issues.

1. The proposed split was refused. The court was not minded to split liability and quantum at this stage.
2. The court required proper particulars before it could make an informed decision about whether liability and quantum should be separated. The claimants’ pleadings and responses to requests for further information did not adequately identify the losses allegedly suffered, their causation, the claimant who suffered them, or the legal or corporate basis on which recovery was sought. This deficiency also impaired the defendants’ ability to know the case they had to meet.
3. The usual advantages of a split trial, including manageability, avoidance of wasted costs and protection of commercially sensitive information, were relevant but not determinative. They had to be weighed against the need for clear pleadings and efficient case preparation.
4. Several liability issues were materially connected with quantum. The alleged bonus entitlement required consideration of the claimants’ financial performance and the circumstances relevant to the exercise of any discretion. Allegations concerning investment performance and portfolio positions might require examination of market conditions, underperformance and related matters. Those issues could not readily be determined without considering matters falling within the quantum area.
5. The court was also concerned that deferring quantum without proper particulars could lead to further pleadings, disclosure and expert evidence after the liability judgment, creating a substantial risk of delay and an excessively prolonged quantum trial.
6. The court would consider a focused later application to defer particular aspects of quantum if the claims were properly particularised. Quantum relating to the surveillance allegations was not to be deferred if those allegations remained alive, subject to the court’s separate decision on the striking-out and summary judgment application. The parties were required to await the decision concerning the proposed special-damage claim.

not stated in the judgment.