West Is West Distribution Ltd v Icon Film Distribution Ltd

Summary judgment is appropriate where the evidence permits a short point of law or construction to be decided fairly and the respondent has no real prospect of success. The court must avoid a mini-trial while considering the evidence before it and evidence reasonably expected at trial.

Where material factual issues, an unpleaded case, or a fact-dependent assessment requires fuller investigation, summary judgment should ordinarily be refused. A claim with a real prospect of success should not be dismissed merely because damages may be weak or nominal. Focused pleading, disclosure and case-management directions may instead be required.

The claimant licensed the defendant to promote and exploit rights in the film West is West under an agreement dated 9 September 2009. The agreement was terminated with effect from 10 January 2012, but the parties disputed the consequences and alleged breaches concerning sub-distribution, accounting and delivery of DVD materials.

The defendant sought strike-out or summary judgment. The claimant sought summary judgment declaring that the agreement had been validly terminated and that DVDs manufactured by the defendant belonged to it. The central questions were whether either application could properly be determined summarily and what directions were required for the remaining issues.

1. Applications refused. Neither party obtained summary judgment. The claim was allowed to proceed, subject to focused directions and further pleading.
2. Under CPR rule 24.2, the court assessed whether the relevant claim or issue had a realistic, rather than fanciful, prospect of success and whether any other compelling reason required a trial. It avoided a mini-trial while considering evidence before it and evidence reasonably expected at trial.
3. The claimant advanced an unpleaded basis for termination for the first time at the hearing. Whether a breach was material was fact-dependent, and there was a serious unresolved issue concerning reliance on later grounds for contractual termination. Summary judgment on valid termination was therefore inappropriate, although the claim had a real prospect of success.
4. The unqualified claim concerning ownership of DVDs could not be determined after the claimant changed its position concerning the defendant’s logos and there had been no full argument.
5. The defendant accepted an arguable case on liability. Factual issues concerning the Universal arrangement, disruption to DVD sales, causation and damages could not properly be resolved on the limited evidence. The claim could not be dismissed merely because damages might be nominal.
6. The claimant was required to align its pleading with its evidence, identify which breach caused each loss and explain the alleged causal connection. Further enquiry into the accounts was permissible, but the claimant had to identify additional documents and set out the accounting issues in a clear schedule, taking account of the audit already undertaken. Costs were to be in the case.