Mitchell v News Group Newspapers Ltd

Relief from sanctions under the revised CPR 3.9 requires the court to consider all the circumstances, with particular emphasis on efficient litigation at proportionate cost and compliance with rules, practice directions and orders. Serious breaches of costs-management requirements may justify a severe sanction, even where the default caused no specific prejudice and produced a benefit to the opposing party. Pressure of work, inadequate resources and delays involving counsel ordinarily carry little weight. A judge cannot generally reconsider the correctness of an earlier case-management order under CPR 3.1(7) or through relief from sanctions; the proper route is appeal, unless there has been a material change of circumstances or material misstatement of fact.

The claimant applied for relief from sanctions imposed after he failed to discuss budgets and budgetary assumptions and failed to file and exchange a costs budget seven days before the costs and case management conference, contrary to Practice Direction 51D. The sanction limited his costs budget to the applicable court fees. The application also challenged the judge’s use of the new CPR 3.14 as an indication of an appropriate sanction, although that provision did not apply to the claim. The central issues were whether the earlier order could be revisited by the same judge, how the revised relief-from-sanctions regime applied, and whether relief would be just in the circumstances.

1. Earlier order. The judge could not act as an appellate court on her own decision. The principles in Tibbles v SIG Plc [2012] EWCA Civ 518 required a principled restriction of CPR 3.1(7), normally permitting reconsideration only after a material change of circumstances or where the original facts had been misstated. Neither circumstance existed. Any challenge to the legal basis of the sanction had to be by appeal.
2. Analogy with CPR 3.14. The judge had not applied CPR 3.14 as a legally applicable rule. She had used it as guidance when exercising general case-management powers. F and C Alternative Investment (Holdings) Ltd v Barthelmy [2012] EWCA Civ 843 was distinguished because that case involved adopting an inapplicable costs regime while overlooking the governing law on indemnity costs.
3. Relief from sanctions. Under revised CPR 3.9, the court must consider all the circumstances, including efficient litigation at proportionate cost and enforcement of compliance. The two breaches were serious because costs budgeting was integral to case management and court-resource allocation. The claimant’s explanations, including pressure of work, limited staffing and delays by counsel, were inadequate. They did not automatically determine the application, but carried reduced weight under the Jackson reforms.
4. The short period available to prepare the budget did not make the sanction procedurally unfair. Proper budgeting should begin from the outset, and the defendant had complied within the available period. Equality of arms under Practice Direction 51D concerned the budgeting exercise, not failure to engage with it.
5. The sanction did not unlawfully deny access to justice. Article 6 rights were engaged, but a proportionate sanction could validly interfere with them. Relief was refused and the application dismissed. Permission to appeal was granted because the strict approach was novel and there was a compelling reason for appellate consideration.

• High Court (Queen's Bench Division): An earlier sanction order was made on 18 June 2013 in [2013] EWHC 2179 (QB), limiting the claimant’s costs budget to applicable court fees. The present application for relief was dismissed. Permission to appeal was granted under CPR 52.3(6)(b).