Thevarajah v Riordan & Ors

Relief from sanctions under the revised Civil Procedure Rules 1998 is not granted merely because default was unintended or caused no immediate prejudice. The court must assess the particular circumstances, but should adopt a robust and cautious approach. It should be slow to dispense with a sanction imposed by an unless order, especially where the order enforces compliance with a freezing order and there has been substantial non-compliance. A sufficient justification, including any material change in circumstances relevant to whether the sanction should continue, must be shown.

The claimant sought compliance with an unless order requiring the defendants to provide information and documents in aid of the release of a freezing order. The defendants accepted a number of deficiencies but argued that their failures were de minimis, resulted from matters outside their control, and were not deliberate. They applied for relief from the resulting sanctions under the revised CPR 3.9.

The court considered whether the unless order had been complied with and, if not, whether relief from the sanction was justified.

1. The defendants had substantially failed to comply with the unless order. The failures included non-disclosure of charge documentation, inadequate disclosure concerning litigation funding, late production of an HSBC account statement, and return of documents to the defendants rather than the claimant’s solicitors. Serious overall failures were sufficient; every alleged deficiency did not need to be established.
2. Although the former CPR 3.9 checklist had been removed, its considerations remained relevant. The revised rule required a robust approach, and the court should be slow to grant relief while considering each case on its own facts.
3. The decision in Tarn Insurance Services Limited (in administration) v Kirby & Others [2009] EWCA Civ 19 supported a rigorous approach where an unless order enforced compliance with a freezing order. The relevant question was whether it remained appropriate for the sanction to continue when relief was sought. Non-compliance required a material change in circumstances to justify relief.
4. The defendants’ asserted defence, efforts to comply, absence of a freezing-order breach, and lack of deliberate default did not provide sufficient justification. They had not taken all reasonable available steps to obtain the missing documents.
5. Relief from sanctions was refused.