Webb Resolutions Ltd v JV Ltd (t/a Shepherd Chartered Surveyors)

An application to strike out pleaded defences should ordinarily be made before the court has established a procedural framework for their trial. A late application may amount to an impermissible collateral attack on existing case-management directions.

Specific disclosure must be confined to documents shown to be relevant to the issues for trial. Where the terms of a commercial transaction are contained in disclosed agreements, speculative requests for pricing information, prospectuses, due-diligence material or related assignment documents will not satisfy that threshold. The court may preserve a party’s ability to rely on expert evidence by imposing a final deadline, with debarment for default.

The claimant, as assignee of mortgage portfolios, brought professional-negligence claims against the defendant valuer. The defendant pleaded champerty and contributory negligence and sought extensive further disclosure concerning the mortgage-sale transactions, portfolio information, due diligence and the transfer of legal title.

The claimant applied contingently to strike out those defences and sought directions concerning the defendant’s late expert evidence. The issues were whether the strike-out application could be entertained, whether further disclosure was required, and what order should govern the defendant’s expert evidence.

1. The claimant’s application to strike out the champerty and Investment Contributory Negligence defences was not entertained. The earlier order had established a framework for determining those issues and had directed disclosure and evidence. The late application, made nearly a year later and after the parties had taken substantial steps towards trial, would disrupt that framework and amount in substance to a collateral attack on the earlier case-management decision.
2. The claimant was not required to disclose correspondence with GMAC. Its solicitors had clearly stated that the documents were not within the claimant’s possession or control, that they had been requested from GMAC, and that GMAC had not provided them. There was no sensible reason to doubt those statements.
3. The defendant’s application for specific disclosure failed. The disclosed mortgage-sale agreements showed the nature of the transaction. The assignment of rights to sue valuers could, in commercial terms, protect against a shortfall on the mortgage loans and form part of a bundle of ancillary rights. The principle identified in Camdex International v Bank of Zambia [1996] 3 WLR 759 supported treating the purchase of debts with ancillary enforcement rights as capable of giving a genuine commercial interest for champerty purposes.
4. That observation did not determine the merits of the champerty defence. The defendant’s requests for individual loan prices, unredacted annexures, prospectuses, due-diligence documents and title-transfer material were speculative or unnecessary. The defendant had not shown that they were likely to be relevant to the issues fixed for the First Trial.
5. The defendant was ordered to file and exchange any expert evidence by 4pm 14 days after hand-down. This was a final order. If the defendant failed to comply, it would be debarred from calling or relying on expert evidence at the trial.