Kelly v Miller & Ors

A trial judge must decide a case within the issues left open by earlier judgments and case-management orders. Where liability has already been determined and the remaining dispute concerns quantum, the judge must not reopen liability or rely on defences and factual matters excluded from the issues. Proceeding on a materially mistaken understanding of the hearing’s scope, and basing the result on matters not open to the parties, is a serious procedural irregularity. The resulting order may be set aside and the case remitted for rehearing before a different judge. The rehearing should begin with effective case management to define and, where possible, further limit the outstanding issues.

William Kelly brought proceedings against Sheila Miller, Joan Brewer and Animal Aid for reimbursement of expenditure allegedly incurred while he was a trustee of the charity. A second claim for further sums was later issued and the claims were consolidated.

The County Court had entered judgment for Mr Kelly on liability, leaving quantum to be proved. A succession of district judges made orders defining and limiting the issues relevant to quantum. At the eventual trial, however, His Honour Judge Bird proceeded on the mistaken understanding that all issues remained open. He dismissed the claim by relying in part on matters which earlier orders had excluded. The central issue on appeal was whether that procedural and jurisdictional error required the order to be set aside and the matter reheard.

1. Appeal allowed. The order of His Honour Judge Bird was set aside and the matter was remitted to Liverpool County Court for rehearing before a different judge.
2. The judge below had been unaware that judgment had already been entered on liability and that the successive case-management orders had confined the hearing to quantum. He therefore approached the hearing as a trial of the whole action and relied on matters which were not open to the parties. This constituted a serious procedural irregularity and a jurisdictional error. The four-day hearing could not safely support the order dismissing the claim.
3. The rehearing must proceed on the basis that liability has already been determined. The outstanding issues are those which would have been open before Judge Bird had he understood the procedural position. A judge nominated by the Designated Civil Judge should first conduct a pre-trial review, define the issues and consider directions capable of producing an economical, efficient and proportionate determination.
4. The Court distinguished errors going to the scope and basis of the hearing from ordinary challenges to evidential assessment. A complaint about the judge’s view of the reliability of witnesses, or about the sufficiency of evidence concerning authorisation, would not alone ordinarily justify appellate intervention. Those matters could be reconsidered at the proper quantum hearing.
5. The Court commended mediation, noting the disproportionate time, expense and emotional cost already incurred. The costs of the hearing before Judge Bird were reserved to the judge conducting the new trial. The Defendants were ordered to pay Mr Kelly’s appeal costs, including the permission application, on the litigant-in-person basis, subject to detailed assessment if not agreed.

1. Court of Appeal (Civil Division) — The appeal was unanimously allowed. The order was set aside and the matter remitted for rehearing before a different judge: [2014] EWCA Civ 1151.
2. Liverpool County Court — On 18 October 2012, His Honour Judge Bird allocated the claim to the multi-track and dismissed it after treating the hearing as determining all issues.