Medical Supplies And Services International Ltd vAcies Engineering Ltd & Anor

An “unless” order remains effective when a later order merely extends the time for compliance. Material non-compliance activates the specified sanction automatically, without a further order, subject to any application for relief. Relief from sanctions under CPR 3.9 requires consideration of all the circumstances, including efficient and proportionate litigation and compliance with court orders. In the post-Jackson regime, non-trivial default without good reason, particularly where inspection remains outstanding and relief is sought late, will ordinarily justify refusing relief.

The claimant brought proceedings alleging that the defendants had used confidential information in developing and marketing a competing medical vaporiser. The proceedings were subject to several case-management orders concerning disclosure, inspection and witness statements.

An order of 17 June 2013 required inspection by a specified date and provided that, upon default, the claim would be struck out. Later orders extended the timetable. The claimant did not provide inspection of the relevant documents and served its witness statements late. The defendants contended that the claim had consequently been struck out and obtained a default costs certificate. The claimant applied for relief from sanctions and to set aside the certificate.

The court declared that the claim had been struck out and refused relief from sanctions. The default costs certificate was not set aside.

1. Continuing effect of the unless order. The order of 17 June 2013 was an “unless” order. The later orders extended the time for compliance but did not make a fresh inspection order or remove the original sanction. Construed objectively against the background available to the parties, the sanction therefore remained in force.
2. Breach. The claimant plainly failed to provide inspection of 232 documents by the extended deadline. The defendants’ alleged shortcomings in disclosure did not excuse that failure. The claimant should have raised any concern about the requested copies rather than treating the request as an attempt to mislead it. The alleged breach concerning a further 49 documents was arguable but did not need to be decided.
3. Automatic operation. Applying Marcan Shipping v Kefalas [2007] 1 WLR 1864, the sanction in an unless order takes effect without a further order where there is material non-compliance. The defaulting party must apply for relief; the opposing party has no obligation to seek a declaration activating the sanction.
4. Relief from sanctions. Under CPR 3.9, the court adopted the robust post-Jackson approach identified in Mitchell v Newsgroup Newspapers Ltd [2013] EWCA Civ 1537, Durrant v Chief Constable of Avon [2013] EWCA Civ 1624 and Thevarajah v Riordan [2014] EWCA Civ 14. The breaches were neither trivial nor supported by a good reason. The application was not prompt, inspection remained outstanding, the claimant had also served witness statements four months late, and granting relief would probably lose the trial date and prejudice the defendants’ preparation.
5. The court was not satisfied that the defendants remained in breach after 12 September 2013. The disclosure list was plainly a list made in good faith, even if further specific disclosure might later have been sought, applying Realkredit Danmark v York Montagu [1998] WL 104421 and Re Atrium [2013] EWHC 2882.

The application for relief was refused, the claim was declared struck out, and the default costs certificate was left in place.

Not stated in the judgment. The decision records that an appeal against an earlier case-management order was dismissed by consent, but this judgment was a first-instance determination of the applications before it.