Evans v Royal Wolverhampton Hospitals NHS Foundation Trust

Natural justice ordinarily requires a party whose substantive legal rights may be affected to know the case against it and have an opportunity to respond. A court should not use an ex parte procedure, or a stay, to determine or postpone such rights on undisclosed evidence or argument. The limited exceptions permitting proceedings without notice do not apply merely because disclosure may delay the applicant’s case.

Permission to withdraw a Part 36 offer during the relevant period requires a sufficient change of circumstances making withdrawal just. The relevant circumstances must exist when withdrawal is notified and must be capable of being disclosed then. An offeree cannot be left in indefinite uncertainty about whether acceptance has created an entitlement to payment or judgment.

The claimant brought a personal injury claim arising from an admitted failure by the defendant hospital to admit her for overnight observation. The defendant made a Part 36 offer of £325,000, then served notice withdrawing it before the expiry of the relevant 21-day period. The claimant accepted the offer later that day.

Without notice to the claimant, the defendant obtained an order permitting withdrawal and setting aside the purported acceptance. The claimant applied to set aside that order and to enter judgment. A judge had decided that the court had jurisdiction retrospectively to validate withdrawal, but adjourned the remaining issues to the expedited hearing before Leggatt J. The central questions were whether undisclosed material could be considered and whether the defendant could obtain an adjournment without disclosing its reasons and evidence.

1. The ex parte order was set aside. Permission to withdraw the Part 36 offer and to set aside the claimant’s purported acceptance determined substantive legal rights. Such an application should not be made without notice unless notice would defeat its purpose or there was literally no time to give notice. Neither condition applied. The defendant had ample time to notify the claimant, and notice could not have prevented effective consideration of the application.
2. The right to apply to set aside an ex parte order under CPR 23.9 and CPR 23.10 is meaningful only if the affected party receives the grounds and evidence relied upon. The dispensing power in CPR 23.9(2) cannot legitimately be used to prevent an effective challenge to the order. This case did not fall within a category permitting a closed material procedure.
3. The principles stated in Al Rawi v Security Service [2012] 1 AC 531 apply whenever the court determines a question of substantive legal right between parties, not merely at trial. Natural justice is not an optional procedural safeguard. The limited exceptions identified in that authority did not extend to this application.
4. The defendant could still seek permission to withdraw the offer in an inter partes hearing, but it had to disclose the reasons and evidence and give the claimant an opportunity to respond. In their absence, the claimant’s acceptance had to be treated as effective, entitling her to judgment under CPR 36.11(7).
5. The same conclusion followed under Part 36. The applicable test was whether a sufficient change of circumstances made withdrawal just, as stated in Cumper v Pothecary [1941] 2 KB 58 and adopted for Part 36 in Flynn v Scougall [2004] 1 WLR 3069. The change had to exist when notice of withdrawal was served and had to be capable of being disclosed at that time. The defendant could not keep the claimant in indefinite uncertainty by seeking an undisclosed adjournment.
6. Unless the defendant promptly served the evidence and disclosed the arguments relied upon in opposition, the claimant was entitled to enter judgment for £325,000.