Greig v Stirling & Anor

An order made without a hearing may be treated as an order made on the court’s own initiative where the applicable procedural direction so provides. An affected party may then apply to set it aside, and the court should extend time where refusing an extension would be disproportionate or unjust. On such an application, the court should ordinarily reconsider the merits where the party lacked a proper opportunity to make representations. Strike-out is an exceptional response to procedural default. It should not ordinarily terminate an arguable and substantial claim where the default concerns another aspect of the litigation, has not disrupted the trial, and dismissal would be disproportionate.

The claimant brought money claims against two defendants arising from dealings in Spanish properties. Judgment in default had been entered against the first defendant, who was later recorded as deceased. The Master directed amendment of the claim to substitute the deceased defendant’s estate and gave directions for the claim against the second defendant to proceed.

The second defendant later applied to strike out the claim without a hearing. The application was granted on the papers, but the claimant said he had not been notified that it would be dealt with in that way and had not received the order. A subsequent order requiring him to pay the second defendant’s costs was made in his absence. The issues were whether both orders should be set aside and, if so, what procedural consequences should follow.

1. The strike-out order was set aside. The application had been determined without agreement and without the notification required by PD23A paragraph 2.4. Under paragraph 11.2, the application was treated as one proposed to be made on the court’s own initiative, so the claimant had a right under CPR 3.3(5) to apply to set the order aside.
2. The claimant’s application was technically late only on the assumption that the order had been served in April. The evidence supported the conclusion that it had probably not been posted then. In any event, applying the approach in Sayers v Clarke-Walker [2002] EWCA Civ 645 and the three-stage guidance in Denton v T H White Ltd [2014] EWCA Civ 906, it was just to extend time. The delay was neither serious nor significant, and refusal would have denied a hearing on an order terminating the claim.
3. The court therefore reheard the strike-out application on its merits. The allegations of deliberate delay, lack of merit, abuse of process and the existence of an adequate remedy against the first defendant were insufficiently supported. The claimant’s default in amending the claim against the deceased defendant was not a direction to pursue enforcement against that estate instead of proceeding against the second defendant. It had not caused the trial to be lost or jeopardised.
4. Dismissal of an arguable and apparently substantial claim was excessive and disproportionate in the circumstances. The Master should consider any amendment or enforcement issues, including whether an unless order was appropriate.
5. The costs order was also set aside. Under CPR 23.11(2), the power to re-list an application included power to rehear it in full, as explained in Riverpath Properties Ltd v Brammall, The Times, February 16, 2000. The costs order was parasitic on the strike-out order.