Chartwell Estate Agents Ltd v Fergies Properties SA & Anor

Where witness statements are served late, the court must decide whether to extend time and, where necessary, grant relief from sanction by applying the overriding objective. A non-trivial default places the burden on the defaulting party, which must explain the default and show why relief is just. The court should assess the whole procedural history, including defaults by other parties, the effect on the trial date, proportionality and the consequences of refusal. Relief may be granted where both parties contributed to the failure, the trial can proceed without significant disruption, and refusal would effectively terminate the claim.

The claimant sought commission under an estate agency agreement concerning the sale of a property. At a case management conference, the court ordered simultaneous exchange of witness statements by 4pm on 22 November 2013. Ongoing disputes about disclosure meant that neither side exchanged statements, and neither sought an extension before the deadline. The claimant applied for an extension of time, relief from sanction and permission to amend its costs budget. The central issues were whether relief under CPR 3.9 was required, whether time should be extended under CPR 3.1(2)(a), and how the amended relief-from-sanction approach applied.

1. Application granted in part. The court granted both parties an extension of time and relief from sanction, directing simultaneous exchange of witness statements within seven days. The application to amend the claimant’s costs budget was refused, and there was no order as to the costs of the application.
2. Failure to serve a witness statement within the time ordered engages the sanction in CPR 32.10. An application for permission to call the witness therefore requires relief from sanction under CPR 3.9, although the court noted the alternative argument that, before trial, the court could extend time under CPR 3.1(2)(a) without CPR 3.9 applying.
3. Applying Mitchell [2013] EWCA Civ 1537, the default was not trivial. The claimant had failed to obtain an extension before the deadline and could have served statements and sought permission for supplementary evidence after disclosure. The burden therefore lay on the claimant to justify relief.
4. The court assessed the default in its full context. Both parties were at fault. The claimant had failed to apply for specific disclosure or an extension, while the defendants had not prepared statements ready for exchange and had contributed to the continuing disclosure difficulties.
5. The case was materially different from Durrant [2013] EWCA Civ 1624 and M A Lloyd & Sons Ltd v PPC International Ltd [2014] EWHC 41 (QB), because the order required simultaneous rather than sequential exchange and the existing trial window could be maintained. Refusal would effectively end the action and would be disproportionate and unjust.