Catalyst Management Services v Libya Africa Investment Portfolio

Under CPR 3.1(7), the power to vary or revoke an order is discretionary. It will normally be exercised only for a material change of circumstances or a material misstatement or omission in the facts underlying the original order. Facts known or reasonably knowable when the order was made rarely justify reopening it. A party cannot advance inconsistent accounts based on facts within its knowledge, particularly where its evidence is inadequate. A party which, after learning of the relevant circumstances, affirms the order cannot later seek revocation after default. An adjournment remains a discretionary case-management decision, and unsupported assurances of future funding do not require further inquiry.

The appellant brought a substantial claim for fees and damages arising from a management and consultancy agreement. It initially opposed an application for security for costs on the ground that security would stifle the claim, but later offered security after stating that third-party funding had been obtained.

Security was ordered by Teare J. The appellant failed to provide it, and the claim was struck out under a subsequent unless order. The appellant then applied under CPR 3.1(7) to revoke the original security order, relying on an alleged change in funding circumstances or misstatement, and sought an adjournment based on an asserted new funding arrangement. Andrew Baker J dismissed the application on 6 April 2017. The central issue was whether the evidence and subsequent conduct justified reopening the security order or granting further time.

The appeal was dismissed unanimously. David Richards LJ gave the judgment, with Sharp LJ and Newey LJ agreeing.

1. Power to revoke. CPR 3.1(7) confers a discretionary power to vary or revoke an order. The Court applied the guidance in Tibbles v SIG plc [2012] EWCA Civ 518; [2012] 1 WLR 2591, under which the usual grounds are a material change of circumstances or a material misstatement or omission in the facts underlying the original decision. Facts or arguments known, or which ought to have been known, when the order was made will rarely justify reopening it.
2. Funding evidence. The 3 February email showed that the funding agreement still required signing and final agreement. The appellant produced neither the agreement nor satisfactory evidence that it had been concluded. It therefore failed to establish a material change of circumstances. It could not recast the case as one based on a mistaken belief in available funding when the relevant facts were within its knowledge and the evidence was inadequate.
3. Misstatement and affirmation. The alleged misstatement did not form the basis of the February order. The order was made because the appellant no longer opposed security and the circumstances otherwise justified it; the asserted belief merely explained the withdrawal of opposition. In any event, the appellant learned of the funding problem, continued to accept that security should be provided, and sought time to comply. Having effectively affirmed the order, it could not seek revocation after failing to provide security. The March order independently created the strike-out consequence.
4. Adjournment. Refusal of an adjournment was a discretionary case-management decision. The judge identified the history of repeated opportunities, the prejudice caused by losing the trial date, and the absence of reliable evidence of new funding. There was no error of principle or material factor wrongly considered or ignored. The unsupported assertion of future funding did not justify further investigation.

1. Court of Appeal (Civil Division) On 12 July 2018, the appeal against the refusal to revoke the security order and the refusal of an adjournment was dismissed.
2. High Court of Justice, Queen’s Bench Division, Commercial Court Andrew Baker J dismissed the appellant’s application on 6 April 2017. The application sought revocation of the security order, relief from the strike-out sanction and preservation of the trial date.