Hague Plant Ltd v Hague & Ors

Permission to amend a statement of case may be mandatory when the order’s wording and procedural context require service of the amended pleading in the specified form. A party cannot unilaterally revert to an earlier pleading after serving a non-compliant amended pleading. Particulars supporting allegations of dishonesty must identify the goods or services said to have been supplied to the defendant. Where the claimant operated its own business as well as supplying services to another company, it must make a plausible allocation between those activities. A response to a request for further information is inadequate if it leaves the alleged disparity, and therefore the basis for the dishonesty inference, unintelligible. A minor, promptly corrected defect in a statement of truth does not justify a sanction.

The claimant brought a long-running claim against former family members and a related company, alleging dishonest breaches of fiduciary duty and dishonest assistance. Following preliminary issues and an unsuccessful amendment application, Norris J made the Second Order, requiring the claimant to serve re-re-amended particulars in a specified form and, unless it did so, to provide compliant replies to a Part 18 request or face strike-out.

The claimant served a pleading which reinstated deleted claims and replies which treated all material and labour at the shared site as supplied to the defendant company. The defendants sought strike-out, while the claimant sought relief from sanctions for a defective statement of truth. The issues concerned the mandatory effect of the order, the adequacy of the replies, and the appropriate sanction.

1. Mandatory amendment. The wording and context of the Second Order required the claimant to serve the re-re-amended particulars in the form scheduled to the order. The expressions that the pleading “must be served” and that the claimant “shall serve” were mandatory. The attached schedule removed any uncertainty. The order therefore required deletion of the claims for topsoil, labour and equipment, scrap, and tipping. The claimant was not entitled simply to decline the permission and revert to the earlier pleading.
2. Effect of non-compliance. The claimant’s reinstatement of the deleted claims breached the Second Order. The judge considered that, even if there had been a right to elect, service of the defective amended pleading would have exhausted it; reverting to the earlier pleading would have required an application and an order.
3. Replies concerning topsoil, labour, equipment and scrap. The replies were illusory and embarrassing. The claimant had operated its own businesses from the site and had used material, labour and equipment for those businesses. It therefore had to provide a plausible allocation between its own activities and supplies to MHH. Without that allocation, the court and defendants could not assess the alleged disparity or understand the pleaded inference of dishonesty. The deficiency concerned liability as well as quantum.
4. Tipping claim and statement of truth. The replies on tipping were not shown to be illusory or in breach of the unless order, because no comparable allocation issue arose. The defective statement of truth was a minor and unintentional error, promptly corrected, and caused no prejudice.
5. Disposition. Relief was not required for the substantive breaches and would in any event have been refused under the Denton principles. The court directed the claimant to serve particulars in the form scheduled to the Second Order within 14 days, or such other agreed period. An unless provision was to provide that failure would result in automatic strike-out of the whole claim. The larger deleted claims were removed, but a more severe immediate sanction was disproportionate.

First-instance decision. The judgment records earlier judgments and orders in the same litigation, including [2016] EWHC 2663 (Ch), [2017] EWHC 1240 (Ch), [2017] EWHC 2021 (Ch) and [2017] EWHC 3076 (Ch), but this decision was not an appeal from those judgments.