Byers & Ors v Samba Financial Group

Where a defendant’s defence is struck out because its culpable conduct has prevented a fair trial of liability issues, the claimant need not ordinarily prove those issues by evidence at trial. The court may enter judgment, or provide for judgment to be entered, under its consequential-order powers. The result differs where the claim requires the court to evaluate discretionary relief or determine an amount, such as quantum in account proceedings. A debarring order concerning liability issues does not impose a greater evidential burden on the claimant merely because other live issues remain for trial.

The claimants sought payment from the defendant bank. Following an earlier judgment, the bank’s defence was struck out and it was debarred from defending the claim, subject to five identified Live Issues proceeding to trial. The parties disputed whether the claimants nevertheless had to prove, by evidence and on the balance of probabilities, all other elements of their claim.

The issue was whether the debarring order entitled the claimants, subject to the Live Issues, to judgment on liability without adducing evidence on the issues from which the bank was debarred, and how the governing-law issue should be treated.

1. Effect of the debarring order. The claimants were not required to adduce evidence proving issues from which the bank had been debarred. Requiring proof of issues for which the bank’s disclosure was necessary would perpetuate the prejudice caused by its serious and culpable breach and allow it to benefit from that breach (paras [4]-[9], [23]-[27]).
2. Power to enter judgment. Where an unqualified debarring order is made without an unless order, the court may make an appropriate consequential order, including entering judgment, under Rule 3.4(3) and para 4 of Practice Direction A to Part 3. Paragraph 4.2 does not require proof by evidence at trial in every case. The power is fact-sensitive (paras [10]-[13]).
3. Limits of the rule. Thevarajah v Riordan [2015] EWCA Civ 41 concerned discretionary equitable relief, which must be evaluated by the court. Times Travel (UK) Ltd v Pakistan International Airlines [2019] EWHC 3732 (Ch) concerned account proceedings in which the court had to determine the appropriate amount. Neither authority established a general requirement that a claimant prove liability issues by evidence after a defence has been struck out (paras [17]-[23]).
4. Application and order. Subject to the outcome of the Live Issues, the claimants were entitled in principle to enter judgment for the amount determined at trial. They had to prepare evidence only on the Live Issues. Unless their pleaded case was amended or abandoned, the claim was to be treated as governed by Cayman Islands or English law rather than Saudi Arabian law, so far as the relevant Live Issue was concerned (paras [26]-[32]).