Bilta (UK) Ltd (In Liquidation) v Tradition Financial Services Ltd

The Court of Appeal allowed the appellant's challenge to the trial judge's refusal to adjourn a multi-week trial where an important defence witness (Ms Mortimer) was temporarily medically unavailable but likely to be fit to give live evidence later in the year. The court emphasised that the governing question on an adjournment application is whether proceeding would produce an unfair trial in all the circumstances, applying a fairness-focused (non-Wednesbury) review rather than a mechanistic checklist. The court held that the unavailability for medical reasons of an important witness whose oral evidence was likely to be material and where there was a realistic prospect of attendance at a reasonably proximate future date made it unfair to proceed; uncompensatable prejudice to the claimant would be required to justify refusal.

Background and parties

The claim was brought by five companies in liquidation (and their joint liquidators) for losses said to arise from spot trading in European Union Emissions Allowances (EUAs) in 2009, pleaded as dishonest assistance and as claims under section 213 of the Insolvency Act 1986. Tradition Financial Services Ltd (TFS), a broker, denied dishonesty and other points in its defence. The trial had been fixed to begin on 25 January 2021 in the Business and Property Courts.

Procedural posture

• The decision under appeal was an order of Marcus Smith J dated 11 January 2021 refusing TFS's application to adjourn the trial. Permission to appeal to the Court of Appeal was granted by Lewison LJ.

Factual background relevant to the application

• TFS intended to call several employees as live witnesses, including Ms Lucy Mortimer, head of the relevant trading desk, whose honesty was directly in issue. She became gravely ill in August 2020 and by November 2020 appeared unable to give evidence in January 2021; by late December 2020 her prognosis had materially improved and there was a realistic prospect that she would be fit to give live evidence after about September 2021.
• TFS applied on 6 January 2021 for an adjournment to the first convenient date after 1 October 2021. The application was supported by a witness statement from Ms Mortimer expressing her wish to give live evidence to answer allegations which could seriously affect her reputation and employability.

Issues for the court

1. What is the proper legal test on an application to adjourn for medical unavailability of an important witness or party?
2. Whether the trial judge erred by refusing the adjournment in this case.

Court's reasoning

• The court reviewed authority from Dick v Piller (1943) onwards and concluded that the central question is whether refusal to adjourn would render the trial unfair; this is an evaluative question to be judged on the facts and the overriding objective. The appellate review is not confined to Wednesbury-style review but must satisfy itself that the decision to refuse was not unfair.
• The court rejected a sharp distinction between a party's own unavailability and the unavailability of an important witness; what fairness requires depends on the circumstances. The importance of oral evidence varies by case, and where a witness's cross-examination is material the absence of live evidence is likely to be decisive.
• Applying the principles, the court found that Ms Mortimer was an important witness whose oral evidence would likely be material in assessing dishonesty; there was a realistic prospect she would be available after 1 October 2021; and there was no demonstrable uncompensatable prejudice to the claimants that would justify refusing an adjournment.

Relief sought and disposition

The appellant sought an adjournment of the trial. The Court of Appeal allowed the appeal and directed the trial be relisted to the first available date after 1 October 2021.

This was an appeal allowed. The Court of Appeal held that the proper question on an adjournment application is whether proceeding would produce an unfair trial. The judge should have asked whether a trial without the witness's oral evidence would be fair; because Ms Mortimer was an important witness, likely to be fit to attend a reasonably proximate re-fixed trial, and there was no shown uncompensatable prejudice to the claimants, refusing an adjournment would have been unfair and the adjournment was ordered.

Appeal from the High Court of Justice, Business and Property Courts (Financial List, Chancery Division), Marcus Smith J [2021] EWHC 36 (Ch) to the Court of Appeal, Civil Division [2021] EWCA Civ 221.