Helios Oryx Limited v Trustco Group Holdings Limited

Relief from sanctions under rule 3.9 of the Civil Procedure Rules 1998 requires the three-stage Denton inquiry. A serious and significant default without a good reason does not automatically determine the application, but the applicant must still show that relief is just in all the circumstances.

The court left open whether the exceptional rule 52.30 jurisdiction governs an appeal dismissed procedurally for non-compliance with an unless order. A party cannot ordinarily use the general power to vary orders to re-argue an interlocutory security condition after it has been contested and decided, absent a material change or another recognised exception.

Trustco appealed against the striking out of its counterclaim after the Commercial Court entered summary judgment for Helios: [2021] EWHC 295 (Comm). Conditional permission was granted on the basis that Trustco provide security, including payment of the judgment sum into court. The condition was later varied, but Trustco failed to comply and its appeal stood dismissed under an unless order.

Trustco applied for relief from sanctions under rule 3.9 of the Civil Procedure Rules 1998 and sought to vary or discharge the security condition. Helios argued that the application was instead governed by the exceptional jurisdiction to reopen final appeals under rule 52.30. The central issues were the applicable procedural route, whether Trustco had been unable to comply, and whether the security condition could be revisited.

1. Relief from sanctions refused. Trustco conceded that its default was serious and significant. It failed to establish a good reason for non-compliance and failed at the third stage of the Denton analysis to show that relief would be just. The burden of proof and persuasion lay on Trustco throughout.
2. The central question was whether Trustco was unable to satisfy the security condition because exchange-control approval in Namibia could not be obtained. The evidence did not establish that a Namibian judgment recognising the English orders was essential to approval, or that its absence caused the failure. Trustco delayed and obstructed the approval process, supplied misleading or ill-founded material, caused its authorised dealer to withdraw, and failed to appoint a substitute.
3. The sanction did not improperly stifle the appeal. Conditional permission had been granted because security in this jurisdiction was regarded as necessary, and Trustco had not shown that it was unable to provide it. The balance of prejudice had already been assessed, and Trustco showed no material change justifying a different result.
4. The court did not need to decide definitively whether rule 52.30 of the Civil Procedure Rules 1998 governed an appeal dismissed by an automatic procedural sanction. The authorities suggested that the rule applied where an appeal had been determined on its merits, whereas other procedural mechanisms could apply to a dismissal by a different procedure. Trustco failed even under the more favourable analysis.
5. The application to vary was unnecessary to determine after relief was refused. Lord Justice Warby nevertheless stated that he would have refused it and considered that the court lacked jurisdiction. The general power under rule 3.1(7) could not be used to re-argue the security issue without a material change or another recognised exception. Rule 52.18(3) also barred a further application to revisit the condition after the relevant hearing. The liberty to apply was construed narrowly.
6. Permission to appeal to the Supreme Court was refused.

1. Court of Appeal (Civil Division) — Relief from sanctions was refused, leaving Trustco’s appeal dismissed under the unless order. Permission to appeal to the Supreme Court was also refused.
2. Court of Appeal (Civil Division) — Males LJ refused Trustco’s proposed variation, varied the security arrangements and imposed the unless order: [2021] EWCA Civ 1845.
3. Commercial Court — Sir Michael Burton entered summary judgment for Helios and struck out Trustco’s counterclaim: [2021] EWHC 295 (Comm).