Mercy Global Consult Limited (in liquidation) v Abayomi Adegbuyi-Jackson & Ors

A trial should proceed despite a pending application for permission to appeal a case-management decision unless the circumstances justify a stay or adjournment. The possibility that directions may later need reconsideration is insufficient. A party seeking a stay must make a proper application and ordinarily show a risk of irremediable harm.

Immediate strike-out and debarring orders may be made where serious and repeated non-compliance threatens the fairness of the trial. The court considers the seriousness of the breaches, whether they are excusable, their consequences, and all the circumstances. An unless order may be pointless where it would jeopardise the trial date.

The claimant brought proceedings alleging, among other matters, fraudulent breach of trust and misappropriation of VAT. At a pre-trial review, the court considered applications by certain defendants to adjourn the review, the trial, and the claimant’s application to strike out defences and debar defendants from defending.

The proposed trial adjournment was based partly on a pending application for permission to appeal to the Supreme Court from the Court of Appeal’s refusal of permission concerning a proposed VAT defence. The defendants had also repeatedly failed to comply with case-management directions. The central issues were whether the proceedings should be adjourned and whether immediate debarring orders were justified against three defendants who had failed to plead and provide disclosure.

1. Adjournment and pending appeal. The application to adjourn the trial was dismissed. The possibility that case-management decisions might later require reconsideration did not justify suspending the proceedings. The Court of Appeal had refused the relevant appeal, permission to the Supreme Court appeared intrinsically unlikely, and no stay had been sought.
2. A party seeking a stay pending appeal must make a proper application, identify solid grounds, and ordinarily demonstrate some form of irremediable harm. The commencement of an appeal or grant of permission does not itself stay enforcement or proceedings. Case management should not be interrupted by interim appeals because of the risk of satellite litigation and delay.
3. The defendants’ failure to comply with directions was not a sufficient reason to adjourn. Applications to extend expired deadlines had not been made, and the three-stage approach in Denton v TH White Ltd did not justify disturbing the timetable on the material before the court. The trial should proceed, with any necessary directions or orders available if a later appeal succeeded.
4. Debarring orders. The Second, Fourth and Fifth Defendants had failed to file proper defences or responsive defences and had provided no disclosure. Their conduct made it almost impossible for the claimant to understand the cases to meet and jeopardised a fair trial, particularly given their former fiduciary or trustee roles and the allegations of fraudulent breach of trust.
5. The court had power under Civil Procedure Rules 1998 rr 3.4(2)(c) and 3.1(3), and under its inherent jurisdiction, to strike out a defence and debar a defendant. An immediate order was appropriate where an unless order would be pointless and likely cause the trial date to be lost. The Debarring Application was granted: any defence filed by the Fourth Defendant was struck out and the Second, Fourth and Fifth Defendants were debarred from defending.

Not an appeal. The judgment records earlier case-management decisions, including Richards J’s judgment of 31 March 2023, [2023] EWHC 749 (Ch), and a subsequent Court of Appeal decision, [2023] EWCA Civ 1073, concerning proposed amendments. The present court dismissed the adjournment application, adjourned the remaining debarring issues, and granted immediate debarring orders against three defendants.