FD Technologies Plc v Inqdata Limited

In deciding whether substantive proceedings should proceed under Part 7 or Part 8, the court should first identify the procedural steps practically required to resolve the dispute and only then select the procedural framework.

Part 8 is flexible and may accommodate factual or expert evidence, but Part 7 is generally more appropriate where contractual construction depends on a substantial factual matrix, technical evidence, disclosure, or disputed factual issues. An unagreed factual matrix table is not necessarily an adequate substitute for pleadings. The court should favour an expeditious but orderly process, supported by proportionate case management.

FD Technologies plc and Inqdata Limited were involved in two related claims concerning the scope of Inqdata’s licence to use FD Technologies’ software. FD Technologies brought a Part 7 claim seeking, among other relief, declarations, an injunction and damages. Inqdata brought a Part 8 claim seeking declarations that its disputed service features fell within the licence.

The parties disputed whether the substantive dispute could suitably be determined under Part 8. The dispute involved the technical operation of the services, the factual matrix surrounding the licence, and the possible need for disclosure, expert evidence and factual evidence. The central issue was which claim should progress.

1. Procedural approach. The court should first determine what procedural steps are practically required to resolve the substantive dispute. Only after that assessment should it decide whether the proceedings should proceed under Part 7 or Part 8 (para [19]).
2. Part 8 flexibility. Part 8 proceedings can be adapted to permit factual or expert evidence, and in an appropriate case may involve a hybrid procedure with limited oral evidence. The availability of that flexibility does not make Part 8 suitable where the dispute requires fuller procedural definition.
3. Need for pleadings. This was a technically complex dispute involving the detail of the services, the use of software, the factual matrix surrounding the licence, and the potential need for disclosure and expert and factual evidence. The unagreed factual matrix table was not an adequate alternative to exchanged pleadings. Pleadings would define the parties’ disagreements and assist the court in deciding what evidence and disclosure were proportionate (paras [23]-[27]).
4. Disposition. An expeditious but orderly exchange of pleadings was preferable to the proposed Part 8 shortcut, which risked procedural derailment and a false economy. FD Technologies’ Part 7 claim was directed to progress, while Inqdata’s Part 8 claim remained stayed. The court indicated that the central dispute might appropriately be resolved first by a preliminary issue hearing or the first trial in a split trial arrangement, subject to consequential directions (para [28]).