Buckinghamshire Council v FCC Buckinghamshire Limited (Judgment Number One: Abuse of Process)

A party does not establish issue estoppel merely by relying on an argument previously advanced in support of a different issue. Issue estoppel requires the same issue to have been expressly decided, or to have been a necessary and fundamental step in the earlier decision.

Henderson abuse is a broad, merits-based evaluation. The defendant must show a clear case of abuse. Failure to raise a connected claim in accordance with the Aldi guidelines creates a high risk of abuse, but does not determine the issue automatically. The court must examine causation, including what case-management decision would probably have been made if the claim had been raised, together with the public interest and the parties’ legitimate private interests.

The claimant brought a contract claim concerning the calculation of third party income and deductible haulage costs under a project agreement. At an earlier trial, the court rejected the claimant’s primary construction case concerning proviso (b) and the deductible-cost provisions.

The claimant subsequently sought permission to advance an alternative contract claim, alongside a restitution claim. Permission was granted after the earlier judgment, and the restitution claim was later discontinued. The defendant applied to strike out the remaining contract claim, alleging issue estoppel abuse and Henderson abuse. It also argued that the defendant was itself attempting to relitigate an argument rejected at an earlier amendment hearing.

The central questions were whether the current claim sought to reopen an issue already decided, whether it was a claim which could and should have been advanced earlier, and whether the defendant’s previous conduct prevented reliance on that contention.

1. Issue estoppel. The court applied the principles summarised in Danish Customs and Tax Administration v MCML Limited and the explanation of issue estoppel given by Lord Keith in Arnold v National Westminster Bank Plc (No.1). The issue must be identical in both proceedings. It must have been expressly decided, or have been a necessary and fundamental part of the earlier decision. Issue estoppel cannot be enlarged by evidence, inference or argument.
2. The earlier trial decided the construction of proviso (b) in the context of whether particular costs were deductible from third party income. The present claim accepted that determination and advanced a different contractual question: whether the defendant was required to give credit for saved haulage costs included in payments made under the contract. Reusing an argument about unfairness in support of a fundamentally different issue did not create an issue estoppel. The issue-estoppel application therefore failed.
3. Henderson abuse. The court applied the principles summarised in Outotec v MW High Tech. Henderson abuse involves a broad merits-based judgment, not the exercise of a discretion. The defendant must establish a clear case. Breach of the Aldi guidelines creates a high risk of abuse but is not automatically abusive. The court must assess the causative effect of the failure, including the alternative case-management decisions that might have been made, and must consider the public interest and the parties’ legitimate private interests.
4. The claimant had not deliberately withheld the alternative contract claim. It was not appreciated until after the earlier judgment, when disclosure and evidence clarified the significance of the underlying model. Even if pleaded earlier, the claim would probably have been adjourned with the restitution claim, so there would still have been two trials. There was therefore no causative case-management prejudice and no sufficient basis for Henderson abuse. The subsequent discontinuance of the restitution claim did not make the conduct oppressive or harassing.
5. Earlier amendment hearing. The court considered Kensell v Khoury and accepted that the parties’ positions and the court’s observation at the earlier hearing had been confused. That did not make the present application decisive. The defendant’s strike-out application was dismissed.

Not stated in the judgment.