CCP Graduate School Limited v The Secretary of State for Education

An appellate court reviewing a strike-out or summary-judgment decision must determine whether the decision was wrong or unjust because of serious procedural irregularity. An implied contract is not established merely because a regulatory and funding scheme makes direct payment commercially convenient; necessity remains required.

Where a contractual term purports to confer a benefit on an identified third party, the Contract (Rights of Third Parties) Act 1999 creates a strong presumption that the third party may enforce it. The presumption is rebutted only by a proper construction showing a positive common intention against enforcement.

A limitation defence may be resolved summarily where no arguable basis exists for implying suspension of limitation. A later claim is not automatically an abuse merely because it could have been raised earlier, particularly where an earlier counterclaim was refused for procedural reasons.

The claimant, a private college, appealed against Master Dagnall’s order striking out its claim for unpaid tuition fees and refusing permission to amend the Particulars of Claim. The claim concerned fees allegedly payable under arrangements involving student loan contracts and direct payment to the college.

The Master held that there was no direct or implied contract, that a claim under the Contract (Rights of Third Parties) Act 1999 had no real prospect of success, that the claims were statute barred, and that the second action was an abuse of process. The central issues were whether those conclusions were arguable and whether the claim should proceed to trial.

1. Ground 1—contract. Permission was refused. The regulatory designation and student-loan arrangements did not, without more, establish a sufficiently certain direct contract. Nor was an implied contract necessary. The college had other possible routes to payment, including proceedings under the Contract (Rights of Third Parties) Act 1999, proceedings against students, and judicial review.
2. Ground 2—third-party rights. Permission was granted and the appeal upheld on this issue. The Master had applied the approach in SSHD v Cox, which had subsequently been held by the Supreme Court in PCSU to be wrong. Where the statutory conditions are met, the 1999 Act creates a strong presumption that an identified third party may enforce a contractual term which purports to confer a benefit. The reasons relied on by the Master did not rebut that presumption. The proposed claim was therefore arguable and the amendment should not have been refused on merits grounds.
3. Amendment. The amendment was the claimant’s principal case, went to the root of the dispute, and had arguable prospects. Its lateness was relevant but did not justify refusal at the interlocutory stage. The court should not conduct a mini-trial when assessing prospects of success.
4. Ground 3—limitation. Permission was refused. The Master lacked sufficient facts to determine precisely when each cause of action accrued, but the pleaded case showed that the claims accrued more than six years before issue. There was no arguable implied term suspending limitation during the respondent’s investigation. Business efficacy and the officious-bystander test did not support such a term, and alternative legal remedies were available.
5. Ground 4—abuse of process. Permission was granted and the appeal upheld. The fact that the claim could have been raised in earlier proceedings did not itself establish abuse. Relevant factors included the claimant’s period as a litigant in person, the procedural refusal of the earlier counterclaim, the absence of a merits determination, the arguable 1999 Act claim, the possible suspension of payments, and the claimant’s Article 6 rights.
6. Disposition. The limitation ruling independently disposed of the appeal. The appeal was dismissed.

• High Court (King’s Bench Division): Master Dagnall struck out the claim and refused permission to amend by order dated 29 January 2024. Mr Justice Ritchie granted permission on grounds 2 and 4, upheld those grounds, refused permission on grounds 1 and 5, and dismissed the appeal because the claims were limitation barred.