APK Communications & Ors v Vodafone Limited

Whether to order a split trial is a pragmatic balancing exercise under the court’s case-management powers. The court must assess how the litigation is likely to unfold with and without a split, considering cost, complexity, witnesses, prejudice, the clarity of the proposed division, settlement, delay and appellate consequences. The starting point is to try as much as possible at the first trial, with a good reason required to defer issues. Separate representation of co-claimants is exceptional. It requires prior court approval and must be justified by the particular facts, ordinarily including safeguards against conflicts, duplication, delay and unnecessary costs. A late heavy application to regularise an irregularity may attract an adverse costs order.

This was the first Case Management Conference in claims by 62 former Vodafone franchisees. The claims, valued at approximately £84.58 million, concerned commercial agency indemnities, franchise remuneration, underpayments, underleases, fines and penalties, notice periods and set-off defences.

The parties supported a division broadly between common liability and principle issues in Trial 1 and claimant-specific quantum issues in Trial 2. The claimants also applied, belatedly, for permission for Knights and Bird & Bird to represent different groups of co-claimants. The court had to determine whether to order a split trial, how sampling should operate, whether separate representation should be authorised, and the costs of that application.

1. Split trial. The court ordered a split trial under CPR rule 3.1(2)(f), (j) and (k). The decision required a pragmatic balancing exercise, assessing how the case was likely to unfold with and without bifurcation. The relevant considerations included cost savings, trial preparation and management, witness inconvenience, complexity, prejudice, the clarity of the division, settlement, delay, duplication and the risk of a bifurcated appeal.
2. The proposed division was sufficiently clear. Common liability and legal issues concerning the commercial agency, franchise remuneration, and fines and penalties claims would be tried first, with claimant-specific quantum issues generally deferred. The substantial value of the common issues, and the possibility that Trial 1 would dispose of much of the litigation, strongly favoured a split despite the risk of appellate delay.
3. The court held that as much as possible should be tried in Trial 1. The reformulated Regulation 17(3)(a) issues concerning goodwill from services, categories of new business, the required causal connection, and quantification of substantial benefits were therefore included, subject to further information and final wording. The parties’ request for a preliminary-issues trial was rejected because that procedure was unnecessary on the facts.
4. Sampling. Sampling was authorised as a case-management measure. The sample had to be sufficiently broad and representative to determine common issues fairly and efficiently and to give non-sampled claimants reasonably accurate guidance on claimant-specific issues. Each party could select eight sample claimants, with a limited additional nomination mechanism where selections substantially overlapped.
5. Separate representation. Co-claimants in one set of proceedings must ordinarily be jointly represented. Separate representation is an irregularity requiring court approval and is exceptional, particularly absent an actual or potential conflict of interest. The application was granted on its particular facts, subject to safeguards limiting recoverable costs to those that would have been incurred with one firm, requiring detailed time records, a single case-management point of contact, workstream allocation, and a continuing common counsel team.
6. The claimants were ordered to pay Vodafone’s costs of the late Co-Counselling Application on the standard basis. The costs were summarily assessed at £17,900.