The Court of Appeal has ruled on the extent and limits of the Mitchell principles and urged practitioners to co-operate and not take advantage of small procedural mistakes.
Today’s judgment in a trio of cases (Denton v TH White Ltd & Anr, Decadent Vapours Ltd v Bevan & Ors and Utilise TDS Ltd v Davies), sees the court step back from the harshness of a strict interpretation of the controversial Mitchell relief from sanctions ruling.
In doing so it has recast Mitchell changing the first test for relief from sanctions from that of "trivial" breach to a serious or significant breach. If the breach does not reach that level then relief will be granted. If it does then the court applies two further tests— examining the reason for the breach, and then applying the wording of the Rule and all the circumstances.
Most importantly the court has urged practitioners to co-operate and not take advantage of small procedural mistakes—doing so will result in cost penalties. However, there was some dissent in the court with Jackson LJ disagreeing on the interpretation of Rule 3.9 urging that the court should take more notice of all the circumstances of the application and the case before concluding on relief.
David Greene, NLJ consultant editor, says: "The judgment is very welcome and moves us back to a pre-Mitchell time in which the court encourages co-operation and punishes tactical battles over procedural errors. It remains to be seen how the courts will interpret the initial test of serious or significant but it clearly sets the bar far higher than the Mitchell "trivial" test.
"I think the profession will support Jackson's wider interpretation of CPR 3.9 which appears much more akin to the idea of giving prominence to seeking to deliver justice between the parties."
Matthew Harrington, a partner at BLM, who acted for the appellant in the lead case (Denton v T H White), says: “The judgment is a fair and proportionate recalibration of the post-Mitchell costs regime. Lord Dyson and Lord Justice Vos ruled that while the guidance in Mitchell was substantially sound, it had been misunderstood and misapplied, with the lower courts often taking a zero-tolerance approach to breaches of compliance. Now, the court should consider whether a failure to comply is serious or significant—if it is neither, then the court should grant relief. Even if a breach is significant, unless there has been an adverse effect on the efficient running of litigation courts hearing applications should be more willing to grant relief depending upon all the circumstances of the case.
“This is a sea change away from circumstances over the past year, where many trivial breaches have been treated as significant, sometimes with disastrous results for claimants. Save for exceptional cases, trial dates should not be threatened—as had happened in Denton v T H White—and the new guidance should improve cycle times for cases because the rules are clearer-cut than before.
“This judgment will help to eliminate the large volumes of satellite litigation that developed from the aftermath of Mitchell. Equally, it is also clear that there will be serious repercussions for litigants who try to ‘point-score’ by opposing relief applications unreasonably.”
The three disputes were heard by Master of the Rolls Lord Dyson, Lord Justice Jackson and Lord Justice Vos last month.
