The Forum of Insurance Lawyers (FOIL) sent an update today. I have duplicated their article below due to its importance.
“If practitioners attending the Manchester meeting of the profession with Lord Dyson on Friday 28 February were hoping for further guidance on case management, or hints of a loosening of the post-Mitchell case management regime, they must have spent their Friday evening disappointed. At the meeting, arranged by Manchester Law Society, Lord Dyson made it clear that the decision in Mitchell was written after very careful consideration. The Court of Appeal has indicated how the rules should be interpreted and the regime will now need to bed down: practitioners (and judges) will get used to it.
Whilst holding his ground against change, Lord Dyson did, however, indicate that “buffer orders” allowing parties to agree one time extension without the need for an application to the court introduced in clinical negligence and asbestos claims over recent weeks, may be extended more widely to other types of proceedings. The CPRC will make a decision on the issue on 7 March.
What counts as trivial or a “good reason”?
“What will it be possible to get away with when Mitchell itself was so trivial?”, Lord Dyson was asked. In His Lordship’s view Mitchell was not so trivial, but rather a case on the edge, involving as it did abortive hearings and wasted costs. It is a matter of degree. Lord Dyson was willing to accept a statement of truth not signed in the right way as an obvious example of a trivial matter but he was unwilling to give more guidance or provide further examples. He took the same approach when asked for guidance on what constitutes a “good reason” for default. Aside from commenting that lack of authority from the Legal Services Commission on a legal aid matter might be a “good reason”, he left further development of the principles to the courts, with support from the editors of the White Book. Given time, he said, a picture will emerge. “It is not a matter of issuing a new Practice Direction: the system doesn’t work like that”.
But is it justice?
Concerns from the floor that penalties under the new regime are disproportionate found little sympathy. Whilst accepting that he had no experience in running a practice, Lord Dyson likened the current litigation regime to the strict approach in Landlord and Tenant law, under which the smallest default in serving a document can be fatal. “The answer is not to default”. A plea from the floor for a more balanced approach between the need for compliance and access to justice made Lord Dyson “nervous” as it echoed the old system.
The inconsistency of the courts
Lord Dyson was told of judges who refused to do costs budgeting and of one who claimed not to have heard of Mitchell. He accepted that haphazard variations in decisions are highly undesirable but “as long as there are judges there will be variations“. At the judges’ training it was reported that some judges arrived hostile and left “properly programmed“, whilst a small number “arrived hostile and left hostile“. The only thing that can be done is to appeal, although appeals are being discouraged; it will be necessary to show that something has gone seriously wrong before an appeal will be allowed.
What about mistakes made by the court?
When the issue of errors by court staff was raised, set against the very high standards required of lawyers, Lord Dyson recognised that mistakes do happen. A reduction in court staff was a factor although not an excuse. Stewart J noted that if a solicitor certifies that a document has been sent to the court “that is something the judge should take into account even if the court says it has not been received“, (although FOIL has been made aware of cases where this approach has been unsuccessful.)
Directions and budgets are inextricably linked
Moving away from Mitchell, one practitioner complained that the time available at a CMC is often used to deal with directions with no time left to address the costs budget. She suggested that the issues should be separated, with the CMC held first to deal with directions, followed by a costs budgeting hearing three weeks later. This drew some support from the floor but Mr. Justice Stewart, on the platform with Lord Dyson, felt this was a fundamental misunderstanding of how budgeting is meant to work.
This two-hearing approach is apparently being tried at present on Manchester mesothelioma claims, where Stewart J accepted it might work because of the “narrow tramlines” of such cases. In general, however, directions and costs budgets must be dealt with together, as one will inform the other. Stewart J suggested that a more sensible approach might be for the CMC to be split into two sessions on the same day. The proportionate spend would be agreed at the first, with the parties then leaving the courtroom to work up detailed figures before returning to the courtroom to consider the budgets. He recognised that this would not work for the very largest cases but it is being tried in some courts. A request from the floor for more time to be allowed for hearings raised concerns of court resource and timetable complications.
Lord Dyson reported that the judiciary had responded in strong terms against the significant increase in court fees recently consulted upon by the MOJ. An MOJ response is awaited but Lord Dyson’s view was that whilst some changes may be achieved, in general terms the Government is unlikely to be deflected from its proposals.