Blog - Wednesday 20 April 2016

Relief From Sanctions Allowed on Appeal - Murray v BAE Systems PLC

In a judgement given by His Honour Judge Peter Gregory sitting in Liverpool County Court on 1st April 2016, relief from sanctions has been granted on appeal against a decision to restrict the claimant’s cost budget to court fees following late service of a cost budget.

The case, a personal injury matter, was allocated to the multi-track with a deadline for service of the cost budget by 19th August 2015. The defendant had previously served their cost budget on 3rd July 2015 and provided the claimant with reminders regarding the due date of the budget. The claimant did not serve their budget on the court until 24th August 2015 and not until 4.45pm. An application for relief from sanction was also filed on 24th August 2015.

The claimant’s explanation for late service of the cost budget was due to a lack of communication between fee earners upon re-allocation of the file, and in addition, an absence of an automatic diary entry at the claimant’s solicitors firm.

At the hearing before the District Judge, DJ Harrison accepted that there had been a genuine mistake for the delay in service of the cost budget and that the delay was not a result of a disregard of the rules. However, it was considered that the delay of 7 days was ‘serious and significant’; with the defendant submitting that the length of delay distinguished this case from previous cases where relief had been granted. As such, relief was refused and the claimant was limited to court fees only.

On appeal, the claimant submitted that the DJ erred in her approach in rejecting the suggestion that the consideration of the consequences of the breach should be a factor to take into account when categorising the nature of the breach– in this matter, there was no knock-on effect to the court timetable as a result of the delay (unlike in Mitchell).

HHJ Gregory found ‘considerable force’ in the claimant’s argument and held that, unlike the district judge, he had had the opportunity to ‘review at length all the various authorities put forward for consideration’(including the case law in Mitchell and Denton) and ‘applying the test of materiality, I do not consider on the facts of this particular case, that the Claimant’s breach can fairly be categorised as “serious and significant” in the sense in which that term is used in the reported case law’.

HHJ Gregory concluded that the district judge’s refusal to grant relief on account of the ‘need to enforce compliance with rules, practice directions and orders’ was heavily outweighed ‘by other factors within the case, such as; the litigation could be conducted efficiently, at proportionate cost and without being adversely affected by the claimant’s failure to file the cost budget on time; that the application for relief had been made promptly; that there had been no previous breach in the proceedings; that the District Judge could have proceeded to assess the cost budget in any event; and that the claimant’s mistakewas an isolated one and due to a genuine breakdown of communication’.

For the reasons outlined, the appeal was granted with the claimant also being allowed their costs of and incidental to the appeal.

The decision shows a slight turn of favour with regards to applications for relief, with the high burden of the party seeking relief being considered. As always, it highlights the need for any applications for relief to be made promptly!


By Kelly Brady - Costs Lawyer



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