Quick updates for those dealing with disputes - Winter 19/20

Canada Goose UK Retail Ltd v Persons Unknown and another [2019] EWHC 2459 (QB)

Background

This decision concerned international retailer, Canada Goose, which sells products including coats manufactured using fur and/or down. It is a target for animal rights protesters who congregate outside its store on Regent Street, London.

In November 2017, the company brought proceedings against "persons unknown", seeking an injunction against them for alleged acts of harassment, trespass and/or nuisance in respect of their protests at the store. The injunction was granted and in November 2018, the company issued an application for summary judgment against the protestors. 

Decision 

The High Court refused to grant summary judgment and discharged the interim injunction. 

The key reasons for the decision were:

• There was no evidence that the claim form had been validly served. It is a fundamental principle of civil litigation that defendants are given proper notice of a claim against them and a reasonable opportunity to advance a defence. 
• The definition of "protestor" in the injunction captured a number of people who were not breaking the law. It was wrong to grant a judgment against a person when the court is not satisfied if they have committed a civil wrong. An order against "persons unknown" could only be justified if the protestors could properly be regarded as a homogenous unit, all of whom were guilty of, or complicit in, the wrongful acts about which complaint was made. 

For the proceedings to continue, the judge ruled that defendants must be joined to them whether by name or adequate description and the nature of the claims made against them identified. 

Comment 

The decision will be significant for future attempts to injunct 'persons unknown', and in particular against those engaged in protests. Such injunctions have been granted in the past, but are only available if the description of 'persons unknown' is narrow enough to exclude individuals who are not engaged in unlawful conduct, or the injunction is amended to name individual parties to the proceedings. The decision confirms that the courts may be prepared to grant such relief against persons unknown, but only where it is "tailored to and justified by the threatened or actual wrongdoing" (§167) and complies with the principles established in Boyd & Anor v Ineos Upstream Ltd & Ors [2019] EWCA Civ 515.

Canada Goose appealed the decision of the High Court and the appeal was heard in the Court of Appeal at the beginning of February. The Court of Appeal's judgment is awaited.

Court of Appeal provides further guidance on injunctions against persons unknown

Cuadrilla Bowland Limited & Ors v Persons Unknown & Ors [2020] EWCA Civ 9

Background

Cuadrilla and the other respondents owned an area of land near Blackpool for the purpose of lawful "fracking". They had been subject to numerous 'direct action' protests, designed to obstruct works on the site. 

In June 2018 an interim injunction was granted to restrain four named individuals and "persons unknown" from trespassing and unlawful interference. Following various breaches of this injunction by anti-fracking activists, an order for committal was made in September 2019.

Decision 

The present case is an appeal by the three named individuals against the committal proceedings, on the basis that the injunction lacked the necessary certainty to be valid. 

The court, relying on the requirements set out in Boyd v Ineos Upstream Ltd [2019] EWCA Civ 515, reminded the parties that injunctions must be expressed in clear, certain terms to make plain what is permitted and what is prohibited. The court rejected the appellants' argument that the references in the terms of the injunction to 'intention' were inherently unclear or had any special legal meaning.

The judge noted in particular that injunctions against persons unknown must be sufficiently clear such that they do not impose on members of the public the cost of consulting a lawyer to understand them. Such an expectation would be unreasonable. 

Comment 

• This case is another example of the courts clarifying the requirements of interim injunctions brought against 'persons unknown', confirming the criteria established in Ineos.
• This decision confirms that there is nothing opaque or unclear about referring to a defendant's intention in the wording of an injunction. Any difficulty in proving the defendant's intention is an issue for the claimant alone.  
• The court added a caveat to the requirement in Ineos that the terms of an injunction must correspond to the threatened tort and not be so wide that they prohibit lawful conduct, noting that this is "desirable" but not "an absolute rule." The judge commented that the recent appeal of Canada Goose UK Retail Ltd v Persons Unknown [2019] EWHC 2459 (see our report above) is likely to clarify the position in cases where such an injunction is sought against persons unknown. 

Author

Louisa Pini

Lomax v Lomax [2019] EWCA Civ 1467 (6 August 2019)

Background

Pursuant to the Inheritance (Provision for Family and Dependants) Act 1975, the claimant (C ) sought financial provision from her late husband's estate, which was resisted by the defendant (D), the beneficiary under the will. At the directions hearing, C sought an Early Neutral Evaluation hearing (ENE) or a Financial Dispute Resolution hearing (FDR). This was opposed by D. 

Decision

At first instance, the judge ruled that the court could not order an ENE pursuant to CPR 3.1(2) (m) because both parties had not consented. C appealed. 

The appeal centred on the proper interpretation of CPR 3.1(2) (m). Pursuant to this provision, the court may "take any other step or make any other order for the purpose of managing the case and furthering the overriding objective, including hearing an Early Neutral Evaluation with the aim of helping the parties settle the case". C's appeal succeeded: in August 2019, the Court of Appeal ruled that the court had the power to order an ENE regardless of whether D had agreed to it. Following a change to the White Book 2019 commentary in June 2019, crucially, there is no longer any commentary on CPR 3.1(2) (m) that expressly states whether the consent of all parties to an ENE is required.  By implying consent wording into the relevant provision, the court would be hindering the fair resolution of the case and be acting counter to the overriding objective.   

Comment

The Court of Appeal referred to the benefits of an ENE and whilst it did consult the White Book commentary and the Court Guides, it concluded that these were not determinative as to whether consent is required. 

Civil Litigators are of course aware that alternative dispute resolution processes like ENE are becoming more common in non-family civil disputes, particularly those with strong emotional elements. Commentators have therefore suggested that this decision might be used as a precedent for ordering mediation without the parties' consent and that civil litigators now need to: (1) be more aware of the benefits offered by ENE and other alternative procedures; and (2) advise clients who refuse to engage that that may no longer be a realistic option, even if the client is prepared to bear costs sanctions for such a refusal. So far, however mediation and other forms of alternative dispute resolution are not expressly mentioned in CPR 3.1(2) (m), unlike ENE.

Author

Charlotte Moss

ABC v Shulmans LLP [2019] EWHC 2458 (Comm)

Background

The Claimant (C) brought a professional negligence claim against the law firm which represented him in proceedings against his previous corporate employer and its owner.  

C applied for wide ranging orders which departed from the principle of open justice, including for the parties' names to be anonymised, various redactions to be made to the statements of case and restrictions on the rights of third parties to access court documents.  C argued that to decide whether to derogate from the principle of open justice, the starting point is to assess whether the public have an 'interest' in the litigation and to balance this against any countervailing rights (in this case, C's rights to privacy under Article 8 of the European Convention on Human Rights which he alleged were engaged).   

Decision 

The judge dismissed the application (although allowed some specific temporary redactions to the statements of case pending the first case management conference) and reaffirmed the importance of the principle of open justice as 'a fundamental aspect of our judicial system and the rule of law'.  

The judge rejected C's proposed approach.  He made it clear that the 'interest' that a member of the public may have in the litigation is irrelevant, and that the principle of open justice is:

'A fixed, given starting point, rather than something which is case sensitive.  From that starting point, the question is whether, on a particular set of facts, there are countervailing rights which justify a derogation from the principle.'

It is only at this point that there will be a balancing exercise. Therefore, although the principle of open justice can be derogated from, that will only happen in very exceptional circumstances. 

Comment

This judgment is a clear restatement that the principle of open justice will only be derogated from in exceptional circumstances.  

Author

Kate Pratt

Pepe's Piri Piri Ltd & Anor v Muhammad Ali Junaid Food Trends Ltd (Now Dissolved) & Ors [2019] EWHC 2769 (QB)

Background

The claimants (Cs) owned a fast-food franchise. The dispute concerned the second defendant (D2) franchisee's "termination" of its franchise agreement with Cs before its shareholders went into business with a competing franchisor.

Cs brought claims for conspiracy to injure, unlawful interference with their business and procuring a breach of contract. The total amount claimed exceeded £500,000, yet Cs were only successful in their claim for procuring a breach of contract and were awarded just £2,523.07 in damages.

Following the trial the court ruled on costs.

Decision on costs

Despite Cs succeeding in their claim for procuring a breach of contract, Ds (rather than Cs), were held to be the "successful parties" since Cs had sought more than £500,000 in damages and were awarded just £2,523.07. 

The result could not be characterised, as counsel had submitted, as an "important victory" for Cs simply because liability had been established on one of the three pleaded bases, when Cs' primary case (conspiracy to injure), had failed in its entirety.

Further, the damages ultimately recovered bore no relation to Cs' budgeted costs, which were substantially more than £200,000. No litigant would have incurred costs of that magnitude in pursuit of the sum awarded.

Comment

This decision highlights that the "successful party" in all or part of their claim, may not be the de facto "successful party" where their damages are eclipsed by (i) the original sum claimed; or (ii) their budgeted costs.

This decision also demonstrates that there may be a reduction in the costs payable to successful defendants to reflect certain matters. In this case, Ds had acted unreasonably by (i) failing to engage with Cs' pre-action correspondence; and (ii) making claims in their defence(s) which were wholly contradicted and undermined by contemporaneous evidence.

The judge held that the appropriate reduction in costs payable to Ds to reflect those matters was 20%. Cs were therefore required to pay 80% of the successful Ds' costs of the claim. Such percentages are however likely to vary according to the bad behaviour of the successful party/parties and should be treated as a sliding scale.

Author

Eleanor Chick

Mobile Telecommunications Company KSC v HRH Prince Hussam Bin Saud Bin Abdulaziz Al Saud

Background

The claimant's solicitors referred in a witness statement to an appeal by the claimant to the Saudi Court's for enforcement of an award in favour of the claimant. The defendant's solicitor then made an application under CPR PD 51U para 21 for disclosure of the documents relating to the claimant's appeal to the Saudi Court. In response, and to undercut the defendant's request for disclosure, the claimant's solicitor sought to amend the witness statement to remove reference to the Saudi appeal.

Key issues

• Should the witness statement be amended?
• Would amending the WS to remove reference to the Saudi appeal remove the court's jurisdiction to order disclosure of the documents?

Decision 

In relation to the first issue the court decided that permission should be granted to amend the witness statement as they considered that there was clearly no intention to rely on the deleted words. 

On the second issue the court held that the claimant had mentioned the appeal inadvertently, and had no intention to rely on the appeal documents. The judge followed the decision in Vardionoyannis v Ansol, 23 May 2001, (unrep), and held that, where after being amended there was no longer mention of the document, the court had no jurisdiction to make an order for disclosure.

In practice 

Parties should ensure that when drafting witness statements they do not refer to documents that they do not need to rely on. This is particularly noteworthy now because the Business and Property Courts' Witness Statement Working Group, which reported at the end of 2019, noted that witness statements often cover material that is not of direct relevance to the main issues, and that this practice should be discouraged. Rule amendments and a Statement of Best Practice are likely to follow later in 2020. 

It is also worth noting that mentioning a document in a witness statement can lead to a request for its disclosure under CPR 31.14. However, this decision shows that the courts are not likely to be satisfied that an order for disclosure is reasonable and proportionate where the request concerns documents that are not relevant to the issues before the court.

Author

Sarah Jackson-Koufie

Samantha Mustard v Jamie Flower, Stephen Flower, Direct Line Insurance [2019] ECHC 2623 (QB), [2019] WL 05104326

Background

This was a personal injury claim which followed the defendant's Fiat Punto car striking the claimant's stationary vehicle. Liability was admitted from the outset. However, the defendant disputed that the claimant had suffered serious brain injuries resulting in reduced long-term cognitive functionality. Expert medical evidence was permitted under CPR 35.4(1). The claimant subsequently recorded each of the medical assessments of her condition carried out by the defendant's medical experts (but neither of her own). The claimant then reviewed the covert recordings and sought to argue that the defendant's medical experts had made clear procedural errors in their assessments. 

In response, the defendant argued that the covert recordings should be excluded under CPR 32.1(2) on the grounds that they (1) were unlawful under general data protection legislation and (2) gave rise to an "uneven evidential playing field".

Decision - "Covert recordings have become a fact of professional life"

It was held that any public policy interest in excluding the covert recordings was outweighed by the narrower interest of achieving justice in the case. The recordings had been obtained through reprehensible, but not unlawful, conduct and raised legitimate concerns and were therefore of relative and probative value. 

Comment

This decision restates the law as to when covert recordings will be admissible in civil proceedings. Provided covert recordings are not obtained unlawfully, other considerations will in many cases be outweighed by the overriding need to admit them to achieve justice in each particular case. 

Author

Jack McConville