The Court of Appeal has issued its judgment in Mitchell v NGN. The case was seen to be the first big test of the Jackson reforms. Andrew Mitchell MP was certainly the biggest and most high profile scalp of the reforms, which seek make not only justice but also proportionality of cost the underpinning of how cases are run.
The background to the case was the defamation case brought by Mr Mitchell against NGN in relation to their reporting of the "Plebgate" row. During the litigation, a case management conference was organised and the parties were required to submit budgets in advance of this. The new requirement for budgets to be submitted during the litigation process, as opposed to assessing the costs spent at the end of it, was a key feature of the Jackson reforms. Mr Mitchell's legal team failed to submit the budget by the deadline set by the court, only in fact getting it in the day before the conference.
As a result of this failure, Master McCloud made a ruling at the conference that the budget submitted by Mr Mitchell's team was to be disregarded and that they should be deemed to have submitted a budget comprising only the applicable court fees, some £2,000. Unsurprisingly Mr Mitchell appealed.
The Court of Appeal roundly dismissed the appeal. While they acknowledged that Master McCloud's ruling was robust, they found that she was entitled to be so. They endorsed the "tougher, more robust approach to rule-compliance and relief from sanction" which has been brought about by the Jackson reforms and which was designed to focus parties' minds and emphasise the superiority of the court, rather allowing the level of indulgence which had previously been permitted.
Usefully, the Court of Appeal also gave a significant level of guidance on the practical implementation of the new approach. While they acknowledged that trivial non-compliance would be allowed by the court, such as a near miss of a deadline, when that non-compliance is more than trivial, the burden is on the defaulting party to persuade the court to grant relief. The court will want to consider why the default occurred and the defaulting party needs to make sure they have a good excuse. The excuse given by Mr Mitchell's team, which was essentially that his solicitors had too much work, was said by the court to be not good enough. The Court of Appeal also specified that "applications for an extension of time made before time has expired will be looked upon more favourably than applications for relief from sanction made after the event" – a clear warning to parties to litigation that they need to be thinking ahead.
The Court of Appeal emphasised several times that the two most important factors which the court will take into account are that the litigation must be conducted efficiently and at proportionate cost and that the compliance with rules, practice directions and orders must be enforced. In the absence of a very good reason for why the procedures and rules imposed by the court have not been complied with, these factors will normally trump anything else.
The practical effect of this judgement is that parties to litigation and their advisers need to ensure that they plan the litigation effectively and comply with all rules and orders. The Court of Appeal acknowledged that circumstances may intervene to prevent this, but in that case parties should be alive to the issue and be making applications in advance rather than leaving it to be dealt with afterwards.
Judgment Date: 27 NOVEMBER 2013