Page v RGC Restaurants Ltd, Court of Appeal - Queen's Bench Division, October 15, 2018, [2018] EWHC 2688 (QB)

Resolution Date:October 15, 2018
Issuing Organization:Queen's Bench Division
Actores:Page v RGC Restaurants Ltd
 
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Appeal No: QB/2017/0313

Neutral Citation Number: [2018] EWHC 2688 (QB)

IN THE HIGH COURT OF JUSTICE

QUEEN'S BENCH DIVISION

On appeal from the order of Master Thornett

dated 19 December 2017 in Case No: HQ17P01545

Rolls Building

7 Rolls Buildings, Fetter Lane,

London, EC4A 1NL

Date: 15/10/2018

Before :

MR JUSTICE WALKER

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Between :

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Mr Benjamin Williams QC (instructed by Fieldfisher LLP) for the claimant appellant

Mr Andrew Roy (instructed by Keoghs) for the defendant respondent

Hearing date: 22 March 2018

Written submissions were completed on 21 April 2018

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JudgmentMr Justice Walker:

  1. Introduction 4

  2. Relevant CPR provisions 5

    B1 The overriding objective 5

    B2 Case Management: Section I of CPR 3 6

    B3 Costs management 7

    B3.1 Costs management: Section II of CPR 3 7

    B3.2 Costs management: Practice Direction 3E 9

    B3.3 Costs management: the Chancery Division Note 10

    B3.4 Costs management: Costs & Funding Q & As 11

    B3.5 Costs management: RGC's concession 12

    B4 Case and costs management: leading cases 13

    B4.1 The new more robust approach: Mitchell 13

    B4.2 Mitchell: CPR 3.14 and proportionality 13

    B4.3 Mitchell: meaning of ``fails to file a budget'' 14

    B4.4 Mitchell: impact of failure to file a budget 14

    B4.5 Mitchell: CPR 3.14 disapplication likened to CPR 3.9 15

    B4.6 Mitchell: CPR 3.14 and the overriding objective 15

    B4.7 Mitchell: relief against sanction 16

    B4.8 Denton: a restated approach to CPR 3.9 17

    B5 Appeals 19

    B5.1 Nature of an appeal: CPR 52.21 (1) 19

    B5.2 When an appeal will be allowed: CPR 52.21(3) 19

    B5.3 The parties' observations on CPR 52.21 20

  3. The proceedings 21

    C1 The proceedings: case summary 21

    C2 CCMC preparation up to 30 Nov 2017 22

    C2.1 Mr Page's interim budget & draft directions 22

    C2.2 RGC's budget 23

    C2.3 Budget discussion reports 23

    C3 Negotiations and agreement 24

    C4 CMCC hearing, rulings and reasons 25

    C4.1 CMCC hearing on Tuesday 5 December 2017: general 25

    C4.2 Start of the CCMC: the master's concern and warning 25

    C4.3 Proceeding in sequence: why not list to trial? 26

    C4.4 Budgeting: what the master said on breach/relief 27

    C4.5 RGC's budget 28

    C5 The costs budgets order 29

  4. Grounds of appeal, reasons for relief, & issues 29

    D1 Grounds of appeal 29

    D1.1 Grounds of appeal: overview 29

    D1.2 Grounds 1 and 2: ``a budget'' had been filed 30

    D1.3 Ground 3: ``irrational'' approach to incompleteness 30

    D1.4 Ground 4A: CPR 3.15 agreement trumps CPR 3.14 31

    D1.5 Grounds 4B and 5: consequences if CPR 3.14 is not engaged 31

    D1.6 Ground 6: disapplying the default sanction 32

    D2 Reasons for seeking relief against sanction 32

    D3 Issues below 33

    D4 Issues arising for determination 34

  5. Applicability of CPR 3.14: grounds 1 to 5 34

    E1 CPR 3.14 applicability: general 34

    E2 Grounds 1 & 2: meaning of ``a budget'' in CPR 3.14 35

    E3 CPR 3.14 applicability: agreement under CPR 3.15 38

    E4 CPR 3.14 applicability: RGC's Budget 39

    E5 CPR 3.14 applicability: potential consequences 39

    E6 CPR 3.14 applicability: RGC's alleged bars. 40

  6. Disapplying CPR 3.14: Ground 6 40

    F1 Disapplication: general 40

    F2 Disapplication: Mr Page's fundamental argument 40

    F3 Disapplication: RGC's alleged bar 41

    F4 Disapplication: consideration of disapplication below 43

    F5 Disapplication: whether to order otherwise 45

  7. The concession and relief against sanction 49

  8. Conclusion 49

  9. Introduction

    1. This is an appeal from an order (``the costs budgets order'') imposing a sanction which limited the claimant's costs budget to applicable court fees only. The costs budgets order was made by Master Thornett at a costs and case management conference (``CCMC'') on 5 December 2017. It formed part of a more general order (``the CCMC order'') giving directions to trial. Prior to the CCMC the parties agreed all directions and costs budget figures for phases up to and including a proposed second case management conference (``CMC'') or pre-trial review (``PTR''). It was proposed that subsequent directions and costs budget figures be left over to be dealt with at the proposed second CMC.

    2. The main issues arising on the appeal concern whether the claimant had filed a costs budget within the meaning of CPR 3.14, and if not whether the master ought to have disapplied the sanction under CPR 3.14. If the answer to both questions is ``no'', or the answer to the second question is ``yes, but only in part'', then subsidiary issues would arise on an application which the claimant has now made seeking relief against sanctions.

    3. The claimant, Mr Justyn Page, appeals by permission granted by an order of Warby J on 22 February 2018. In addition, Mr Page applies in section 10 of his appellant's notice for an order granting relief from the sanction imposed by the master. Section 10 stated that the order granting relief was sought ``by virtue of CPR 3.10.'' In support of that application, section 11 of the appellant's notice contained a short witness statement by Mr Page's solicitor. The order of Warby J directed that the application for relief be heard concurrently with the appeal.

    4. The defendant is RGC Restaurants Limited (``RGC''). At the hearing before me, RGC's primary response to the appeal was that the appeal should be dismissed. Similarly, RGC's primary case in answer to the application for relief was that it should be dismissed. RGC recognised, however, that the court might consider that partial relief would be appropriate. In that event RGC's alternative submission was that Mr Page's cost budget should be limited to the figures which had been agreed by RGC.

    5. At the hearing before me Mr Benjamin Williams QC, instructed by Fieldfisher LLP (``Fieldfisher''), appeared for Mr Page. Mr Andrew Roy, instructed by Keoghs LLP (``Keoghs''), appeared for RGC. Neither counsel appeared below. I have the benefit of detailed skeleton arguments from each of them.

    6. Following the hearing I received further materials. I deal with the content of those materials at appropriate points later in this judgment. For present purposes I summarise:

      (1) on 27 March 2018 RGC made a concession and drew attention to two recent authorities;

      (2) on the same day, a response was sent on behalf of Mr Page;

      (3) on 9 April 2018 I was sent a revised transcript of the proceedings below;

      (4) on 20 April 2018 RGC drew attention to a further recent authority, and later that day a response was sent on behalf of Mr Page.

    7. The concession made by RGC on 27 March 2018 was prompted by a question I asked during oral argument. My question arose because there had been agreed figures for various phases in both sides' budgets. In that regard I asked whether RGC might be estopped from going back on its agreement. In section B3.5 below I set out the details of RGC's concession. For present purposes I note that RGC described the effect of the concession as being that:

      ``... the sanction can only bite on those phases which were not agreed.''

  10. Relevant CPR provisions

    B1 The overriding objective

    1. CPR 1.1 provides, as amended in April 2013:

      The overriding objective

      1.1- (1) These Rules are a new procedural code with the overriding objective of enabling the court to deal with cases justly and at proportionate cost.

      (2) Dealing with a case justly and at proportionate cost includes, so far as practicable -

      (a) ensuring that the parties are on an equal footing;

      (b) saving expense;

      (c) dealing with the case in ways that are proportionate -

      (i) to the amount of money involved;

      (ii) to the importance of the case;

      (iii) to the complexity of the issues; and

      (iv) to the financial position of each party;

      (d) ensuring that it is dealt with expeditiously and fairly;

      (e) allotting to it an appropriate share of the court's resources, while taking into account the need to allot resources to other cases; and

      (f) enforcing compliance with rules, practice directions and orders.

      B2 Case Management: Section I of CPR 3

    2. Section I of CPR 3 deals with case management. It compromises CPR 3.1 to CPR 3.11.

    3. CPR 3.1 provides:

      The court's general powers of management

      3.1 - (1) The list of powers in this rule is in addition to any powers given to the court by any other rule or practice direction or by any other enactment or any powers it may otherwise have.

      ...

      (7) a power of the court under these Rules to make an order includes a power to vary or revoke the order.

    4. CPR 3.8 was amended in April 2013. There were further amendments in 2014. For present purposes, I need only set out provisions which took effect in April 2013 and were unaffected by the 2014 amendments:

      Sanctions have effect unless defaulting party obtains relief.

      3.8 - (1) Where a party has failed to comply with a rule, practice direction or court order, any sanction for failure to comply imposed by the rule, practice direction or court order has effect unless the party in default applies for and obtains relief from the sanction

      (Rule 3.9 sets out the circumstances which the court will consider on an application to grant relief from a sanction)

      (2) Where the sanction is the payment of costs, the party in default may only obtain relief by appealing against the order for costs.

      ...

    5. General provision concerning relief from sanctions is found in CPR 3.9. With effect from April 2013 CPR 3.9 was amended to read:

      Relief from sanctions

      3.9-(1) On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need-

      (a) for litigation to be conducted efficiently and at proportionate cost; and

      (b) to enforce compliance with rules, practice directions and orders.

      (2) An application for relief must be supported by evidence.

    6. In addition, CPR 3.10 confers on the court a general power to rectify matters where there...

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