High Court refuses extension of time for service of particulars, further illustrating new strict approach to compliance

The High Court has refused an application to extend time for service of particulars of claim in circumstances where a fresh action would be time barred, with the result that the claimant will be unable to pursue its claim against the relevant defendants: Venulum Property Investments Ltd v Space Architecture Ltd and others [2013] EWHC 1242 (TCC).

In reaching this decision, the court referred to "the stricter approach that must now be taken by the courts towards those who fail to comply with rules" following recent changes to implement the Jackson reforms. The decision therefore re-emphasises the need for careful compliance in the post-Jackson regime.

The decision is also a reminder of an important procedural point. Where a claim form is served at or near the end of its four-month period of validity (which of course is always a risky course of action) the claimant does not have a further 14 days to serve the particulars of claim: these must be served no later than the latest time for serving the claim form.

Background

The claimant issued proceedings but did not serve them until the last day of the four-month period for service under Civil Procedure Rule (CPR) 7.5(1). The particulars of claim were not served with the claim form, as the claimant's solicitors wrongly believed they had a further 14 days in which to serve them. In fact this was a misreading of CPR 7.4, which provides that particulars of claim must be served within 14 days of service of the claim form but subject to the requirement under sub-paragraph (2) that they be served no later than the latest time for serving the claim form.

Upon realising the error, the claimant applied for permission to extend time for service of the particulars. Two of the defendants (the "Miller defendants") opposed the application because a fresh action against them would be time-barred. The other defendants agreed a short extension of time.

Decision

The judge (Edwards-Stuart J) noted that in considering whether to exercise its discretion to extend time for service of particulars of claim, the court should adopt the relief from sanctions framework set out in CPR 3.9 (as established by the Court of Appeal decision in Price v Price [2003] 3 All ER 911).

The judge referred to recent amendments to the CPR implementing the Jackson reforms from 1 April 2013 (see our Jackson reforms home page for more information):

• An amendment to CPR 3.9 replacing the previous list of nine factors the court had to consider with a statement that the court must 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”; and
• An amendment to the “overriding objective” at CPR 1.1 to add a new sub-paragraph (f) which makes it clear that dealing with cases justly includes “enforcing compliance with rules, practice directions and orders”.

There was some doubt as to whether the amended CPR 3.9 applied in this case: the transitional provisions provide that it does not apply to applications for relief from sanctions made before 1 April, but the present application was for an extension of time rather than relief from sanctions. In any event, neither party argued that the previous list of factors could be ignored; the defendants' submission was that the emphasis had shifted so that the court was required to take a less tolerant approach to failures to comply with matters such as time limits. Both parties agreed that the amendment to the overriding objective applied to the present application.

The judge went through each of the factors listed under the old CPR 3.9, concluding that the factors were fairly evenly balanced in this case. Against the claimant was the fact that there was no good reason for the failure to serve the particulars in time: it was an oversight by the claimant's solicitors. Against that the Miller defendants were aware of the claim and the consequences of a refusal to grant the application would be to shut out the claimant's claim for good.

Although the judge recognised that the very strict rules governing applications to extend time for service of the claim form under CPR 7.6, and the cases applying those rules, do not apply to service of particulars of claim (following Totty v Snowden [2002] 1 WLR 1384), he said that nevertheless the approach adopted in those cases of considering the reason for the failure as a paramount consideration were reinforced by new sub-paragraph (f) of the overriding objective. This meant that under the present rule the absence of a good reason for non-compliance with the relevant time limit was an important factor.

The judge concluded that, all being equal, he would have difficulty in seeing how it would be just or proportionate to visit a few days' delay in service with the sanction of preventing the claimant pursuing its claim against the Miller defendants. However, three factors were of particular importance:

1. The claimant had delayed for over five years before instructing solicitors, and that delay was unexplained.
2. The claimant's claim against the Miller defendants was not a strong one, and in any case if the claim was a good one the claimant probably had an equally good, or better, claim against some of the other defendants.
3. The claimant was seeking to advance a claim for bad faith that was pleaded in vague terms, which the court said was "a course that does not merit indulgence".

When the circumstances were considered as a whole, particularly in light of the stricter approach that must now be taken following implementation of the Jackson reforms, the judge concluded that this was a case in which the court should refuse permission.

Comment

It is not of course clear whether the judge's decision in this case would have been any different had it not been for the recent amendments to the CPR. The three factors listed above as being of "particular relevance" would have applied regardless of the recent changes. Nonetheless, the judgment underlines the fact that judges see the new regime as requiring a stricter approach toward failures in compliance. We expect therefore that we will see more instances of tough case management decisions under the new regime.