Freeborn v Marcal: A Reality Check for Relief From Sanctions

In his recent Judgment in Freeborn & Another v Marcal (t/a Dan Marcal Architects) [2017] EWHC 3046 Mr Justice Coulson has given a clear warning to parties that civil litigation is not to be viewed as a game, and that point-scoring and pedantics may lead to unwelcome costs’ consequences.

Any such Judgment from a High Court Judge needs of course to be noted but particularly so when that Judge is the incoming Deputy Head of Civil Justice (Coulson J takes on the role in Spring 2018 when he joins the Court of Appeal).

In the case, correspondence from the Technology and Construction Court expressly informed the parties that costs budgets were to be filed not less than seven days before a Case Management Hearing listed on 24th November 2017. The Defendant’s solicitors followed the deadline given in the letter and submitted its budget on 16th November. The Claimant’s solicitors however followed the clear wording of the Civil Procedure Rules and submitted their budget earlier in compliance with CPR 3.13 which specifies a deadline of no later than 21 days before the CMC “unless the court orders otherwise”. The solicitors then wrote to the Defendant complaining that they had been late in serving their budget and so fell foul of the rule in CPR 3.14 (that a party filing its budget late is at risk of being treated as having filed a budget comprising only the court fees).

Despite the Defendant’s solicitor pointing out the deadline given in the letter from the Court itself the Claimant maintained its stance and forced the Defendant to apply for relief from sanctions.

The case came before Coulson J who made clear his displeasure at the Claimant’s “pedantic” approach to the situation. The Judge commented that in his view the correspondence from the court amounted to the court “ordering otherwise” within the meaning of CPR 3.13. The Judge went on to state that “A busy litigation solicitor is entitled simply to rely on the date specified in writing by the court office, rather than embarking on an investigation into whether or not the letter contained an error”. The Judge was in no doubt that the Defendant had not in fact been required to apply for relief from sanctions as it had not breached the deadline.

In a further attempt to warn other parties off playing tactical games by taking minor procedural points, the Judge went on to comment that in his view there had been no serious or significant breach in any event and so had an application for relief been necessary it would clearly have been successful.

In the Judge’s words “No hearing has been lost and no delay to the costs budget process has in fact occurred…There was at worst an inadvertent breach…” In such circumstances the Claimant’s solicitor’s “uncompromising” stance had been unreasonable and amounted to an attempt to abuse the Court’s approach to non-compliance.

Coulson J expressed the view that “Parties need to consider carefully whether the alleged breach of the rules is, on analysis, any such thing and, even if it is, whether it is proportionate and appropriate to require or oppose an application for relief from sanctions in all the circumstances of the case (my emphasis).

The Judge expressly stated that he hoped the Judgment would encourage parties in future to take a more realistic approach to litigation and in effect to choose their battles in the process of trying to win the war. Solicitors are therefore advised to consider the factual circumstances of alleged breaches carefully and to consider whether forcing their opponent to make formal applications to the court may in fact result in costs consequences for their own clients.