Neutral Citation Number: [2014] EWHC 4445 (QB)
Case No:   QB/2014/0324
IN THE HIGH COURT OF JUSTICE
QUEEN’S BENCH DIVISION
Royal Courts of Justice
Strand
London WC2A 2LL

Date: Friday, 31 October 2014

BEFORE:

MR JUSTICE SUPPERSTONE

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BETWEEN:

CUTLER
Appellant 
- and -

BARNET LONDON BOROUGH COUNCIL
Respondent
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MR A GRIGG (instructed by Steel & Shamash) appeared on behalf of the Appellant

MR K BHOGAL (instructed by Borough Council Legal Services) appeared on behalf of the Respondent
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Approved Judgment
1.	MR JUSTICE SUPPERSTONE:  This is an appeal by the first defendant, who I shall refer to as the appellant, against the order made by His Honour Judge Mitchell at Central London County Court on 8 May 2014.  The learned judge debarred the appellant from defending the claim for possession of her home and proceeded to summary judgment and the making of a 14‑day possession order.  That order has been stayed pending this appeal.  

2.	The judge found the appellant was debarred from defending the claim on the basis of having failed to comply with an "unless order".  The judge also found the appellant's oral application for relief from sanctions did not constitute an effective application on account of not being made as a formal application and that he had no discretion in this matter.  

3.	The factual background can be stated shortly for the purposes of this appeal.  Barnet London Borough Council, the respondent, claimed possession of the appellant's flat at Westbrook Close Barnet EN5 9AU, which had been let to her by the Local Authority in 2003 under a secured tenancy.  The tenancy was determined by notice to quit served on 20 December 2012.  The claim for possession was brought on the basis of alleged non‑occupation by the appellant.  The issue was whether or not the appellant had lost security because she had ceased to occupy the property as her only or principal home.  

4.	Since 2005, the appellant's mother had lived in the appellant's one‑bedroom flat whilst she was awaiting determination by the council of her application for independent permanent accommodation.  The appellant and her mother had lived together at the property at times, but she had also over the years lived at her ex‑partner's flat.  She contended the property had been always been her principal home and that she had always intended to return to it.  

5.	The claim was issued on 30 August 2013.  The appellant filed a pro forma defence on 23 December.  On 31 October 2013, the matter came before Deputy District Judge Shaw.  He made an order which allocated the claim to multi track provided that the appellant should file any defence by 28 November and that each party should give disclosure by list by 4 pm on 9 January 2014.  The parties were to exchange statements of witness of fact by 4 o'clock on 20 February.  The appellant did not give disclosure, and on 20 February the respondent applied both for summary judgment and for an order striking out the defence for non‑compliance with directions given by Deputy District Judge Shaw.  

6.	The application came before Mr Recorder Chapman on 28 February 2014 who made an order, the material terms of which state as follows:  

“The first defendant [that is the appellant] is debarred from defending unless by 4 pm 14 days after the service of this order she files and serves a disclosure list.  The aforesaid disclosure list is specifically to include bank statements (or other documents) showing payments made to the second defendant for rent and expenses in the sum of £500 per month during the period of 1 July 2012 to 31 January 2013.”

The second defendant is the appellant's mother.  

7.	Although the appellant had been granted emergency legal aid on 22 November 2013, her certificate had been cancelled on 25 November.  Her solicitors Steel & Shamash were at the time attempting to obtain legal aid for her, but at this stage she was unrepresented and she did not attend the hearing before Mr Recorder Chapman.  

8.	However, she was personally with the order of Mr Recorder Chapman on 20 March 2014 and the parties are agreed that the time for complying with the order was by 4 pm on 3 April.  At paragraphs 7, 8, 14 and 15 of his judgment in particular, the learned judge dealt with the disclosure that was given by the appellant pursuant to the order of Mr Recorder Chapman.  The appellant contended that there had been compliance with the order, at least reasonable compliance in the circumstances, but the judge found that the disclosure was incomplete.  

9.	For these reasons, the judge found that the appellant had failed to comply with the order of Mr Recorder Chapman.  At paragraph 16 of the judgment, he said:  

“It is not part of the current exercise to decide whether or not the first defendant had a good excuse for failing to comply.  The issue is solely whether she did comply.  She did not comply.  The sanction therefore takes effect and she is debarred from defending this claim.” 

10.	The judge then continued at paragraph 17:  

“This hearing has been listed for some time.  It is argued by Mr Grigg on behalf of the first defendant that a statement filed by the first defendant solicitor on 2 May amounts to an application for relief from sanction.  It is not.  An application has to be issued formally under CPR 23.  It may be that that statement could stand as evidence in that application, but it cannot constitute an application in itself.  I express no view as to whether or not any application for relief from sanction would succeed, but I note that any application for relief has to be made promptly.  In the current circumstances, I have no discretion.  I am required merely to find whether or not there had been compliance with the order.  The first defendant is debarred from defending and I shall proceed to hear the claim of possession.”  

11.	Earlier in his judgment at paragraph 4, the judge had stated:  

“There is no application before me for relief from sanction.  It would only be on such an application that I would have a discretion to grant relief, and at that stage there would be a need to investigate the [merits].” 

12.	It is plain from the transcript of the hearing and accepted by Ms Bhogal, who appears for the respondent, that during the course of the hearing Mr Grigg, who appeared for the appellant, did make an application for relief from sanction.  Plainly, the judge was of the view that because there had been no written application for relief issued formally under CPR 23, he had no power to consider the application and no discretion to grant relief.  

13.	Mr Grigg advances six grounds of appeal.  He submits that the learned judge erred by, (1) finding that he had no discretion to consider an oral application for relief from sanction; (2) finding that there was no application for relief from sanction; (3) finding that such an application had to be made formally in writing; (4) thereby failing to consider his broad discretion in case management powers under CPR 3.1(2) and Rule 3.3(1); (5) failing to consider the respondent's failure to comply with the mandatory requirement under CPR 3.5.5; and (6) failing to consider the appellant's right to a fair trial under common law and Article 6 ECHR, in particular given that this case involves the loss of the appellant's home.  

14.	It is convenient to consider grounds 1-4 together.  In support of these grounds, Mr Grigg relies on the judgments of the Court of Appeal in Keen Philips v Field [2007] 1 WLR 686 where Lord Justice Parker said at paragraphs 18 and 19, as follows:  

“I am content to assume, for present purposes, that in granting an extension of time in the circumstances of the instant case Judge Reid was granting relief from the sanction imposed by his earlier order within the meaning of Rule 3.8. However, even on that assumption, I am wholly unable to accept Mr Mallet's submission that the court's general case management powers (a) to extend time (see Rule 3.1(2)(a)) and (b) to act on its own initiative (see Rule 3.3(1)), are cut down by Rule 3.8(1), with the consequence that the court is powerless (that is to say has no jurisdiction) to extend time in circumstances such as those of the instant case unless and until an application for relief under Rule 3.8 is made by the party in default. Indeed, I would regard such an interpretation of a CPR as perverse and as flying in the face of the overriding objective of dealing with cases justly.” 

15.	Paragraph 19:  
“In my judgment, Mr Mallet has put the cart before the horse.  It is Rule 3.8(1) which takes effect, subject to the court's general case management powers in Rule 3.1(2)(a) and Rule 3.3(1), rather than the other way around. I can think of no sensible reason why, in the circumstances such as those of the instant case, the court should be deprived of jurisdiction to exercise those powers by extending time or otherwise granting relief from a sanction, unless and until the party who would otherwise be in default applies for relief under Rule 3.8.  The words “has effect” in Rule 3.8 mean, in my judgment, no more than that, absent any exercise by the court of its general case management powers in extending time or otherwise granting relief from the sanction, the sanction will remain in effect until relief from it is granted by the court on an application made under Rule 3.8 by the party in default.” 

16.	In Marcan Shipping (London) Ltd v Kefalas [2007] EWCA Civ 463, [2007] 1 WLR 1864, Lord Justice Moore‑Bick delivering the judgment of the Court of Appeal stated at paragraph 30:  

“The scheme of the Rules relating to conditional orders is in my view both clear and salutary in its effect, namely, that such orders mean what they say, that the consequences of non‑compliance take effect in accordance with the terms of the order, but that the court has ample power to do justice under rule 3.8 on the application of the party in default, or, in an exceptional case, acting on its own initiative.” 

17.	At paragraph 33, Lord Justice Moore‑Bick referred sto the decision in Keen Philips v field and said as follows:  

“Keen Philips v Field was a very unusual case. The only question for decision was whether the court had jurisdiction to grant relief from sanctions under rule 3.8 in the absence of an application by the party in default. This court held that despite the wording of rule 3.8, which naturally assumes that the party in default will make an application for relief, the court has jurisdiction to act of its own initiative in an appropriate case. However, the jurisdiction is one which is likely to be exercised only rarely because it will usually be necessary for evidence to be placed before the court to enable it to consider the various matters to which rule 3.9 refers. In that case, however, there was no dispute relating to the manner in which the judge had exercised his discretion, and rightly so, because it was accepted that the claimant's failure to comply with the order had resulted from matters wholly outside its control, had caused no prejudice of any kind to the defendant and had had no adverse effect on the course of the proceedings.” 

18.	Mr Grigg submits that these two authorities make clear that the court's discretion to grant leave extends to situations where an application is made without formalities and even where no application has been made at all.  In fact, in the present case, an oral application had been made with reference to a witness statement and there had been a previous application on 11 April 2014, when the appellant solicitor submitted an application notice to amend the directions of 31 October 2013 given by Deputy District Judge Shaw, which, Mr Grigg submitted, implicitly amounted to an application for relief from sanctions, the date on which the order of Mr Recorder Chapman was due to take effect having already passed.  

19.	Ms Bhogal submits that as the appellant did not issue an application for relief from sanctions in accordance with CPR 3.9 and CPR Part 23, the debarring order which had taken effect must stand.  Accordingly, His Honour Judge Mitchell was entitled to make the order which he did.  As I have said, Ms Bhogal accepts that Mr Grigg made an oral application for relief, but she submits that he did not make an application to the judge for dispensation from notice of the application under CPR Part 23.  She goes on to submit that it is clear from the transcript of the hearing that if he had done so, that application would have been refused.  

20.	Ms Bhogal refers to the overriding objective stated in the CPR, and in particular to CPR 1.1, which provides that dealing with a case justly and at proportionate cost, it includes, so far as is practicable “enforcing compliance with Rules, Practice Directions and Orders”.  Ms Bhogal, in this context, also refers to the 18th Implementation Lecture on the Jackson Reforms delivered by Lord Dyson, Master of the Rolls, on 22 March 2013.  Lord Dyson said in relation to CPR rule 3.9 that there was now to be a shift away from exclusively focusing on doing justice in the individual case.  

21.	The overriding objective, Ms Bhogal submits, is reflected in the language used in CPR 3.9, which states that on an application for relief from sanctions, the court's consideration must include the need to enforce compliance with Rules, Practice Directions and Orders and that an application for relief must be supported by evidence.  

22.	Referring to the terms of CPR 23.3, Ms Bhogal submits that in the present case there are no Rules or Practice Directions which provide for an application under CPR 3.9 to be made without filing an application notice and supporting evidence.  Further, the court has not dispensed with the requirement for an application notice.  The court should, Ms Bhogal submits, treat any pre‑Jackson and pre‑Mitchell authorities with caution.  

23.	There was no formal application for relief from sanctions; the Rules do not make provision for CPR 3.9 applications to be made implicitly or without evidence in support; and the court's broad discretion in case management powers under CPR 3.1(2) do not allow the appellant to bypass other aspects of the CPR.  Ms Bhogal submits that, for these reasons, the decision of the learned judge should be upheld.  

24.	I reject these submissions.  In my judgment, the absence of a formal application under CPR 23 does not conclude the matter.  At the hearing before the judge, Mr Grigg made an oral application for relief from sanctions which was supported by the statement of Mr Calendar, the appellant's solicitor, dated 11 April 2014, in support of the application to amend the directions of Deputy District Judge Shaw made on 31 October 2013 and, in addition, there is the statement of Mr Calendar of 2 May 2014.  

25.	CPR 3.8 does not require the application to be made in writing, nor does CPR 3.9.  In my judgment, the learned judge had power under Rule 3.8 to determine the application that was made before him on the appellant's behalf, as indeed he could have done if he considered it appropriate to do so on his own initiative.  

26.	The decisions made by the Court of Appeal in Keen Philips v Field and Marcan Shipping, to which I have referred in this regard, remain in my view good law.  That the court can of its own motion consider whether there should be such relief has been confirmed recently by the Court of Appeal in Circle Thirty Three Housing Trust Ltd v Nelson [2014] EWCA Civ 106 (see the judgment of Sir Robin Jacob at paragraph 18).  

27.	The judge was not, I understand, formally referred to CPR Part 23 by either counsel, but Ms Bhogal accepts that by making his oral application for relief from sanctions, Mr Grigg was, in effect, asking for dispensation under CPR 23.3(2)(b).  That, in my view, is plainly so.  I do not accept Ms Bhogal's submission that if the judge had appreciated that he had power to dispense with written notice, he would have refused the application.  The fact is that the judge did not appreciate that he had the power in the first place and he did not consider the matter.  

28.	Having reached the conclusion that I have on grounds 1-4, I can deal shortly with grounds 5 and 6.  Mr Grigg, in support of ground 6, referred me to the decision of the Court of Appeal in Folashade Rashida Momson v Dauda Abiodun Azeez [2009] EWCA civ 202, where the Court of Appeal considered the application of Article 6 to relief from sanctions.  

29.	In my judgment, applying the principles set out in Folashade, the learned judge should have balanced the Part 3.9 factors and considered proportionality and the overriding objective.  This he failed to do.  In my view, debarring the appellant from defending possession of her home purely on the basis that there had been no formal application issued under CPR 23, does amount to a breach of Article 6, ECHR.  

30.	Ground 5, the judge’s failure to consider the respondent's failure to comply with the mandatory requirement under CPR 3.5.5 does not in my view amount to a separate ground of challenge.  

31.	Ms Bhogal submits that an application under CPR 3.9 would have failed in any event.  That was not a matter that was considered by the learned judge and it would not be appropriate, in my view, for this court to determine that issue when it was not even argued below. 

32.	For the reasons that I have given, this appeal is allowed.  I will ask counsel for any submissions that they wish to make with regard to remission and how the matter should now proceed.