The judgment of Arnold J in Solland v Clifford Harris highlights that unilaterally “warehousing” a claim (that is, putting a claim on hold without intending to pursue it) can amount to an abuse of process, even if a claimant subsequently decides to pursue the claim.
The defendant firm of solicitors represented the claimants in litigation, which settled on unfavourable terms in February 2004. A letter of claim alleging professional negligence was sent in December 2004, but the claim form was not issued until November 2008. Particulars of claim were served in December 2011, claiming damages in excess of £8 million against the two-partner firm.
Following service of the defence, the claimants failed to file or serve an allocation questionnaire by 3 April 2012 as required. Thereafter, neither party took any further step in the proceedings until August 2014, when the defendant issued an application to strike out the claim. In November 2014, the claimants filed their allocation questionnaire and applied for an extension of time and (to the extent necessary) relief from sanctions.
The master’s decision
Before Master Bowles, the defendant’s first ground to strike out the claim was that the claimants had failed to comply with a rule, practice direction or court order by not filing an allocation questionnaire. The master rejected that argument. He found that the failure to file an allocation questionnaire did not give rise to an express or implicit sanction. Accordingly, it would not be appropriate to strike out the claim purely because of the breach.
The defendant’s second ground was that the claim should be struck out as an abuse of process. The master accepted that the claimants had abused the process of the court in that they had:
- Commenced or continued the claim with no intention of pursuing the claim to trial or other proper resolution in the period between April 2012 and August 2014, within the meaning of Grovit v Doctor.
- Conducted the proceedings with a wholesale disregard of the rules of litigation in full knowledge of the consequences, within the meaning of Choraria v Sethia.
The master then went on to strike out the claim on the second ground.
The master also struck out the claim on the defendant’s third ground, which was that there was a substantial risk that a fair trial would no longer be possible (largely as a result of memories of detail being dimmed in respect of crucial factual disputes), which had been significantly contributed to by the claimants’ delay.
On appeal, the claimants challenged almost every aspect of the master’s reasoning and his decision to strike out the claim. However, the judge found that the master was entitled to find that there had been an abuse of process within the meaning of Grovit v Doctor, on the basis that the claimants did not intend to pursue the claim to trial or other proper resolution during a period from April 2012 until August 2014.
The judge did conclude that the master had erred in finding an abuse of process within the meaning of Choraria v Sethia. The claimants had not conducted the proceedings with a wholesale disregard of the rules. The only breach of the rules was a failure to file the allocation questionnaire on time. At most, the claimants had failed to comply with the spirit of the CPR by failing to prosecute their claim diligently.
The judge went on to find that the master had acted properly and within his discretion by striking out the claim as an abuse of process. Accordingly, he dismissed the appeal (he also dismissed the appeal against the third ground so the appeal would have failed in any event).
The judge rejected the claimant’s argument that the master had wrongly treated mere inactivity as enough to discharge the defendants’ burden of proving an abuse of process. The judge emphasised that the master had expressly recognised that delay in itself, however inordinate and inexcusable, does not amount to an abuse of process. Something more is required to transform delay into an abuse.
In this case, the additional factor (as in Grovit v Doctor) was the finding that the claimants had decided not to pursue the litigation to trial or other proper resolution for an indeterminate period. In other words, they had decided to warehouse the claim. The master was entitled to find that the claimants’ inactivity, and the inadequacies in the evidence explaining that inactivity, showed a lack of intention to advance the action.
The claimants’ argument that the master failed to consider the possibility that the claimants had “simply put the litigation on hold for the time being” did not assist them. It was essentially an admission that the claimants did not intend to pursue the litigation for a significant period, which can in itself constitute an abuse of process. The judge made clear that the Grovit limb of abuse of process does not require the claimants’ lack of intention to pursue the claim to trial to continue until the date of the application to strike out.
The decision illustrates that there can be a fine dividing line between recognising delay as an abuse of process in itself (which is impermissible, see Icebird Ltd v Winegardner) and relying on the claimants’ inactivity as evidence of the absence of an intention to advance the action (which is permissible, see Grovit v Doctor).
Another interesting aspect of the case (although not one which was considered on appeal) was the master’s conclusion that, as the failure to file an allocation questionnaire did not give rise to a sanction, the factors relevant to relief from sanction in CPR 3.9 should not be applied. Looking at the language of CPR 3.9, that conclusion is justifiable. However, it is difficult to reconcile with the Court of Appeal’s decision in Walsham Chalet Park Ltd v Tallington Lakes Ltd that on an application under CPR 3.4 for non-compliance, the Mitchell/Denton principles have a direct bearing, even although they relate to applications for relief from sanctions rather than applications to impose a sanction.
More generally, the case shows the strength of the court’s inherent jurisdiction to control its own procedure. Ordinarily, that jurisdiction is only exercised when the court cannot find an adequate solution under the CPR or other legislation. In this case, the claim was struck out primarily pursuant to the court’s inherent jurisdiction, although the judge noted that the claim could equally have been struck out pursuant to CPR 3.4(2)(b).