In the case of Frances v F Berndes Ltd & Ors, Deputy Master Linwood was asked to decide whether an applicant should be given relief from sanctions notwithstanding his application being made nine years out of time. The underlying claim related to an accusation that the Claimant invested some money in a property in London with the Defendants.
The claim was summarised by Deputy Master Linwood as follows:
“The claimant says that he invested, with a small contribution from one Desmond Hughes (now deceased), £250,000 on refurbishment of a property at 807 High Road, Tottenham, London, together with a flat and a workshop. The claimant says the defendant ejected both him and Mr Hughes from the property without any compensation, relying on an agreement which Master Teverson found to be unenforceable under section 2 of the Law of Property (Miscellaneous Provisions) Act 1989. The claimant says that the defendant said it would sell the property, valued at some £300,000 for just £50,000 to take into account the £250,000 the claimant had spent on it. This £250,000, the claimant says, represents his life savings which he says he has been unjustly deprived of by the unlawful conduct of the defendant and therefore the defendant has been unjustly enriched to the value of that sum, so the claimant now seeks restitution of his investment…That claim for restitution, as I have mentioned, was what the claimant was permitted to apply for permission to amend to claim. The defendant says that the agreement was a forgery and so there was no binding contract.”
The permission to apply for the Claimant to amend his claim arose after the claim was dismissed following an application for summary judgment and strike out resulting in the Claimant appealing same with the net effect that permission to apply to amend his claim to include the restitution argument on condition that that application was made by 5th January 2012.
The Claimant claims that the application was submitted to the Court but never heard. One of the Defendants resisted the application on the basis that:
“(1) The defendant says it is an attempt to revive by seeking to amend proceedings already dismissed by order of Master Teverson nearly ten years ago on 3 November 2010 and by order of Henderson J when he dismissed the claimant’s appeal against Master Teverson’s order but gave the claimant a window of opportunity to apply to amend and to persuade the court he had an arguable case based on restitution.
(2) The claimant has failed, the defendant says, to file and serve an application to amend with supporting evidence by 4 pm on 5 January 2012 and therefore the action remains dismissed.
(3) The claimant made an application a year later on 4 January 2013 for directions in the already dismissed action, which was correctly dismissed by Deputy Master Clark (as she then was) on 18 February 2013, Master Teverson having declined to adjourn that hearing. There then followed complete silence.”
In finding that the application was not issued by the Claimant whether in time or at all prior to the current application, the Judge said:
“I therefore find as to Issue 1 on the balance of probabilities the application for permission to amend was not issued, filed and served, whether or not with supporting evidence and proposed amended claim form and proposed amended particulars of claim, as the evidence of the claimant, Mr Green and Ms Collette Parkinson is insubstantial, unconvincing, mutually inconsistent and does not bear examination in the face of the contemporary documents. I find the claimant’s evidence especially unsatisfactory as it is self-serving, unsupported and inherently improbable. I say this particularly in view of the now detailed recollections which have come about over events some eight-and-a-half years before the witness statements were made which fly in the face, as I have said, of the contemporaneous documents, which are deliberately ignored by especially Mr Green.”
The Judge therefore moved on to the three-stage test set out in the leading case of Denton, namely:
- Was the breach significant or serious?
- What was the explanation?
- All of the circumstances of the case.
In dismissing the Claimant’s application, the Judge made the findings set out below in respect of the above three stages.
- The breach was both serious and significant.
- The Claimant’s explanation was summarised as follows:
“In summary and in general terms the reasons may be listed as follows:
(a) lack of funds;
(b) an absence of legal representatives willing to take on the case until now;
(c) my fear and belief I may not be able to get relief at all;
(d) my discovery after encountering my present lawyers that I may still be able to proceed with my claim and the need to locate and recover documents; and
(e) other factors that have delayed me getting to this stage.”
The Judge’s response to each of the above reasons was as follows:
“That appears to be the explanation for this substantial, indeed until the application was issued, eight-and-a-half year delay. As to (a), the lack of funds, I do not think impecuniosity is a good reason not to progress the matter…As to (b), the absence of legal representatives, there is no correspondence produced by the claimant showing attempts to obtain legal advice. As to (c) namely his fear that he may not be able to get relief and (d) the discovery he may still be able to proceed some time later, I do not think that this is a good explanation for delaying for so long, particularly as at the start of that period, it appears he did have the advice of counsel. I would add that not proceeding until he had solicitors who could address the claim is not a good explanation. It could mean, if he was correct in that, that time is open-ended, which must be wrong.”
- The Judge cited substantial delay, disproportionate costs, prejudice to the Defendant in terms of evidence no longer being available as a result of the passage of time, destruction of the Court file due to the passage of time and the failure of the Claimant to comply with a costs order previously made against him as further reasons for refusing the application.
Comment
The above referred to outcome is not remotely surprising. It would be a very unwise applicant that thought a nine-year delay was reasonable and explainable.
The finding that a lack of legal representation was not a good reason is in my view clearly the correct decision and further highlights the need to ensure that a party obtains legal advice in respect of their matter without delay.
How Nelsons can help
Kevin Modiri is a Partner in our expert Dispute Resolution team.
Should you be involved in litigation and require advice, please feel free to contact Kevin or another member of the team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online enquiry form.