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Court’s powers to strike out a claim – how to ensure your case resists the strike out test? (7 May 2019)

Date: 07/05/2019
Duncan Lewis, Legal News Solicitors, Court’s powers to strike out a claim – how to ensure your case resists the strike out test?

The court has the power to strike out a party’s statements of case (or any part of it) through its case management powers under CPR 3.4. This can happen when the statement of case does not disclose “reasonable grounds for bringing the claim”. The court can exercise this power upon a party's application or on its own initiative. In practice, the courts use the power to strike out sparingly. The overriding objective, to deal with cases in a just manner and at proportionate costs, means that the courts will not easily entertain a strike out unless there is a very good reason to do otherwise. Strike out is a matter of the very last resort as there are other tools within the CPR to deal with defective pleadings rather than turning to the drastic strike out. The threshold for a strike out is necessarily a high one as it brings the case to an automatic end without the need for any further court order. Taking the necessary steps to avoid a case being struck off is an essential consideration in the litigation process.

If a statement of case does not disclose any legally recognisable cause of action it is deemed to fail under the ground that it “discloses no reasonable grounds for bringing or defending the claim”. This ground essentially excludes from the litigation process statements of a case that are unreasonably vague, incoherent, vexatious, scurrilous or obviously ill-funded and other cases which do not amount to a legally recognizable claim or defence. This ground also covers cases where the case is unwinnable, and continuance of the proceedings is without any possible benefit to the respondent and would waste resources on both sides.

Claims which may fail the test to disclose a legal cause of action include those “which set out no facts indicating what the claim is about, those which are incoherent and make no sense, those which contain a coherent set of facts but those facts, even if true, do not disclose any legally recognisable claim against the defendant” (PD 3A 1.4).

On the other side, statement of case passes the test under CPR 3.4 by providing a coherent set of all the relevant facts which allows the courts and the other side to identify the actionable claim against the defendant, to which he can then respond to in the defence. Identifying a legal cause of action and particularising all the relevant facts is therefore crucial in commencing legal proceedings. The judgment of Master Shuman in in a recent case of Capita Pension Trustees Ltd & Anor v Sedgwick Financial Services Ltd & Ors[2019] EWHC 314 (Ch) emphasises the importance of a clear and concise statements of case:-

“18. The purpose of a pleading or statement of case is to inform the other party what the case is that is being brought against him. It is necessary that the other party understands the case which is being brought against him so that he may plead to it in response, disclose those of his documents which are relevant to that case and prepare witness statements which support his defence. If the case which is brought against him is vague or incoherent he will not, or may not, be able to do any of those things. Time and costs will, or may, be wasted if the defendant seeks to respond to a vague and incoherent case. It is also necessary for the Court to understand the case which is brought so that it may fairly and expeditiously decide the case and in a manner which saves unnecessary expense. For these reasons it is necessary that a party’s pleaded case is a concise and clear statement of the facts on which he relies; …”

Litigants in person might easily fall into a trap of filing deficient pleadings. However, this can be addressed at the very early phase of litigation when the claim form is filed at court. As mentioned earlier, the power to strike out a case can be exercised by Judges acting on their own initiative at any stage of litigation including the day of trial and when filing a claim form at court. Therefore, when the court officers cannot discern any reasonable legal cause of action from the filed claim form, they refer the case to a judge for further consideration. The logic behind this is to dispose of cases with no legal cause of action as early as possible to save both parties from incurring unnecessary expenses as well as the courts’ time when dealing with cases that are bound to fail from the outset. The notes to the White Book 2018, at paragraph 3.4.2 however reiterate that a claim should not be struck out unless the court is certain that it is bound to fail.

Therefore, where a statement of case is found to be defective, the court should consider whether that defect might be cured by amendment and, if it might be, the court should refrain from striking it out without first giving the party concerned an opportunity to amend it (Soo Kim v Young 2011 EWHC 1781 QB).

The deficiency in the claim form will be most likely raised by the court or pointed out by the Defendant in which case, the Claimant ought to make the necessary amendments to ensure that he has a valid and actionable claim. If the claim form is issued without any orders from the court with regards to a possible amendment, and it is the Defendant who raises the deficiency in the pleadings, it is worth considering whether the amendment is necessary and discuss this with the opposing party. The Claimant needs to be made aware that if an amendment application is made, then he will most likely bear the costs of such application. If the Claimant is adamant that the statements of case are clearly addressing what the case is about and it is the Defendant who insists on having the claim struck out for lack of clarity, the appropriate course of action would be for the Defendant to make a strike out application under CPR 3.4, and bear the costs if such application fails.

However, what is most likely to happen in this scenario if both parties remain silent on the issue of amendment until trial? In Donovan & Anor v Grainmarket Asset Management LLP [2019] EWHC 1023 (QB) Martin Griffiths QC, sitting as a High Court judge, disallowed a late application to amend by the Claimant because it was made shortly before trial and the judge found that the amendment application could have been made much earlier. The relevant balancing factors that the judge considered included history of amendment with an explanation for its lateness, the clarity of the proposed amendment, the prejudice to the resisting parties if the amendments are allowed, from considering whether the opposing party is being ‘mucked around’ to the disruption of and additional pressure on their lawyers in the run-up to trial, and the duplication of cost and effort and whether allowing the amendments would necessitate the adjournment of the trial. It was pointed out that “if that prejudice has come about by the amending party’s own conduct, then it is a much less important element of the balancing exercise”.

The Donovan & Anor case provides valuable guidance on considering amendment applications indicating that such applications need to be made as early as possible to give the opposing party enough time to respond to the amended case. It is evident from case law that the courts enter careful deliberations when presented with strike out applications given their frustrating effects with an adverse costs order. Strike out decisions at trial are very rare and hence likely to be appealed leaving both parties having to incur further costs and requiring the courts to spend more time on a case that could have been ended in the usual way but for a hasty strike out decision, which clearly goes against the overriding objective. Each case depends on its own merits however it is always prudent to consider an amendment application if the claim form was filed without legal assistance.

It is therefore important for litigants in person considering issuing claims in Court to ensure that their claim will not be susceptible to a strike out. Obtaining legal advice before hand is very crucial.

If you require further expert advice or assistance please contact, author of this article, Karolina Natkaniec in our Civil & Commercial Litigation department on 020 3114 1223 or at Karolinan@Duncanlewis.com.

Duncan Lewis Civil Litigation Solicitors

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