Disputes - Interim Applications (12) Flashcards
What should be done before applying to court for an interim application?
Application and Hearing Procedure: Parties should firstly seek informal agreement with the opponent, but failing this, apply to court for an interim hearing.
What is the procedure for an interim application?
Application: Applications are made on Form N244, setting out the order sought and the appropriate grounds, alongside a court fee, to the court of claim. This is accompanied by:
(1) Evidence: Supporting evidence: a) in an attached witness statement/affidavit; b) by reference to a statement of case; or c) on N244 itself. This is made by the person with the appropriate personal knowledge.
>Technical orders tend to be reasoned by solicitors, others may be reasoned by the client.
>Evidence should outline factual information and anticipate the opponent’s case.
(2) Draft Order: A draft of the order sought.
(3) Estimated Costs/Length: An estimation of costs and length of interim hearing.
(4) Statement of Truth: Applications must be verified by a statement of truth.
(5) Grounds: Grounds of order must be set out - these differ for each type of order sought (below).
How are hearings held?
Hearing: Interim hearings are usually required, and may be applied for with or without notice (if required). Solicitors make submissions, but the case is decided on the written evidence. There is no oral evidence.
Telephone/Video Hearings: Courts now actively encourage hearings by telephone or video link. Telephone is the general rule for hearings estimated at one hour or less, unless it is a hearing without notice (CPR PD23A).
Who pays the costs of an interim hearing?
Costs: Costs of interim applications and hearings are determined at the hearing itself (by summary assessment):
(1) Pay as You Go/Costs in Any Event: Losing party at hearing pays (usual order).
>Less common if winner is at fault, i.e. trying to amend a statement for their own mistake.
(2) Costs in Case: Losing party at full trial will pay.
(3) Costs Reserved: Costs to be decided later.
(4) No Order: Each party pays its own costs.
(5) Wasted Costs: Applicant or their solicitor pays, even if successful, for poor conduct or errors in process.
What is the test for strike out?
Strike Out: Parties may apply to strike out an opponent’s statement of case.
(1) Grounds: The statement of case must either:
- Unreasonable: Discloses no reasonable grounds for case, i.e. poor legal or factual basis.
- Abuse of Process: Constitute an abuse of process to the just disposal of proceedings.
- Failure to Comply: Failed to comply with a rule, practice direction, or court order.
(2) Fairness: It must be fair to strike out the document with reference to the overriding objective and the effect on the opponent.
What is the test for relief from sanctions?
Relief from Sanctions: Parties can apply to seek relief from sanctions imposed on them by the court. Relief is considered under the Denton Test (Denton v White). There are three factors applied in order:
(1) Seriousness: Was the original breach serious or substantial? If not, grant relief.
(2) Good Reason: Did the applicant have a good reason for the breach? If so, grant relief.
(3) Fairness: Would relief be fair in reference to the overriding objective and other parties, and was relief sought promptly? If so, grant relief.
What is the test for setting aside default judgment?
Setting Aside Default Judgment: Parties who have been made subject to an order of default judgment against them can apply to the court to have it set aside. There is one mandatory ground and two discretionary grounds.
Challenging Judgment
Challenging Judgment: The opponent can challenge default judgment on three grounds (CPR 13).
(1) Mandatory: Court must set aside a default judgment if wrongly entered (i.e. too early or claim already settled).
(2) Discretional: Courts can also set aside a default judgment on either of two discretionary grounds, provided the application to set aside was made promptly.
- Real Prospect: The applicant has a real prospect of success at trial.
- Good Reason: The applicant has a good reason for failure to respond (i.e. illness - not disorganisation).
>Probably rejected if the applicant is ‘doomed to fail’ in any case.
Denton Factors
Denton Factors: As an application for relief from sanction, the court must also apply the Denton Test (unless mandatory).
(1) Significance: Was the original delay significant or substantial? If not, grant relief.
>Generally serious.
(2) Good Reason: Did the applicant have a good reason for the delay? If so, grant relief.
>I.e. Outside of their control (will link to ‘good reason’).
(3) Fairness: Would relief be fair in reference to the overriding objective and other parties, and was relief sought promptly? If so, grant relief.
>Promptness is a major consideration.
Outcome of Challenge
Outcome of Challenge: Outcome of challenge will differ.
(1) Mandatory: Courts will set aside judgment following a valid mandatory challenge.
(2) Discretional: Courts may set aside judgement following valid discretional challenge.
Conditional Order: Court may set aside judgment on the condition that the applicant pays a security into court (to deter fruitless defences). The security is forfeited if the applicant loses at trial.
Costs of Default Judgment
Costs of Default Judgment: The costs of attempting to enter default judgment will differ by outcome.
(1) Mandatory Ground: If claimant incorrectly entered judgment, they are liable for costs.
(2) Real Prospect Ground: If defendant had real prospect of success but no good reason to delay response, they are normally liable for costs.
(3) Good Reason Ground: If defendant had good reason for delayed response, no party is liable, so costs are awarded ‘in case’.
(4) Default Judgment Maintained: If claimant successfully enters judgment, defendant will be liable for costs.
How are statements of case amended?
Amending Statement of Case: Parties can seek to amend statements of case. They must serve both the old and amended statements to the court alongside the N244.
(1) Within Limitation Period: Courts will permit amendments within the limitation period if this is fair with reference to the overriding objective and other parties. Alternatively, parties can agree to amend.
(2) Outside Limitation Period: Courts may permit amendments outside limitation period in three instances:
- New Claim: Claim is added or substitute if arising from the same facts as the original claim.
- Mistaken Name: Amendment corrects a genuine mistake to a party name (not other mistakes).
>Mistaken name should not differ substantially to real name - must be clearly the same person.
- Party Capacity: Amendment alters the capacity of a party (i.e. natural to corporate).
How are parties to a case altered?
Altering Parties to Case: Parties can attempt to add, remove, or substitute parties to the case. Applicants must be an existing party, or prospective party. Potential new claimants must give written consent for application.
(1) Pre-Service of Claim Form: Parties can be altered without permission prior to service of the initial claim form, provided the court is notified and the claim is within the limitation period.
(2) Within Limitation Period: The court will typically give permission to alter a party to an existing claim within the limitation period (i.e. claimant has died, replaced with PR).
(3) Outside Limitation Period: The court will only give permission to alter a party to an existing claim beyond the limitation period in three instances:
- Named by Mistake: An original party was named by mistake.
- Interest/Liability Passed: The interest or liability of a party has passed, i.e. on death or incorporation.
- Necessity: If the claim cannot otherwise continue without alteration, making it a necessity.
How is an extension of time limit applied for?
Extension of Time Limit: Party may seek to extend a time limit for a court direction or service of a document, provided they apply before expiry of the original time limit (otherwise relief from sanction). This is based on an altered Denton Test:
(1) Significance: Would late service be significant or substantial to the case? If not, grant extension.
(2) Good Reason: Does the applicant have a good reason for requesting an extension? If so, grant extension.
(3) Fairness: Would extension be fair, considering the overriding objective and other parties, and was extension sought promptly? If so, grant extension.
What is the test for summary judgment?
Summary Judgment: Party can seek summary judgment if some or all of the opponent’s case has no real prospect of success at trial. It is similar to default judgment for a response that has been served but is groundless. They must establish:
(1) No Real Prospect of Success: The party has no real prospect of succeeding on the claim defence or issue, meaning it lacks legal or evidential merit. It is a ‘flight of fancy’ (Peskin v Anderson).
(2) No Other Compelling Reason: There is no other compelling reason why the case or issue should be disposed of at trial, such as for technical cases or the opponent requiring expert evidence or key witness examination.
>Infringement of game show was too complex to summarily judge (Celador v Melville).
Effect of Order
Effect of Order: Courts can make a number of orders.
(1) Judgment: Judgment is granted, meaning the Respondent is required to pay damages and costs.
(2) Dismissal: Application is dismissed; applicant tends to pay costs.
(3) Conditional Order: Respondent is permitted to continue case provided they pay a sum to court, usually to dissuade improbable litigants from continuing claims or defences.
How is an interim injunction applied for?
Interim Injunction: Parties can seek injunctions against opponents prior to final judgment, to remain in effect until final judgment or otherwise ordered. Only Circuit Judges and Judges can grant interim/interlocutory injunctions.
(1) Grounds: It must be just and equitable to order an interlocutory injunction with respect to the relevant guidelines.
- Pre-Action: Injunctions can only be ordered pre-issue of claim if urgent or in the interests of justice.
(2) Guidelines: Courts consider the American Cyanamid v Ethicon guidelines:
* The issue to be tried must be serious (i.e. valid legal merit);
* Damages would be inadequate (or respondent does not have means to pay them);
* The balance of convenience must lie with the applicant (risk of no injunction outweighs risk);
* Any other special factors.
(3) Cross-Undertaking In Damages: Applicants must undertake to pay the Respondent associated damages if it later transpires that the injunction was unwarranted.
>Applicants must establish that they have funds to meet any such damages.
(4) Pre-Issue Undertaking: Applicants who seek an injunction prior to issuing proceedings must undertake to issue proceedings if the injunction is granted.
(5) Types of Injunction: The primary forms of ordinary injunction are mandatory and prohibitory injunctions.
- Mandatory: Defendant is ordered to rectify an issue.
>Must be a high degree of assurance that it will appear that the injunction was rightfully granted at full trial (requires very strong evidence).
>Advocates should not disguise a mandatory injunction as a prohibitory injunction, i.e. ‘the defendant should be prohibited from having the wall in its current location’. This is mandatory.
-Prohibitory: Defendant is prohibited from continuing an act.
Special Injunctions
Special Injunctions: Two types of injunction can be granted without notice (for good reason). These can only be granted by a High Court Judge, and must be supported by affidavit.
(1) Freezing Order: Respondent is restrained from removing their assets from the jurisdiction if there is a real risk that they will be taken out of the country to defeat judgment.
(2) Search Order: Applicant is permitted to search the Respondent’s premises if there is a strong case that they would otherwise suffer serious harm (usually due to stolen or incriminating materials).
(3) Appeal: Respondents can appeal in a pre-fixed hearing, or on application to set aside.
How is an interim payment applied for?
Interim Payment: Parties can seek interim payments from opponents, meaning an advance on final judgment sum. Applications are made once acknowledgement of service has been filed. This can be in a lump sum or instalments.
(1) Grounds: One of three grounds must be satisfied:
- Admission: Respondent has already admitted liability.
- Pending Damages: Applicant has obtained judgment, pending calculation of damages.
- Future Damages: Applicant establishes on balance of probabilities that a substantial sum of money is indisputably due to them on judgment.
(2) Reasonable Proportion: Party can seek no more than a reasonable proportion of this substantial sum, accounting for contributory negligence, set-off and counterclaim.
(3) Fairness: It must be appropriate and fair to make the payment, with reference to the overriding objective and the opponent.
Effect on Trial
Effect on Trial: Trial judges are not informed of voluntary or interim payments until after they have determined liability and quantum, unless the parties agree to disclose (this is unlikely).
Discontinuing Claim
Discontinuing Claim: Successful applicants who wish to discontinue their claim must seek the written permission of the opponent or the court.
How is security for costs applied for?
Security for Costs: Parties can seek security for costs from the opponent, meaning a claimant or counterclaimant is ordered to pay potential costs into court on the basis that they may be unlikely to pay them at final judgment.
(1) Part 25 Condition: A CPR 25 condition must be met:
- Outside Jurisdiction: Respondent or their assets are domiciled outside of the UK or a Hague State.
- Impecunious Company: Respondent is a company in financial difficulty and will not be able to pay costs.
- Judgment Proof: Respondent has taken steps to become judgment proof, intentionally or otherwise (i.e. assets held on trust by others, changed or given wrong address to evade consequences).
(2) Interests of Justice: It must be in the interests of justice to order security, considering factors such as:
- Prospects of Success: Applicant’s prospects of success should be good.
- Stifle Opponent: Security for costs should not stifle opponent’s prospects of success.
- Culpability: Applicant should not be responsible for opponent’s impecuniosity.
- Domestic Assets: Foreign opponents should not have sufficient domestic assets.
- Prompt Application: Applicant should have applied as soon as reasonably practicable.
How is specific disclosure applied for?
Specific Disclosure: Parties may seek specific disclosure of documents following standard disclosure, if they expected but did not receive a specific document, or to inspect a privileged document. This is a document that is:
(1) Document: Recorded information, i.e. e-mail, photograph, letter.
(2) Disclosable: In support of or adverse to the case of a party.
(3) Relevant: Relevant to a disputed matter, not an agreed issue.
(4) Controlled by Respondent: In the control of the Respondent, meaning they physically possess it, or have the right to physically possess or inspect it.
