General

Costly errors made by first instance judge “misapplying and misunderstanding” Mitchell leads to the Court of Appeal overturning judge’s decision.

Background

The Jackson reforms in how courts should impose sanctions in 2013 gave clear guidance to the courts in trying to manage costs.

 In the landmark case of Mitchell MP v News Group Newspapers [2013] EWCA Civ 1537 (“Mitchell case”), the Court of Appeal had given guidance on the revised CPR 3.9 (relief from sanctions) following the Jackson Reforms. It was thought that courts had become too tolerant of delays and of non-compliance of orders. The emphasis therefore would be for the need for litigation to be conducted efficiently and at a proportionate cost and the need to enforce compliance of the rules.

“The question at the heart of the appeal is: how strictly should the courts now enforce compliance with rules, practice directions and court orders?” (Lord Dyson MR)

It was held that a sanction will usually stand unless

(a)    the non-compliance is trivial ( e.g. failure to complete a small section of a form)  or

(b)   there is a good reason for  the non-compliance.

The Court hoped it had sent a clear message that “from now on relief from sanctions should be granted more sparingly than previously.”

The concept of justice in the overriding objective did not refer exclusively to justice inter partes but rather to the needs and interests of all court users.

2016

In the recent case of McTear and Williams v Engelhard and Others [2016] EWCA Civ87 , according to the Court of Appeal, the first instance judge applied the Mitchell case “wrongly and unjustly”. It has caused the original judgment to be set aside and for a new trial to be ordered.

So what had the judge erroneously applied for the Court of Appeal to overturn the judgment?

At the start of the trial, the judge had refused

–          to allow any of their witness statements (served 50 minutes late) to be admitted at trial and for the witnesses to be called to give oral evidence;

–          admission of documents discovered two weeks before the trial which were relied on by the defendants and had been given to the claimants through discovery some weeks before;

–          permission for the defendants to amend their defence in order to plead set off  of mutual debts.

The Court of Appeal was critical of the judge’s errors and approach taken. This is not the first time that the principles in the Mitchell case had been seemingly misapplied and misunderstood by the first instance court. The same happened before leading to decisions that were “manifestly unjust and disproportionate” (Denton v TH White Ltd) and were ultimately overturned by the Court of Appeal.

There has been an interesting case, Alan Castledine the Commissioners for HMRC, concerning the minimum requirement for entrepreneurs relief.   It acts as a timely reminder as to the qualification for entrepreneurial relief.

This is that in order to qualify for such relief from Capital Gains Tax in respect of shares or securities of a company the person seeking the relief, the tax payer, must hold at least 5% of the ordinary shares of the company.   At least 5% of the voting rights in the company must be exercisable by that person, there are other conditions for relief to be made available which include the fact that the shares must be held for a minimum of 12 months and where the relief applies the tax payer will qualify for a reduced rate of Capital Gains Tax of 10% on up to £10,000,000 of the lifetime gain.

This comes into force on the 1st October 2015. In general the new act reflects the current law although there are difference about which businesses should be aware and take appropriate action.

The legislation sets out the regulations effecting contracts between traders and consumers; it includes consumer notices.

Changes to note include a new definition of a consumer, a concept of non-conforming goods, services and digital content and reference to a new category – that of digital content. In general the new legislation may broaden the potential liability of a trader to its consumer customers which in turn could increase the costs of doing business.

In the light of the new law, businesses in this sector should be aware of the position after the beginning of next month and take steps to ensure that their business terms and paper work comply with the law and are drafted to the best advantage of the trader.

Two first class cricket umpires, Peter Willey and George Sharpe, who umpired at 40 international matches between them, have recently lost their age discrimination and unfair dismissal claims against The England Wales Cricket Board (ECB).   The two were forced to retire at the age of 65 in line with the ECB’s compulsory retirement age policy.  

The default retirement age was abolished by government legislation in 2011 and since then employers have only been able to force employees at a certain age if they can show that the policy exists to meet a legitimate aim, and it is a proportionate way of meeting that aim.  

The Tribunal had to consider whether the age at which the policy was set was appropriate and justified.   The Tribunal decided that the age of 65 was justified at the current time.   The ECB’s position was strengthened by the fact that it had an existing written policy in place which set out the policy and the justification for that policy.

In light of the expansion of web domains that are now available to purchase (previous domains were limited to for example .com and .co.uk), a trend is beginning to arise to purchase domain names that may reduce those companies’ exposure to reputational risks.

It has been reported that the pop star Taylor Swift has purchased “TaylorSwift.adult” and “Taylor Swift.porn”, with Microsoft similarly purchasing “.adult” and “.porn” domains to protect their “Office” brand.

Although it is possible to recover a domain name from a registered owner through the Uniform Domain-Name Dispute Resolution Policy procedure, it is a requirement to show that the domain name has been registered in bad faith. Furthermore, it may not be possible to raise a claim and recover the domain name on the basis that the domain name infringes a registered trade mark, if the use of the domain name is a legitimate exception which allows the use of another person’s trade mark. It would then be a requirement to use other remedies on the grounds of defamation or malicious falsehood, if they are applicable.

If there are no trademarks, then the common law of passing off may be a viable possibility however all these options are reactionary and the legal costs involved could be significant. Companies should opt to purchase the web domains that may be a risk to their particular brands, before others do so.