‘Finally, a down to earth approach to compliance!’
The facts of Americhem Europe Ltd v Rakem Ltd are not of major relevance. The matter reached allocation and when filing and serving the cost budgets in the form of the Precedent H, the Defendant’s Precedent H, while compliant in every other respect, was signed by the Defendant’s Cost Draftsman and indeed specified “Costs Draftsman” on the Precedent H, following his signature.
The Claimant took issue and argued that the Defendant’s Precedent H was non-compliant with the rules. The rules at PD3E say that ‘…A budget must be dated and verified by a statement of truth signed by a senior legal representative of the party……’ The Claimant argued that the cost draftsman was not a senior legal representative and the Defendant was to be treated as having filed a budget comprising only the applicable Court fees.
At the hearing, Mr Justice Stuart-Smith rejected the Claimant’s submission that the Defendant’s Precedent H was a nullity, despite, in fact finding that the cost draftsman was not a ‘senior legal representative.’
The key to Mr Justice Stuart-Smith’s finding was that ‘while CPR 3.14 provides a sanction in the event that a party “fails to provide a budget”, it does not include the additional words “complying in all respects with the formal requirements laid down by PD3E” or any other words to similar effect. Here, the document was in a form which stated it was the Defendant’s Costs Budget and would immediately be recognised as such. There was nothing to impede the normal constructive discussions on figures that would have been open to the parties if it had been fully compliant. To hold that it was not a Costs Budget at all would not, in my judgment, be a proper application of a robust approach rather, it would lack in any form of reality or justification’.
What does this say? It emphasises what the Master of the Rolls emphasised in his lecture on the Jackson reforms in words approved by the Court of Appeal in Mitchell at , ‘it is not the aim of the reforms to turn rules and rule compliance into “trip wires”, nor into “the mistress rather than the handmaid of justice”, nor to render compliance “an end in itself”. Finally, the Court has taken a step back in respect of compliance post-Mitchell.
However, a word of warning; this is not to say that the Court will waive penalties on parties that have not complied with the rules, but what this case does do is expel those challenges whose basis have no merit.