Dispute Resolution Summary Notes - SQE PDF

Summary Notes – is En Dispute Resolution im Solicitors Qualifying Examination – SQE ah br ,I an zk O © QLTS Sc...

Summary Notes – is En Dispute Resolution im Solicitors Qualifying Examination – SQE ah br ,I an zk O © QLTS School Ltd. All Rights Reserved. Not for Distribution.  Summary Notes – Dispute Resolution 1. Dispute Resolution in England & Wales The Civil Procedure Rules (‘CPR’) and the Overriding Objective (CPR 1) The CPR are a procedural code with the Overriding Objective of enabling the court to deal with cases justly and at proportionate cost. This includes, so far as is practicable: (a) ensuring that the parties are on an equal footing; (b) saving expense; (c) dealing with the case in ways which are proportionate to – (i) the amount of money involved; is (ii) the importance of the case; En (iii) the complexity of the issues; and (iv) the financial position of each party; (d) ensuring that it is dealt with expeditiously and fairly; im (e) allotting to it an appropriate share of the court’s resources, while taking into account the need to allot resources to other cases; and (f) enforcing compliance with rules, practice directions, and orders. ah The court expects parties to try to cooperate. Failure to comply with the Overriding Objective is likely to result in costs consequences. br The CPR also includes provisions to ensure that the Welsh language is accounted for in civil proceedings in Wales and that Welsh speakers are able to participate fully. Any party can also submit written evidence in Welsh. Where necessary the court will book and pay for a Welsh ,I interpreter. an The Case Management Powers of the Court To facilitate compliance with the CPR and further the Overriding Objective, the court has extremely wide case management powers (CPR 3.1). zk For example (except where these CPR provide otherwise), the court may: O extend or shorten the time for compliance with any rule, practice direction or court order; adjourn or bring forward a hearing; require a party or a party’s legal representative to attend the court; hold a hearing and receive evidence by telephone or by using any other method of direct oral communication; direct that part of any proceedings be dealt with as separate proceedings; stay the whole or part of any proceedings or judgment either generally or until a specified date or event; 2 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution consolidate proceedings, try two or more claims on the same occasion, and direct a separate trial of any issue; order any party to file and exchange a costs budged; take any other step or make any other order for the purpose of managing the case and furthering the overriding objective. Litigants in Person (‘LIPs’) LIPs are unrepresented or self-represented parties. A solicitor must act in their client’s best interest, however, they must also take account of is Principles 1, 2 and 5 of the SRA Code of Conduct, which states, ‘You do not abuse your position by taking unfair advantage of clients or others’ and the Litigants in Person: Guidelines for En Lawyers. Although the CPR apply to LIPs, the court will take into account the fact that a party is an LIP when making case management decisions and may exercise a greater degree of leniency. The Civil Courts of England & Wales im The Supreme Court of the United Kingdom – the highest court in the land. ah The Court of Appeal – deals primarily with appeals from the High Court and has both Civil and Criminal Divisions. br The High Court of Justice – deals with specialised cases and those over various monetary thresholds and is separated by division: ,I (Chancery Division) – handles business and property related disputes, as well as those relating to companies, insolvency and intellectual property. Includes the Bankruptcy and an Companies Court and the Patents Court. (King’s Bench Division) – handles all common law business, including cases related to contracts and tort. Includes the Admiralty Court, Commercial Court and Technology zk and Construction Court. (Family Division) – handles all cases relating to family law. O The County Court – the first rung on the ladder when it comes to dealing with most civil cases, unless the claim is for a high amount or of a complex or specialised nature. A wide variety of claims can be issued in the County Court, including claims between individuals, or between companies or partnerships. Primarily deals with monetary claims and claims involving land and property. 3 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution is En im ah br ,I an zk O 4 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution is En im ah br ,I an zk O 5 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 2. New Client Considerations Professional Conduct specific to Dispute Resolution Part 1.4 of the Code: you must not mislead or attempt to mislead your clients, the court or others, either by your own acts or omissions or allowing or being complicit in the acts or omissions of others (including your client). Part 2 of the Code: in Dispute Resolution and Proceedings before Courts, Tribunals and Inquiries, you must: Not misuse or tamper with evidence, or attempt to do so. is Not seek to influence the substance of evidence, including generating false evidence or persuading witnesses to change their evidence. En Not provide or offer to provide any benefit to witnesses dependent upon the nature of their evidence or the outcome of the case. Only make assertions or put forward statements, representations or submissions to the court or others which are properly arguable. im Not place yourself in contempt of court and comply with court orders which place obligations on you. ah Not waste the court’s time. Draw the court’s attention to relevant cases and statutory provisions, or procedural irregularities of which you are aware, and which are likely to have a material effect on br the outcome of the proceedings. ,I Initial Steps to take in relation to a New Matter In addition to ensuring that you are the proper person to act for the client, there are some an common initial steps to take in relation to all new clients or matters: Identify the client – it is important to accurately identify the client from the outset of any instruction to ensure compliance with Anti-Money Laundering (MLR) requirements, that the client has the zk authority and capacity to give instructions, and that the parties are accurately described, particularly in statements of case. O The range of potential clients includes: an individual over the age of 18 a partnership or sole trader (see CPR 7.2A and PD 7.5A–5C) a child or a protected party (see CPR 21.1) the estate of a deceased person (see CPR 19.8) a trust or trustee (see CPR 19.10) a limited or public limited company a limited liability partnership any other form of incorporated or unincorporated association, including a trade union, a building society, a charity, a local government body, or a club 6 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Identify the opposing party – consideration may need to be given to the following questions: Retailer or manufacturer? There may be more than one cause of action available. Bear in mind limitation issues. Employer or employee? Consider vicarious liability and what is deemed to be ‘in the course of employment’. Agent or principal? This may be relevant in commercial contract cases. Consider actual/ ostensible authority. Motorist or insurer? In Road Traffic Accidents (RTA) cases, there is usually an express term in the contract of insurance entitling the insurer to ‘step into the shoes’ of the insured (‘subrogation’). is Conduct Conflict Search – before any instructions are received from a client to see if the firm or En legal representative is acting, or has acted, for any opposing party. Conduct Risk Assessment – before and throughout the matter. Comply with Money Laundering Regulations – litigation is generally classed as a low-risk im activity, but the Money Laundering Regulations 2017 must still be complied with. Send Letter of Engagement – including information as to when bills will be invoiced, interest ah provisions for late payments, VAT, storage of client files and documents, dispute resolution clauses, etc. Details of the client’s ‘right to cancel’ should also be included if the client is an individual (failure to do creates a criminal offence to undertake work and no fee can be charged). br Request any Relevant Documentation – to the case itself and funding e.g. insurance policies. Some firms require clients to complete a pro forma questionnaire. ,I Hold the First Client Meeting – the purpose of the first meeting is to review any documentation and information which the client is able to provide and ensure all MLR and professional conduct an obligations are met. Additionally, there are generally 6 main tasks to perform: 1) Take full details of the client’s version of events zk In the client’s own words, and produce an attendance note of the meeting. O 2) Manage the client’s expectations It is important to ensure the client does not have unrealistic expectations as to what can be achieved by way of legal remedy, understands the risks, and is fully informed as to the likely cost of proceedings and the prospects of success. 3) Take full details of the client’s version of events In the client’s own words, and produce an attendance note of the meeting. 7 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 4) Explain the basic legal principles Explain the basic legal principles relevant to the dispute, including in relation to liability, causation, quantum, the burden of proof, and the nature of the evidence by reference to which the claim may be determined. See Tort and Contract for causes of action. 5) Discuss how the dispute can be resolved It is important to ensure the client understands that litigation is a last resort, the options available for Alternative Dispute Resolution (ADR), the consequences of failing to comply with the Practice Direction and Pre-Action Protocols, and the procedural steps involved in the progression of a claim to trial in the event a negotiated outcome cannot be achieved. is 6) Respond to the client’s questions En Keeping in mind all of the above. 7) Explain what happens next im Towards the end of the meeting, it is good practice to summarise the client’s position including the options available to the client in terms of next steps, the costs and risk associated with proceeding with those next steps. This will normally be followed up in writing. ah Specific Considerations – although every new matter will differ, you should give further consideration to any unique aspects of the case, e.g. limitation, jurisdiction, or funding issues. br Consider the ability of the opposing party to satisfy an award of costs or damages – the financial position of a party can be assessed in various ways, including: ,I company search an credit search Land Registry search a search of the Register of Judgments, Orders and Fines zk the instruction of a private investigator to prepare a report a bankruptcy search through the Insolvency Register (natural person) O a winding-up search at the Royal Courts of Justice (body corporate) In relation to claims for personal injury, a defendant will often be insured. If not, it may nevertheless be possible to pursue a claim against the Motor Insurers’ Bureau for RTA claims. For criminal injury claims only, the Criminal Injuries Compensation Authority is the statutory body that administers the Criminal Injuries Compensation Scheme, which provides compensation payments to victims of criminal violence for physical and psychological injuries valued at a minimum of £1,000. The following steps will usually need to be taken following the first client meeting: 8 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Risk assessment – this includes a review of: liability, causation and quantum, and the evidential position in relation to each; the prospects of success; the costs which the client has incurred and may incur; the costs which the opposing party has incurred and may incur; the recoverability of costs by any party; the client’s commercial or personal objectives; and the possibility of a negotiated outcome. is Write to the client – it is best practice to follow up any attendance on a client with confirmation in writing of what was discussed. Following the initial meeting, this will usually include: En information relating to funding arrangements; a copy of any CFA, DBA and/or ATE insurance policy entered into; a request for any payment of money on account which is required; a detailed fee estimate; im a request for the return of any signed retainer, terms of business or client care letter and any outstanding money laundering ID documents which may be outstanding; ah a review of the client’s position, the advice given (including any risk assessment), costs and recoverability, and the client’s instructions; br a request for any documentation and/or instructions which may be outstanding; and details of the agreed next steps and timescales. ,I Draft the client’s proof of evidence – it is best practice to draft the client’s proof of evidence as soon as possible, based on the initial meeting. an Notify any opposing party or legal representative in writing that you are the client’s appointed legal representative and all further correspondence should be sent to you. Where proceedings have already been issued it will be necessary to file and serve Notice of Change of Solicitor. zk Begin early investigations into liability, causation and quantum. This may involve a conference with counsel to assess the evidence in detail. The scope of investigations may also include: O Liability and Causation Personal injury Commercial Inspecting the accident scene and taking Obtaining copies of any contract, photographs. correspondence or other documentation. Interviewing witnesses and preparing Obtaining and preserving for inspection any witness statements. real evidence (e.g. a faulty product). 9 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Obtaining any CCTV or dashcam footage of Interviewing witnesses and preparing witness the incident. statements. Obtaining a copy of any accident report Instructing an appropriate expert to provide book, policies or records. an opinion in relation to the issues. Obtaining a copy of any police accident report book. Obtaining the client’s medical records. Attending any inquest. Quantum is Personal injury Commercial En Identifying the range of general damages to Obtaining evidence of the cost of repairing or which the claimant may be entitled, to be replacing any goods or property, the loss of confirmed by expert evidence. management time or profit suffered. Obtaining the details and evidence in Obtaining evidence from third parties in im support of any claim for loss of earnings, and relation to the losses suffered (e.g. in a claim for the cost of care (for example medical notes). breach of restrictive covenant by an employee, Obtaining receipts for any other costs evidence regarding the scope of the breach). ah incurred. Instructing an accountant or other appropriate expert to quantify the client’s losses. Formulating a draft schedule of financial losses. br ,I an zk O 10 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 3. Funding Litigation Private Funds Private funds are the traditional method of paying for litigation. It is usually cheaper than other methods of funding, such as a CFA, as there is no uplift on the firm’s hourly rates or success fee. Legal Aid Legal Aid for civil matters is operated through the Legal Aid Agency (LAA), with which authorised firms must have a contract in order to undertake legally aided work. is There is a financial eligibility and merits test. There are a number of excluded categories of work that cannot be funded by the LAA, including nearly all personal injury work and most En areas of civil and commercial litigation. Union and Association Funding im If your client is a member of a trade union or other association, he may have funding in place. If so, it is very likely that the union will insist that panel solicitors be appointed to represent the client. In this case, you must inform the client that if they are to take advantage of the union ah funding, they must terminate any retainer with you. Before the Event (BTE) Insurance br Companies and individuals may have existing legal expense insurance as part of their business, motor vehicle or household insurance or perhaps as part of a bank or credit card account. A ,I legal representative should check whether such cover is provided. After the Event (ATE) Insurance an An ATE insurance policy can be used to supplement the CFA and provide cover for any adverse costs for which the client may be liable if unsuccessful (i.e. the costs of the opposing party). zk The premium is not recoverable from an unsuccessful opposing party and must be paid by the client except in claims relating to defamation, publication and privacy; diffuse mesothelioma; O and certain clinical negligence cases. Conditional Fee Agreements (CFAs) A CFA is an agreement under which the legal representative’s fees and expenses are payable only if the client is successful. CFAs are available to claimants and defendants. They can stand alone or be used in conjunction with other forms of funding. The most common types are those with a success fee and discounted CFAs with no success fee: 11 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution CFA with a Success Fee Discounted CFAs These will usually provide that the client is not These will usually provide that the client is required to pay any costs to the legal required to pay the costs and disbursements of representative until the conclusion of the its legal representative as the matter matter (and it will vary whether the client is progresses, with the costs only being paid at a required to pay disbursements or not). discounted hourly rate. If the client is successful, they will be liable to If the client is successful, they will be liable to pay the costs and any disbursements which are pay the balance due on the costs calculated subject to the CFA, plus the success fee. by reference to the legal representative’s full is hourly rate. If the client is unsuccessful, they will not be liable to pay the costs and any disbursements En subject to the CFA. The difference between the discounted and full hourly rate is essentially a ‘success fee’. im For a CFA to be enforceable it must be in writing and must not relate to proceedings that cannot be the subject of an enforceable CFA (including criminal (with limited exceptions) and family proceedings). ah In addition, prior to entering into a CFA, a legal representative must explain to the client: that any success fee is not recoverable from the opposing party (unless the claim relates br to defamation, publication, privacy or diffuse mesothelioma); the maximum amount of the success fee which can be charged under the CFA; ,I when the client may be liable for their own costs and those of the opposing party; the client’s entitlement to an assessment of their own costs; and an whether the legal representative has any interest in any corresponding funding policy (for example, a referral fee received for introducing the client to an ATE insurer). zk Damages Based Agreements (DBAs) A DBA is an agreement which provides that the legal representative is paid a percentage of O the damages recovered by a client that is successful in litigation. The DBA Regulations 2013 set out the caps which apply in relation to a legal representative’s claim under a DBA: personal injury cases no more than 25% of the sum recovered excluding damages for future care and loss. employment cases no more than 35% of the sum recovered. non-personal injury cases no more than 50% of the sum recovered. (excl. employment tribunal cases) 12 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Counsel’s fees and VAT are included in the fee caps, but disbursements such as court fees and experts’ reports are not. A DBA can be used by claimants pursuing a claim for a financial remedy, but can only be used by defendants pursuing a financial remedy via counterclaim. They cannot be used for appeals. A DBA will usually provide that: the client is not required to pay any costs to the legal representative until the conclusion of the matter (and it will vary whether the client is required to pay disbursements or not); if the client is unsuccessful, the client will not be liable to pay the costs and any disbursements which are subject to the DBA; and is if the client is successful, they will be liable to pay to the legal representative an agreed percentage of the sum recovered by the client from the opposing party. En The legal representative will only be able to claim payment of the agreed percentage of the sum recovered from the opposing party less any amount which is recovered in respect of costs and disbursements. The client’s claim for costs and disbursements cannot exceed the sum which im the client is liable to pay the legal representative under the DBA. A DBA must be in writing and specify matters such as the claim/proceedings to which the DBA relates; the circumstances in which the legal representative is entitled to payment; the ah percentage of damages which the legal representative will be entitled to claim; etc. Litigation Funding br Payment of all/part of a client’s costs is made by an individual/company who has no other connection with the litigation. Litigation funding is not usually intended to cover the costs of ,I the opponent, in the event the client is unsuccessful. Litigation funding is usually used in large value commercial cases. The funder expects to make an a profit. If the funded party loses, then the funder does not recover its investment. Following R (PACCAR) v Competition Appeal Tribunal litigation funding agreements zk which provide for the funder to receive a percentage of the sum recovered must also comply with the DBA Regulations in order to be enforceable. O 13 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 4. Alternative Dispute Resolution The Benefits of Alternative Dispute Resolution (ADR) The benefits of ADR can include: Cheaper and less time consuming than court proceedings. Facilitating settlement by providing the parties with a confidential, neutral and non- threatening environment in which to consider and reflect on the respective commercial and legal positions and explore routes of settlement. More flexible process than court proceedings. is Enabling more flexible outcomes. With the exception of arbitration and adjudication, the En common forms of ADR do not impose a binding outcome on the parties unless a contractually binding settlement is entered into. At any time prior to that, a party may withdraw from the process. Confidentiality, in contrast to public and recorded court proceedings. im Providing each party with a better understanding of the issues which are important to the psychology of the opponent, which may prove useful in any subsequent settlement ah negotiations if ADR is not successful. The courts have an obligation to promote ADR (CPR 1.4(2)(e)) and they do so at various stages of an action. Each Pre-Action Protocol includes a paragraph requiring the parties to consider ADR. br Proceedings can be stayed if the parties wish to attempt ADR and/or the court considers it appropriate. If one of the parties requests a stay, in order to attempt ADR, and the party ,I opposing a stay cannot show good reasons why ADR is unlikely to work, the court is likely to order the stay. an A party who refuses to enter into ADR may be penalised in costs if the matter proceeds to trial and they are successful. In deciding the level of costs, the court must have regard to ‘the efforts made, if any, before and during the proceedings in order to try and resolve the dispute’. zk Halsey v Milton Keynes NHS Trust provides the guidelines on what the court will take into account when assessing whether a party was justified in refusing to mediate: O the nature of the dispute; the merits of the case; the extent to which other settlement methods were attempted; whether the cost of ADR would be disproportionately high; whether any delay in setting up the ADR would have been prejudicial; and whether ADR had reasonable prospects of success. It is important to ensure that there is a clear paper trail on the file by way of an attendance note or letter detailing the occasions on which ADR was discussed with the client and the opponent. 14 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Types of ADR Negotiations or ‘Round Table Discussions’ on a ‘Without Prejudice’ Basis Mediation (more detail below) Conciliation Similar to mediation, but the conciliator is more proactive. Common in employment disputes. The Executive Tribunal is Most common in commercial disputes. Panel of senior representatives of the parties – not involved in the dispute – plus an En independent adviser. Party representatives make submissions to the tribunal, who seek to negotiate a settlement. Early Neutral Evaluation im If agreement is not reached, the independent adviser issues non-binding opinion. ah Independent legal representative/judge provides evaluation. Judicial or Expert Determination br Parties jointly instruct and make written submissions to a senior judge (often retired)/King’s Counsel or an expert witness (often in construction disputes). Parties agree form and extent of the instruction in advance, and whether the appraisal ,I is to be binding. Judge/expert provides a written appraisal of the issues. an Expert determination can be on a preliminary issue e.g. liability. Arbitration (more detail below) zk Adjudication Adjudicator will issue directions on paper as to when full written submissions (‘Referral O Notice’) are to be made. Strict time limits apply. Decisions are usually reached within 28 days of service of Referral Notice. Frequently used in construction and engineering disputes. Issues determined in adjudication can be ‘re-litigated’ at any time; either through arbitration or court proceedings. 15 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Choice of ADR There may be a particular type of ADR which is best suited to a dispute or which may offer a tactical advantage (e.g. the restricted timescales which apply in adjudication which may make it difficult for an opposing party to obtain evidence). The timing of ADR may be important (e.g. sometimes ADR will be most effective after the matter has progressed to a point at which the issues have crystallised). ADR may not be a suitable way of attempting to resolve every dispute because: a client’s commercial objectives may be best achieved by engaging in court proceedings the cost and risk of which may exert more pressure on an opposing party; is court proceedings may be necessary because only the court can grant the remedy En sought by the claimant (for example, injunctive relief) or because there is reason to establish a binding precedent; an opposing party is taking an unrealistic view with regard to settlement and requires exposure to further cost pressure or risk or the development of the evidential position; or im a party’s position may be strong enough to justify an application for summary judgment and thereby achieve a cost-effective and quick resolution of the issues between the ah parties. Mediation br Mediation is a process whereby litigants, with the assistance of an independent mediator, identify the issues in dispute, explore the options for resolution and attempt to reach settlement. ,I Through a combination of joint and private sessions, the mediator will endeavour to facilitate a settlement between the parties by: an 1. exploring each party’s position; 2. challenging the commercial and legal merits of each party’s position; and zk 3. enabling each party to obtain a new perspective which may result in concessions being made that narrow the issues between the parties. O The mediator does not act as judge or rule on the merits and will not impose or propose settlement terms. Advantages of mediation include: can occur at any time (before/during proceedings) is confidential and without prejudice is non-binding until a settlement agreement has been executed by the parties is flexible in process can facilitate an outcome the parties are comfortable with is cost and time saving where successful 16 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution can support solving the problem, rather than finding fault can satisfy the psychological needs of the parties can unearth the real issues in a case To prepare for mediation the parties may agree on a known individual to act as mediator, or request a nominated mediator from a mediation nominating body such as CEDR. Once the identity of the mediator and their appointment is confirmed, the parties will enter into a mediation agreement covering some basic rules for the mediation, including confidentiality. Prior to mediation, the mediator will usually: is require the parties to agree and submit a mediation bundle containing a position statement from each party and other key documents; En request that the position statements include a case summary and brief explanation of each party’s stance in relation to the issues; and contact each party or legal representative for a confidential discussion of the issues, the progress of the dispute to date, and the settlement position of the party. On the day of mediation, the mediator will typically: im invite the parties to participate in a joint session (or ‘plenary session’) where the mediator ah will explain the mediation process and rules for the conduct of the mediation, and invite each party or legal representative to provide brief opening statements of case; invite each party to participate in a private session (or ‘caucus’) where the mediator will br explore the position of each party confidentially and on the strict understanding that nothing which is said will be communicated to any other party without agreement; ,I engage in ‘shuttle diplomacy’, meaning moving between each room in a series of private sessions in order to identify common ground or issues in relation to which any party may be willing to make concessions and communicate any offers which may be made; an if necessary, invite the parties to participate in further joint sessions to enable direct negotiations or the discussion of issues that may be a barrier to settlement; and zk if necessary, invite any experts or legal representatives to meet independently of the parties to enable a franker discussion of any barrier, technical or legal issues. O Following mediation, if the mediation does not result in settlement, the mediator may invite each party to agree to continue the mediation at a later date. Where it results in settlement, this should be recorded in a formal settlement agreement. Once signed, it becomes binding. Arbitration With arbitration, the parties agree to submit to the jurisdiction of an arbitrator who will make a binding and final decision which is enforceable in the same way as a court judgment. It is prevalent in industries such as construction and is governed by the Arbitration Act 1996. A party may have no option but to arbitrate if there is a valid arbitration clause in the contract to which the dispute relates. 17 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution An arbitrator is usually legally qualified, though it is common for appropriately qualified architects and surveyors to be appointed in relation to construction disputes. Arbitration is not as formal as court proceedings, but the main disadvantages of arbitration are that it is expensive (sometimes more so than court proceedings given the high arbitrator fees), and it can be a long-running procedure, as long as court proceedings. The arbitrator’s decision is known as the final award as it is generally win or lose. If a party fails to comply with the final award, any other party can apply to the High Court to enforce it. It is important to note that arbitration is different from the other forms of ADR as it is adjudicative and may impose a binding decision on the parties. is En im ah br ,I an zk O 18 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 5. Pre-action Considerations Jurisdiction Before commencing an action, it is important to be sure that the courts have jurisdiction and are the appropriate place in which to hear the dispute. In any action in which the client or opponent is based abroad, or in which the cause of action arose outside of that jurisdiction, questions of jurisdiction must be considered. There are different rules to determine whether the courts of England and Wales have jurisdiction – this depends largely on: is i) the domicile of the defendant; and ii) the date the proceedings were or are instigated which will be determined: En a) under Regulation (EU) 1215/2012 of the European Parliament (‘European Rules’). The basic principle of the European Rules is that a defendant should be sued in the defendant’s country of domicile (subject to exceptions). For claims instigated by 11.00pm on 31 December 2020, the courts of England and Wales will have had jurisdiction under England or Wales. im the European Rules if certain criteria are met, e.g. the defendant was domiciled in b) under the common law rules (or, where applicable, the Hague Convention on Choice of ah Court Agreements), for claims instigated from 1 January 2021. The basic principle of the common law rules is that the English court will generally have jurisdiction if the proceedings can be served on the defendant either within the jurisdiction; or outside the br jurisdiction with permission. An application for permission to serve proceedings outside England and Wales must be ,I made (CPR 6.36 and PD 6B) which: generally requires evidence of a connecting factor between the claim and or the an parties and England Wales; and will be refused if the court determines the courts of England and Wales are not the appropriate forum (forum non conveniens) for the resolution of the matter. zk The full scope of the common law rules exceeds the SRA specification, but regard should be had from the outset of any matter to the following issues which may impact on O jurisdiction: Contract disputes Tortious disputes Is there an agreement that contains a In relation to a personal injury claim, jurisdiction clause? was the claimant injured outside the jurisdiction of England and Wales? Was any agreement concluded or entered into outside the jurisdiction of Does any party reside or have its England and Wales? business outside the jurisdiction of England and Wales? 19 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Does any party reside or have its Is any party a body corporate or other business outside the jurisdiction of organisation domiciled or registered England and Wales? outside the jurisdiction of England and Wales and, if so, are there any Is any party a body corporate or other business premises within the organisation domiciled or registered jurisdiction? outside the jurisdiction of England and Wales and, if so, are there any business premises within the jurisdiction? The Correct Court is Claims for money may only be issued in the High Court where the sum claimed exceeds En £100,000 (except in a personal injury case, where the minimum threshold is £50,000) (PD 7A.2.1). A claim for personal injury may not be issued in the High Court unless the value of the claim is £50,000 or more (PD 7A.2.2). Clinical negligence claims may only be brought in the High Court if their value is over £100,000. im A claim must be issued in the High Court or in the County Court where a statute requires it. ah If a claim with an estimated value of less than £100,000 is commenced in the High Court, it will generally be transferred to the County Court, unless: br (a) it is required by statute to be heard in the High Court, (b) it falls within a specialist list, or ,I (c) it relates to professional negligence, fraud or undue influence, defamation, malicious prosecution or false imprisonment, claims against the police, claims under the Fatal Accidents Act 1976, or contentious probate claims (PD 29 2.2). an Legal Capacity zk There must be a party capable of suing and a party capable of being sued. Individuals and Mental Capacity – a child (under 18) or protected party (a party, or an intended O party, who lacks capacity to conduct the proceedings) does not have the capacity to sue and be sued in their own name. Instead, a protected party must have a litigation friend to conduct proceedings (CPR 21). Companies – companies registered under the Companies Acts are legal ‘persons’ and can sue or be sued in their own full registered name. If the company is in liquidation, then the words ‘(in liquidation)’must be added. Limited Liability Partnerships (LLPs) – an LLP is a legal person separate from its members and must sue or be sued in its own name, which must be the registered name. 20 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Partnerships – as partnerships are not legal entities, and the liability of partners is generally joint and several, partners may sue or be sued in their individual names, or in the name of the firm and the words ‘(a firm)’ added to the case title. Sole Traders – a sole trader may be sued, but may not sue, in their trading name. A claimant sole trader should sue in his own name, adding the words ‘trading as’ (or ‘t/a’) and the trading name. A defendant sole trader whose real name is not known may be sued in the business name, followed by the words ‘(a trading name)’. Associations – these may include trade unions and employers’ associations, building societies, charities, local and central government bodies or departments, and other public bodies. All of these may sue or be sued in their name. Clubs, however, may not; these may sue or be sued in is the names of the members of the club, or representative proceedings may be brought. An incorporated club may sue or be sued in its own name. En Trusts and Trustees – a claim by or against a trust is brought by or against all of its trustees. The beneficiaries of the trust need not be parties to the action (CPR 19.10), but any judgment or order made in the action will bind the beneficiaries unless the court orders otherwise. im Estates of Deceased Persons (CPR 19) – most causes of action subsisting against or vested in an individual survive his or her death. If a party to a claim dies (or is adjudged bankrupt), the court has the power to add/substitute as a party the person to whom the interest/liability of ah the deceased/bankrupt party has passed. Where the death of the party is before the claim is issued – the claim must be brought or br defended by the personal representatives of the deceased person. Where the death of the party is after the claim has been commenced – the surviving party in ,I the action must make an application to the court either to substitute the deceased party for the personal representatives of the estate or, if no personal representatives have been appointed, to direct a person to represent the estate of the deceased party or to order the action to proceed an without the deceased party being represented. Limitation zk Periods of limitation vary depending on the type of claim. Time ends when the claimant delivers the claim form and corresponding fee to the court office for issue, even if the court office is O closed. If proceedings are sent by post, the claim form and fee must be received by the court no later than the last day of the limitation period. The court will then issue the claim by sealing the claim form. Following issue of proceedings, the claimant will have up to four months to serve the claim form and particulars of claim on the defendant or else the claim form will lapse and, if the limitation period has expired, there will be a complete defence to the claim. If a claim is approaching the expiry of its limitation period, it may be necessary to issue ‘protective proceedings’ to ensure the limitation period does not expire. Limitation is a procedural defence, but it must be specifically pleaded. It will not apply automatically. 21 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution The key limitation periods are laid down in the Limitation Act 1980 (LA 1980), and are set out below unless otherwise referenced: Class of claim Limitation period Enforcement of a judgment 6 years from the date on which the judgment became enforceable (s. 24(1)) Contract 6 years from the date on which the cause of action accrued. (s. 5) Tort (except those listed below) 6 years from the date on which the cause of action accrued (s. 2) is Note: This includes claims under s. 2(1) of the Misrepresentation Act 1967 En Personal injury claims 3 years from the date on which the cause of action accrued; or the date of knowledge (if later) of the person injured (s. 11(4)) Fatal Accident Act 1976 claims 3 years from the date of death or the date of knowledge of Claims under the Consumer im the person for whose benefit the action is brought, whichever is the later (s. 12(2)) 3 years from the date of damage. If the damage is not ah Protection Act 1987 initially discoverable, the claimant has an additional three years from the date of awareness to bring a claim. However, the claimant's action is extinguished after ten br years from the date of product supply. (s. 11A) Special time limit for negligence 3 years from the date the claimant first had both the ,I actions where facts relevant to knowledge required for bringing an action for damages in cause of action are not known at respect of the relevant damage and a right to bring such date of accrual an action (s. 14A) an Applications for judicial review Promptly. but in any event no later than 3 months after the grounds to make the claim first arose (CPR 54.5) zk Where the rules of private international law provide that the law of any other country is to be taken into account in any claim in England or Wales, the law of that other country relating to limitation must be applied under the Foreign Limitation Periods Act 1984. O Time runs from the point at which facts exist establishing all of the essential elements of the cause of action. In contract, the cause of action accrues on the date of the breach. For an action brought in tort the limitation period runs from the date on which the damage is suffered. The claimant must have knowledge of the ‘factual essence of the act or omission’ that caused the loss and a right to bring such an action. Where the claimant is a child or a protected party, the limitation period does not start to run: if a child, from the date of the child’s 18th birthday; or if a protected party and if they were of unsound mind at the time of the cause of action (or the unsound mind was caused by the cause of action), from the date on which they 22 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution are no longer of unsound mind (whenever that may be medically certified). If the person was of sound mind at the time of the cause of action, the limitation period will continue to run. In claims based on fraud, the limitation period does not begin to run until the claimant discovers (or could, with reasonable diligence, have discovered) the fraud. The limitation period will also not run whilst the defendant deliberately conceals a relevant fact. Where the claim is for relief from the consequences of a mistake, time does not run until the mistake is discovered, or could have been discovered with reasonable diligence. The Latent Damage Act 1986 provides two periods of limitation: is 6 years from accrual (the usual period for claims in tort); and En 3 years from the ‘starting date’ (the earliest date at which the claimant knew that the relevant damage was sufficiently serious to justify proceedings and had the right to bring such a claim, enabling a claim to subsist, and when it could be attributed to the act of negligence and the identity of the defendant). im Time ‘runs’ from the day following the day of accrual of the action. Time ‘ends’ when the claimant delivers the claim form and appropriate fee to the court office for issue. ah There is also a long-stop period for bringing proceedings: 15 years from the act or omission alleged to constitute the negligence causing the claimant’s damage. A claim for a contribution under the Civil Liability (Contribution) Act 1978 must be brought br within 2 years from the date on which the person seeking a contribution is held liable by a judgment (LA 1980, s. 10). Time runs from the date of assessment of the damages. ,I Discretionary provisions to extend the statutory limitation period apply in judicial review proceedings; defamation claims; and personal injury claims. an The Legal Components of a Claim i) Liability zk Claimants will have to prove liability unless the opponent admits it. Initial factors to consider include: O Joint and Several Liability – where a contract provides that more than one person will be liable. The contract will usually set out the parties’ liability. If the contract fails to state the nature of the parties’ liability, then determining that liability will be a matter of construction. The general rule is that all of the joint debtors should be made parties to the action. Where the claimant fails to do this, the defendant may make an application for his joint debtor to be added to the action as an additional party. Joint liability – either party is liable up to the full amount. Several liability – the parties are liable only for their respective shares. 23 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Joint and several liability – a mixture of both. The person to whom the parties owe the joint and several liability may elect to pursue the whole claim against either one of those liable (as in joint liability), but as between those liable, the liability is several and thus any party pursued by the recipient of the liability may seek a contribution from his co- obligors in the share of each of their liability (several liability). Vicarious Liability is an employer’s liability for the acts of its employees (see Tort). ii) Causation ‘Liability causation’ concerns whether the negligent acts caused the accident or breach. is ‘Quantum causation’ concerns whether the breach caused the loss. iii) Quantum En There are different types of damages that a client can recover in a civil claim (see the Contract and Tort textbooks for more detail). Pre-action Disclosure Applications (CPR 31.16) im An application for pre-action disclosure can be taken where the opposing party has ah failed/refused to disclose documents relevant to the claim. Orders can be made against a person who is a non-party for relevant documents. The court can only make an order if: br the respondent is likely to be a party to the proceedings; ,I the applicant is likely to be a party to the proceedings; the documents, or classes of document, requested would be disclosed under standard disclosure rules; and an early disclosure would fairly assist in disposing of the claim without the need to issue proceedings and result in a saving of costs. zk Pre-action Applications to Inspect Property (CPR 25.5) O Where, for example, an injury was caused by machinery, it may be prudent to inspect the machine before it is altered, adjusted, repaired or removed. To obtain such an order, it must be shown that the property: is, or may become, the subject matter of the proceedings; or is relevant to the issues that will arise in relation to those proceedings. 24 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Pre-action Part 36 Offers to Settle An offer can be made before proceedings are commenced. Provided it is not withdrawn, it will have the same impact and cost consequences as a Part 36 offer made after the issue of proceedings. The Claims Portal The Claims Portal (the Portal) is an online dispute resolution system for the resolution of RTAs, Employer’s Liability (EL), and Public Liability (PL) personal injury claims up to a value of £25,000 – prior to the issue of proceedings. The use of the Portal is intended to speed up the resolution of a claim where liability (but not quantum) is admitted and the issues are relatively is straightforward. En Certain claims are excluded from the Portal e.g. Claims involving the Motor Insurers’ Bureau; where there is more than one defendant; claims involving clinical negligence or mesothelioma etc. Stage 1 im The portal procedure can be divided into three stages: Includes a previous claims search and filing a Claims Notification Form. If the claim is admitted (whether on liability and quantum or just liability), the claim will ah continue to be processed through the Portal. If not, the claim will exit the Portal and the applicable Protocol will need to be followed by the claimant. Costs are fixed. br Stage 2 The claimant completes a Medical Report Form and Settlement Pack. The insurer has 15 days to agree to pay the settlement figure or make a counter-offer. If a ,I counter-offer is made, the claimant has 20 days within which to consider it. If the action is concluded, the agreed sum is paid plus an additional sum of £300 (for an RTA claim) or £600 (for EL or PL claims) in respect of the costs for this stage an (the relevant Stage 1 fixed costs will already have been paid for Stage 1). Stage 3 Where there has been a settlement on liability but not on quantum: zk The claimant’s legal representative sends the insurer a Court Proceedings Pack form EPL6. O Proceedings will be commenced by a modified Part 8 procedure. The final assessment hearing can be a paper or oral hearing. The fixed costs for this stage are £250 (if a ‘paper’ hearing) plus an additional £250 advocate’s fee (if the matter is listed for a hearing). 25 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 6. Remedies The remedy sought will be dependent upon the cause of action, and the client’s goals. The principal remedies available in civil proceedings are: i. legal remedies, to which the claimant is entitled as of right on demonstrating the infringement of a corresponding legal right e.g. an award of compensatory damages; and ii. equitable remedies, which the court may award in accordance with equitable principles at its discretion when a legal remedy would be inadequate or is unavailable e.g. injunctions. Summary of Common Remedies in Tort and Contract is Contract Tort En Damages Under Common Law Intended to restore the party who has Intended primarily to be compensatory, not suffered loss, to the same financial position punitive. The aim is to restore the claimant to they would have been in, had the contract been performed. im the position that they were in before the tort was committed. ah Claimants are unable to profit as there is Nominal damages – awarded where some no concept of punitive (or exemplary) right of the claimant has been infringed, but the damages in English contract law. claimant has suffered no loss. br Contemptuous damages (rare) – awarded to Heads of claim for damages include: indicate that while the claimant’s action was Loss of Expectation – to put the technically justified, it was without merit and ,I claimant in the same position as if should not have been brought. the contract had been performed. Aggravated damages – additional Reliance Loss – the cost to the an compensation awarded on top of the basic claimant of relying on the contract. compensatory award, because of some Restitution – of benefits obtained aggravating feature about the defendant’s zk by the defendant under the conduct. contract. Exemplary damages (rare) – when the court Liquidated damages – a contract may O wishes to punish the defendant for stipulate a sum payable by a party in deplorable/outrageous behaviour. breach of contract to the innocent party, in advance of any breach of contract. The Damages for Personal Injury: sum payable must reflect the innocent Special damages relate to the claimant’s party’s legitimate interests in ensuring the contract is performed. actual pecuniary loss to the date of trial. General damages relate to losses which cannot be precisely calculated and must be assessed by the court at trial. Damages for death: 26 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Law Reform (Miscellaneous Provisions) Act 1934 Fatal Accidents Act 1976 Damages Act 1996 If the damages can be quantified, any claim will be for a ‘specified sum’. If the damages cannot be quantified, any claim will be for an ‘unspecified sum’. A claim can include claims for both specified and unspecified sums. In every claim the claimant has a duty to mitigate the loss suffered where the claimant fails is to do so, any award of damages may be reduced. En Equitable Remedies (Contract): Rectification – corrects a contract to reflect the contractual intention of the parties to take effect from the date of the original agreement. Specific performance – enforces one party im ah to comply with its contractual obligations. Rescission – rescinds the contract. br Restitution – restoring any performance. Declarations – a binding interim or final declaration in relation to findings of fact and or ,I legal rights made where the court will generally only make a declaration if it would be just to do so and it will serve a useful purpose (CPR 40.20). an Injunctions (see below). Injunctions zk Injunctions are equitable remedies, which cannot be obtained ‘as of right’. The threshold is high. O There are three main types of injunctions: i. Prohibitory (or negative) ii. Mandatory iii. Quia timet To prevent a party from Require a party to take Require a party to take taking certain action e.g. to certain action e.g. to compel action to prevent harm e.g. restrain the publication of the removal of overhanging to prevent illegal raves defamatory material. structures. taking place on private land. Injunctions can be either interim or final orders: An interim injunction may be obtained before proceedings have commenced, to be fully determined once the matter comes before the court. Such applications will be generally made 27 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution on notice (otherwise there will be a return date) and require an undertaking to the court to issue proceedings on the same, or next working day, if the injunction is granted. Such injunctions preserve the legal standing of the parties until their rights have been determined. Interim injunctions remain in force until trial where they may be made final. Court – all interim injunctions can be granted by the High Court; the County Court has limited jurisdiction. The following principles generally apply: i. The claimant must have locus standi – the claimant must be able to establish that they have a substantive cause of action in English law i.e. the defendant is either: is a) threatening to invade, or has invaded, the claimant’s legal or equitable rights; or En b) threatening to behave, or has behaved, in an unconscionable manner. ii. Injunctions are discretionary – the claimant must comply with the equitable maxims. iii. Damages must not be an adequate remedy – damages would be unlikely to be an im adequate remedy where there is harm which is likely to continue, the harm cannot be quantified, or the defendant does not have the means to pay damages. iv. It appears to the court to be just convenient to grant an injunction (s. 37, Senior Courts ah Act 1981), by reference to the principles laid down in American Cyanamid Co v Ethicon Ltd : br a) whether there is a serious question to be tried; This does not require proof of certainty that the case will be successful, but a ‘real ,I prospect of success’ must be shown. b) whether damages would be an adequate remedy (instead of an injunction); an This must be considered from both the applicant, and respondent’s perspectives. If damages would not be adequate, the court will move to consider the next factor. zk c) whether the balance of convenience lies in favour of granting or refusing; The question here is what action will cause the least damage to both parties. If all O factors are equal, the court will seek to uphold the status quo. d) whether there are any special factors to be considered. Note that there are situations where the courts have varied, or not applied, the American Cyanamid principles e.g. freezing injunctions and search orders. Applicant’s cross undertaking as to damages – an undertaking that the respondent will be compensated should they go on to win, yet have suffered loss owing to the injunction. Duty of full and frank disclosure – the applicant has a responsibility to disclose all material relevant matters to the court, including those which may be unfavourable to the applicant. The 28 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution duty extends to all known material facts including those which would have been apparent upon proper inquiry and is ongoing. Enforcing an injunction – an order granting an injunction will include a penal notice, meaning the injunction is enforceable by charge for contempt of court if the defendant fails to comply with the terms. Alternative orders – should be considered e.g. expedited trial, or a trial of preliminary issues. Freezing Orders A freezing order is an interim injunction that restrains a party from disposing of or dealing with is their known assets (up to the value of the claim), to preserve the defendant’s assets until judgment can be enforced. They can either be domestic or worldwide. Orders can be made at En any time against a respondent, or a third party who holds assets on behalf of the respondent e.g. a bank. The court will only grant a freezing order where: 1. the court has jurisdiction; 2. it would be just and convenient to do so; im ah 3. there is a cause of action to which the application relates; 4. the applicant has a good, arguable case; br 5. there are sufficient assets in existence to satisfy the claim if successful; and ,I 6. there is a real risk that the respondent will seek to dispose of or dissipate the assets. Per above, the applicant must also: an 7. give an undertaking in damages and to commence proceedings on the same, or next working day, in the event that the injunction is granted; and zk 8. comply with the duty of full and frank disclosure. Procedure (CPR 25 and PD 25A) – applications will generally be made without notice and must O be supported by sworn affidavit evidence which: explains the reason for the urgency of the application and the risk of dissipation; gives details of the assets to be frozen; and provides evidence of the applicant’s ability to meet the cross-undertaking in damages. The freezing order must be served promptly and personally on the respondent and any relevant third party. 29 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Breaching a freezing order – the order commences with a penal notice which states the penalty for breaching an injunction. A breach of a freezing order may result in committal proceedings for contempt of court, which are punishable by a fine, imprisonment or the seizure of assets. Search Orders A search order requires a respondent to allow the applicant’s legal representatives to enter the respondent’s premises and to search for, copy and remove documents or material – generally when there is concern that evidence will be altered, concealed or even destroyed. The court will only grant a search order if: is 1. the court has jurisdiction; En 2. it would be just and convenient to do so; 3. there is a cause of action to which the application relates; 4. the applicant has an extremely strong prima facie case (which is a higher threshold than im the test which applies to application for summary judgment under CPR 24); 5. the respondent’s actions have resulted in, or may result in, very serious damage to the ah applicant’s interests; 6. there is clear evidence that the ‘incriminating documents or things’ to which the application relates are in the respondent's possession; br 7. the documents or material cannot be obtained in any other way; ,I 8. there is a real possibility of destruction or disposal of material in the respondent's possession before an application can be made on notice; and an 9. the harm likely to be caused to the respondent and the respondent’s business affairs by the execution of the search order is not excessive or out of proportion. zk Per above, the applicant must also: 10. give an undertaking in damages and to commence proceedings forthwith on the same, O or next working day, in the event that the injunction is granted; and 11. comply with the duty of full and frank disclosure. Procedure (CPR 25 and PD 25A) – applications are normally made urgently and without notice, often before proceedings begin with an undertaking that proceedings will be issued immediately. An application for a search order must be supported by sworn affidavit evidence by the applicant which: explains the reason for the urgency of the application and the risk of destruction or disposal of material; 30 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution give details of the material sought; and provides evidence of the applicant’s ability to meet the cross-undertaking in damages. Service and execution – there are very strict rules for the service and execution of search orders. Usually, independent solicitors will be appointed by the court to act as ‘supervising solicitors’ who will carry out the execution of a search order under the supervision of an independent supervising solicitor. They must be served on the respondent personally. The process is, in summary, as follows: serve the order and explain its terms and effect to the respondent; is provide the respondent with the opportunity to obtain legal advice; supervise the carrying out of the search; En produce a list of every item seized; and produce a detailed report of the search which will be filed at court. The applicant will be responsible for the fees of the supervising solicitor. im When executed at two or more locations, it is best practice to serve the search order and execute at all locations simultaneously to avoid any respondent having advance warning of the search. ah The search cannot be carried out until the supervising solicitor has explained the order to the defendant and allowed sufficient time to obtain legal advice (usually up to 2 hours). br The search must be carried out thoroughly, and a list produced by the supervising solicitor of every item seized. Documents seized must generally be copied and returned to the defendant ,I or its solicitor within 2 days. After the search, the supervising solicitor must prepare a report of the execution to be delivered an to the court before the second hearing which both parties will attend. Breaching a search order – the respondent may be held in of contempt of court which is punishable by a fine, imprisonment or the seizure of assets. The applicant or any legal zk representative may be held in contempt of court for having failed to carry out any search in accordance with the terms. O 31 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 7. The Protocols and Pre-action Conduct References to the ‘claimant’ or the ‘defendant’ below are to potential claimants or defendants. The Protocols The Protocols are guidance annexed to the CPR setting out the steps the court normally expects parties to take before commencing proceedings for particular types of claim e.g. personal injury, debt claims etc. The Practice Direction on Pre-Action Conduct and Protocols (PDPACP) applies to claims to which no specific Protocol applies. All of the Protocols and the PDPACP contain: is a template for the recommended contents of a letter of claim; En guidelines for the contents of a letter of response; guidelines for the exchange of documentation and information between parties; guidelines for the appointment of experts, where appropriate; provisions to encourage ADR; and deadlines for certain conduct. im ah In all cases, the court will take into account any non-compliance with the relevant Protocol when giving directions for the management of proceedings. A party who unreasonably fails to comply is likely to face penalties and/or sanctions by the court in any subsequent litigation. br The following protocols are most relevant to contract and tort claims: ,I The Practice Direction on Pre-Action Conduct and Protocols (PDPACP) The PDPACP states that before commencing proceedings, the court will expect the parties to a an dispute to have exchanged sufficient information to: understand each other’s position; zk make decisions about how to proceed; try to settle the issues without proceedings; O consider a form of ADR to assist with settlement; support the efficient management of those proceedings; and reduce the costs of resolving the dispute. This involves the claimant writing to the defendant in a Letter of Claim (LoC), the defendant’s response within a reasonable time (generally 14 days in a straightforward case, and no more than three months in a complex one) and disclose key documents relevant to the issues in dispute. Where the parties have followed the PDPACP but settlement has not been possible, the claimant may commence proceedings and ultimately seek to recover any costs reasonably 32 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution incurred. If a case settles pre-action the court will not have jurisdiction over costs. If a claimant decides not to pursue their claim as a result of the steps taken in complying with the PDPACP, the costs incurred by the prospective defendant in responding are unlikely to be recoverable. The Pre-Action Protocol for Personal Injury Claims (PI Protocol) The PI Protocol is designed for personal injury claims which are likely to be allocated to the fast- track and have a value of up to £25,000 (but should still be considered in claims of a higher value). As with the PDPACP, the PI Protocol encourages the claimant to contact the prospective defendant as soon as practicable to advise that investigations into liability and losses are is underway, giving as much detail as possible. The initial correspondence should advise when the formal LofC will be sent. En The LofC should include the following information (per Annex B to the PI Protocol): a clear summary of the facts on which the claim is based; im an indication of the nature of all injuries that have been sustained; an indication of the way the injuries sustained impact on the claimant’s day-to-day life; ah an indication of other financial losses, with an indication of the anticipated heads of damage unless this is impracticable; br a request that the defendant identify its insurers; the documents that the claimant proposes to disclose (if any) and of which he seeks disclosure from the defendant; and ,I the date on which the letter must be acknowledged. Under the PI Protocol, this is usually within 21 days, with a full response (including an admission or rejection of an liability) to be provided within three months. Rehabilitation – there is a duty on both the claimant and defendant to consider any reasonable needs that the claimant may have for rehabilitation and/or medical treatment. zk The defendant’s response – if there is no response within the 21 days (or a longer period if stipulated), proceedings can be commenced. Once the LofC has been acknowledged, the O defendant (or his insurer) has 3 months in which to investigate the claim. The defendant must then formally reply and admit or deny liability. Selection of experts – the claimant or defendant may propose a list of joint experts for appointment by the parties. If, within 14 days, no objections are raised by the opponent then one of the mutually acceptable experts can be appointed and will be an agreed joint expert. If the parties cannot agree on the identity of a jointly selected expert, then the PI Protocol provides that the parties may instruct experts of their own choice, with the court to consider if either party has acted unreasonably at a later date. ADR – generally, it is not possible to proceed with ADR until expert evidence has been obtained. 33 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution If the claim is denied and settlement is not achieved during the Protocol phase, then the claimant can proceed to issue his claim. The Pre-Action Protocol for Debt Claims The Pre-Action Protocol for Debt Claims (Debt Protocol) applies to any business (including sole traders) claiming payment of a debt from an individual (including a sole trader). It does not apply to: business-to-business debts (unless the debtor is a sole trader); to claims which could otherwise proceed under any other Protocol; nor to claims issued by HMRC. The LofC should specify: is the amount of the debt; En whether interest or other charges are continuing; the details of the agreement; where the debt has been assigned, all relevant details; im an explanation of why any current offer or arrangement is not acceptable; details of how the debt can be paid, and how to proceed if the debtor wishes to discuss payment options; ah the address to which the completed Reply Form should be sent; and the required enclosures. br Response by the Debtor – the debtor should reply using the Reply Form and address early disclosure. The creditor should not start court proceedings less than 30 days from receipt of the ,I completed Reply Form or 30 days from the creditor providing any documents requested by the debtor, whichever is the later. an Disclosure of Documents – the parties should exchange information and disclose documents sufficient to enable them to understand each other’s position. zk ADR – the parties should consider the use of an appropriate form of ADR. The creditor should give the debtor at least 14 days’ notice of their intention to start court proceedings, unless there are exceptional circumstances. O 34 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution 8. Commencing Proceedings Issuing a Claim Delivery of the claim form with the appropriate fee by the claimant to the court stops time running for limitation purposes. Issuing the claim by sealing the claim form by the court starts time running for the proceedings themselves. The court in which the claim must be issued is largely dependent upon the nature of the case, and its value: is En im ah The County Court – there is a single County Court with national jurisdiction that is exercised br through local County Court Hearing Centres. Cases in the County Court will be issued in either: The County Court Money Claims Centre – all County Court money claims under CPR 7 ,I should be issued in the CCMCC. A County Court Hearing Centre – certain claims are excluded e.g. probate claims; an claims in the Technology and Construction Court, intellectual property claims; etc. Certain claims may be started at any County Court Hearing Centre e.g. certain Consumer Credit Act 2006 claims; possession claims; landlord and tenant claims; and applications for certain types of injunction. zk The High Court – cases brought within the High Court may be brought in the High Court in London or one of the District Registries. The claim must be issued in the appropriate O court/division. Part 7 Procedure The most common way to start civil proceedings is by issuing a claim form (Form N1) under CPR Part 7. However, an action may be commenced in a different way, depending on the type of action, e.g. a claim form issued pursuant to CPR Part 8 (Form N208). The Claim Form must include all of the following (CPR 16.2): (a) the names (correctly set out by individual/entity) and addresses of the respective parties, including the parties’ titles; 35 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution (b) a concise statement of the nature of the claim; (c) the remedy that the claimant seeks; (d) where the claimant is making a claim for money, a statement of value (CPR 16.3). Where the claim is for an unspecified sum, the Claim Form must make a statement as to the value of the claim by setting out that the claimant expects to recover (as applicable): not more than £10,000; more than £10,000 but not more than £25,000; more than £25,000; or is that the claimant cannot say how much is likely to be recovered. In personal injury cases, the amount the claimant expects to recover in general damages En for pain, suffering, and loss of amenity must be stated, whether more than £1,500, or not. In personal injury cases arising from road traffic accidents, the statement will depend im on which of the rules apply and state whether they expect to recover damages for pain, suffering, and loss of amenity of more than £5,000, or not, or more than £1,000 (where rule 26.6A applies). ah In claims against residential landlords for repairs, the claimant must state whether the estimated cost of the repairs is more than £1,000, or not. br Such statements of value provide an initial indication of the likely track to which the case will be allocated (see Case Management). ,I If the claim is to be issued in the High Court, it must include one of the following statements: an the claimant expects to recover more than £100,000, or some other enactment provides that the claim may be commenced in the High Court; zk if the claim is for personal injury, the claimant expects to recover £50,000 or more. In computing the value to place on the claim form, the following are disregarded: O interest; costs; contributory negligence (unless admitted); any counterclaim or set-off (unless admitted); and any amounts to be recovered from state benefits under the Compensation Recovery Rules. (e) where the claimant’s only claim is for a specified sum, a statement of the interest accrued on that sum (the interest will not be part of the ‘value’ of the case for track purposes); (f) such other matters as may be set out in a practice direction; (g) whether the claim involves any issues under the Human Rights Act 1998; The form may also, 36 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution (h) set out the claimant’s statement of case if there is room to do so. If not, it should indicate that the Particulars of Claim are ‘attached’ or ‘to follow’. The court will issue the claim when the completed Claim Form, alongside the following are issued: the court fee (which will vary according to the sum claimed). sufficient copies of the Claim Form for service on each defendant, and the court file. The court may then effect service of the Claim Form on the defendant(s) or return the documents to the claimant for service. is The claimant must then serve the Particulars of Claim within 14 days of service of the Claim Form (if not together with the Claim Form). A Response Pack (From N9) must accompany the En Particulars. The Claim Form and Particulars of Claim must be served within 4 months of the issue of the proceedings. Once the defendant has been served with the Particulars of Claim and Response Pack, the defendant must take steps to respond to the action. Service of Proceedings im ‘Service’ involves formally notifying the defendant(s) of the action. Part 6 distinguishes the requirements for the Claim Form from ‘other documents’. ah Provided the rules are complied with, the document will be ‘deemed served’ on the second business day after completion of the ‘relevant step’ required to effect service by the chosen br method (CPR 7.5). A Claim Form issued for service within the jurisdiction must be served within 4 months of the ,I date of issue (CPR 7.5(2)). A Claim Form issued for service outside the jurisdiction must be served within 6 months of the date of issue (CPR 7.5(3)). an The parties can agree to extend the time for service of the Claim Form (CPR 2.11). zk The methods of service that may be used with the step required are as follows (CPR 6.3, 7.5): Method Step required O First-class post, document exchange Posting, leaving with, delivering to, or (DX), or other service that provides for collection by the relevant service provider. delivery on the next business day Delivery of the document to, or leaving it Delivering to, or leaving the document at, at, the relevant place the relevant place. Personal service under CPR 6.5 Completing the relevant step required by CPR 6.5(3). 37 © QLTS School Ltd S/N 837194  Summary Notes – Dispute Resolution Fax (only when within jurisdiction and Completing the transmission of the fax. expressly accepted and the number provided, incl. letterhead) Other electronic method (only when Sending the email or other electronic expressly accepted) transmission. The claimant must complete the step required by that method of service before midnight on the calendar day 4 months after the date of issue of the Claim Form (or 6 months for service outside of the jurisdiction). It is the taking of the step required that is the relevant time in which to determine whether service is has been effected in