Coventry View

A litigation lawyer's perspective

Posts Tagged ‘procedure

Can I Come In? – Enforcing Suspended Possession Orders

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Now some of you may remember that in a previous life (when I really was Coventry Man) I worked for a firm who acted for some major social housing providers. They, unlike private landlords, usually let properties on assured tenancies (rather than assured shorthold tenancies) and played a much longer game. If a tenant was in arrears then they were quite prepared to let them pay off the arrears by instalments and sometimes they encouraged this by getting possession orders that were suspended on payment of say

“the current rent as it falls due plus the arrears of £800 at the rate of £100 a month, commencing on 1st November.

Now from time to time, indeed surprisingly often, the tenants would fall down on the payments and we would issue a warrant for possession and the tenant would be stirred up by a visit from the merry County Court bailiff who would give them an appointment for eviction in 4 weeks, and the form to apply to have the warrant suspended, so they could rush back to the court and explain to the cynical DJ why they had failed to keep the promises that they had made only a couple of months ago.

This might happen several times before either they got their priorities in order, or the DJ lost his remaining patience and the eviction went ahead.

Now it always surprised me that we could get the warrant issued just on our say-so. We signed the Request and cerified that they were in arrears and that was that. Indeed, if there were more complicated terms, such as the removal of a noisy dog, or the clearing of rubbish from the garden, we still just had to certify that they were in breach. No evidence was needed. Naturally our clients were fair about things, and my colleagues were decent honest and truthful, but I couldn’t help think that not everybody was like that, and that the courts were being very trusting, especially when more and more litigants were doing without lawyers and acting for themselves.

Anyway, things have changed now, and when the bits of the County Court Rules that governed enforcing judgments and warrants (rr25-26) were taken into the CPR in April 2014 (along with RSC 45-47) the powers that be took the opportunity of tigntening things up. I hadn’t noticed because I have moved on and don’t act for social housing providers any more, but it would seem that before you can apply for a warrant for possession after a suspended order you have to get permission by making an application supported with evidence.

The rules are in CPR 83.2 and spell things out pretty clearly:

(1)

This rule applies to—

(d)

warrants of possession.

(2)

A writ or warrant to which this rule applies is referred to in this rule as a “relevant writ or warrant”.

(3)

A relevant writ or warrant must not be issued without the permission of the court where—

(e)

under the judgment or order, any person is entitled to a remedy subject to the fulfilment of any condition, and it is alleged that the condition has been fulfilled; or

(4)

An application for permission may be made in accordance with Part 23 and must—

(a)

identify the judgment or order to which the application relates;

(b)

if the judgment or order is for the payment of money, state the amount originally due and, if different, the amount due at the date the application notice is filed;

(e)

where the case falls within paragraph (3)(c) or (d), state that a demand to satisfy the judgment or order was made on the person liable to satisfy it and that that person has refused or failed to do so;

(f)

give such other information as is necessary to satisfy the court that the applicant is entitled to proceed to execution on the judgment or order, and that the person against whom it is sought to issue execution is liable to execution on it.

(5)

An application for permission may be made without notice being served on any other party unless the court directs otherwise.

Now the problem is that there is no reference to any of this on the form of application for a warrant – N325 – which is the form needed under r83.26. Indeed there are several references in the order that make it look as if nothing has changed:

83.26 (1)

A judgment or order for the recovery of land will be enforceable by warrant of possession.

(2)

An application for a warrant of possession—

(a)

may be made without notice; and

(b)

must be made to—

(i)

the County Court hearing centre where the judgment or order which it is sought to enforce was made; or

(ii)

the County Court hearing centre to which the proceedings have since been transferred.

(4)

Without prejudice to paragraph (7), the person applying for a warrant of possession must file a certificate that the land which is subject of the judgment or order has not been vacated.

(5)

When applying for a warrant of possession of a dwelling-house subject to a mortgage, the claimant must certify that notice has been given in accordance with the Dwelling Houses (Execution of Possession Orders by Mortgagees) Regulations 2010.

(6)

Where a warrant of possession is issued, the creditor will be entitled, by the same or a separate warrant, to execution against the debtor’s goods for any money payable under the judgment or order which is to be enforced by the warrant of possession.

(7)

In a case to which paragraph (6) applies or where an order for possession has been suspended on terms as to payment of a sum of money by instalments, the creditor must in the request certify—

(a)

the amount of money remaining due under the judgment or order; and

(b)

that the whole or part of any instalment due remains unpaid.

You always had to certfy this sort of thing. The difference is that you shouldn’t apply for the warrant at all before you get permission under r83.2(3). Easily overlooked.

Well, what happens if you get it wrong, and haven’t got permission and the court doesn’t notice? Because the issue of a warrant is dealt with by the court office, not the DJ, and court offices are busy understaffed places. Is your warrant invalid, and can the tenant get it set aside? Or can you rely on good old r3.10 that allows the court to fix things when there has been a mess-up by somebody:

3.10 Where there has been an error of procedure such as a failure to comply with a rule or practice direction –

(a) the error does not invalidate any step taken in the proceedings unless the court so orders; and

(b) the court may make an order to remedy the error.

There has been some interest in this among the frantically overworked heroes who represent tenants expecting immenent eviction, as some courts and DDJs had one idea and some had another, and there has now been a decision by the CA in Cardiff CC v Lee [2016] EWCA Civ 1034 .

The CA decided, after some navel-gazing,  that if the failure to apply for permission was “an error of procedure” then an application under r3.10 could put things right. In the particular case the tenant had applied to set aside the warrant anyway without success so the facts had been examined and nothing would be gained by going into things again, so the court below had been right to allow the warrant to go ahead.

Had the failure to apply been intentional however they might have taken a different view. And given there has now been a case in the CA on this point, which is being reported and commented on in interested circles (like here), it is going to be much harder for any landlords who merrily sign the N325 without getting permission to enforce first.

Applications can be made without notice and dealt with on the papers, but it will mean another delay of several weeks in most courts before the order can be enforced in any event.

As usual this is covered in the Nearly Legal blog in a lot more detail that I do here. However, you all know this now, so there’s now one less thing to trip over.

Written by Coventry Man

24/10/2016 at 18:09

More Changes for s8 Notices

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It seems to be traditional to change the form of the notices that a Landlord has to give an Assured, or Assured Shorthold, Tenant if they want to recover possession for any reason other than service of a s21 Notice every so often, usually at short notice, and with little publicity. The powers that be did so in April 2015 (see my piece) and are now doing so again, with effect from 6th April 2016.

This matters, because although the actual changes are trivial – correcting of some cross-references to the new form of notice needed for s21 Notices – the form is a prescribed form, and if you don’t use the right one then the notice is invalid, and you might have to start the possession claim again. And you will have to start again if you are using the most popular Ground 8 (2 months’ or 8 weeks’ arrears of rent) because the court isn’t allowed to dispense with service of a valid notice in that case.

The new form of notice is in the regulations here  along with some similar minor amendments to the notices for increasing rent etc. The layout is as awful as ever, and printed in ridiculaously small print – why can’t they produce these forms in a usable version (can’t really call it a form) rather than getting everybody to type the things out afresh? The people who produce the court forms have now made pretty good, amendable pdf versions, so perhaps they can pass on a few tips to their colleagues in housing.

Still, there it is. Don’t forget it if you advise landlords. Or indeed if you advise tenants either, as you may be able to give your client much longer to find somewhere else to live than you had expected.

 

Written by Coventry Man

04/04/2016 at 18:36

If it Sounds Too Good to be True – Enforcing Possession Orders

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A constant complaint from landlords who are trying to recover possession of rented residential properties is that everything takes so long. Not only do you have to give the appropriate notice – often 2 months – to the tenants before you can issue possession proceedings, but once you issue them they don’t normally come up for hearing until about 6-8 weeks later. The judge, if he deals with it at the first hearing, may make an order for possession in 14-28 days, and then you have to apply for a warrant for possession, and eventually get a bailiff’s appointment for an eviction some time later. Where I practice the delay is about 3-4 weeks, but in London and Birmingham it is nearer 12 weeks. So a landlord may be waiting for 8 months from when he served the initial notice (or longer if there is any sort of problem) before he gets the property back. Throughout this time the tenant is unlikely to have paid any rent, and although there will be a money judgment, this is rarely worth anything, so it is a major issue.

Of course, advising a tenant, you can tell them that they have all this time to stay in the property, and there is very little the landlord can do about it. So there is free accommodation and/or plenty of time to find somewhere else to go.

The Problem

Now, this isn’t fair. The delays in getting the order have to be accepted, but 12 weeks for an eviction is ridiculous, and a farce. So landlords and their advisors have been trying to get round the problem, and some of them had thought that they had just discovered the silver bullet – or at any rate the gun that fires the silver bullet. This is the High Court Enforcement Officer (HCEO), a self-employed official who used to be called the Sheriff (not strictly true but close enough for now.) They enforce High Court Orders (as you might expect) and are much better at getting money out of people than the County Court Bailiffs are, who enforce CC orders, largely because they are paid by results.

This is recognised by claimants, and most CC money judgments for more than £600 are transferred to the HC for enforcement by the simple procedures (sign a request in form N293A) under CPR r40.14A and CPR r83.19 and then enforced by the HCEOs.

Those of you in the know will realise that you can use the same procedure of transfer for an order for possession against trespassers, and indeed the form N293A helpfully provides for this. But the applicant (or their solicitor) has to certify that:

I intend to enforce the judgment or order by execution against goods, and/or against trespassers in the High Court and require this Certificate for this purpose.

You can’t use this simple procedure for other sorts of enforcement, such as enforcing possession orders against tenants. You have to go through the formal procedure of an application under r23 to a District Judge for a transfer from the CC to the HC under s42 County Courts Act 1984. This allows any action (with a few minor exceptions) to be transferred, and there are some criteria for determining these transfers set out in CPR r30.3. Most of the criteria don’t apply once you have a judgment, and the application can probably be dealt with on a paper application without a hearing, but is still needs to be made. If dealt with on paper it will take a few weeks, depending on workload.

However, there is another hurdle before you can enforce your CC possession order, which has now become a HC possession order, with the HCEOs. You need to issue a Writ of Possession. And under CPR r83.13 (2):

Subject to paras 3, 5 & 6, a writ of possession to enforce a judgment or order for the giving of possession of any land will not be issued without the permission of the court.

None of the exceptions cover tenants, just trespassers  and mortgagors. And even more clearly para 8 says that notice has to be given to the tenants:

(8) Permission referred to in paragraph (2) will not be granted unless it is shown—

(a) that every person in actual possession of the whole or any part of the land (‘the occupant’) has received such notice of the proceedings as appears to the court sufficient to enable the occupant to apply to the court for any relief to which the occupant may be entitled; and

(b) if the operation of the judgment or order is suspended by section 16(2) of the Landlord and Tenant Act 1954, that the applicant has not received notice in writing from the tenant that the tenant desires that the provisions of section 16(2)(a) and (b) of that subsection shall have effect.

Now it would be just about possible to argue that the occupants only had to be given notice of the original possession proceedings, which they would have been in the normal course of events. However even this has been taken away by the decision of Rose J in Nicholas v SoS 24.8.15 (unreported but covered in a note from Arden Chambers and referred to in para 63 of Birmingham CC v Mondhlani (2015)). She stated quite categorically that the occupants must be given notice of the application for permission, and as she had not been the writ was set aside, even though it had already been executed. And this decision of a High Court judge is binding on all DJs and Masters, and circuit judges in the CC.

By the time that you have issued an application for a hearing, served it on the tenants, and then attended and (hopefully) won you could easily have taken 6-8 weeks, and lost all the time that you had been hoping to save. Together with the extra cost, which you won’t in practice get back from the tenant.

The Right Thing to Do

The only way out is political – get the law changed to allow for speedier enforcement of possession orders, if people think that is a good idea. There is a good practical argument in favour of change, and although the normal objection from tenants is that HCEOs don’t give notice of the evictions, which makes removing their belongings and getting rehoused particularly difficult, this requirement could easily be inserted into any legislation, or indeed into the orders giving permission to enforce (see the Mondhlani case above for an example) so at the end of the day an amendment certainly looks possible, if anybody will take up the cudgels.

The Wrong thing to Do

Ignore the caveats, sign the N293A form, and then enforce the order without getting permission from anybody, or at any rate without giving the tenants notice of your application. You save a lot of time and make a lot of money until you are caught.

Which they have been. Nicholas v SoS, mentioned above, showed the Ministry of Defence being remarkably inventive, and Birmingham CC v Mondhlani (2015) shows Birmingham City Council, who really ought to know better, again being caught red handed. And there must be many more.

Worse, it appears that some of the larger firms of HCEOs may have been encouraging this course of action. Nearly Legal, the housing law blog, has run two excellent posts on this recently (here and here) and it looks as if there may be further developments, in the form of actions for damages by aggrieved tenants, or even arguments about contempt of court.   There are certainly a lot of comments on the blogs, on Twitter and in the legal press. A recent addition is in the Landlord Law Blog.

I will say no more for now, except to comment that it is yet another example of the truth of the old saying:

If something sounds too good to be true, it probably is.

PS – another update from Nearly Legal on this saga here.

Written by Coventry Man

08/01/2016 at 00:24

Where Do We Go Now?

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I started this blog in 2011 and as you do at this time of year, I’ve been looking back through the postings to see what I seem to be writing about. The blog is meant to be about property litigation, and to no real surprise I have written quite a lot about that. However, I do keep coming back to a different topic, and this is another piece of that sort.

The topic is the actual way in which people can use their legal rights and the legal system that supports them.

As a practical lawyer I know that for people to have useful legal rights they need a lot more than just having the rights themselves. They need to know about them, be able to get advice, and have practical, and affordable ways of enforcing them.  I have written about the need for all businesses to know some basic law in Law and Business and about some of the other requirements for a practical legal system in Having Rights is Not Enough, and pointed out why Mediation is not the answer,  but this time I want to look at things from another angle. I touched on it in Tell Me what You Want, but I’ve developed it further here.

A lot has been made of the changes in legal procedure and practice over recent years. Some people say that it is a long-needed simplification, and the cutting of miles of unnecessary red tape, that will result in much quicker, easier and cheaper justice for all. Others say that it is the destruction of hundreds of years of justice and a legal profession solely for the advantage of big business, the government and other prowerful players in the field. The argument has raised a lot of heat, but not cast a lot of light, and I’m not going to tackle things in such a broad brush way. Because there was something to be said for both sides.

The practical effect however has changed the legal landscape, and like the earth after the asteroid, it is no longer a place for dinosaurs. This piece is aimed at lawyers who want to survive.

The Sheep, Goats and Dinosaurs

In the new reality you can divide the survivors into two sorts: the sheep and the goats.

The Sheep are major companies, the Government and its quangos, and High Net Worth Individuals, engaged in disputes with other Sheep, and the large firms of lawyers they use, based in the major cities.They deal with the High Court, and the Court of Appeal, and apart from some increase in cost, and some decrease in the time taken by the Courts to deal with things, they will have noticed very little change.

The Goats are smaller businesses, clubs and associations, and the rest of the population. They have disputes with other Goats, and also from time to time with Sheep. They also use Goats –  smaller specialised lawyers and other agencies who adapt rapidly to change. They generally deal the County Court and District Registries, and have noticed very significant increases in cost and in the time taken to deal with their cases, and a large reduction in the resourses available for their use. So they have to be canny and resourceful and will be the heroes of this article.

The Dinosaurs used to be either Sheep or Goats, or their lawyers. They didn’t notice the change in the legal environment until too late, if at all, and so are either trying to carry on as if nothing had changed, with disasterous consequences, or have given up any significant use of the court system, and try to deal with things in other ways.  The lawyers have gone out of business.

How to be a lawyer for Goats

In the new world there are many new rules:

  • Be light on your feet – be ready to adapt to changes quickly. Just because you always did something one way doesn’t mean that it’s the best way now.
  • Keep up to date – there are frequent  changes in the law and the CPR and in the court decisions that follow them. You have to be ahead of the crowd to win.
  • Winning matters – this is why your clients come to you.
  • Keep an open mind – there are lots of different was of doing things. If one way doesn’t work there are many others.
  • Payment by the hour is on the way out. Clients much prefer payment by stages (eg up to issue) or by results. You have to adapt.
  • You’ve got to know the shortcuts. Nobody wants to go all the way to trial. Know how to get summary judgment or default judgment, or the Defence struck out. Or more usually, a good offer.
  • Specialise. You can’t know everything well enought to be really good at it. And being really good matters.
  • Get it right first time. You can’t afford to do things twice.
  • Don’t carry passengers. You need a few experts plus a flexible team to draw on when you need them.
  • Be small. You may grow into a Sheep with guaranteed multiple repeat businesses. But until then you can’t afford to be bigger than you have to be.
  • Make friends. This is the key to being a small business. There are lots of people out there who want to help you and you only need to pay them when you need them. And sometimes not even then. A smile may be worth hundreds.
  • And remember you’re a lawyer. You don’t run the client’s business or life. That’s their concern. But you’re liable to lots of extra obligations as a lawyer. And being one will pay the rent next year, when this client has moved on.

I’m not telling you everything. I need to make a living too. As I said, I’m a practical lawyer. But this is the new reality. And if you ignore it you are likely to go the same way as the dinosaurs. Which is not a good idea, on the whole.

A Happy New Year to you all.

Written by Coventry Man

01/01/2015 at 20:04

Charges in the Air – Compensation for Delays

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Today, at the end of the holiday season, I’m going to talk about what happens if your plane was late, or indeed was cancelled, and how you can get compensation for your inconvenience. And I’m doing this as I’ve just done an interesting claim of this sort for a couple of clients, so I have done the research already and want to have an opportunity of using it again, while it’s still relevant, and I can read my notes. Because it is an amazingly complicated and frustrating experience.

The Law – Part One

As you might expect, this is EU legislation, and so nothing is quite as it seems. The current Regulation is 261/2004 and Arts 5,6 & 7 provide for compensation of varying amounts if passengers with tickets for  flights that start  in the EU, or end in the EU and are by an EU carrier, are denied boarding, either because the flight is cancelled or because it is overbooked. The amount of compensation is a modest €250 or €400 or €600 each, depending on the length of flight. But the compensation is not payable

If [the operating air carrier] can prove that the cancellation is caused by extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken.

In addition the carrier has to provide reasonable refreshment and accommodation for the passenger and put them on a suitable replacement flight at no additional cost. And all these rights can’t be waived, or taken away by the small print.

Now, this being the EU “cancellation” doesn’t just mean cancellation. The ECJ decided in the  Sturgeon (2012) decisions  that this included a delay of more than three hours. If your flight arrives more than three hours after the scheduled time you have a claim. The reasons are basically irrelevant, and so is the amount of actual inconvenience that you suffer.

This is important. Not many flights are actually cancelled, and there is a lot less overbooking than there used to be, and airlines realise they are messing you about if they stop you boarding, so are prepared to offer deals. But lots of flights are late, for a variety of reasons, and if you have a flight from say Tenerife to Manchester with 250 people on it that is more than three hours late this adds up to total compensation of €100,000. Which hurts, especially of you are a budget airline and are only charging a £120 return fare. So as you might imagine the airlines have been making claiming less than simple, or convenient.

How to Claim

The Regulations mention payment “immediately”, but of course this is unusual. And most people do nothing, so get nothing either. But if you do want to make a claim then normally you have to write in to a claims department and wait. In due course the claim will be refused. So what do you do then? Well another chunk of passengers give up at this stage too. But you are a more determined lot, surely.

The Regulations expect enforcement to be by national enforcement authorities – in the UK’s case this is the CAA, but you can apply to the body for the other end of the flight if you wish. They can fine airlines that regularly fail to comply with their obligations. This doesn’t help the passengers much. And they operate various non-binding forms of dispute resolution – AESA, the Spanish authority, operates a written arbitration procedure, in English and Spanish  (and possibly other languages if you want to be difficult) that seems to be fairly quick and effective. But the airline doesn’t have to pay up if it doesn’t want to. And it doesn’t. So what then?

Well, you can go to court in either the departing or arriving EU country and make what in England will be a (very) small claim. In fact you can go to court without bothering with the CAA or AESA at all, and this is probably the best course, after a protocol letter demanding payment and enclosing the appropriate proof.

The airlines tried to argue that there was no right to go to court, and almost succeeded in the CA case of Graham v Thomas Cook (2012) but fortunately the ECJ held in McDonagh v Ryanair (2013) that this was nonsense and that there was a clear right for a passenger to make a claim before a national court for this compensation.

So you might think it was easy – write to the airline making a claim, and if they don’t pay pop in a Money Claims Online to the court with your fee, and a few months later turn up before a puzzled DDJ in your local court for a Small Claims Trial. Not so fast – there is more law to deal with first.

The Law – Part Two

If you look back to the top of this piece you will see a reference to

extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken

There are some examples given in the Preamble to the Regulations, and they cover things like coups and insurrections, bad weather, security risks, air traffic control problems and strikes. These are all external causes and clearly you can’t hold the airlines liable for this sort of thing. The Iceland Volcano a few years ago is a particularly good example of this. Do note however that the obligations to provide refreshment and accommodation etc isn’t affected by this exception, and the airline still has to provide it – the Ryanair case above was on this very point.

Now airlines thought about this and decided that they only had to pay compensation if they were in some way to blame. For example if they forgot to book a pilot then it was fair enough, but not if the booked pilot fell ill. Or if some part of the (extremely complicated) aircraft broke because it hadn’t been serviced properly they would pay up, but not if it just broke for no predictable reason. And given the paper-thin servicing teams and the lean operation that some airlines use this could happen quite frequently. And they could always say it, and who would know? Certainly not the passenger.

Fortunately the ECJ wasn’t having this and in the Wallentin-Hermann  (2008) decision they held that

Article 5(3) of Regulation (EC) No 261/2004…..must be interpreted as meaning that a technical problem in an aircraft which leads to the cancellation of a flight is not covered by the concept of ‘extraordinary circumstances’ within the meaning of that provision, unless that problem stems from events which, by their nature or origin, are not inherent in the normal exercise of the activity of the air carrier concerned and are beyond its actual control.

They said it was a matter for the courts to determine in each case, but gave an example of something that couldn’t be an “extraordinary circumstance” – a failure caused by inadequate maintenance – and of something that could be – a manufacturer’s recall of multiple aircraft because of some safety problem.

You might think that this would have ended the argument, but remember there is potentially a lot of money at stake here, so the airlines shifted their ground. How about arguing that it depends whether the failure was within the airline’s control? So if a part which has a normal life of 5,000 hours fails after 4,000 hours without warning then it is beyond their control. But if it has reached its expected life then it ought to be replaced and so it is in their control.  There is quite a lot of scope for this.

But no longer. The CA in the strangely named case of Huzar v Jet2.com (2014) has upheld a decision by HHJ Platts sitting in Manchester who pointed out that air carriers have to encounter and deal with unexpected unforeseen and unforeseeable technical problems as part of running an airline. They cannot be said to be an extraordinary circumstance. Elias LJ said:

In my judgment, a proper understanding of the inter-relationship between the two limbs should focus on the concept of “extraordinary circumstances” itself, the language used in Article 5(3). This requires that the circumstances must be out of the ordinary, as the Court noted in Sturgeon. As the CJEU recognised in paragraph 24 of Wallentin-Hermann, difficult technical problems arise as a matter of course in the ordinary operation of the carrier’s activity. Some may be foreseeable and some not but all are, in my view, properly described as inherent in the normal exercise of the carrier’s activity. They have their nature and origin in that activity; they are part of the wear and tear. In my judgment, the appellant’s submissions fail to give proper effect to the language of the exception….. It makes an event extraordinary which in common sense terms is perfectly ordinary.

He pointed out that if you exclude unforeseeable problems then the courts are going to be filled with arguments about whether such and such a problem should have been picked up during servicing, which would need experts and much study of documents and that would be most unsatisfactory.

And he blocked off another loophole:

The appellant advanced one further argument. It was suggested that an unforeseeable technical problem would constitute an unexpected flight safety shortcoming which recital 14 identifies as a potential extraordinary circumstance. I do not accept the submission; the fact that a particular technical problem may be unforeseeable does not mean that it is unexpected. Problems of this nature frequently arise.

So extraordinary circumstances should be just that – extraordinary. Volcanoes but not a defective fuel pump.

They Don’t Give Up

The airlines, supported rather strangely by the CAA, have now applied to the Supreme Court for leave to appeal. They lodged the application at the end of July and the SC will make a decision on this some time before Christmas. If they grant permission then we have another year or so of waiting beyond that for a final, final, result. Unfortunately the CA ruling could have been expressed more clearly in places, but on the face of it the ruling should stand. Subject to a possible application to the ECJ again.

And in the meantime many airlines continue to argue all these points, take as long as possible, and do all they can to discourage passengers from making claims, or pursuing claims once made.

The Law – Part Three

All this supposes that it is your flight that is delayed or cancelled because of some extraordinary operational problems. What if it is an earlier one, and you are merely caught up in the backlog. Can you claim, or will you be faced with the extraordinary circumstances defence? Well there’s an easy answer to this one  and it is a resounding “no!” The ECJ ruled in Finnair v Lassooy (2012) that extraordinary circumstances can only apply to the flights that are affected by them, and not to later flights. In that case a strike at Barcelona on 28th July (an extraordinary circumstance) prevented a Finnair flight from leaving, and Mr L was denied boarding two days later on 30th July because they gave his seat to some passenger who had been waiting since the 29th and made him fly 12 hours later. So he got his compensation.

And the Result?

It’s a mess. You can see it several ways:

From the airlines’ point of view the compensation that they are likely to have to pay from the current interpretation is going to make it very difficult if not impossible to operate on their current model of pricing, with very cheap tickets and few aircraft. Only one or two delays can wipe out the profits of several weeks of perfect operations. Surely the EC didn’t mean to do this? Clearly the EC didn’t mean to do this  – the Regulations only deal with cancellation etc, not delays, which were brought in by the court in Sturgeon. So it is worth while paying the lawyers and fighting every claim in order to discourage the others.

From the passenger’s point of view it will take for ever, it is really only peanuts, and life is too short at the end of the day to battle away at this sort of thing. It may have been meant to be dealt with as a small claim but the airline tactics make it very, very hard for a litigant in person.

From a lawyer’s point of view these claims are small claims and so unless you can show that the airline in behaving unreasonably there are no recoverable costs. A client will only pay a little in order to recover €400 even with some interest. So you need lots and lots of clients. If you get 100 on one flight your costs are hardly any greater and a small fee, or cut of the winnings, from each will give you a sensible return.  But passengers rarely exchange contact details unless they’re all in one party, so you have to do things in dribs and drabs, which doesn’t make any financial sense.

And from the court’s point of view a small claim list can be seriously messed up by even one of these surprisingly technical claims, usually with a litigant in person on one side and an airline lawyer on the other, and a very confused DDJ in the middle.

A real mess.  Almost enough to give the EU a bad name.

 

UPDATE – News of application for appeal to SC on Jet2 here

Written by Coventry Man

04/09/2014 at 01:27

At Last, some Relief (from Sanctions)

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Denton & others v TH White Ltd & others [2014] EWCA Civ 906

This is, I am afraid, a rather boring and very legal piece about the intricacies of the Civil Procedure Rules (CPR). I try not to write things like this but it is so important that I can’t really avoid doing so. At least it isn’t that long.

I won’t need to remind you that in November 2013 the Court of Appeal gave its decision in Mitchell v NGN and brought down Hell and Damnation on civil litigation in general, and lawyers in particular, by deciding that following the changes in the CPR , especially r3.9, relief from sanctions for failing to comply with court rules and orders was going to be a lot harder to get, and impossible in many cases. They set out a two-stage test:

  1. was the default trivial?
  2. was there a good reason for the default?

So far so good. But they went on to say, or at any rate imply, that if the answers were both “no” then there should be no relief. And often the result was that a whole claim was struck out because some document was served a day or two late without a “good reason”.  Because the CA had said merely overlooking a deadline was unlikely to be a good reason. And rules are rules.

The result of course has been that as soon as you see that the other side has breached some time-scale by the smallest amount you are duty bound to make an application to strike the claim out, and the courts became very clogged up by it all, and in due course, seriously concerned at what a mess they had made.

This wasn’t helped by the case of MA Lloyd v PPP International which decided that in most cases the parties couldn’t extend the time to do things such as exchange lists of documents because it was prohibited by the rules as they then stood. I said at the time that something would have to be done because it was unworkable (here) and after a time the CPR were changed to allow the parties to extend time by up to 28 days provided court hearings were not put at risk (r3.8(4)) . But that left a lot of other problems. And why should you agree to extend time if your client could get such a bonus by being awkward and saying “no”?

Relief at last

Well the Court of Appeal has at last acted and on 4th July 2014 decided Denton v White and eased things up considerably, and smacked heads and told everybody not to be so silly in future. I won’t go into things in detail because virtually everybody has done so already, and for the full story either read the judgement (another link here) or look at the articles listed below. But the outline is that the court has looked at the test for relief set out in r3.9 and decided the right way to go about things is now to ask:

  1. Is the breach serious or significant? In other words, will it have a real effect on the future conduct of the case, or seriously inconvenienced other court users? If not then relief should normally be given, and matters come to an end. If it is however:
  2. Why did the default occur? Was there a good reason, or excuse? If so then relief should be given. But if not:
  3. Look at all the circumstances of the case, consider what is necessary to deal justly with the application, but bear in mind the two particular factors a) and b) below, and make a fair and just decision. Just because the default was serious and  there was no excuse does not mean that the relief has to be refused. It will just make things harder for the applicant.

The two factors are set out in CPR r3.9 which provides:

(1) On an application for relief from any sanction imposed for a failure to comply with any rule, practice direction or court order, the court will consider all the circumstances of the case, so as to enable it to deal justly with the application, including the need –

(a) for litigation to be conducted efficiently and at proportionate cost; and

(b) to enforce compliance with rules, practice directions and orders.

(2) An application for relief must be supported by evidence.

And having set down the rules, the court decided the cases on their merits, and then laid into parties who try to take advantage of small slips by their opponents:

41 We think we should make it plain that it is wholly inappropriate for litigants or their lawyers to take advantage of mistakes made by opposing parties in the hope that relief from sanctions will be denied and that they will obtain a windfall strike out or other litigation advantage….

42 It should be very much the exceptional case where a contested application for relief from sanctions is necessary. This is for two reasons: first because compliance should become the norm, rather than the exception as it was in the past, and secondly, because the parties should work together to make sure that, in all but the most serious cases, satellite litigation is avoided even where a breach has occurred.

43 The court will be more ready in the future to penalise opportunism. The duty of care owed by a legal representative to his client takes account of the fact that litigants are required to help the court to further the overriding objective. Representatives should bear this important obligation to the court in mind when considering whether to advise their clients to adopt an uncooperative attitude in unreasonably refusing to agree extensions of time and in unreasonably opposing applications for relief from sanctions. It is as unacceptable for a party to try to take advantage of a minor inadvertent error, as it is for rules, orders and practice directions to be breached in the first place. Heavy costs sanctions should, therefore, be imposed on parties who behave unreasonably in refusing to agree extensions of time or unreasonably oppose applications for relief from sanctions. An order to pay the costs of the application under rule 3.9 may not always be sufficient. The court can, in an appropriate case, also record in its order that the opposition to the relief application was unreasonable conduct to be taken into account under CPR rule 44.11 when costs are dealt with at the end of the case. If the offending party ultimately wins, the court may make a substantial reduction in its costs recovery on grounds of conduct under rule 44.11.  If the offending party ultimately loses, then its conduct may be a good reason to order it to pay indemnity costs. Such an order would free the winning party from the operation of CPR rule 3.18 in relation to its costs budget. [my emphasis]

Even judges were not immune from criticism, and it was pointed out that if rules are to be complied with then timetables and other directions have got to be realistic, and “unless” orders should be reserved for situations in which they are truly required.

So what next?

Given the unholy mess that has emerged over the 8 months or so since Mitchell it is very much hoped that things will now settle down so that those of us at the coal face can get on with litigating disputes for our clients and not spending all our time making sure that we don’t overlook the slightest direction or requirement, or pouncing on our opponents if they do so. The CA was pretty robust, and given the emphasis on penalising parties who are unreasonable it is going to be a lot more dangerous to oppose applications for relief in future. Only time will tell.

There have been a lot of comments on the fact that although the main judgement was given by by Lord Dyson MR and Vos LJ, there was a separate judgement by Jackson LJ that disagreed to some extent with the majority decision. And the reforms had of course been brought in following Jackson LJ’s report. But in all fairness the disagreements were more on matters of emphasis than anything else.

And the latest thing is consideration on whether it would now be possible to appeal some of the relief applications out of time, in the light of Denton. Is an application to appeal a relief application out of time an application for relief against sanctions?

More details

Lots of comments in all the normal legal sources, plus a lot of solicitors’ or chambers’ sites as well. As normal the best are at Nearly Legal and Gordon Exall’s site which has an enormous number of links, comments and lists of all sorts.

Written by Coventry Man

17/07/2014 at 18:44

Having Rights is Not Enough

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Let me tell you a story. You are walking down a dark lane carrying a box containing a nice watch that you have just bought from a jewellers. A thug comes up to you, threatens you with a knife, and demands that you give it to them. You tell them “it’s mine, I’ve just bought it”. They say that they don’t care, and as you aren’t a mad hero you hand it over and they run off. Your legal rights have been completely worthless on their own. What you needed was a pet leopard, one of those Crocodile Dundee “you call that a knife? This is what I call a knife” blades, or a small troop of cavalry. In other words, you need to have your rights enforced by force if necessary.

Let’s change the facts a bit. You get home safely but the next morning a man from the jewellers comes to say that there has been a mistake and that the watch had been reserved by Mr Big, a local gangster,  and so they shouldn’t have sold it to you and that you would have to give it back. You refuse. They sue you in the local court where the judge is Mr Big’s brother, and despite there being no legal basis for their claim you lose. Again, your legal rights have been completely worthless on their own. You need an honest legal system to enforce the rights.

Let’s change things again. You are sitting at home and admiring your property. A developer calls and gives you a formal claim to buy the house under an option that he said had been granted to him by a previous owner. The price to be paid is a fraction of the true value. You don’t believe the option is genuine (you don’t think it likely that the house once belonged to a “Mr Michael Mouse” of Hollywood) and go to a lawyer. The lawyer explains that under recent legal reforms it is necessary to carry out an enormous amount of work in the early stages of a case, (see here) and so you will need to pay him £25,000 immediately, and that the total cost of the case will be £50k-£100k, or possibly more, of which you may recover half if you win. You don’t have that sort of money, but the developer does. You can’t fight the case on your own and so have to negotiate a poor deal. So your legal rights have been completely worthless on their own. You have to be able to afford to enforce them.

One final scenario. Your local council decide to retrospectively revoke the planning permission on your house and demand that it is demolished without compensation because there was an error in the initial planning application made by the the original owner. This is said to be permissible under recent legislation passed to tighten up planning procedure. You try to find a lawyer to advise you on this complicated matter, but find that under the legislation lawyers are not allowed to advise or represent parties. You try to look up the legal background but it is beyond your limited education and skill. So you never know what your legal rights are, let alone how to enforce them. Your legal rights have been completely worthless on their own. You need access to legal advice when necessary.

These are just stories, as I said at the beginning. But the lessons are very real. Legal rights are only any good if they can be enforced for a sensible price and in a sensible period of time by the people who have them, and for this purpose they need affordable legal advice and an affordable and fair legal system. Of course some matters are best dealt with by a small claims system where people argue cases themselves, and some things are best dealt with by ombudsmen and the like. But there must be an effective system if the rule of law is to mean anything. And recent developments, with small claims now running up to £10,000, vastly increased work needed for fairly ordinary civil cases, draconian penalties if anything goes even slightly wrong, the abolition of Legal Aid, greatly increased court fees, large issue and trial fees for employment claims, and the loss of so many local solicitors who gave advice to local people, make me very concerned.

Because if you can’t enforce your rights you’ve lost them.

Written by Coventry Man

04/04/2014 at 18:02