Civil way: 25 January 2008

LAWBITES

Payments in are out

CPR Pt 36 was set for a major overhaul. The plan was to scrap payments in for parties who were ‘good for the money’. They’ve gone further. Payments into court in satisfaction are being scrapped for all offerors in favour of written offers to settle. If accepted, the offeror must come up with the money within 14 days or be susceptible to a judgment and loss of Pt 36 costs protection. These are just some of the major changes to be brought into force on 6 April 2007 with the 44th CPR update reflecting the Civil Procedure (Amendment No 3) Rules 2006 (SI 2006/3435), about which stay tuned into this column.

More money

The guideline hourly rates for summary

assessment of costs have been raised after two years in line with the retail prices index. (See NLJ, 12 January 2007, pp 62–63). The
increases will apply to work conducted on and after 1 January 2007 and are intended to run for 12 months. Grade A fee earners in the highest band courts outside London will collect £195 per hour as against £380 for the City and £292 for central London.

The Wonder of 10

HM Courts Service has just published a new charter for the civil courts. Clock this! Assurances are given that when you telephone a court Monday to Friday between 9am and 5pm you will get a prompt and helpful answer. And within 10 working days:
 of a court receiving a letter, you will get a reply written to you or by telephone;
 of a judge’s order, you will get a copy sent to you;
 of the court receiving a request for cancellation of a registered judgment—paid within one month—with proof from the claimant of payment, a certificate of cancellation will be sent out; and
 of the court receiving a request for a warrant of execution with the fee, the warrant will be sent to a bailiff—and the court will ensure that the bailiff makes a visit within 15 working days from the warrant being sent out.

And within 10 minutes of you going to the public counter or inquiry point, your inquiry will be attended to or you will be given an explanation for the delay. In the unlikely event of a complaint, guidance is given on what to do.  See www.hmcourts-service.gov.uk.
 

Surprise, surprise

The claimant applied for CPR Pt 24 summary judgment on its specific performance claim in P & O Nedlloyd BV v Arab Metals Co and others [2006] EWCA Civ 1717, [2006] All ER (D) 187 (Dec). The judge disposed of the application by refusing summary judgment and, without notice,
effectively giving summary judgment to the defendant and throwing out the specific performance claim. Lord Justice Moore-Bick on appeal said that in setting out the orders that the court could make on a summary judgment application, PD 24 para 5 should not be read as giving a general power to dismiss the claim without warning when the matter is before the court on the claimant’s strike out application.

“My daddy is very rich and we’re having forms E and not those silly Children Act sheets of paper”

Financial claims under Sch 1 of the Children Act 1989 are likely to be brought into procedural line with ancillary relief applications at some time in the future. No book has been opened about when. For the moment, Lord Justice Thorpe has given guidance about the treatment of Sch 1 applications against rich daddies—in Morgan v Hill [2006] EWCA Civ 1602, [2006] All ER (D) 386 (Nov). The parties should seek directions that financial information be exchanged by the use of forms E; that any questionnaires should be limited to those directed by the court; and that an appointment should be in financial dispute resolution (FDR) style and privileged—an FDR equivalent only being achievable consensually. In any case where the applicant has a statutory claim against more than one father, the court should ensure that the applicant establishes their respective liabilities at a consolidated hearing or at consecutive hearings. In exceptional cases, consideration should be given to separate representation of the child. 
 

Bundle rumble

It was only a matter of time. A care case before a Family Division judge who had not dealt with previous hearings and was being asked to give directions. And no bundle. Really. Not even two pages joined together by a treasury tag and unpaginated, never mind the Full Monty demanded by the new bundles practice direction for family cases—[2006] All ER (D) 7 (Aug) and see 156 NLJ 7239, p 1357, and remember that even at your local and smoke-free county court, a family case lasting for one hour now means a nicely paginated and otherwise compliant bundle. In Re D (a child) (compliance with Practice Direction in relation to bundles) [2006] All ER (D) 409 (Nov), Mrs Justice Baron hit the roof but went on to make a consent order—bundleless.  
 

HELP! HIRE!

£610 odd. That’s what Bee v Jenson [2006] EWHC 3359, [2006] All ER (D) 352 (Dec) was about. £610 odd for the cost of a hire car for the claimant after his road traffic accident and the damages claim for it that was brought against the tortfeasor. But £610 odd with, no doubt, wider ramifications for the insurance industry.

The car was provided to the claimant by DAS with whom he had cover for legal expenses and assistance. DAS had a business relationship with Helphire and the car came from them. The claimant would have been liable to Helphire for their charges had, say, his insurers gone bust.

DAS received an undisclosed discount from Helphire. Aha. Yes, that’s what was behind this High Court claim. Did the claimant in the subrogated claim have to give credit to the tortfeasor for the discount or could his insurers collect the gross hire charges? The gross sum could be recovered, held Mr Justice Morison. The tortfeasor’s submissions misunderstood the nature of subrogation in an insurance case such as this—contractual subrogation—as against subrogation as a remedy to prevent unjust enrichment.

Nil excess charge OK

The evidence showed that the Helphire rate was  good value by comparison with spot hire rates. The judge said that had the point been live, he would have held that it was reasonable for the claimant to have hired with a nil excess regardless of the excess which applied to his own car. He would have followed the Court of Appeal in Marcic v Davies 20 February 1985 (unreported) in which it ruled that the claimant who had hired and paid a waiver fee to achieve a nil excess when his own excess had been £150 was entitled to recover that fee.

LOOK, NO RENT

Fixed-term lease. Before expiry, the tenant vacates and ceases to pay rent. The law was recited or
established in Reichman and another v Beveridge and another [2006] EWCA Civ 1659, [2006] All ER (D) 186 (Dec).
Let them pay
The landlord sits by and holds the tenant to the lease, suing for arrears as and when they accrue?  OK.

Let them go

The landlord re-enters and thereby puts an end to the lease? OK, but the landlord cannot recover as damages any difference between the contractual rent under the old lease and a lower rent payable under a new lease.

Let out

Put in another tenant and, in relation to the unexpired residue, claim damages for any difference between the contractual rent under the first lease and rent collected from tenant put in and also claim contractual rent under the first lease during any void? No good.

Putting in another tenant amounts either to accepting a surrender or evicting the original tenant to put an end to the right to claim rent—Walls v Atcheson (1826) 11 Moore CP 379, although it was there suggested that the position would be different if the landlord first notified the tenant that the premises were not to be occupied by him but let to another on the tenant’s account. But in Reichman Lord Justice Lloyd said “the scope and effect of this possible course of action seems to me to be somewhat uncertain and questionable”. He considered that a landlord could not be criticised for taking the view that it would be unwise to place reliance on that approach.  

Let’s get ready

Take steps preparatory to a re-letting? Possible without amounting to a re-entry which would forfeit the lease—as in Oastler v Henderson (1877) 2 QBD 575. Lloyd LJ said in Reichman that there may be some scope for this but a landlord would be entitled to take a cautious line, knowing that the tenant would wish to argue that the lease had been determined sooner rather than later.

Let the landlord pull his finger out 

The solicitor tenants in Reichman who had been in partnership ceased to practise and at some stage ceased to pay the rent. They were sued for arrears. The courageous argument of the tenants—or at least one of the two who participated in the second tier appeal, the landlords being unrepresented after two previous outings at which they were victorious and submissions being made by an advocate to the court—was that the landlords had been under an obligation to mitigate their loss and had failed to do so by forfeiting the lease despite knowing of the tenants’ plight.
 

Let’s try a Reid

The Court of Appeal ruled that while there was no doubt that mitigation applied to a claim for damages for breach of lease covenant, the same could not be said for a claim for rent which was in debt. The tenants were seeking to rely on a principle analogous to the doctrine of mitigation of loss by courtesy of Lord Reid in White and Carter (Councils) Ltd v McGregor [1962] AC 431.
Over to Lord Reid: “It may well be that, if it can be shown that a person has no legitimate interest, financial or otherwise, in performing the contract rather than claiming damages, he ought not to be allowed to saddle the other party with an additional burden with no benefit to himself. If a party has no interest to enforce a stipulation, he cannot in general enforce: so it might be said that, if a party has no interest to insist on a particular remedy, he ought not to be allowed to insist on it. And just as a party is not allowed to enforce a penalty, so he ought not to be allowed to penalise the other party by taking one course when another is equally advantageous to him.”

Let’s be serious

Lloyd LJ said this could only apply in a limited category of cases. The characteristics were that an election to keep the contract alive would be wholly unreasonable and damages would be an adequate remedy or that the landlord would have no legitimate interest in making such an election.
The tenants’ argument in Reichman was not open to them. If a landlord chooses to regard it as up to the tenant to propose an assignee, sub-tenant, or, if he wishes, a substitute tenant under a new tenancy, rather than take the initiative himself, that was not unreasonable.