Many organisations of all shapes and sizes have at one time been on the receiving end of a totally unmeritorious complaint. When such complaints turn litigious, and the claimant refuses to accept that his claim is devoid of merit, the burden on the organisation and its employees, both financial and otherwise, is considerable. Richard Harrison and James Taylor examine a recent Court of Appeal decision which reviews and extends the options available to defendants to restrain claimants who persist in bringing hopeless claims.
DEFEATING "VEXATIOUS" CLAIMANTS
There is a small but disproportionately problematic number of claimants who place a significant burden on organisations and the courts by bringing legal proceedings or multiple applications within those proceedings time and time again which have absolutely no merit. They are a drain on the organisation’s time and finances through the legal costs which inevitably result and can, but in the overwhelming majority of cases should not, cause wholly unjustified stress. The position is exacerbated by the fact that these claimants frequently qualify for an exemption from having to pay the substantial fees now payable on the issue of Claim Forms and fees for making applications and they are usually unable to pay any costs orders made against them. The courts too have become conscious of the extent to which their processes are being abused. They recognise that these claimants are a drain on the court’s time and limited financial resources and are concerned that they divert the court’s attention away from cases of real merit.
Until now the remedies available to defendants have been limited and the drastic step of having a claimant declared a vexatious litigant pursuant to s.42 of the Supreme Court Act 1981 was only available to the Attorney General. Once this order is made a claimant ( and often his agents) can only bring an application or issue proceedings against another party with the permission of a High Court Judge.
In Bhamjee v Forsdick & Ors, (in which judgment was handed down on 25 July 2003), the Court of Appeal revisited and extended the existing options available to defendants and provided guidance on which measures the court should adopt, depending on the scale of mischief it is sought to address. The Court of Appeal renamed the existing remedies and introduced a new form of order, a General Civil Restraint Order, which covers all proceedings in the court in which the order is made regardless of whether the proceedings arise from the same facts as the claimant’s earlier unmeritorious claims. In addition, the Court of Appeal authorised courts, in exceptional circumstances, to limit the claimant’s right to apply for permission to appeal. We set out the new framework below.
The background to Mr Bhamjee’s case is largely irrelevant and a brief summary will suffice. Mr Bhamjee brought a claim against five barristers, none of whom had ever been instructed for or acted on his behalf. We were instructed to defend the barristers by their professional indemnity insurers. Mr Justice Park struck out the claim in January 2003 as being hopeless and devoid of merit. Mr Bhamjee then sought leave to appeal. The Court of Appeal refused his application and ordered instead that a hearing be convened to consider Mr Bhamjee’s future litigious activities. We applied on the barristers’ behalf for what was then known as an Ebert Order, a remedy preventing a claimant from bringing any applications or issuing any further claims against the same people arising out of the same facts. In the supporting witness statement we informed the Court of Appeal that we were aware that Mr Bhamjee had already brought separate proceedings against three other defendants arising out of the same facts and that he was proposing to issue claims against eight further barristers who had never acted for him. The Court of Appeal granted the Ebert Order and added a penal notice, meaning that if the order was breached, Mr Bhamjee could be committed to prison.
While considering the various means of controlling Mr Bhamjee’s conduct the Court of Appeal set out a framework of updated remedies. Beginning with the least stringent, these are as follows:
- Strike out under Rules 3.3 and 3.4 of the Civil Procedure Rules: This is probably the first step to consider when faced with proceedings or an application which appear to be vexatious in character. Judges are also encouraged to be alert to cases where it might be appropriate to use their initiative to strike out cases under rule 3.3 as being without merit before proceedings are served on the other party.
- A Civil Restraint Order (formerly called a Grepe v Loam order): This prevents the issue of further applications within a single set of proceedings without the permission of a nominated Judge and usually lasts for the duration of the proceedings. Any application made without permission is regarded as dismissed and the other party does not need to respond. The Court has stated that this order is appropriate when the claimant has shown an obsessive resort to litigation and made a number of applications in a single set of proceedings all of which have been dismissed for being totally without merit.
- An Extended Civil Restraint Order (formerly called an extended Grepe v Loam order): This order was established in Ebert v Venvil (2000). This can be made in the Court Appeal, High Court and County Court and extends not only to applications in the current proceedings, but also to new applications, or other steps in new proceedings, in both the court in which the order is made and the courts below, arising out of the same factual matrix and instituted without the leave (applied for and given in writing) of a nominated Judge. The Court has stated that for such a restraint to be appropriate, the claimant should have exhibited persistently vexatious behaviour and a refusal to take "no" for an answer. This order should be made for a period not exceeding two years. This can be extended if necessary, but not beyond a further two years on any given occasion. This appears to be a restriction of the ambit of the order as no time restrictions were laid down in Ebert.
- A General Civil Restraint Order: This is a new order introduced by the Court of Appeal which can be made when an Extended Civil Restraint Order does not prove sufficient to restrain the claimant’s conduct. It restrains the claimant from commencing any action or application in a particular court, ie the High Court or a particular County Court, without the permission of that court. Again this order should be made for a period not exceeding two years.
- Refusal of permission to appeal: If a claimant subject to an Extended or General Civil Restraint Order continues to make unmeritorious applications, a High Court Judge or a designated civil Judge can direct that his decision is final and that no appeal court would have jurisdiction to grant leave to appeal.
All of these measures may be instituted by the court on its own motion or upon application by other parties to the action. The Court of Appeal has stated that it is open to a party to apply for any of the three restraint orders (although presumably parties should follow the guidance on which order is appropriate), and the court, on hearing the application, should make an order "proportionate to the mischief complained of ".
HUMAN RIGHTS The Human Rights Act 1998 is often used by claimants as a reason why parties should not be constrained from conducting themselves at will. The Court of Appeal confirmed that claimants bringing unmeritorious claims will not be saved by arguing that restraining an individual’s access to the courts is a breach of human rights as long as the restrictions imposed are appropriate and proportionate to the conduct which it is sought to restrain.
IMPLICATIONS The Court of Appeal’s reaction to Mr Bhamjee’s activities, and its measured judgment setting out and extending the various remedies available, indicates that the courts should be prepared to take a more robust stance against claimants who persist in making unmeritorious claims/applications. For example, Judges are encouraged to use their own initiative to strike out claims even before proceedings are served on other parties. The new General Civil Restraint Order is a welcome development since it provides defendants, as a last resort, with the ability to apply for a remedy the like of which was previously available only to the Attorney General. It remains to be seen quite how vexatious a claimant has to be before a court is prepared to make the more stringent restraining orders but the Court of Appeal indicated in its Judgment that courts should be more willing to use the Extended Civil Restraint Order. The framework in the Judgment suggests that, provided the remedy being sought is proportionate to the mischief, the court will make the Order. In certain circumstances it would be appropriate also to seek a penal notice.
On a more cautious note, although the Court of Appeal has imposed this new framework and has extended the available remedies, the first two remedies remain limited either to particular proceedings or facts while the more severe of the restraint orders will only operate for a maximum of two years unless the court agrees to extend it. Furthermore, the various restraint orders do not appear to extend to the claimant’s agents. So while the new framework should suffice in the majority of cases, there might still be occasions when the Attorney General would have to apply, as under the old law, for an order pursuant to s. 42 of the Supreme Court Act 1981.
The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.