Applications for relief from sanctions continue to trouble the courts, the latest judgment being given by the Court of Appeal in ELO Trustees Ltd v (1) Bonhams 1793 Ltd (2) HNW Lending Ltd [2023] EWCA Civ 664. One of the take away points from this case concerns the need to make an application for RFS promptly. In this case, 18 days was considered too late.
Mr Elo, whose first name was "XXXX", had defaulted on a settlement agreement in relation to loans he had taken out. The defendants obtained judgment in default and proceeded to seize some rare cars under a writ of control. The claimant alleged that it owned the cars instead of Mr Elo and on 13 April 2022 successfully obtained an injunction preventing the defendants from selling the cars. The injunction order provided that the injunction would be discharged unless the claimant issued a claim form seeking a determination of the ownership of the cars by 14 April, served it by 20 April and filed and served evidence in support of its application for continuation of the injunction by 27 April 2022.
Although the claimant submitted a draft claim form to the court on 14 April 2022 it was not issued until 19 April 2022. The claimant did not chase the Court. Meanwhile the Court raised with the claimant the question of the spelling of his name and that the fee stated in the claim form was incorrect. The claimant then served the claim form on 19 April 2022 by email but without complying with the rules on service of a claim form by email so this did not constitute service. It also served the claim form by post but deemed service rules meant it was served on one defendant on 21 April and on the other defendant on 22 April. Likewise the evidence was served by email which did not constitute service. Service by post resulting in deemed service being out of time by two days on 29 April on one defendant and it was not served on the other defendant at all.
The claimant did not apply for relief from sanctions until 2 May 2022, some 18 days after the first missed deadline of 14 April. In the meantime the defendants had pointed out to the claimant that RFS was necessary. RFS was refused by the Judge on the basis that there were serious and significant breaches of peremptory orders with no good reason. When considering the other circumstances of the case the Judge considered that the application for RFS had not been made promptly.
The claimant appealed but the decision was upheld by the Court of Appeal. One of the grounds of appeal was that the Judge was wrong to hold that the application for RFS had not been made promptly. The Court of Appeal said at [31]: Counsel for ETL relied upon the dictum of Simon Brown LJ in Regency Rolls Ltd v Carnall [2000] EWCA Civ 379 at [45] that, in the context of CPR rule 39.5 , "promptly" means "with all reasonable celerity in the circumstances". Counsel for ETL submitted that it was sufficient for an application to be made within 14 days. There is no basis for that submission. As Simon Brown LJ's statement recognises, promptness depends on the circumstances. Whether ETL applied promptly in the circumstances of the present case was a matter for the judge's evaluation. It cannot be said that his evaluation was plainly wrong. In any event, this was only one of the factors he took into account at stage three of Denton.
Overall, this delay fed into the various instances of what the Court of Appeal called the claimant's "unsatisfactory approach to the proceedings" and what the Judge called the "relaxed and, frankly, reckless approach... of leaving things to and beyond the last minute." This case is a reminder (i) not to treat dates in orders as targets instead of strict deadlines to be complied with; and (ii) to take prompt action in making an application if RFS is needed.
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