Supreme Court cracks down

Posted: 31st December 2015

In a stern decision of which all litigants should take careful note, the Supreme Court cracked the whip and underlined that tactical manoeuvring and failures to comply with case management orders will not be tolerated. Three men who did just that were prevented from defending a £1.5 million breach of contract claim.

supreme courtThe trio had received the money from a businessman after agreeing to sell him their shares in a company. They failed to complete their side of the bargain, however, and the buyer obtained a freezing order against them. That order required them to disclose full details of their own and the company’s assets.

They failed to comply with that order and, as a result, were debarred by a judge from defending the claim. A second judge relented after a further hearing. They were granted relief from the debarring sanction and a date was fixed for the trial of the action. That decision was subsequently overturned by the Court of Appeal and the debarring order restored.

In dismissing the three men’s appeal, the Supreme Court found that the second judge was not entitled to reach a different conclusion from the first on what were essentially the same facts. He should not have entertained the relief application in the absence of any material change in circumstances since the first hearing. The trio’s belated compliance with their disclosure obligations prior to the second hearing did not, by itself, amount to such a change in circumstances.