Claim No: IP-2022-000077 - [2024] EWHC 234 (IPEC)

The cost-benefit test

Mr Selmi’s position on behalf of the First Defendant was that the application should succeed in respect of all three individuals; that any objection to their joinder on case management or cost benefit grounds was ‘synthetic prejudice’; that the action was relatively simple; and that, even if all parties were included in the action, it could easily be heard in three days, given the IPEC’s case management expertise. He submitted that the Claimant’s objections based on the need for additional disclosure and evidence, and the likely length of the trial, were extraordinary and that a small increase in complexity was not a proper basis for refusing to add additional parties, but only for case managing things tightly. Mr Selmi further submitted that the case could, with all additional parties included, be heard in two days if required.

As far as further facts relating to joint tortfeasorship were concerned, his primary submission was that those flowed naturally from the existing facts and would introduce little in the way of added complexity. His position on evidence was, however, that the First Defendant would wish to receive disclosure from any additional parties and to cross examine them at trial.

Ms Berkeley submitted first that the First Defendant’s application was late without any proper explanation for its lateness. During the hearing, the way in which the evidence relied on against the proposed new parties had come to light and the steps taken by the First Defendant to bring it to the attention of the Claimant were discussed by Mr Selmi. Given that this is the CMC, and therefore the appropriate time to bring applications which will have an impact on the proceedings, I concluded that the application was not late in a way to influence the exercise of the court’s discretion.

Ms Berkeley also submitted that the First Defendant had put forward no explanation as to the practical benefit of adding the additional parties, noting that the Claimant is a substantial company with significant resources, able to meet any damages or costs order that might be made against it in due course. She noted that the impact of the IPEC costs cap would be to limit the recovery of costs by any successful party irrespective of the number of parties involved and drew my attention to the White Book commentary under CPR 63.26 2F-17.19.2: “It is easy to see how substantial injustice might arise in this situation, for example if a claimant chooses to sue a large number of unconnected defendants. However, the Court has effectively decided that the desirability of certainty of costs exposure to IPEC users outweighs the problems that result. It may be that the Court will recognise this potential problem by seeking to apply stricter controls on the proper parties to the action at the case management conference stage or some other appropriate time.” Ms Berkeley submitted that in this instance, given that no material benefit had been identified by the First Defendant, such considerations militated against including the additional parties as part of the costs-benefit analysis.

As far as other case management issues were concerned, Ms Berkeley submitted that the addition of the three individuals would add significantly to the cost, time and complexity (and therefore cost) of preparing for trial as well as to the duration of the trial itself. Ms Berkeley confirmed that all the new parties intended to defend the allegations of joint tortfeasorship, which would require witness statements and, based on the Defendants’ draft CMC order, significant disclosure obligations as well as cross-examination at trial.

It was the Claimant’s position that, without the new parties, the trial would require at least two days, and possibly more, and that the addition of the new parties would add around 1.5 extra days, taking it outside the maximum length of an IPEC trial which is (in exceptional circumstances only) three days. Ms Berkeley’s proposal was that if the Court were to allow additional parties to be joined, there should be a split trial in IPEC, with the issue of joint tortfeasance in respect of the Counterclaim being stayed (together with all related case management) and heard, if necessary, at a subsequent liability trial on joint tortfeasorship only. A third trial on quantum would also then be necessary. An alternative possibility might be for the court to transfer the action to the High Court, although no application to do so had been made.