HT-2022-000180 - [2024] EWHC 1088 (TCC)

The law relating to summary judgment/strike out

The relevant rules in the CPR are as follows:

Power to strike out a statement of case

“3.4

(1)

In this rule and rule 3.5, reference to a statement of case includes reference to part of a statement of case.

(2)

The court may strike out a statement of case if it appears to the court –

(a)

that the statement of case discloses no reasonable grounds for bringing or defending the claim;

(b)

that the statement of case is an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings; or

(c)

that there has been a failure to comply with a rule, practice direction or court order.”

Grounds for summary judgment

“24.2

The court may give summary judgment against a claimant or defendant on the whole of a claim or on a particular issue if –

(a)

it considers that –

(i)

that claimant has no real prospect of succeeding on the claim or issue; or

(ii)

that defendant has no real prospect of successfully defending the claim or issue; and

(b)

there is no other compelling reason why the case or issue should be disposed of at a trial.”

(Rule 3.4 makes provision for the court to strike out a statement of case or part of a statement of case if it appears that it discloses no reasonable grounds for bringing or defending a claim)”

In EasyAir Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch), Lewison J said the following about summary judgment applications, but the same applies also to strike out applications:

“The correct approach on applications by defendants is, in my judgment, as follows:

i)

The court must consider whether the claimant has a “realistic” as opposed to a “fanciful” prospect of success: Swain v Hillman [2001] 2 All ER 91;

ii)

A “realistic” claim is one that carries some degree of conviction. This means a claim that is more than merely arguable: ED & F Man Liquid Products v Patel [2003] EWCA Civ 472 at [8]

iii)

In reaching its conclusion the court must not conduct a “mini-trial”: Swain v Hillman

iv)

This does not mean that the court must take at face value and without analysis everything that a claimant says in his statements before the court. In some cases it may be clear that there is no real substance in factual assertions made, particularly if contradicted by contemporaneous documents: ED & F Man Liquid Products v Patel at [10]

v)

However, in reaching its conclusion the court must take into account not only the evidence actually placed before it on the application for summary judgment, but also the evidence that can reasonably be expected to be available at trial: Royal Brompton Hospital NHS Trust v Hammond (No 5) [2001] EWCA Civ 550 ;

vi)

Although a case may turn out at trial not to be really complicated, it does not follow that it should be decided without the fuller investigation into the facts at trial than is possible or permissible on summary judgment. Thus the court should hesitate about making a final decision without a trial, even where there is no obvious conflict of fact at the time of the application, where reasonable grounds exist for believing that a fuller investigation into the facts of the case would add to or alter the evidence available to a trial judge and so affect the outcome of the case: Doncaster Pharmaceuticals Group Ltd v Bolton Pharmaceutical Co 100 Ltd [2007] FSR 63 ;

vii)On the other hand it is not uncommon for an application under Part 24 to give rise to a short point of law or construction and, if the court is satisfied that it has before it all the evidence necessary for the proper determination of the question and that the parties have had an adequate opportunity to address it in argument, it should grasp the nettle and decide it. The reason is quite simple: if the respondent's case is bad in law, he will in truth have no real prospect of succeeding on his claim or successfully defending the claim against him, as the case may be. Similarly, if the applicant's case is bad in law, the sooner that is determined, the better. If it is possible to show by evidence that although material in the form of documents or oral evidence that would put the documents in another light is not currently before the court, such material is likely to exist and can be expected to be available at trial, it would be wrong to give summary judgment because there would be a real, as opposed to a fanciful, prospect of success. However, it is not enough simply to argue that the case should be allowed to go to trial because something may turn up which would have a bearing on the question of construction: ICI Chemicals & Polymers Ltd v TTE Training Ltd [2007] EWCA Civ 725

The principles applicable to an application for strike out pursuant to CPR 3.4(2)(a) are conveniently summarised in section 3.4.2 of the White Book (2024 Edition). That makes reference to paragraph 1.4 of PD3A (Striking Out a Statement of Case), which gives examples of the types of claim suitable for strike out. This includes claims “which are incoherent and make no sense” and “those which contain a coherent set of facts but those facts, even if true, do not disclose any legally recognisable claim against the defendant.”

In Liberty Homes (Kent) Limited v Kanangaratnam Rajakanthan [2022] EWHC 2201 (TCC), Jefford J struck out a pleading which did not set out the facts necessary for a completed cause of action. She referred at [52] to the purpose of the rule as summarised by Teare J in Towler v Wills [2010] EWHC 1209 (Comm) at [18]:

“The purpose of the pleading or statement of case is to inform the other party what the case is that is being brought against him. It is necessary that the other party understands the case which is being brought against him so that he may plead to it in response, disclose those of his documents which are relevant to that case and prepare witness statements which support his defence. If the case which is brought against him is vague or incoherent he will not, or may not, be able to do any of those things. Time and costs will, or may, be wasted if the defendant seeks to respond to a vague and incoherent case. It is also necessary for the Court to understand the case which is brought so that it may fairly and expeditiously decide the case and in a matter which saves unnecessary expense…” [emphasis added]

Three purposes of pleadings are identified, namely:

It is important not to take this too far. For example, the case of Towler v Wills was a shareholder dispute where a litigant in person appeared without a skeleton argument to defend a pleading which was unreasonably vague and incoherent, and after a long run up putting him on notice about the basis of the strike out application. The next paragraph of the judgment after the one quoted above gives something of what would have happened if the strike out had not occurred, namely at [19]:

“19.

It is not fair and just that the Defendant cannot be sure of the case he has to meet. It may well be that, with appropriate legal advice, the Claimant could have pleaded a concise, clear and particularised case against the Defendant but that has not been done. If the Amended Particulars of Claim are not struck out there is a very real risk that unnecessary expense will be incurred by the Defendant in preparing to defend allegations which are not pursued, that he will be impeded in his defence of allegations which are pursued and that the Court will not be sure of the case which it must decide.”

Paragraph 1.3 of Practice Direction 3A states that a claim may fall within CPR 3.4(2)(b) where it is "vexatious, scurrilous or obviously ill-founded". The White Book 2024 at para. 3.4.1 referring to 3.4(2)(a) and (b) states: “Grounds (a) and (b) cover statements of case which are unreasonably vague, incoherent, vexatious, scurrilous or obviously ill-founded and other cases which do not amount to a legally recognisable claim or defence.”

The ambit of the rule was considered by Whipple J in Cleeves v The Chancellor, Masters and Scholars of the University of Oxford [2017] EWHC 702 (QB) at [35] as follows:

A related form of abuse is a party who “blows hot and cold” where a party pursues a case in the same or other proceedings and then does a volte face and pursues an inconsistent case. Even without that, if there is a case which lacks coherence and is “endlessly mutable” with fundamental contradictions for example between witness statements and pleadings which could not stand together, and if the case were not ready to move forward, the need to strike out might arise: see Nekoti v Univilla Ltd [2016] EWHC 556 (Ch) (Chief Master Marsh) especially at [72 - 76]. It might be different if the party was "genuinely mistaken about a version of events, particular facts or how best to put forward its case". Whilst the Court has to control its own process and be prepared to strike out a claim, the Court will be cautious before so doing in respect of a case which has a real prospect of success. The Court will not exercise the power to strike out for abuse of process without a scrupulous examination of the circumstances and a consideration as to whether this is appropriate and proportionate.

In Summers v Fairclough Homes Limited [2012] 1 WLR 2004, Lord Clarke drew attention to the right to a fair and public hearing, and then said this at [48]: "It is in the public interest that there should be a power to strike out a statement of case for abuse of process, both under the inherent jurisdiction of the court and under the CPR , but the Court accepts the submission that in deciding whether or not to exercise the power the court must examine the circumstances of the case scrupulously in order to ensure that to strike out the claim is a proportionate means of achieving the aim of controlling the process of the court and deciding cases justly".

CPR 16.4(1)(a) requires that a statement of case must include a “concise statement of the facts” relied on. In Pantelli Associates Limited v Corporate City Developments Number Two Limited [2011] EWHC 3189 (TCC), the pleader had “simply taken each relevant contractual term and then added the words “failing to” or “failing adequately at all to” as a prefix to each obligation, thus turning the obligation into a breach of professional negligence” (at [10]). Coulson J (as he then was) said this was non-compliant with the Rules:

“CPR 16.4(1)(a) requires that a particulars of claim must include “a concise statement of the facts on which the claimant relies.” Thus, where the particulars of claim contain an allegation of breach of contract and/or negligence, it must be pleaded in such a way as to allow the defendant to know the case that it has to meet. The pleading needs to set out clearly what it is that the defendant failed to do that it should have done, and/or what the defendant did that it should not have done, what would have happened but for those acts or omissions, and the loss that eventuated. Those are ‘the facts’ relied on in support of the allegation, and are required in order that proper witness statements (and if necessary an expert’s report) can be obtained by both sides which address the specific allegations made.”

Jefford J also referred to Coulson J’s comments in Liberty Homes. She concluded at [60]:

“It is incumbent on the claimant to comply with the rules and it cannot be right in principle that the burden should pass to the defendant to tease out the claimant’s case. As ever there is a question of fact and degree. There may be cases in which a simple request for clarification could have been made but was not and the court will not exercise its discretion to strike out where that course has not been taken…”

The White Book 2024 states as follows at 17.3.6:

“A proposed amendment must be arguable, carry a degree of conviction, be coherent, properly particularised and supported by evidence that establishes a factual basis for the allegation: see Kawasaki Kisen Kaisha Ltd v James Kemball Ltd [2021] EWCA Civ 33 at [18].

However, for the amendment to be allowed it must be shown to have “a real prospect of success”, as draws upon the test for summary judgment. Distinction is sometimes drawn between whether the amendment: (i) introduces a new claim or alternatively (ii) provides further particulars, based on factual material, in support of an existing pleaded point. It is clear that the former will not be permitted if the new allegation carries no reasonable prospect of success. There is support for the proposition that the latter should not invite an assessment whether the particulars have a real prospect of success, these being matters for trial. See Phones 4U Ltd (In Administration) v EE Ltd [2021] EWHC 2816 (Ch) at [11], as followed HH Judge Eyre QC (as he then was), sitting as a judge of the High Court, in Scott v Singh [2020] EWHC 1714 (Comm) at [19] (the summarised principles in which were approved by the Court of Appeal in CNM Estates (Tolworth Tower) Ltd v Simon Peter Carvill-Biggs Freddy Khalastchi [2023] EWCA Civ 480) and JFC Plastics Ltd v Motan Colortronic Ltd [2019] EWHC 3959 (Comm) at [14] and [34]. However, in Gerko v Seal [2023] EWHC 63 (KB) the court expressed “slight scepticism” (at [190]) as to the existence of a “rule” that additional particulars do not have to meet a real prospect of success, giving reasons why such rule, if it exists, must have very limited scope. Even if an amendment does not present a new cause of action or defence, it should still properly be subject to considerations of the overriding objective and case management powers and so irrespective of any “rule” displacing a test of prospect of success.

Real prospect must focus must be on the pleaded case rather than supporting evidence and conclusions that might be drawn based on that evidence.”

LOR’s claim against MAAP is very closely related to the claim against Sweett. Whereas LOR says that Sweett failed to spot non-compliances in the designs, the claim against MAAP is advanced on the basis that MAAP produced the non-compliant designs. LOR submitted that this is a “poacher-gamekeeper” situation. LOR has claims against both the poacher (MAAP) and the gamekeeper (Sweett). The details of the design non-compliances themselves are, necessarily, the same against both defendants.

Sweett is critical of the pleadings of LOR because it says that what has happened is that LOR has simply repeated the claim against MAAP against LOR, LOR’s characterisation is of MAAP having produced defective designs being liable as poacher and LOR having failed to observe the defective designs being liable as gamekeeper. This is an odd characterisation because there is no suggestion that there was an intentional wrong on the part of MAAP, and so the analogy of poacher and gamekeeper is not particularly apposite. Of more moment to consider is the criticism of Sweett that in assuming that there are two sides of the same coin, LOR has neglected to analyse that the liabilities may be connected but they are not co-extensive. It is necessary to consider in this judgment the suggestion that the specific obligations of Sweett have to be analysed separately from those of MAAP, and that to the extent that a pleading does not do this, it is deficient.

As originally pleaded, and perhaps in subsequent iterations, there may not have been sufficient attention given to separating the two claims and to identifying the obligations specific to Sweett. The question for the Court is not whether that is how it started: rather it is how it has ended up on the basis of the latest iteration of the draft Particulars of Claim and the RFI replies.