Summary judgement of part 24

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Christopher Tromans reviews the interpretation of part 24 of the Civil Procedure Rules

Order 14 of the Rules of the Supreme Court previously provided for summary judgment for a defendant only on a counter-claim and otherwise was concerned with applications by claimants for summary judgment.



The ease with which a defendant could resist such an application will be well remembered. All that a defendant had to show was what had been variously described as a 'fair probability of a bona fide defence', a defence that was 'more than shadowy but less than probable', a defence that was more than 'frivolous and practically moonshine' and, in the words of Vice-Chancellor Megarry in Tennant v Associated Newspapers [1979] FSR 298, 303, a case that was not 'all surmise and Micawberism'.



That cosy regime was changed by the Civil Procedure Rules 1998 (CPR), which introduced two procedures for the early disposal of cases, both of claimants and defendants, that lack merit.


Under CPR 3.4(2), a statement of case can be struck out if it shows no reasonable grounds for bringing or defending the claim, if it amounts to an abuse of process, or if it does not comply with a rule, practice direction or order. Normally, the focus at this stage will be on the statement of case itself. If the statement does not set out a coherent case in law or fact, or if it does not comply with the requirements of CPR 16, it can be struck out.


The second procedure is in CPR 24, which, subject to a few specified exceptions, provides for summary judgment against claimants and defendants. The criteria to be applied are whether a party has no real prospect of success and whether there is any other compelling reason why the case or issue should be disposed of at trial.



The first criterion overlaps with the 'reasonable grounds' test in CPR 3.4(2)(a). The Court of Appeal in Taylor v Midland Bank Trust Co Ltd [1999] All ER (D) 831, held that an application under that rule could be treated as if it were an application for summary judgment under part 24. As the defendants had not shown that on the available evidence the claim was bound to be dismissed at trial, their application for summary judgment failed.



There is also a parallel with CPR 13.3, which deals with the setting aside of judgments. Under this rule, too, 'real prospects of success' must be shown, and the Court of Appeal in ED & F Man Liquid Products Ltd v Patel & Patel [2003] EWCA Civ 47; [2004] All ER (D) 75 (Apr), held that the tests under the two rules are similar. Whether one asked if the first defendant (who had made several unqualified admissions of the debt) had an arguable case or if he had real prospects of success, the answer was the same.



What in practice amounts to 'a real prospect of success'? This is a topic that has been considered by the Court of Appeal several times in different contexts.



In Swain v Hillman [2001] 1 All ER 91, Lord Woolf, the then Master of the Rolls, held that while the words speak for themselves, the court needs to determine whether there is a real or realistic, as opposed to a fanciful, prospect of success, and that if a claimant has a case that is bound to fail, it is in his interests to know that as soon as possible.



At first sight, this does not indicate a particularly high threshold. To avoid summary judgment, a party must show only a better than fanciful prospect of success. However, the Court of Appeal in other cases has given a rather different emphasis and has resurrected the pre-CPR authority of Alpine Bulk Transport Co Inc v Saudi Eagle Shipping Co Inc [1986] 2 Lloyd's Rep 221. That case concerned an application to set aside judgment. Sir Roger Ormrod said the court's task was to form a provisional view of the probable outcome of the case if the judgment were to be set aside and the defence allowed to proceed. The defence must carry some degree of conviction.



Saudi Eagle was not cited in Swain and re-emerged in the judgment of Mr Justice Moore-Bick in International Finance Corporation v Utexafrica Sprl [2001] EWHC 508 (Comm); [2001] All ER (D) 101 (May). This was a setting-aside case, in which the judge applied the Saudi Eagle approach and held that to justify setting aside a judgment under CPR 13.3, a case had to be better than merely arguable.



In The Royal Brompton NHS Trust v Hammond & Ors (No 5) [2001] EWCA Civ 550; [2001] All ER (D) 130 (Apr), a summary judgment case, Lord Justice Aldous reverted to the Swain approach and held that claims should be struck out only when they stood no real prospect of success. However, in Man v Patel, another setting-aside case, Lord Justice Potter held that the Swain and Saudi Eagle approaches amounted to much the same thing. Each approach required a party to have a case that was better than merely arguable.



Similarly, in Balamoody v UKCC [2001] EWCA Civ 2097; [2002] IRLR 288; [2001] All ER(D) 80 (Dec), Lord Justice Ward suggested that there was little difference between the tests of 'reasonable grounds' in CPR 3.4 and 'real prospect of success' in CPR 24.2 and (as applied to applications for permission to appeal) 52.3. 'Real' means that the prospects of success must be realistic rather than fanciful. If the grounds are fanciful, they are not likely to be reasonable.



So the standard is higher than that which applied under order 14, although there is still scope for argument about how much better than 'arguable' a case must be. Watch this space.


However, the authorities do provide guidance as to the assessment of the merits of a case at the summary judgment stage. The court should not conduct a mini-trial and if there are issues of fact, these should be resolved at trial [Swain at paragraph 98b].


Similarly, the judge should work on the assumption that the statements before the court at that stage are unlikely to contain the totality of the evidence and should consider the evidence reasonably to be expected to be available at trial [Royal Brompton at paragraphs 19 and 20].


Nevertheless, the court should not accept without analysis everything in the statements, particularly if contemporary documents contradict factual assertions made in the statements.



District Judge Tromans sits at Plymouth Combined Court Centre

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