A cause of action arose in April 1994.
A writ and points of claim (it was a Commercial Court case) were served in January 1998.
Discovery took place in November 1998 but then there was no further correspondence at all between the solicitors until March 2000.Both firms were clearly alive to the provisions of CPR PD51 para 19(1): 'If any existing proceedings have not come before a judge, at a hearing or on paper, between 26 April 1999 and 25 April 2000, those proceedings shall be stayed.'The solicitors could not then agree on how best to proceed.
In a nutshell, the defendants took the view that the case should be stayed.
So the claimants' solicitors faxed the court on 19 April 2000 setting out the history of the case, making it clear that they did not have the consent of the defendants and asking the court to place their fax before the judge for him either to make directions or to direct that the claimants should take out a case management conference in May.The very next day, 20 April, the fax was put before Morison J.
He endorsed the fax cover sheet with the following words:'Automatic stay to apply - claimants have not taken sufficient steps to progress a relatively stale claim'.'Before me but not before me'And so it was that the case of Reliance National Insurance Co (Europe) Ltd v Ropner Insurance Services Ltd [2000] All ER (D) 2073 found its way to the Court of Appeal where it came before Chadwick and Latham LJJ on 1 December 2000.They upheld the opinion (it was not considered an order as such) of Morison J, saying that the mere writing of a letter to the court, even if it was brought to the judge's attention and he responded to it, did not mean that the proceedings had 'come before the court .
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on paper'.Why did the appeal judges reach this decision? The claimants argued in the Court of Appeal that, in a literal sense, the proceedings had clea rly come before Morison J on 20 April 2000, on paper.
That was all that was necessary to exclude the operation of the automatic stay.But the Court of Appeal rejected that argument because the claimants' solicitors' letter had not been treated as an application notice under CPR Pt 23 - even though the court can always dispense with a formal notice and treat a letter as sufficient (r.23.3(2)(b)).Latham LJ commented that those same words - 'come before a judge, whether at a hearing or on paper' - appear in PD51 para 15, where they are clearly intended to denote an occasion on which the judge considers exercising his powers in accordance with the CPR.And under r.3.3(1), that means either on an application or of the court's own initiative.
Support for that general proposition is, as Chadwick LJ said, to be found in PD51 para 14(1) where it says that 'any application to the court made on or after 26 April 1999 must be made in accordance with CPR Pt 23'.Check the insurance?At this point many readers will be starting to feel uneasy.
But no problems can arise where the procedural judge made an order on paper (even following simply a letter or draft order from the parties without an application notice) if that order had the consent of the parties.And in the overwhelming majority of non-consent cases that fell onto the desks of procedural judges between 26 April 1999 and 25 April 2000 as a result of a letter from one or more of the parties, the judges concerned chose to treat the cases as being before them and exercised their powers under r.3.3.That they did so is evidenced by the many directions orders that were made, most of them expressly designed to avoid the otherwise automatic imposition of the stay.Many of the directions orders made were quite lengthy: most expressly made mention of the extent to which the CPR were to apply from that moment on.
These cases are not affected by the outcome in Reliance National.What happened in Reliance National is that Morison J made the decision not to treat the letter as effective to bring the proceedings before him 'on paper'.
His comments on the fax cover sheet could not by any stretch of the imagination be considered an exercise of his powers under r.3.3.The simple expedient of one side writing a letter to the court would not suffice: the judge had to intend to further the proceedings in the sense envisaged by PD51 para 15, that is the giving of directions as to how the CPR were to apply to the proceedings, the making of case management directions and so on.A word of warningIf a judge treated a letter as sufficient for the matter to be before him or her, and proceeded to make appropriate directions, that order would have been made by the court of its own initiative under r.3.3.
As a result r.3.3(5) applies, under which the other parties affected by the order would have been entitled to apply to have it set aside, varied or stayed.
Perhaps it was not apparent on the face of the order that the court had acted on its own initiative and that a right to apply to set aside, vary or stay proceedings did exist.Would such an application under r.3.3(5) succeed in 2001, some eight months or so after the order would have been made? Certainly that period is longer than that of seven days mentioned in r.3.3(6)(b).On top of the delay in applying, the judge will inevitably look at the progress made in the case since it was brought within the CPR.
A case close to trial will not be stayed; nor will a case where neither side has thought that the case has been stayed.
The overriding objective w ould clearly be of relevance.Where there might be room for concern is with those relatively few cases which, despite even active case management, have suffered serious delay since being brought within the CPR.
But, in reality, such cases would be vulnerable to a strike-out application in any event.Next stop?Where does the Court of Appeal's decision leave Reliance National now? Clearly, and as both members of the Court of Appeal indicated, it could apply for the automatic stay to be lifted.That application would thus provide the court with an opportunity for the court to consider whether the proceedings (which in Reliance National had prima facie been allowed to stagnate) should be permitted to continue and, if so, on what terms.
The checklist in r.3.9 would have to be considered, item by item, and the line of cases starting with Biguzzi v Rank Leisure plc [1999] 1 WLR 1926 would have to be revisited.Should Reliance National's claim survive? On that, their Lordships declined to comment.
Thankfully, the case turns on its particular facts and the number of past cases caught by the decision will be relatively few.
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