Fitzroy Robinson Ltd v Mentmore Towers Ltd

At the hearing on the 20^th November 2009, I refused the defendants’ application to adjourn the trial, due to start on 7^th December 2009. During the course of my preparations before - and leading counsel’s submissions during - that hearing, it became apparent that there were very few authorities dealing with the relevant principles to be applied in what might be called an ‘ordinary’ application to adjourn a trial: that is to say, a case where the adjournment was said to be necessitated by the parties’ failure to comply with the earlier directions of the court, which non-compliance, so it was said, made a fair trial difficult if not impossible. Partly due to the lack of such authority, and partly because of the importance of the adjournment application in the context of this case generally, I agreed to provide written reasons for my decision.

On 7^th July 2009, I handed down judgment on the liability issues in this case. (Footnote: ¹) On 21^st July, I fixed a timetable leading up to a 4 day quantum hearing, starting on 7^th December 2009. The hearing on 20^th November was fixed as the Pre-Trial Review for that quantum trial. Unhappily, the day before the PTR, the court was informed, for the first time, that the defendants wished to adjourn the trial. The application was supported by a late and rather limited statement from the defendant’s solicitor, Mr James Brownlie.

The background to the quantum trial can be summarised briefly as follows:

The claimant’s substantial claim for fees is based squarely upon invoices raised at the time, which were not paid by the defendants, but which have never been the subject of any withholding notices.

The claim was originally the subject of a CPR Part 24 application in the autumn of 2008, which application was then properly abandoned by the claimant in the light of the defendant’s defence, which raised a number of issues including fraudulent misrepresentation and negligence. General points were also taken as to the calculation of the fees due.

The liability issues were tried in May 2009 and were the subject of the judgment noted above. The defendants’ misrepresentation allegations succeeded, although their financial effect was unclear. The professional negligence allegations failed.

It was not possible at the earlier trial to resolve as many of the issues concerned with causation and the proper calculation of the fees as I would have liked. This was because the defendants had wholly failed to plead any case whatsoever as to the effect of their liability allegations on the claimant’s fee entitlement. For this reason, I considered that the onus was on the defendants to set out a properly pleaded case as to the claimant’s entitlement to fees, and my directions on 21^st July 2009 reflected that approach.

Those directions provided that:

The defendants were to serve their quantum pleadings by 2.9.09;

The claimant was to respond by 23.9.09;

The defendants were to serve a reply (if they were advised that it was necessary) by 2.10.09;

Disclosure of any other quantum documents was to be by 9.10.09;

Witness statements were to be exchanged by 23.10.09;

Experts, limited to one per party, were to meet and exchange reports by 6.11.09;

Experts were to produce a written joint statement pursuant to CPR Part 35.12 by 16.11.09.

These directions were extended by consent by Akenhead J on 8.10.09, although they still led to the experts’ joint statement on 16.11.09 in advance of the PTR on 20.11.09. Under those extended directions:

The defendants were to serve their quantum pleadings by 25.9.09;

The claimants were to respond by 16.10.09;

A reply (if so advised) was to be served by the defendants on 23.10.09;

Disclosure of any additional documents was to occur by 30.10.09;

Witness statements were to be exchanged by 10.11.09;

Experts reports were also to be exchanged by 10.11.09;

The joint statement was to be completed by 16.11.09 as originally ordered.

The actual position is as follows:

The defendants served their quantum pleading on 28.9.09. The points raised in that document appear to be principally matters of argument and submission, although I accept that there are points raised which may require some limited expert architectural evidence. Included in this category are issues such as the percentage completion achieved; the value of work, if any, carried out beyond Stage D; the quality of the work generally (although I am presently doubtful as to how far this point can be taken); and the nature and extent of any adjustment required under clause 16 of the contract. I am told that the defendants’ new expert, Mr Miers, was involved in the production of that pleading. The pleading also demonstrates that there are few, if any, matters of primary fact in dispute.

The claimant’s pleading was served on 20.10.09. This broadly confirms that the quantum issues are largely matters of argument, with some issues requiring expert evidence. Mr Hudson, the claimant’s expert throughout, was involved in the production of this document.

The defendants have chosen not to serve a reply. On their behalf, Mr Darling sought permission at the hearing on 20.11.09 to put in a belated reply, but it was apparent that the purpose of such a document was to allow the defendants at least the opportunity to raise new points which should have been pleaded before. In view of the shortness of time before trial, I refused that application. The defendants have had more than enough time to serve a reply, had they chosen to do so.

The claimant provided its list of documents relating to quantum on 3.11.09. The defendants have confirmed that they have no additional quantum documents.

The defendants have also indicated that they do not wish to serve any factual evidence. The claimant has prepared some witness statements which are, I am told, confirmatory in nature, relating to issues such as the extent of the work carried out, possible overlap between one partner and the other, and the like. Those statements are in an advanced stage of completion. I gave the claimant until 4.30pm on 24.11.09 to serve such statements, and that was a final order.

The experts have not met; they have not exchanged reports; and they have not produced a joint statement under CPR r 35.12.

Accordingly, the problem that underlies the application to adjourn concerns the expert evidence. In accordance with the extended timetable ordered by Akenhead J, those meetings were supposed to commence by no later than 4.11.09; reports were to be exchanged by 10.11.09; and the joint statement was to be provided by 16.11.09. In fact, I am told that, despite attempts made by Mr Hudson to arrange meetings with Mr Miers, the latter has not been involved in this case since the production of the defendants’ pleading at the end of September and has had no instructions to take part in any such meetings.

What are the relevant principles governing an application of this kind? It seems to me that the starting point is the overriding objective (CPR Part 1.1), the notes in the White Book at paragraph 3.1.3, and the decision of the Court of Appeal in Boyd and Hutchinson (A Firm) v Foenander [2003] EWCA Civ 1516. Thus, the court must ensure that the parties are on an equal footing; that the case - in particular, here, the quantum trial - is dealt with proportionately, expeditiously and fairly; and that an appropriate share of the court’s resources is allotted, taking into account the need to allot resources to other cases.

More particularly, as it seems to me, a court when considering a contested application at the 11^th hour to adjourn the trial, should have specific regard to:

The parties’ conduct and the reason for the delays;

The extent to which the consequences of the delays can be overcome before the trial;

The extent to which a fair trial may have been jeopardised by the delays;

Specific matters affecting the trial, such as illness of a critical witness and the like;

The consequences of an adjournment for the claimant, the defendant, and the court.

The defendants say that the dates have been allowed to slip because the parties have been negotiating in order to try and settle the case. That is, of course, not a good reason for failing to comply with court orders; negotiations are an inevitable feature of cases like this, and directions are given in the knowledge (or at the very least, the expectation) that the parties will or should be trying to resolve their differences even as they prepare for trial.

In addition, both in the specific context of expert evidence and more widely, I am troubled in a number of ways by the defendant’s conduct, past and present. First, there is their failure to give any indication until the day before the PTR that they intended to apply for an adjournment of the trial. Such an absence of notice is inexcusable. It seems to me to be a strong indication that the defendants are using this application as a negotiating tactic; by putting off an imminent trial, they may see themselves as being in a better position to negotiate an acceptable settlement.

Secondly, the delays have to be considered against the background of the defendants’ earlier unsatisfactory conduct in the run-up to the liability trial. I have already mentioned their failure to address the causation/quantum elements of their case prior to the first hearing, an omission which has meant that there are more issues to be resolved at the forthcoming trial than there should be.

In addition, a feature of the first trial - and of my earlier judgment at paragraphs 232-237 - was the repeated ‘standing down’ of their then expert, Mr Salisbury, during the preparation for that trial, which I said gave me “considerable cause for concern”. It would appear that, despite this warning, the defendants have engaged in precisely the same conduct with their new expert, with the result that Mr Miers has deliberately not been made available to take part in the joint discussions between the experts. I have to say that I consider that such conduct is both unacceptable and surprising, particularly given that the defendants have already been criticised by the court for just this approach.

Thirdly, and perhaps most important of all, I note the complete lack of analysis of how and why, on the defendants’ case, the delays in relation to the expert evidence may make a proper trial impossible. That is the assertion at the end of Mr Brownlie’s witness statement. But there is no material, either in that statement or anywhere else, by which this bland assertion can be justified. In particular, Mr Brownlie wholly fails to deal with:

Why Mr Miers has not yet contacted or met with Mr Hudson. It was only at the hearing on 20.11.09 that it became apparent that this lack of progress was based on Mr Brownlie’s specific instructions.

When Mr Miers might produce his report. Mr Brownlie’s statement says that Mr Miers is now involved and will produce his report “shortly” which seems to be at odds with the suggestion that he cannot be ready for the trial.

What preparation time Mr Miers might require for his report; for his meetings with Mr Hudson; and for the production of the joint statement. In the absence of any explanation as to how much time he might need to accomplish these tasks, by comparison with how much time was left before the trial, it is impossible for the court to conclude that Mr Miers cannot be ready for the trial.

For these reasons, I am driven to conclude that the defendants are seeking an adjournment for reasons which are not obviously connected to the delays to the expert evidence, but which are instead based upon their attempts to improve their own negotiating position. Furthermore, even if there was a genuine connection between this application and the state of the expert evidence, any difficulties would appear to be entirely the defendants’ responsibility, by failing to involve Mr Miers earlier in the preparations for the trial. Accordingly, my conclusions as to conduct and the reasons for delay must be a factor against granting the defendants’ application to adjourn.

The experts’ meetings are an important part of the preparation process. I consider that the experts should be given the entirety of the week from 23rd November to 27^th November in order to consider the issues between them, and then to produce their joint statement by 4.30 on 27^th November 2009. Their reports, limited to those matters on which they do not agree, are to be exchanged by 4.30pm on 2^nd December 2009. That would then allow a PTR on the afternoon of 4^th December, with written openings on Thursday 10^th December, with the trial itself being moved by a week, to start on 14^th December and finish on the 17^th December.

The claimant confirmed that Mr Hudson would be able to comply with this timetable. The defendants were unable to say that Mr Miers could not comply with this timetable and, given that his own report was promised “shortly”, it seems to me that he can and should be able to comply with these directions.

I am strengthened in that view by my assessment of the issues raised in the quantum pleadings. As already noted, most of them are matters of legal argument and construction of the contracts: issues on which any expert evidence would be inadmissible in any event. There are matters for the experts to address but they are, by their very nature, questions of assessment: the percentage completion of particular stages of work; the overall quality of the drawings; the nature of the adjustment under clause 16; and so on. Those are matters on which the experts were always going to have to form a broad view based on the material before them. They are not going to be able to do a drawing-by-drawing, point-by-point analysis of, say, the precise percentage completion of Stage D, because the trial is due to last 4 days, not 4 months, and because anything other than a broad assessment of these matters would not be proportionate or in accordance with the overriding objective. In such circumstances, the fact that time may now only permit an analysis based on 50 drawings, rather than 500, may well be an advantage to both sides, as well as the court: there is nothing to say that it would lead to an injustice.

For these reasons, I consider that the delays which have occurred can be overcome in advance of the trial. I have been able to move the trial back by one week in order to accommodate this. This is a further factor against granting the application to adjourn.

It follows from the previous section of this Judgment that I consider that, in all the circumstances, a fair trial on the quantum issues has not been jeopardised by the delays in the preparation of the expert evidence. I acknowledge of course that the proposed timetable is very tight but that is a risk that the claimant at any rate is prepared to run. Does it cause an unfair disadvantage to the defendants?

In my judgment, it does not. There is a considerable amount of work which the defendants have to do over the next 3 weeks. However, I am in no doubt that this workscope is quite possible. To the extent that it may mean that some of the more obscure parts of the defendants’ case on quantum remain unexplored, that is the inevitable result of the defendants’ delays. In the absence of any evidence of specific difficulty or impossibility caused by those delays, it is not appropriate for a court to grant an adjournment of the trial. That is particularly so when the delays are the defendants’ responsibility in any event.

Accordingly, I do not consider that, on the material before me, there is a risk that a fair trial has been jeopardised. Again, that is another factor against granting the application to adjourn.

The authorities made clear that, for example, the illness of a key witness or a litigant in person is a good reason for an adjournment, at least first time round: see for example, Fox v Graham Group Limited, The Times 3.8.01. Such an issue does not arise in the present case.

In addition, no other specific matters are raised by the defendants in support of their application to adjourn. Unlike, for example, the decision of the Court of Appeal in Lloyds Bank Plc v Dix [2000] WLR 1918520, 26.10.00, this is not a case in which I could conclude that the adjournment would make no material difference to the outcome, in view of the weakness of the defendants’ case. I am bound to consider this application on the basis that both claim and defence have an equal prospect of success. However, I reiterate my view that the expert evidence does not lie at the heart of the forthcoming quantum trial.

The consequences of an adjournment to the claimant are dire. Because I must hear the trial on quantum, having done the trial on liability, my availability could not be guaranteed until March 2010 at the earliest. Mr Fraser, properly, baulked at that delay. He pointed out that the claimant has already been kept out of its money for well over a year. Moreover, during that time, it appears that the defendants’ financial position has worsened, and the In & Out Club is now up for sale. Thus any delay to the trial, let alone one of three or four months, could have potentially catastrophic results for the claimant.

I accept that an adjournment would allow the defendants further time to dot the i’s and dot the t’s of their expert evidence but, in the absence of any specific evidence as to real impossibility, it would not be appropriate to grant them an adjournment just to achieve such a task.

In addition, Mr Darling, taking up a point first raised in Mr Brownlie’s statement, submitted that one of the advantages of an adjournment would be that the parties could mediate so as to endeavour to achieve a settlement. This was somewhat ironic, given that, at the outset of the trial on liability, 7 months ago, I expressed my surprise that no such mediation had taken place. In addition, the parties have had since early July 2009 every opportunity to mediate on the back of my judgment on liability. They have not taken that opportunity. In such circumstances, it could not possibly be right for the trial to be adjourned merely to allow such a mediation to take place now. In any event, of course, the parties remain free to mediate even as they prepare for their trial.

An adjournment would also have a deleterious effect on the court and other court users. This hearing has been fixed in my diary for some time, and no other trial has been booked to overlap it because, for the reasons noted above, I am obliged to hear the quantum trial myself. This lack of flexibility means that there would be a hole in the TCC diary of 2 weeks (the weeks commencing 7^th and 14^th December) and the trial would then have to be squeezed in late next term, at a time when there are presently other trials in my diary. Such a late change would inevitably have an adverse effect on other court users.

On this analysis, this is a fourth and final reason, why in all the circumstances, the trial should not be adjourned.

A fair trial is not impossible, because the limited time for the preparation of expert evidence is the same for each party. They are therefore on an equal footing. If Mr Hudson is a in a better position than Mr Miers, that is only because of the defendants’ deliberate dis-instruction of their expert, and that cannot justify an adjournment. And if, as I suspect it might be, the alleged unfairness is just that, because of the limited preparation time, the evidence at trial would in some way be less detailed or less thorough than it might have been, that would again place the parties on an equal footing, and would not mean that the trial was unfair. The popularity of adjudication in the UK construction industry demonstrates that the absence of what Dyson LJ once called “the grinding detail” (Footnote: ²) inherent in the traditional approach to the resolution of construction disputes does not mean that the outcome of a broader-based assessment is regarded by the participants as any the less satisfactory or fair.

In his frank submissions, Mr Darling argued that an adjournment was “undesirable, inappropriate, but the least bad solution”. As I indicated at the end of that hearing, I agree that an adjournment is both undesirable and inappropriate. I do not consider that it is the least bad solution: for the reasons that I have given, the least bad solution is for the parties to prepare to be ready for the quantum trial that was fixed in July.

By way of postscript I should add that today, 25^th November 2009, I have acceded to the claimant’s application for various unless orders in order to ensure that the timetable noted above is met. As of this morning, the experts have not met (despite Mr Hudson’s efforts), and the defendants’ solicitors have not even formally confirmed that Mr Miers is available for the w/p meetings. I have concluded that the defendants’ refusal to take the steps necessary to comply with my order of 20.11.09 is deliberate. It merely strengthens my view that the defendants are more interested in tactical manoeuvring than preparing for trial or complying with the orders of the court, and that it would be quite wrong to reward their stance by adjourning the trial.