The Court of Appeal says (almost definitely) no

We have previously blogged about the 90-day stay of all possession proceedings until the end of June, which was brought into force by the courts on 27 March 2020 by the new practice direction PD 51Z.

Earlier this week, in the case of Arkin v Marshall, the Court of Appeal decided a number of issues concerning PD 51Z, including whether the practice direction was itself ultra vires and whether the 90-day stay can ever be lifted.

Background to the case

Arkin v Marshall is a rather unremarkable possession claim.  However, the timing of the proceedings brought PD 51Z to the fore.

On the day that PD 51Z came into force certain procedural steps were ordered by a judge in the County Court at Central London.  These included the usual directions for disclosure of documents and exchange of witness statements.

Paragraph 2 of PD 51Z provides that:

“All proceedings for possession brought under CPR Part 55 and all proceedings seeking to enforce an order for possession by a warrant or writ of possession are stayed for a period of 90 days from the date this Direction comes into force.”

PD 51Z was amended on 20 April 2020 by the introduction of a new paragraph 2A, to make clear that the stay in paragraph 2 does not apply to:

• possession proceedings brought against “persons unknown”; and
• “an application for case management directions which are agreed by all parties“.

The Marshalls, who were defendants to the claim, took the view that the effect of paragraph 2 was to discharge the parties from any obligation to take steps in accordance with the court’s directions for the 90-day period.  The claimant, Arkin, disagreed, arguing that the stay did not apply to the proceedings and, even if it did, the stay should be lifted.

The County Court judge found for the Marshalls and held that the proceedings were stayed, and that the court had no power to lift the stay.  Given the importance of the case, permission was given for Arkin’s appeal to “leapfrog” the High Court, and proceed directly to the Court of Appeal.

Is PD 51Z ultra vires?

In order for PD 51Z to be enforceable, it was agreed that it must constitute a “pilot scheme” the aim of which was for “assessing the use of new practices and procedures in connection with proceedings“.  Arkin argued that PD 51Z was not a genuine pilot scheme.

The Court of Appeal concluded that PD 51Z clearly was a pilot scheme.  PD 51Z itself provides that it “is intended to assess modifications to the rules and Practice Directions that may be necessary during the Coronavirus pandemic and the need to ensure that the administration of justice, including the enforcement of orders, is carried out so as not to endanger public health”.

Arkin’s argument that PD 51Z was inconsistent with the Coronavirus Act 2020 was said by the Court of Appeal to be “not tenable”.  Arkin further argued that PD 51Z was contrary to Article 6 of the European Convention on Human Rights and Fundamental Freedoms and the principle of access to justice. The Court of Appeal disagreed, considering that “the short delay to possession litigation enshrined in PD 51Z is amply justified by the exceptional circumstances of the coronavirus pandemic.”

Does the Court have jurisdiction to lift the stay?

Arkin argued that the effect of paragraph 2A is that if the parties agree case management directions, then these should be complied with, notwithstanding the 90-day stay.

The Court of Appeal disagreed, finding that paragraph 2A allows the making of an “application” for agreed case management directions.  If any of those directions include an obligation to do something before the 90-day stay expires, then such directions cannot be enforced.

However, the Court of Appeal did make the following clear:

“If either party fails to do what it agreed to do during the period of the stay, the other party will, no doubt, be able to rely on that circumstance once the stay is lifted.  It will be able to ask the court, at that stage, to take the conduct of the other party into account in making revised directions.”

Arkin also argued that the court must retain a general discretion to lift the 90-day stay.  The Court of Appeal acknowledged that “a judge retains the power to lift the stay which [PD 51Z] imposes” although, in relation to PD 51Z, “it would almost always be wrong in principle to use it”. There was also nothing about these possession proceedings which would warrant the lifting of the stay.

What does this mean?

The effect of this decision is that, unless you are dealing with possession claims against persons unknown, there is very little prospect of getting the 90-day stay of proceedings imposed by PD 51Z lifted.

However, if a property owner has agreed directions with a defendant requiring action before the end of the 90-day stay, they should still seek to comply with them, notwithstanding the stay, as any failure to comply without good reason may be taken into account by the court at a future date.

Arkin v Marshall [2020] EWCA Civ 620

[View source.]