Litigation and ADR procedure news for in-house lawyers: UK Construction Focus - November 2018



Our pick of recent news and decisions on dispute resolution procedures for construction claims.

Civil Procedure Rules news

Disclosure Pilot in force from 1 January 2018

An imminent and significant change to the Civil Procedure Rules (CPR) is the introduction of the Disclosure Pilot Scheme from 1 January 2019. It will be governed by new Practice Direction (PD) 51U, which effectively replaces CPR31 and current PDs.

First announced in November 2017 and refined by the Disclosure Working Group following widespread consultation, the two-year, mandatory, pilot scheme was approved by the Civil Procedure Rules Committee in July 2018. It will apply in the Business and Property Courts (B&PC) (including the Technology and Construction Court (TCC)).

The pilot aims to initiate "widespread cultural change" to the disclosure regime, to make the disclosure process more cost-efficient and to give practitioners the chance to feed back on the new procedures to enable ongoing improvements of the new PD.

PD51U removes standard disclosure as currently in force and, for example, introduces disclosure duties, "Initial Disclosure", Disclosure Guidance Hearings, a Disclosure Certificate, a Certificate of Compliance, scope for various different models for Extended Disclosure as well as replacing the Electronic Documents Questionnaire with a new Disclosure Review Document.

The five models for Extended Disclosure are: Model A (Known adverse documents); Model B (Documents relied on and necessary to understand the case); Model C (Request led / specific disclosure); Model D (Standard disclosure); and Model E (Train of enquiry). Transition procedures have also been included to deal with how to use the new disclosure system in existing cases.

Shorter and Flexible Trial Schemes made permanent

The Shorter Trial Scheme and the Flexible Trial Scheme become permanent under PD57AB in the B&PC on 1 October 2018. (The pilot PD51N has now been deleted.)

You can read our summary of the pilots for these schemes here: "Shorter trials: take a short cut" and "Shorter and flexible trials for some construction disputes – and why we need them".

Survey into use of witness evidence in the B&PC

The deadline for responding to the survey on the use of witness evidence in the B&PC closed on 23 November 2018. Prompted by concerns raised by the Witness Evidence Working Group that statements have become "over-elaborate" expensive documents prepared by lawyers rather than witnesses themselves, the results of the survey will be used to assess the utility of the current system of giving witness evidence and how it can be improved.

Research on video hearings

HMCTS is conducting research into video hearings and legal professionals' user experience of this form of hearing. The Law Society has highlighted the potential benefits but is also mindful of concerns about the reliability of the technology used, the fairness of the process and the potential impact on access to justice. (Source: The Law Society)

Procedures in the Queen's Bench

The Sixth edition of the Queen's Bench Guide was published in August 2018 (click here for the announcement). Barbara Fontaine, Senior Master, summarised the changes as including: "changes to the procedure for obtaining Queen's Bench trial listing appointments, amendments reflecting the introduction of the Media & Communications List, and other changes and updating required since the publication of the 2017 edition".

The pilot scheme for electronic working (under PD51O) is to be extended to the Queen's Bench Division from 1 January 2019 and will run until 6 April 2020.

Full hearings of the Court of Appeal (Civil Division) to be heard

Earlier this month (November 2018), the Court of Appeal announced a pilot to test live-streaming of court proceedings in the Court of Appeal's Civil Division. As is the practice in the Supreme Court, the new stream will be subject to a short delay to allow filming to be halted if necessary to avoid inadvertent breaches of reporting restrictions.

"This is an exciting way of opening up our courts to help the public understand and see for themselves the way that courts work, and how appeals are heard. The first case* is a high profile one with a great deal of public interest, which is why it has been selected for the public pilot." (Sir Terence Etherton, the Master of the Rolls). You can access the live-stream here.

*The first case involves a dispute between West Ham United and E20 relating to the available seating capacity of the former Olympic Stadium in London."

News about the judiciary

The Rt Hon The Lord Burnett of Maldon, Lord Chief Justice of England and Wales, published his 2018 report and gave evidence to the Justice Committee on his conclusions on 20 November 2018. He outlined the principal challenges faced by the current legal system including recruitment and retention of new judges (more senior), the low morale of the judiciary and the need to modernise our courts system to bring it into the 21st century (including how to address the dilapidated state of elements of the court estate). You can view Lord Burnett's evidence here and read the 2018 report here.

Alternative Dispute Resolution news

UN (Singapore) convention on mediation

The UN Commission on International Trade Law (UNCITRAL) had approved a new convention on the enforcement of mediation settlement agreements and corresponding model law. (See The Law Society's report, UN Mediation Convention.) The convention recognises the benefits of mediation and will make it easier to enforce mediated settlements, which, in turn, should help improve international trade. The convention will create an international enforcement regime for mediated settlement agreements similar to that created for arbitration under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards 1958 ( the New York Convention). The aim is for UN members to sign this multilateral convention in Singapore in August 2019.

CIC model mediation agreement and procedure

The Construction Industry Council (CIC) has announced that it will publish a model mediation agreement and procedure, underpinned by a CIC construction industry mediation panel, in January 2019. In the meantime, the CIC has invited comments from interested parties to ensure that the agreement and procedure are as good as possible. The consultation ends on 14 December 2018. Click here for more information.

Recent judgments on procedural issues

Be sure a witness statement is truthful before signing the statement of truth

Those signing a statement of truth should not underestimate its onerous nature. In Liverpool Victoria Insurance Company Ltd v. Khan and others [2018] EWHC 2581 (QB), a personal injury claim, the judge committed both a lawyer and a medical expert for civil contempt of court under CPR 32.14. The expert had substantially and recklessly changed a whiplash prognosis on the lawyer's suggestion without any clinical justification. CPR 32.14 allows contempt of court proceedings against those who make "… a false statement in a document verified by a statement of truth without an honest belief in its truth". A finding of contempt can incur a fine or imprisonment. The Liverpool Victoria decision includes guidance for judges on how to approach the evidence in contempt proceedings given that the applicable standard of proof is the criminal standard.

In some circumstances there will be a duty to warn an opponent of a procedural mistake

In Woodward v. Phoenix Healthcare Distribution Ltd [2018] EWHC 334 (Ch), the judge had little sympathy for those who had taken advantage of a technical error in their opponent's service of proceedings. The claimant's solicitors had served a claim form on the defendant's solicitors the day before the expiry of the limitation period. The claimant's solicitors were not instructed to accept service - but failed to tell the defendant's solicitors in time for them to remedy service.

The judge had to consider whether there was good reason to validate the service under CPR 6.16. Parties are not required to correct another's mistake but the right to take advantage of another's mistake is qualified by the duty to assist the court prescribed by the overriding objective (CPR 1.3). The defendant had become aware of the claim form when it was still valid. In concluding that there was a good reason to retrospectively validate service, a key factor was the claimant's failure to warn the defendant's solicitors of their procedural mistake. The judge considered this to be a breach of the overriding objective which amounted to playing "technical games".

Expert evidence

Witnesses of fact should stick to the facts

A statement by a witness of fact should deal with facts and not expert evidence. This might sound obvious to those familiar with litigation procedure, but it was, nevertheless, an issue that the TCC had to consider in New Media Distribution Company SEZC Ltd v. Kagalovsky [2018] EWHC 2742 (Ch). One of the defendant's witness statements adduced evidence that was or purported to be expert opinion. The judge excluded the evidence from the statement on the basis that the witness was not competent to deal with such evidence. To have found otherwise would have gone against the essence of the CPR requirement to obtain court permission before adducing expert evidence.

Appealing technical and factually complex TCC decisions can be difficult

Construction claims tend to involve complex facts and technical details. Consequent TCC judgments often follow suit. However, if a party believes a TCC judge has reached the wrong conclusion, obtaining permission to appeal the judgment under CPR 52.6(1) can prove hard: the appeal court appreciates only too well how difficult it can be to break down the facts and expert evidence and is therefore unwilling to grant permission to appeal. There has to be a real prospect of success or some other compelling reason for the appeal to be permitted.

In Wheeldon Brothers Waste Ltd v. Millennium Insurance Company Ltd [2018] EWCA Civ 2403, the Court of Appeal confirmed that: "the same rules apply to applications for permission to appeal from the TCC, as compared with any other part of the High Court. On the other hand, because TCC cases often involve complex and interlinked findings of fact and assessments of expert evidence, it is inevitable that wide-ranging applications for permission to appeal against such findings and assessments will rarely be successful." Aggrieved parties should think carefully before requesting permission to appeal.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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