Practice and procedure – Pleading – Strike out – Claimant seeking damages for loss of trade in business allegedly arising from water leak and to join fourth defendant – First and third claimant applying to strike out claim – Whether reasonable grounds existing for bringing claim – Claimants’ applications dismissed – First and third defendants’ applications allowed
The claimants were owned a Caribbean themed restaurant situated on the ground floor of a nine-storey building in Stratford, London E15. The first defendant local authority was the immediate landlord of the first claimant, which was the assignee of a sub-underlease originally granted to another company (now in liquidation) of which the second and third claimants were directors. The second defendant acted as managing agent for the superior landlord of the building and the third defendant was a construction company which had carried out excavations around the restaurant at the relevant time. On 3 December 2012 the first defendants re-entered the property and forfeited the lease. As at that date the first claimant owed in excess of £58,000 in respect of rent and service charges.
The claimants argued that, for a number of years, their trading prospects had been blighted by ingress of water from a pipe some eight storeys above the restaurant, by works carried out on the footpaths and highway outside the restaurant, by a persistent pool of water to the side of the restaurant, and by the planting of trees which were said to have obscured the restaurant from passing trade. The claimants brought proceedings to recover damages for loss arising from those complaints.
The proceedings were issued without a pre-action protocol letter on 31 May 2013. A master subsequently struck out the claim against the second defendant on the ground that the claimants had failed properly to serve complete particulars of claim in accordance with court rules. The claimants applied to set aside that order and to amend their particulars of claim. They sought to amend the pleading by joining Thames Water as the fourth defendant. The second defendant opposed the claimants’ application to set aside the master’s order. The first and third defendants opposed the applications to amend and themselves applied to strike out the claims against them.
Held: The claimants’ applications were dismissed. The applications of the first and third defendants were allowed.
The court would only strike out a statement of case if it disclosed no reasonable grounds for bringing the claim: CPR 3.4(2)(a). That might include a statement of case which was unreasonably vague, incoherent, scurrilous or obviously ill-founded and other cases which did not amount to legally recognisable claims. Similarly, the court might grant a defendant summary judgment when satisfied that the claimant had no real prospect of succeeding on the claim or issue in question and there was no other compelling reason why the case should be disposed of at a trial: CPR 24.2(a)(i). On such applications, the court should not conduct a mini-trial of disputed facts, but might take into account facts that were uncontroversial.
In the present case, when considering whether to overturn the master’s order, one of the matters to be borne in mind was the need to enforce, so far as practicable, compliance with rules, practice directions and orders; but the court would approach the claimants’ application to amend as against all of the defendants on the basis that, if there was a real and substantial claim disclosed by the amended pleading, the court’s first instinct should be to enable real and substantial disputes to go forward. If the stringent criteria for striking out a claim or granting summary judgment to the defendants were satisfied, the claimants would have had a fair and public hearing before an independent tribunal and no breach of article 6 of the European Convention on Human Rights would occur.
There were compelling reasons why the specific allegations that the claimants now wished to advance were without foundation. The specific claims and the amended pleading as a whole, as against the first three defendants, were characterised by a failure to analyse the true nature of the claims that the claimants might have or to plead the claims that had in fact been advanced with the clarity and particularity that was required of a party attempting to remedy the acknowledged inadequacies of its original pleadings. It was a well-established principle that had been recognised from long before the introduction of the CPR that a party who sought to amend its statement of case was under an obligation to formulate its amendments clearly and coherently, so that the court and the opposing parties might understand the true nature of the case being brought. The continuance of that principle was central to the CPR objective of enabling cases to be dealt with justly and with appropriate allocation of resources. The amended pleading in the present case singularly failed to comply with those requirements.
Accordingly, the claims against the first and third defendants would be struck out. The application to reverse the master’s order would be refused and there would be judgment for the first and third defendants. Furthermore, the claimants’ application to amend to join a fourth defendant would be refused. Joining Thames to an action where the majority of the amended pleading was being struck out would leave a limping document that would require extensive further changes to make a claim against Thames coherent. If the claimants wished to bring such a claim they ought to do so by a fresh action.
Serugo-Lugo (instructed by Huka & Co Solicitors) appeared for the first claimant; Matt Hutchings (instructed by Newham Legal Services) appeared for the first defendant; Robin Howard (instructed by Judge & Priestley) appeared for the second defendant; Alexandra Bodnar (instructed by Kennedys Law LLP) for the third defendant.
Eileen O’Grady, barrister