The 113th Civil Procedure Rules update, mostly taking effect on 6th April 2020, contains changes which will affect both litigants and their representatives alike.
The headline changes to the rules provide for an expanded statement of truth and requirements relating to the specific pleading of credit hire claims. Whilst it is hoped that the changes will not cause too much disruption, there remains the prospects of litigants exploring the new boundaries to establish whether the changes are as wide reaching as they perhaps seem to be on first reading.
In respect of credit hire in particular, whilst the requirement for a specific pleading is welcome, it is unclear as of yet whether this will be of any tangible benefit to those who defend Credit Hire claims, or whether it will change the status quo without further support. In particular, the requirement for the disclosure of ‘relevant facts’ in relation to credit hire is undefined, and we expect that there may be satellite litigation on the definition of this phrase.
Default judgment CPR12
Following the Jackson reforms, and the resulting focus on sanctions, it became evident that there were two schools of thought with regard to a defence being filed after the time provided by the rules. Historically, courts accepted ‘late’ defences beating a request for judgment, however, a strict interpretation of the rules, suggested that defendants had 14 days, a period that could only be extended by the provision of an Acknowledgement of Service.
A dichotomy in judicial discretion developed; dependent upon the individual judge, a defendant filing a late defence without the accompanying application for relief could find the claimant granted judgment.
The clarification being made by this update will allow for a Defence or Acknowledgement received before judgment is entered to stand. Despite reducing the court revenue stream, this will reduce drain on the court’s resources where applications may have been issued unnecessarily previously.
Credit hire pleadings
Claims for credit hire will now carry its own specific elements of the practice direction to Rule 16 for the pleading of Particulars of Claim.
The Court of Appeal has already set out that need and impecuniosity ought to pleaded by a claimant and CPR 16PD8.2(8) already requires that a claimant must plead as to facts of mitigation of loss or damage. This second point is often opposed by claimant representatives currently (and received with some sympathy by judges) on the grounds that the rule is at odds with the burden of proof for mitigation resting with defendants. It is that approach which has undoubtedly led to Practice Direction 16 8.2(8) being redrafted to remove “mitigation of loss and damage”, replacing it with “a claim for mitigation expenditure”.
The complementary additions at 6.3 and 6.4 will now mean that Part 6.3 of the Practice Direction should now be read as meaning that there is a requirement on “the claimant [that they] must state the relevant facts” in relation to the credit hire claim.
Whilst defendant practitioners may celebrate the inclusion of this part of the Practice Direction, the height of the burden for pleading has yet to be tested. It is arguable that the word "relevant" when applied to the context of a pleading is not as extensive as it would be within a statement.
Will the new requirement place the burden as any higher than ‘putting those elements in issue’?
In an area where even specialised credit hire recovery firms are unsure as to the simple fact as to whether their client is an owner or a bailee of a motor vehicle, it remains to be seen as to what will change further in their pleadings.
Many of the larger establishments who specialise in recovery of credit hire may argue that their pleading already complies with this change. We expect that most of those firms will plead positively that the claimant “needed” to hire for a “reasonable period”, at a given “rate per day” with the additional collision damage waiver.
Although the change may provide an opportunity for defendant firms to seek an early advantage by making an early application for better particularisation, that window is going to be open for a relatively short period of time. Furthermore, for all the investment of time in drafting, the cost of the application fee and Counsel's attendance fee, it is unlikely that this would yield any significant benefit to defendants.
An alternative approach would be to use the claimant’s pleading as an anvil upon which to hammer the claimant’s trial evidence against. By way of example, much can be made of inconsistencies where an RTA 1 form, which states there were limited injuries, is contradicted by evidence at trial that the injuries are far more extensive than claimed at the outset.
Ultimately, these changes on their own are, in our view, unlikely to make any serious dent in the guarding of knowledge of the claim by those acting for claimants. We are of the view that these changes should be partnered with tailored directions supporting the new pleading benchmark. Hopefully these amendments are a preamble to the approval of the proposed credit hire model directions.
Statements of truth
The statement of truth for pleadings, statements of case and witness statements will now be required to include the contempt warning.
We consider that this requirement has been inserted in anticipation of the new portal scheme for low value road traffic accident claims. Whilst credit hire claims themselves fall outside of this new portal, it is widely expected that Accident Management Companies and some Credit Hire Organisations may look to take up the burden of acting for the public in presenting claims against insurers. By including the warning (which will be presumably entered into the stationery for when the portal goes live) it provides a precursor for those acting in these claims of the obligations within the statement of truth, if they are not already aware.
This inclusion can only be a good thing for both practitioners and litigants. Practitioners can be sure that the signatory to the statement of truth has been aware of the extent of what such a statement means. For those claimants who are signing documents based on standard templates, the wording may encourage greater scrutiny of the documents prepared for them.
For the judiciary too, there should be less uncertainty as to what a litigant interprets the statement of truth to mean, allowing them to be bolder with sanctions.
The new requirements in relation to statements of truth also make clear distinctions for those who are unable to read or sign a document for reasons other than language. For those for whom English is not their ‘own language’ as the rules describe it, and will require the use of an interpreter at trial, the statement must be translated into the witness' own language.
A small but potentially significant area for satellite litigation may be the inclusion of the expression “or causes to be made” in relation to those who make false statements. This throws the net significantly wider than those caught by these provisions currently. Those at risk may include those who "offer services" in assistance of parties in the wider part of the claims/damages market.
Within the bubble of personal injury and associated litigation, which has seen increased use of Section 57 fundamental dishonesty submissions, this addition should be welcomed by all corners of the legal field, as improving the base level of certainty that a signatory is aware of their obligations.
The CPR update will also provide a fundamentally crucial change to the requirements setting out the process by which the statement has been prepared.
The new subparagraph (5) for CPR 18.1 will require those who prepare and draft statements to set out additionally how the statement has been prepared, be it by telephone, face-to-face, from a document and/or an interpreter.
It is unclear whether this will have an impact on how the judiciary see a witness. Would a statement prepared face-to-face, mean that the witness is considered more credible than someone who was spoken to over the phone? How would a statement be viewed when it has been prepared from a questionnaire of sorts, or been subject to various amendments and back-and-forths, before the final agreement?
As a consequence, this rule change may cement the presence of the cottage industry of witness statement takers, the impact of which would likely be in an increase in disbursements where it becomes ‘necessary’ for a solicitor to obtain a face-to-face statement from their client to ensure they discharge their burden.