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Relief from Sanctions – a sense of Perspective

The Court of Appeal case of Parham Khandanpour v Colin Chambers (2019) EWCA Civ 570 comes as a welcome relief for litigators and serves to remind litigators of the need to exercise‘a sense of perspective’ throughout the litigation. This is a case that involved a landlord who was at the end of an order requiring him to pay damages of £6,874 based on unlawful eviction and breach of covenant. The Appellant landlord had failed to engage with the Respondent to agree costs and as a result the Respondent obtained a default costs certificate in the sum of £27, 824. The default costs certificate was set aside on the basis that the Appellant landlord file his points of dispute and pay the sum of £10,000 by 4pm on 15 June 2017.

A sequence of unfortunate events followed which meant that the Appellant landlord was unable to fully comply with the Order. Days before the deadline, the Appellant was hospitalised. Although he managed to file the points of dispute and pay a sum of £4000 by the deadline, the balance of £6000 was not received by the Respondent until 8.53am the next day.

The Respondent via his solicitors contended that the Applicant was in breach of the Order and thereby prevented from challenging the costs certificate. The Respondent made an application for relief from sanction.

Males LJ considered the principles set out in Denton. He took the view that inregards to the seriousness of the breach, the delay was minor and had no effect at all on the conduct of the litigation or in any other way and the delay was at most 17 hours.He identified that the Order of 17 May 2017 was not in the form of an ‘Unless Order’ and he went on to consider that there was evidence that the Appellant landlord had been in hospital and had given instructions for the payment to be made on time. He was satisfied that the principles for stage 1 and 2 of Denton were satisfied and there was no need for him toconsider all the circumstances of the case at stage three butMales LJ confirmed that even if stage 3 applied, he still would have gone on to permit relief from sanction.

In his summing up Males LJ clarified that refusal of relief from sanctions would mean that the Default Costs Certificate in the sum of £27,824.40 would stand unchallenged which, on the face of it, seems like a high figure in comparison to the value of the claim. It would be disproportionate to deprive the Appellant of an opportunity to challenge the Default Costs Certificate for the sake of a delay of a few hours which had no practical difference.

May 2019
Patricia Wollington