A useful case demonstrating that the old pleading practice lives on to a degree and that there is a limit to the pre-pleading enquiries that are expected to be made of third parties. Henderson LJ said,
1. According to CPR rule 16.5(1), the defendant must state in his defence:
“(a) which of the allegations in the particulars of claim he denies;
(b) which allegations he is unable to admit or deny, but which he requires the claimant to prove; and
(c) which allegations he admits.”
2. Although the rule does not use the language of “non-admission”, it is I think still common practice in a professionally drawn defence for the pleader to state that a particular allegation in the particulars of claim is “not admitted”, when the intention is to say that the allegation falls within paragraph (1)(b) as one which the defendant is unable to admit or deny, but which he requires the claimant to prove. So used, the expression is a convenient form of shorthand, provided that the requirements of the sub-paragraph are not thereby overlooked or watered down. Under the CPR, unlike the previous Rules of the Supreme Court (“RSC”), a non-admission may only properly be pleaded by a defendant where he is, in fact, unable to admit or deny the allegation in question, and therefore requires the claimant to prove it.
3. Plainly, a defendant is able to admit or deny facts which are within his own actual knowledge, or which he is able to verify without undue delay, difficulty or inconvenience, by reference to records and other sources of information which are under his control or otherwise at his ready disposal. Furthermore, in the case of a corporate defendant, which can only act through human agents and has no mind of its own, its actual knowledge must clearly be understood as that of its individual officers, employees or other agents whose knowledge is for the purposes of applying rule 16.5 to be attributed to it, in accordance with the relevant rules of attribution: see the well-known observations of Lord Hoffmann in Meridian Global Funds Management Asia Limited v Securities Commission  2 AC 500 (PC) at 506-507. But does paragraph (1)(b), properly construed, go further, and require a defendant to make reasonable enquires of third parties before it can be said that he is “unable” to admit or deny a particular allegation?
48…[there is a] the significant difference between the language and structure of rule 16.5(1) on the one hand, and the position which obtained under the RSC on the other hand. Continuing use of the language of non-admission, convenient though it may be, must not be allowed to blur the distinction, or still less to encourage a reversion to the bad old days when a defendant could get away with a stonewalling defence full of indiscriminate non-admissions. Clearly, a defendant is now under a positive duty to admit or deny pleaded allegations where he is able to do so, and he may only put the claimant to proof of a fact where he is unable to admit or deny it. But that does not answer the question of what “unable” means in this context.
49. In my judgment, a number of factors point towards the conclusion that a defendant is “unable to admit or deny” an allegation within the meaning of rule 16.5(1)(b) where the truth or falsity of the allegation is neither within his actual knowledge (including attributed knowledge in the case of a corporate defendant) nor capable of rapid ascertainment from documents or other sources of information at his ready disposal. In particular, there is no general obligation to make reasonable enquiries of third parties at this very early stage of the litigation. Instead, the purpose of the defence is to define and narrow the issues between the parties in general terms, on the basis of knowledge and information which the defendant has readily available to him during the short period afforded by the rules for filing his defence.
50. There are two main reasons which in my view support this conclusion. The first reason has to do with the procedural timetable laid down by the CPR for all Part 7 claims, whatever their magnitude or value, and whether commenced in the High Court or the County Court. The default position is that a defence must be filed within fourteen days after service of the particulars of claims, extended to twenty eight days if more time is needed and an acknowledgement of service is filed. This is, deliberately, a relatively short period, designed to encourage expedition and the rapid progress towards trial of an action once it has been started. Within such a short period, it does not seem to me practicable to impose a general obligation on defendants to make all reasonable enquiries of third parties who may be in possession of relevant information before filing the defence. That is not to say, of course, that a defendant is prevented from making such enquiries, if he chooses and has the time to do so. Nor would I wish to discourage claimants from granting, or not opposing, reasonable extensions of time for that purpose, if satisfied that this would further the overriding objective. But that is a very different matter from saying that, as a matter of obligation, a defendant is precluded from putting the claimant to proof of an allegation until all reasonable third party enquiries potentially relevant to it have been pursued. The action is still at its earliest stages, and in most cases the preferable course will be for the parties to follow the strict timetable prescribed by the CPR, leaving the making of wider enquiries and further refinement of the issues to subsequent stages in the pre-trial procedure, including requests for further information under Part 18, disclosure and the exchange of witness statements.
51. My second main reason is to do with the difficulty of drawing a sensible line if a general duty of the type I have mentioned were held to exist at the stage of filing the defence. There would be endless scope for disagreement about the enquiries which the defendant ought reasonably to make in the limited time available to him, particularly as there is no relevant guidance in Part 16 itself or its associated Practice Direction, nor is there any requirement for a defence to be accompanied by a statement explaining what enquiries have been made. By contrast, where an application for further information is made under Part 18, the focus will be on a specific request for clarification or additional information in relation to a matter in dispute in the proceedings, evidence relevant to the application will usually have been filed on both sides, and the court should be well placed to decide whether or not to make an order.
52. A related point, of equal importance, is that a defence has to be verified by a statement of truth signed by the defendant or their legal representative: see CPR rule 22.1(1)(a) and (6)(a). There should be no difficulty in complying with this requirement where the contents of the defence are based on the defendant’s own knowledge, but the position may be very different where an admission or denial is based on information obtained from a third party. In such a case, making contact with the third party may be only the first step in a complex process which will require the information obtained to be evaluated, tested and correlated with other information which is or becomes available to the defendant. It would often be completely unrealistic to expect such a process to be completed within the short period allowed for the filing of a defence, and it is correspondingly difficult to believe that this is what rule 16.5(1)(b) on its true construction really requires.
Edited for ease of reading.