The Commercial Court judge was unhappy that the parties had not sought permission to file pleadings that were longer than permitted.
Legatt J. did not pull his punches. He said,
1. Statements of case must be concise. They must plead only material facts, meaning those necessary for the purpose of formulating a cause of action or defence, and not background facts or evidence. Still less should they contain arguments, reasons or rhetoric. These basic rules were developed long ago and have stood the test of time because they serve the vital purpose of identifying the matters which each party will need to prove by evidence at trial.
2. As commercial transactions have become more complex and more heavily documented (including electronically), adhering to the basic rules of pleading has become both increasingly difficult and all the more important. It is increasingly difficult because it is harder for pleaders to distil what is essential from the material with which they are provided and because they can feel pressure to show their mettle and enthusiasm for their client’s case by treating the pleadings as an opening salvo of submissions in the litigation. It is all the more important because prolixity adds substantial unnecessary costs to litigation at a time when it is harder than ever to keep such costs under control.
4. [The] 8th Edition of the Commercial Court Guide published on 30 April 2009 [contains] …guidance which has remained unchanged since. Section C1.1 of the Guide is in the following terms [he cites the Guide]…
5. The particulars of claim which have been served in the present case flout all these principles. They are 94 pages in length. They include background facts, evidence and polemic in a way which makes it hard to identify the material facts and complicates, instead of simplifying, the issues. The phrasing is often not just contentious but tendentious…
6. …This case is not in essence a complicated one. It is of course necessary to specify the statements allegedly made to the SFO by the defendants and to give particulars of the matters relied on in support of the allegation that the defendants did not believe those statements to be true. Those matters are in fact pleaded, starting at page 61 of the particulars of claim. However, this operative part of the statement of case is preceded by some 50 pages of narrative, liberally interspersed with assertions of fraud, falsity, dishonesty and improper motive which are not at that stage particularised. This form of pleading is typical of Complaints in United States litigation where pleadings serve different purposes and different practices obtain. It has no place in English civil procedure.
7. On top of all this, the particulars of claim were served without first requesting permission from the court to serve a statement of case longer than 25 pages. It was only after the defendants took objection that an application for permission was made retrospectively some two months after the particulars of claim had been settled. The witness statement of [the lawyer] filed in support of the application included an apology for the fact that permission had not been sought before but did not think it necessary to attach a copy of the particulars of claim themselves.
8. The particulars of claim have been signed by four counsel, including leading counsel. When the claimants’ application came to me as a paper application, I was concerned that the counsel responsible for drafting the particulars of claim must either be ignorant of the applicable requirements of the Commercial Court Guide or have taken a deliberate decision to disregard them. In these circumstances I asked each of the counsel concerned to explain individually whether, when drafting the particulars of claim, they were aware of the requirements of Appendix 4 of the Commercial Court Guide, including paragraph 17 which states that the document must not be longer than 25 pages unless the court has given permission for a longer document; and if so, what steps, if any, they had taken to comply with those requirements and whether they had deliberately not complied.
9. …The two senior counsel…have said that they were conscious of the relevant provisions of the Guide when they embarked on drafting the particulars of claim but that, by the time they completed this task which took place over a period of more than three months, they were no longer conscious of the need for an application to be made for permission to serve particulars of claim longer than 25 pages.
10. The justification given by [another lawyer] in his witness statement for the length of the particulars of claim is that:
“The length of the document was considered necessary to make sufficiently clear to the defendants (and ultimately the court) the extremely serious allegations being raised by the claimants against the defendants.”
It must be abundantly clear to anyone who is accused in a statement of case of fraudulent conduct that extremely serious allegations are being made against them. It is unnecessary to repeat the assertion that the person has been fraudulent again and again on page after page in order to convey this fact.
11. At the same time as asking counsel to explain why the proper practice had not been followed, I invited written submissions on the question of whether the particulars of claim should be re-pleaded and the costs of drafting the current version disallowed.
12. …counsel for the claimants …accept that it would be possible to edit the particulars of claim down to perhaps half their current length…. A properly pleaded statement of case would, as I have indicated, specify the false statements allegedly made by the defendants and the occasions on which those statements were made and would give particulars of the allegation of knowledge. It would, however, omit the large tracts of unnecessary narrative and rhetoric which have been included. All this could and should be accomplished in a document which is at most half the length of the current particulars of claim.
13. … The absence of objection from the other party is not, however, a license to disregard the practice and procedure of the court. Equally unfounded is the suggestion that [the judge] by approving a consent order extending time for service of the defence must be taken to have approved the length of the particulars of claim, merely because their length was mentioned in the defendant’s application to which the claimants had consented. That suggestion is obviously untenable – which is why the claimants have recognised that it was necessary to make the present application.
14. …I accept that in the short term some delay and inconvenience will be caused by requiring the claimants to settle fresh particulars of claim. In the longer term, however, the efficient conduct of the case will be assisted by particulars of claim which are properly drafted. In any event, responsibility for such delay and inconvenience lies squarely with the claimants or their legal advisors in disregarding the requirements clearly stated in the Commercial Court Guide including the need for permission. They cannot rely on their failure to seek permission at the proper time as a reason why it should now be given.
16. It seems to me that, unless adverse costs orders are made in cases of flagrant non-compliance, practitioners who are well aware of the principles of pleading and the provisions of the Commercial Court Guide will continue to overlook them, as happened here. In my view, the appropriate order in this case, and the order which I will make, is that the particulars of claim are struck out, the costs of drafting the particulars of claim are disallowed, and fresh particulars of claim no longer than 45 pages and otherwise complying with Appendix 4 of the Commercial Court Guide should be served within 21 days.
17. I have shown this judgment in draft to the Judge in charge of the Commercial List, who endorses the principle that flagrant disregard of the guidance applicable to statements of case may lead to adverse costs orders.
Edited for ease of reading.
You can find this judgment on Baillii