Legal Cost Specialists

Post-Mitchell test for relief from sanctions

Recent editions of Costs Law Reports have been so full of cases concerning applications for relief from sanctions they could have been renamed the Relief from Sanctions Law Reports. Sadly, all those trees have been cut down in vain. The Court of Appeal, giving their eagerly awaited post-Mitchell decision on the correct test to apply said:

“We hope that what follows will avoid the need in future to resort to the earlier authorities.”

The press has recently reported a decision of the first-tier tax tribunal as to whether Snowballs are cakes or confectionery, and therefore zero rated for VAT. As to whether the Court of Appeal’s new guidance is a cake or a confection, the answer is that it is a fudge. They were not prepared to state the Mitchell test was wrong but neither were they willing to confirm it was correct. Apparently, the fault lies with other judges being silly enough to believe that the Mitchell test meant what it said.

We now have a different test. The Court of Appeal optimistically hopes the new test will reduce the amount of satellite litigation generated by Mitchell. It appears the Court has forgotten what was said in Mitchell:

“We share the judge’s desire to discourage satellite litigation, but that is not a good reason for adopting a more relaxed approach to the enforcement of compliance with rules, practice directions and orders. In our view, once it is well understood that the courts will adopt a firm line on enforcement, litigation will be conducted in a more disciplined way and there should be fewer applications under CPR 3.9. In other words, once the new culture becomes accepted, there should be less satellite litigation, not more.”

It now appears the courts are meant to take a less firm line. Quite how this will lead to less satellite litigation remains a mystery, particularly given the new test creates far more uncertainty as to which way a court may go on an application for relief.

Costs Law Reports will no doubt be full over the next year or two with new decisions attempting to interpret the new test.

7 thoughts on “Post-Mitchell test for relief from sanctions”

  1. Why does all this sound like a climb down on compliance is coming?

    If any part of the preliminary findings in Mitchell are watered down then every party failing to comply will reel off the excuses with great dilligence.

    Obviously the approach has to be workable but it must be strict otherwise there is no point.

    It is sad that our great costs profession has become a pidgeon hole for uncertainty.

  2. Money for Nothing

    Less of a fudge and more of a three tier wedding cake that no one ordered and is likely to cause indigestion for a significant time to come!

  3. Northern Costs Monkey

    Reply to annon on July 7th, 2014 11:33 am

    Uncertainty is good. It will keep us all in jobs, so stop whining.

  4. Keep us in a job? I know of at least 6 north west cost drafting firms who are making redundancies.

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