LITIGATION - The Impact of COVID-19 on compliance with case management directions – Hotel Portfolio II UK Ltd (in liquidation) v Ruhan 2020

The current climate is somewhat unchartered territory, it was only a matter of time before the circumstances surrounding the pandemic would impact the litigation process, specifically compliance with case management directions.

This case highlights the willingness of the courts to take a more flexible approach with regards to procedural shortcomings following the mandated lockdown restrictions.

The initial proceedings concerned numerous transactions between the parties made in 2005, 2006 and 2008. It had been ordered that the deadline for disclosure be set for 31 January 2020 with an anticipated trial date of November 2021. An application had been made in March 2020 to extend the disclosure deadline, and an extension until 17 April 2020 was granted.

However, the defendants’ subsequently submitted that the lockdown restrictions made it difficult for them to complete the procedural tasks within the prescribed deadlines. There was various reasons intimated for this, including difficulty obtaining certain documentation from a person living abroad for the purpose of the witness statement, largely limited responses from third parties, unexpected disclosure of 13 box files and general personal difficulty with household self-isolation and a working from home setup. Collectively for these reasons, the defendants’ submitted an application for a further extension to the disclosure/witness statement deadline claiming that the restrictions were not within their reasonable contemplation at the time they made the March application.

 This was disputed by the claimant but nonetheless the defendant’s argument was accepted by the court who held that the pandemic did reasonably cause some delays as ‘the pandemic and its consequences had involved a significant change of circumstances for the parties’.                                    

Nonetheless, the Judge expressed that the personal justifications put forward by the defendant for his inability to access documents while working from home was unacceptable, highlighting that the majority of work forces had to adapt to the new way of remote working including offices and the courts. There was also express dissatisfaction with the defendants’ progress with regards to disclosure and the disparity in the size of the data involved in the disclosure exercise and the judge commented that insufficient effort had been made to circumvent the problems caused by the lockdown in relation to completion of the witness statement.

In considering the above, the court decided that although the pandemic may have caused up to three months delay, disclosure should be reasonably completed by August 2020 and therefore an extended deadline of 14 September 2020 was granted with the deadline for completion of witness statement’s extended to 31 august 2020.

This case highlights that the courts can and will adopt some flexibility in relation to the circumstances surrounding the pandemic, offering a degree of sympathy and understanding towards procedural shortcomings. However, parties in proceedings hoping to make applications for procedural extensions should be mindful that the courts are fully aware of the possibility that the current climate may be used as an excuse for shortcomings when realistically compliance would have been completely feasible – their sympathetic approach can only stretch so far and parties should take extra care to ensure they comply with existing timetables insofar as possible.