BUSINESS AND PROPERTY COURTS NEWS – December 2018

BUSINESS AND PROPERTY COURTS NEWS – December 2018

His Honour Judge Kramer

  1. It is almost a year since the Business and Property Courts opened their doors in Newcastle. Since then, much has happened. The most notable change is the increase in judicial resources devoted to this line of work. I sit in Newcastle for the greater part of the year and  am supported by Specialist Civil Circuit Judges from Leeds, who sit in Newcastle during my absence.  We are all authorised to deal with High Court claims in the various subdivisions of the Chancery lists and the  Circuit Commercial and Technology and Construction Court lists, which fall under the aegis of the Queen’s Bench Division. Anecdotally, I have noticed an increase in emergency applications issued in Newcastle which previously would have gone to Leeds or London.
  2. There are further resources available if the need arises. One object of the BPC is that there is no claim too large to be tried in Newcastle. Thus, in cases which require a full time High Court judge, either due to the  complexity or value of the subject matter or a need for specialist knowledge,  not only do we have our Vice Chancellor, who sits in Newcastle for 4 weeks of the year,  but arrangements can be made for other High Court judges to sit in the Newcastle BPC. Having spoken to judges at the Rolls Building, it is clear that they are committed to servicing Newcastle if they can. That goes across the board, from admiralty, intellectual property, public procurement to other areas of the law which were formerly the preserve of the London courts.
  3. Those of you who braved the snow to hear the Chancellor, Sir Geoffrey Vos, at the launch event for the BPC on 1st March 2018,  may recall that he made the connection between the presence of an effective local dispute resolution system and economic development. This requires not just the provision of a judicial resources but the continued development of professional services to deal with the cases referred to the court. With this in mind, the BPC Forum was brought into being. It is, currently, a non- membership organisation which arranges talks  of interest to the professions who come into contact with the court. We deliberately reach out beyond the legal profession, seeking to involve accountants, engineers, surveyors, architects and the like. We have also developed a useful connection with Northumbria University which has kindly hosted our talks, provided speakers and looks at areas of BPC work which are suitable for academic research.
  4. The first talk, by the Chancellor,  was almost derailed by the “Beast from the East” but managed to attract about 75 hardy souls to the Sutherland Hall. The fraught circumstances surrounding that first meeting have followed us, in that our June talk on Expert Hot Tubbing was at the time at which everyone was arranging GDPR compliance, which proved something of an obstacle to distributing the invitations. The most recent talk, in October, was almost literally derailed, the speaker, Fraser J, phoning me 3 hours before the talk to say that his train from London was now stationary in South Yorkshire as it had hit an animal and was  awaiting a replacement traction unit; it turned out the animal was a duck! The prospect that I would have to step in to give a talk to an audience of 80 for which I had no time to prepare is, I think, what is called living one’s dreams. Fortunately, the relief engine was found in good time and on the stroke of 6.30pm, the advertised start of the talk, the speaker was at the podium. Gauging from  the response to the talks, persistence has paid off.
  5. It would take up too much space to summarise our talks to date and, following the  Premiership business model,  I would rather people experienced the live event rather than rely upon the edited highlights. Nevertheless, as regards the talk on Hot Tubbing the differences in judicial, expert, academic and audience perception of the process were telling and worthy of comment.
  6.  HH Judge Freedman, the DCJ for Newcastle, gave examples from his experience of Hot Tubbing narrowing differences. Bart Kavanagh, a chartered architect with considerable experience of hot tubbing, pointed to the more congenial atmosphere it creates for giving evidence. The academics, Professor Tony Ward and Ann Ferguson, whose paper on the subject is now published in 2018 Civil Justice Quarterly, highlighted that their research pointed to a danger that employing hot tubbing as the default method for considering expert evidence, risked decisions based on an expert’s performance in the process rather than a proper analysis of the expert issues.  The audience, in true Question Time spirit, asked some pointed questions of the speakers as to whether Hot Tubbing was not just a way of avoiding having to decide between  experts or face hostile cross-examination; I leave you to guess which question was addressed to which speaker. The talk did place a large question mark over the benefits of Hot Tubbing and as to whether we should be favouring the process over the more traditional methods of dealing with expert evidence.
  7. In his talk on Construction and Insolvency, Fraser J identified the practical difficulties which arise when the employer or a contractor becomes insolvent, which under standard term contracts extends beyond a company liquidation, and will include acts pointing towards insolvency, such as the appointment of an administrative receiver. Commonly, issues arise as to unpaid interim payments, the payment of contractors and sub- contractors, liability for defects, payment for and ownership of materials on site, and  the financial costs of delays and completing the work.
  8. He  highlighted his recent case of Michael J Lonsdale (Electrical) Ltd  v Bresco Electrical Services Ltd  ( in liquidation) [2018] EWHC 2043 in which  he ruled that a company in liquidation could not refer a dispute to adjudication under the Housing Grants, Construction and Regeneration Act 1996,  because upon liquidation all claims and cross-claims cease to be capable of separate enforcement and become enforceable by way of proving the net balance on mutual dealings under rule 14.25 of the Insolvency Rules 2016.   The question as to whether enforcement of the contractual debt is simply barred by the liquidation, and thus capable of resurrection if circumstances permit, or whether it is extinguished, was considered but not decided. Leave to appeal has been granted and it is worth looking out for the decision of the Court of Appeal, probably towards the middle of next year.
  9.  A further point which comes out of Lonsdale v Bresco is that the court will only interfere in an ongoing adjudication in very limited circumstances. This contrasts with the court’s  approach to intervening in expert determinations, which is governed by considerations of procedural convenience; Mercury Communications Ltd v Director General of Telecommunications 1994 CLC 1125 at 1141, for an recent example of a case in which the court intervened in an expert determination see Great Dunmow Estates Ltd v Crest Nicholson Operations Ltd LTL 12/6/18.
  10. Our next Forum meeting is set for 21st January 2019 and will deal with the BPC disclosure pilot and electronic disclosure in its current form and with the assistance of artificial intelligence. Adherence to the pilot will be compulsory in all BPC claims extant or started after 1st January 2019.  An invitation will be sent out nearer the day. The Newcastle Law Society has a list of those who have expressed an interest in attending our talks. If you  have not requested  to be on the list but would like to receive an invitation to events, please contact the society and ask for your name to be added.
  11. Not quite finally, I am aware that there has been some uncertainty as to where to send skeletons, authorities for hearings, and costs schedules. If the hearing is before me or one of the Newcastle specialist DJs the email address to use is newcastlechancery@hmcts.gsi.gov.uk, if you are before the Vice Chancellor or a deputy High Court Judge, which includes HHJs Raeside QC, Davis-White QC and Klein, or a chancery recorder please use the general  BPC section email address  newcastleBPC@justice.gov.uk  .  
  12. Finally, I expect that CE filing in the Newcastle BPCs will shortly be with us. I am expecting some training in December which suggests that we are looking to go live in the early part of next year.  All proceedings and documents, save for trial bundles, will have to be filed electronically through the CE file. This includes emails which must be uploaded to the electronic file. Those of you who have used CE filing at the Rolls Building have been impressed. I hope to be in a better position to give you a clearer picture by the time of the January Forum.