Swift justice in Technology and Construction cases
In the arena of construction related disputes and indeed technology disputes, there are many ways to resolve disputes from alternative dispute resolution ("ADR") methods to the more entrenched, but comparatively lengthy and expensive, litigation in the courts and arbitration. Indeed, the ever-increasing rise in use of ADR is largely due to the comparative expense and complexity of conducting litigation.
Perhaps in response to this, certain courts are now subject to two new pilot schemes introduced by Practice Direction 51N and brought into force on 1 October 2015: the Shorter Trials Scheme and the Flexible Trials Scheme.
Both schemes will last for two years and will operate in the courts situated in the Rolls Building – the Chancery Division (including the Patents Court and the Companies Court), the Admiralty and Commercial Court, the London Mercantile Court and the Technology and Construction Court.
The Shorter Trial Scheme can be agreed by the parties or ordered by the court if suitable. Certain cases may not be suitable, such as cases including an allegation of fraud or dishonesty, where extensive disclosure or extensive factual or expert evidence is required, where there are multiple issues and/or parties, cases in the Intellectual Property Enterprise Court and public procurement cases. If the scheme is suitable then there is a pre-action procedure set out in PD 51N which will substitute any applicable pre-action protocols. Once proceedings are commenced, particulars of claim must be served with the claim form. Both the particulars of claim and any defence and counterclaim should not exceed twenty pages and should be accompanied by a bundle of core documents on which either party relies. This is a similar approach to arbitration where core documents are often served at the same time as each party sets out their pleaded case.
All scheme cases will be assigned to a designated judge at the time of the first case management conference ("CMC") and all proceedings will normally be heard by that judge. A CMC should be set to take place approximately twelve weeks after the defendant is due to acknowledge service of the claim form. All applications will be dealt with without a hearing. In respect of disclosure, rules 31.5(2) and 31.7 do not apply. If a party seeks disclosure of particular documents or classes of documents or documents relating to a particular issue, they must write to the other party to make such requests not less than fourteen days in advance of the CMC. Then, within four weeks of the CMC, the parties must make and serve a disclosure list and serve copies of all documents in the list to which inspection has not been objected to. The documents to be listed are those that each party relies on as supporting its case and the documents requested by the other party and agreed to be disclosed.
Witness statements should not exceed 25 pages (without good reason) and may be limited to agreed issues. Oral evidence at trial by experts will be restricted to identified issues.
A trial date should take place no more than eight months after the CMC and the length of eventual trial should be no more than four days including reading time. In all, therefore, the time from commencement of a claim to end of trial should be approximately a year. Interestingly, the court will aim to hand down judgement within six weeks of trial or (if later) final written submissions. Significantly, the costs management regime, including budgeting, in Practice Direction 3E will not apply (unless the parties agree otherwise). However, parties are required within 21 days of the conclusion of trial to file and exchange schedules of costs which should be detailed to show cost for each of the phases identified by Precedent H to the Cost Budgeting regime.
In cases where a party is seeking an appeal, the Court of Appeal shall take into account that fact that the case was in the Shorter Trial Scheme and the desire for expedition in deciding when applications for permissions to appeal will be considered and when appeals will be listed.
This scheme enables parties by agreement to adapt trial procedure to suit their particular case and is designed to encourage parties to limit disclosure and confine oral evidence at trial to the minimum necessary for fair resolution. The aim is to reduce costs, the time required for trial and to enable earlier trial dates to be obtained.
Practice Direction 51N sets out the procedure for flexible trials although the parties may agree to variations of the procedure in advance of the first CMC. The Flexible trial Procedure provides that each party discloses only those documents on which it relies and documents which are actually known to fall within rules 31.6(b) or (c) (i.e. the documents which adversely affect its own case; adversely affect another party’s case; or support another party’s case; as well as any documents which are required to be disclosed by a relevant practice direction). In other words, only documents which are "known" to fall within the scope of standard disclosure need be disclosed. At the same time, the party may request specific disclosure of documents it requires from the other party. If wider disclosure is agreed, it should only be in relation to limited and defined issues.
Oral evidence at trial must be limited to identified issues or identified witnesses and, likewise, oral expert evidence will be limited to identified issues. If an issue must be determined by oral evidence it will only be necessary to put the principal parts of the case to the witness. Finally, submissions at trial will be made in writing with oral submissions and cross-examination subject to a time limit. The imposition of a time limit is akin to the "chess clock" approach in arbitration.
There has been surprisingly little fanfare announcing the arrival of both schemes but as a construction disputes lawyer this is an exciting development as it offers even more options to clients facing a dispute. It provides considerable flexibility in a manner comparable to what arbitration has done for years. Obviously the Shorter Trials Scheme will not be appropriate for all cases, particularly the most complex construction disputes which involve multiple complex factual and expert issues where trial, if the claim progresses that far, will typically last several weeks. Even so, those cases can be ideally suited to the Flexible Trials Scheme. Therefore, during the two years that both schemes run it is hoped that parties will seize the opportunity to adopt flexible arrangements in order to reduce costs (particularly in disclosure) and to achieve earlier trial dates.
We suspect that construction practitioners will be quick to adapt to the new schemes because they are already well-versed in the rough and tumble of construction adjudications and arbitration procedure with its compressed timetabling, reduced disclosure, "hot-tubbing" of experts, oral evidence restricted to pre-agreed lists of issues and chess-clock allotment of time.