Striking out a claim is a draconian sanction and wholly disproportionate for inordinate and inexcusable delay

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03/06/2019

In Alba Exotic Fruit SH PK v MSC Mediterranean Shipping Company SA [2019] EWHC (Comm), the Defendant made an application to strike out the Claimant’s claim for damages arising from the negligent shipment of bananas on the grounds that a delay of 4 years and 7 months in applying for a CMC is unacceptable. The Defendant argued that (a) there has been inordinate and inexcusable delay and as a consequence of such delay there is a substantial risk that a fair trial will not be possible or of serious prejudice to the defendant; (b) there has been intentional and contumelious delay involving a complete and total disregard for the rules of the court with full awareness of the consequences; and (c) the claimant has made an intentional decision not to progress the claim.

The Defendant asserted that the Claimant’s deliberate and intentional delay amounted to “warehousing” and was an abuse of the court’s process.

The Claimant asserted that following the guidance in Walsham Chalet Park (t/a Dream Lodge Group) v Tallington Lakes Limited [2014] EWCA Civ 1607 and Denton v TH White [2014] EWCA Civ 906, the court must have regard to the overriding objective and proportionality.

Further, the court has the discretion to impose a sanction, such as security for costs instead of striking out the claim.  The Claimant argued that the striking out of the claim would deprive the Claimant of the ability to pursue what, on its face is a legitimate claim against the Defendant for damage caused to bananas loaded in 28 containers and shipped by the Defendant.

HHJ Rawlings sitting as a High Court Judge held that he was not satisfied that: (a) Claimant’s delay was intentional and contumelious in full awareness of the consequences; and (b) Claimant did not make a conscious decision to maintain but not to progress the claim until a time convenient to it (referred to in the relevant cases as “warehousing”). The Judge held however that the delay is nonetheless very significant (over 4 years and 7 months and still continuing) and as indicated above the explanation for that delay is unsatisfactory.

The Judge held that it would not be proportionate and just to strike out the claim in all the circumstances. The appropriate sanction would be the payment of security for costs in the sum of £100,000.

The Defendant’s application was dismissed.

Simon Butler was instructed by Alexander Shaw Solicitors on behalf of the Claimant.

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