The Show Must Go On (but only where it is in the interests of justice for it to do so)…

April 24, 2020

By Jodie Wildridge and Simon Whitfield

Following on from the decision of Mr John Kimbell QC in Re Blackfriars Limited [2020] EWHC 845 (Ch), HHJ Eyre QC has provided some further guidance on the approach to be taken to applications made in consequence of the current Covid-19 pandemic. See the case of Muncipio De Mariana & Others v BHP Group Plc (formerly BHP Billiton), BHP Billiton Brasil Ltda, Samarco Mineração SA, BHP International Finance Corp, BHP Minerals International LLC, Marcona Intl, SA, BHP Group Ltd [2020] EWHC 928 (TCC).

The substantive proceedings in this matter arose out of the collapse of the Fundão Dam in Brazil in 2015. The collapse resulted in huge environmental damage and losses to local municipalities, businesses and individuals. Members of Exchange Chambers have spent time in Brazil working with local lawyers and thousands of Claimants, on what is one of the largest class actions ever brought.

Proceedings have been issued in Brazil and in England. The First and Seventh Defendants (collectively, “the Defendants”) applied for a stay of the English proceedings on jurisdictional grounds; and such application was to be heard early in June 2020.

The hearing before HHJ Eyre QC concerned the Defendants’ application for an extension of the deadline for the service of their evidence in reply to the Claimants’ evidence; and acknowledging that this would lead to a vacation of the June hearing date for the jurisdiction challenge, the Defendants sought an adjournment of the same; the reason being the consequences of the Covid-19 pandemic. More specifically:

a) the lockdowns in Brazil and the UK were imposed just as the UK lawyers were about to travel to Brazil, with the consequence that the work must now be done remotely. Due to the significant volume of documentation which has to be considered and because of the need for interpreters to be included in the remote meetings, the same will take considerable time;

b) one of the Defendants’ experts, Mr Justice Rezek, is aged 76. Though he lives in Sao Paulo, he is in lockdown in Brasilia, separated from his staff and library. Thus, the preparation of his expert evidence is hindered;

c) another of the Defendants’ experts, Professor Didier is currently devoting his time to supporting his vulnerable parents and his diabetic wife; and guiding his law firm through this pandemic, without having access to his office. Furthermore, his home internet connection is unreliable and intermittent.

The Claimants, whilst accepting that an extension of time was necessary in principle, suggested that the Defendants’ concerns were exaggerated, and that, in any event, as professionals, the Defendants’ lawyers and experts should be expected to sufficiently adapt to the use of remote technology. The Claimants felt a shorter extension, whereby a vacation of the June hearing date would not be necessary, was more appropriate in the circumstances.

Such submissions were rejected by the HHJ Eyre QC, who, instead, found that:

“…the problems expressed by the Defendants’ witnesses are real and are genuinely perceived as posing grave difficulties”.

 

Determining the application

Going back to basics, the Judge considered, as his starting point, the overriding objective.

Of particular interest is that despite submissions from the Claimants as to the relevance of the decision in Quah Su Lung v Goldman Sachs International [2015] EWHC 759 (Comm) in relation to late applications leading to the vacation of a trial date, HHJ Eyre QC was quick to dismiss the same, stating:

“…the principles governing late amendments to pleadings in normal circumstances are of little assistance in determining the approach to be taken to an application for the extension of time for the filing of evidence where it is said that the circumstances of a worldwide pandemic and of national lockdowns have caused delay in the gathering of evidence. Of markedly more assistance are those cases where the courts have addressed the problems arising from the current circumstances”.

Instead, the Judge went on to consider paragraph 4 of PD 51ZA:

“In so far as compatible with the proper administration of justice, the court will take into account the impact of the Covid-19 pandemic when considering applications for the extension of time for compliance with directions, the adjournment of hearings, and applications for relief from sanctions”,

as well as the decisions in the recent cases of National Bank of Kazakhstan v Bank of New York Mellon; Re Smith Technologies; and Re Blackfriars Limited [2020] EWHC 845 (Ch).

1. Whether the dispute can fairly be resolved by way of a remote hearing

As regards the issue as to whether a hearing ought to be adjourned if it cannot proceed to an in-person hearing; or whether a remote hearing would, instead, suffice, the Judge set out the following as the governing principles:

• despite the current circumstances, the Court must have regard to the continued administration of justice;
• the Court should recognise the extent to which disputes can in fact be resolved fairly by way of remote hearings;
• the Court must be prepared to hold remote hearings where the same would have been inconceivable only a matter of weeks ago;
• before declining to hold a remote hearing, the Court must first examine whether, and the ways in which, such a hearing could be achieved consistent with justice; and
• decisions will be case-specific, and there will inevitably be some circumstances in which the Court cannot be satisfied that a fair resolution can be achieved by way of a remote hearing.

After considering the above, the Judge decided that, this was “clearly” a case capable of being fairly determined by way of a remote hearing. This decision was premised on the fact that the evidence in the case, though substantial, would be written, and there was no need for live evidence. Equally, submissions could easily be made by Counsel using Skype or another appropriate video-link.

2. Whether there should be an extension of time for the gathering of evidence because of the effects of the COVID-19 pandemic.

As regards an extension of time for the filing of evidence, the Judge set out the below guiding principles:

• where possible, existing deadlines must be kept; otherwise, any extension granted should be the “minimum extension of time which is realistically practicable”;
• legal professionals are expected to adapt to remote methods of working;
• legal professionals are expected to rise to the challenges caused by the pandemic, and “…to roll up their sleeves or to go the extra mile to address the problems encountered in the current circumstances. It is not enough for those involved simply to throw up their hands and to say that because there are difficulties deadlines cannot be kept”;
• professional expert witnesses are expected to adapt in the same way as legal professionals;
• if such is necessary to achieve the timely production of evidence and other material, the Court should accept the same in a less polished form;
• despite the above, care must be taken to avoid requiring compliance with deadlines which are not achievable even with proper effort;
• the Court should be conscious that remote working will likely mean things will take longer and require more work;
• in the same way the court must have regard to the consequences of the restrictions on movement and the steps by way of working from home which have been taken to address the pandemic; and
• before acceding to an application for an extension of time which would cause the loss of a trial date the Court must be confident that there is no alternative which is compatible with dealing fairly with the case.

Despite the general theme of the Judgment, the Judge was satisfied that the interests of justice did require the granting of the requested extension of time. His reason was that the Defendants’ evidence as to the particular difficulties they faced as a consequence of Covid-19 was “compelling”; and that even where proper allowance is made for remote working and the additional effort it involves, “the exercise of preparing the reply evidence will take significantly longer than was provided for in the timetable laid down in September last year”. In the event, the hearing of the jurisdiction challenge was put back to July 2020.

And so, whilst mindful that the Courts continue to adapt to the issues presenting themselves in this evolving legal landscape, a general direction appears to be forming. The continued administration of justice is of fundamental concern, and where hearings can proceed fairly by way of remote hearings, they will go ahead. All involved are expected to go above and beyond that previously expected in more normal times, and where deadlines can reasonably be met with the provision of increased effort, there will be no justification for them to be extended. However, such decisions are case-specific and there can be no hard and fast rules. Where the interests of justice in a particular case require an adjournment, or an extension, as a consequence of the Covid-19 disruption, the same should be granted. Where this leads to the vacation of a fixed trial date, circumstances ought to be examined with particular scrutiny, but the principles as to fairness and justice will remain of paramount importance.

 

Jodie Wildridge is a second six commercial pupil at Exchange Chambers who practices in the areas of commercial dispute resolution, insolvency and property and who appears regularly in the District Registries of the High Court and in the County Court on a wide range of matters.

Simon Whitfield was called to the Bar in 2009 having previously been a partner at international law firm Squire Patton Boggs. His practice includes commercial dispute resolution, construction, professional negligence and insolvency work.