Litigation round-up June 2020

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3 min read

A round-up of some recent litigation cases.

Waiver of privilege

Barclays Bank was held to have waived privilege in all contemporaneous communications with its lawyers relating to allegedly sham transactions.  The bank had deployed the lawyers’ advice that the transactions were lawful in order to support its case on the merits in earlier criminal proceedings by repeated references to the involvement of lawyers and to taking comfort from their advice in witness statements and in its opening in court.  An order for disclosure was appropriate even though the bank did not set out any of the content of the advice but only referred to its effect (PCP Capital Partners LLP v Barclays Bank Plc).

Calderbank offer

A Calderbank offer to settle without an express time limit can be accepted once the relevant substantive hearing has begun; the offer does not lapse at the beginning of the hearing. The judge rejected the defendant’s arguments: the claimant had been entitled to accept the offer part way through the hearing, when it became clear that things were not going well for him.  The rule applying to Part 36 offers in CPR 36.11(3) requiring the court’s permission to accept an offer during a hearing is irrelevant to Calderbank offers. It had been open to the defendant to put a time limit on the offer and it could have withdrawn the offer at any time (MEF v St George's Healthcare NHS Trust).”

Adjudication

The Supreme Court has held that a company in liquidation can refer a dispute to adjudication where there are claims by the company and cross claims by the other party. An insolvent company has both a statutory and a contractual right to pursue adjudication to resolve a dispute arising under a construction contract, even where the dispute relates to a claim affected by insolvency set-off. In some cases summary enforcement will be appropriate. Where this is not the case, opposition to attempts to enforce can be dealt with when the outcome of the adjudication is known (Bresco Electrical Services Ltd v Michael J Lonsdale (Electrical) Ltd). 

Exceptions to the without prejudice rule

Given that without prejudice negotiations can be used by a claimant to prove a misrepresentation and thereby rescind an agreement, a defendant should be able to use them to disprove a misrepresentation and thereby uphold an agreement. The defendant was entitled to adduce evidence of statements it had given in mediation proceedings between the parties five years earlier. The statements might rebut the claimants’ allegation of fraud, and it was therefore appropriate to apply an exception to the rule that without prejudice communications are inadmissible (Berkeley Square Holdings & Ors v Lancer Property Asset Management Ltd).

FCA business interruption insurance test case

The Financial Conduct Authority has begun proceedings in the Financial Markets Test Case Scheme to obtain legal clarity about the meaning and effect of selected business interruption insurance policy wordings in the context of Covid-19 claims.  The expedited eight-day final hearing will take place on 20 to 23 and 27 to 30 July 2020 before Flaux LJ and Butcher J and will be live-streamed.  See our briefing and the FCA website  for more detail about the case.

The Shorter Trials Scheme

Proceedings concerning an alleged breach of contract and/or negligence in relation to the design, manufacture and supply of components should not have been determined under the Shorter Trials Scheme.   The trial bundle stretched to 11 bundles of documents and there were four witnesses of fact and four experts.  The parties should have revisited this question and, at the latest, informed the judge at the pre-trial review that the case could not be completed in the time allotted (DBE Energy Ltd v Biogas Products Ltd).

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