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The Court of Appeal has revised guidance on how the English Courts evaluate applications for relief from sanctions imposed for failure to comply with deadlines.
Denton has important ramifications as to how applications should be approached by parties in default and whether they should be resisted by the opposing party.
In 2013, changes were introduced to the Civil Procedure Rules that sought to redress the perception that Courts were overly tolerant toward failures to comply with deadlines imposed by rules, practice directions and court orders.
This revision, in the form of a revised CPR r. 3.9, altered the factors that the Courts should have regard to when considering applications for relief from sanctions imposed for a failure to comply with deadlines. The amended rule states, at rule 9.7(1), that, in evaluating applications, the court "will consider all the circumstances of the case" including:
Until July 2014, the case of Mitchell was the leading authority on the interpretation of this rule. In Mitchell, the Court indicated that relief from sanctions would only be granted in limited circumstances:
The guidance provided in Mitchell came under severe criticism from solicitors and barristers alike. They argued that:
Mitchell arguably made litigation unnecessarily aggressive for the sake of it.
In light of the inconsistent application of Mitchell by the Courts, the Court of Appeal heard three cases concerning applications for relief from sanctions under CPR 3.9 together (collectively referred to as Denton).
A three stage test was formulated for evaluating applications, which now replaces the Mitchell guidance. This requires the Court to:
In Denton, it was accepted that there are "degrees of seriousness and significance". A test of immateriality was favoured to address seriousness and significance, with an immaterial breach defined as one that "neither imperils future hearing dates nor otherwise disrupts the conduct of the litigation".
The Court should consider why the default occurred and whether there was a good reason for it.
This stage was held to be necessary, meaning that an application for relief would not automatically fail, even if stage one and two (above) were not made out.
Denton has important ramifications for the parties to any application in that:
Hopefully, the guidance in Denton will (as the Court of Appeal intends) enable "a reasonably consistent judicial approach to the application of rule 3.9" so that the parties can focus on resolving the underlying dispute rather than engaging in expensive and distracting satellite litigation.
In any event, it sends a message to the legal community that unnecessary or disproportionate aggression, if there are good for reasons for a deadline to have been missed, will be punished.
Despite this comfort, the best position no matter how the courts apply Denton is to seek extensions to deadlines in advance, so that Denton does not apply and one can rely on the case of Hallam Estates.
In that case, the Court of Appeal held that legal representatives further the Overriding Objective and save costs if they avoid a contested application by agreeing to a reasonable extension of time, which does not imperil future hearing dates or otherwise disrupt the conduct of the litigation.
 Mitchell v News Group Newspapers Ltd EWCA Civ 1537
 Denton v TH White Ltd and another, Decadent Vapours Ltd v Bevan and others and Utilise TDS Ltd v Davies and others  EWCA Civ 906
 Dyson MR and Vos LJ at 
 Dyson MR and Vos LJ at 
 Hallam Estates Ltd v Teresa Baker  EWCA Civ 661
This article was written by Rhys Novak and Christopher Wenn.
For more information please contact Rhys on +44 (0)20 7427 6563 or email@example.com