Shared & Halved – IHL series: Court proceedings

As part of our series of webinars to support in-house lawyers during the current pandemic, on 6 May we hosted a webinar looking at court proceedings.

Introduction

The IHL series of our COVID-19 webinar programme covers bite-size topics designed for a half hour coffee break and focuses on practical tips for in-house lawyers. This session covered court proceedings and the impact COVID-19 has had.

Overview

• Court system continues to operate, albeit with lot of new rules/legislation
• Starting point is the Coronavirus Act 2020, but for litigation there have also been new practice directions, protocols and guidance issued by the courts. Main emphasis to facilitate courts working remotely using audio/video hearings, but also some changes to procedure, and to particular types of claim (see further below)
• Very few live hearings taking place, most hearings currently being adjourned if cannot proceed remotely

New claims

• Under normal circumstances, most claims would follow a pre action protocol, requiring the other side to be put on notice, and for information and documents to be exchanged. This has not changed
• Ensure, if at all possible, that hard copy post is monitored in case proceedings are served. To avoid issues put the other side on notice that communication should be via email
• Courts are still dealing with urgent applications, eg injunctions and freezing orders, using remote hearings
• If proceedings are served, make sure you comply with deadlines for responding (straightforward money claim, 14 days to acknowledge, 28 days from service of Particulars of Claim to file Defence) or get extension of time

Ongoing claims

• Possession proceedings under Civil Procedure Rules part 55 (CPR 55) are currently stayed (with limited exceptions).
• Otherwise, court and procedural timetables must still be complied with. No moratorium on deadlines as such (nb including as to limitation); parties can now agree longer extensions of time (up to 56 days) without court order if hearing date not at risk (PD 51Z A). But check that court’s permission to extend a particular deadline not specifically required.
• If need extension of time, ensure application made to court before deadline in question expires (otherwise will have to seek relief from sanctions, which is more difficult). Court will take current circumstances into account when deciding applications to extend time/adjourn hearings
• Safest course ; assume that the timetable will have to be met, and that hearings will have to be prepared for
• Disclosure might be more difficult if documents cannot physically be searched for ; consider applying for extension of time and/or order varying scope of disclosure required

Other routes to recovering debt

• Awaiting new Corporate Governance and Insolvency Bill, so not yet clear what changes will be made. Government guidance recently released  is that use of statutory demands and winding-up petitions against companies for non-payment of rent will be prohibited, as will forfeiture, at least for the present
• No reason why a company cannot put itself into administration or liquidation
• Our experience is that majority of bankruptcy and winding-up hearings have been adjourned (although can, in principle, be heard remotely)
• Might be practical difficulties with e.g. with personal service of statutory demands, but suggest get everything ready now so can action as soon as lockdown relaxed

Settlement

• Most options remain available, e.g. negotiations by phone/email ; no reason why settlement meetings cannot be dealt with remotely
• Consider using some form of alternative dispute resolution, such as mediation. Again, mediation can be held remotely, and can be particularly helpful in resolving disputes whilst preserving ongoing commercial relationships

Key points

• There is no general moratorium on court proceedings ; know your deadlines, and comply with them
• If you cannot comply, agree an extension of time with the other side or apply to the court before the deadline expires
• Try to agree with the other side that documents can be served by email
• Start planning now for the backlog of claims that the courts will inevitably face; make sure that you are ready to go, and think about alternatives to court proceedings which might be quicker (and cheaper)