The Court’s Power to Vary Orders in Relation to the ‘Show Cause’ Process: Ministry of Defence v Sivaji [2021] EWCA Civ 1163

At the end of July, the Court of Appeal shone a light on the practical workings of the Practice Direction 3D ‘show cause’ procedure, whose purpose is to streamline (time and costs) the resolution of mesothelioma cases, where there are ‘no reasonable prospects of maintaining a defence at an early stage’. A defendant must therefore ‘show cause’ at the 1st CMC why judgment on liability should not be entered against it.

The case of Ministry of Defence v Sivaji [2021] EWCA Civ 1163 regarded a fatal mesothelioma claim, advanced under the Law Reform (Miscellaneous Provisions) Act 1934 and the Fatal Accidents Act 1976 by the spouse of a deceased welder.

She alleged that the defendant had negligently (and in breach of its statutory duty) exposed her late husband to asbestos in a naval dockyard, in Singapore, from 1953 to 1968.

Initially, the Claim Form and Particulars of Claim only plead arguments in respect of English law, but it was inevitable that questions over the application Singaporean law, as well as the extraterritorial effect of the 1934 and 1976 Acts, would lead to a complex legal dispute on valid causes of action.

When the 1st CMC was heard before Master Thornett, it was held that the action was unsuitable for the ‘show cause’ procedure. Trying it as a standard case in the Queen’s Bench Division List was deemed the more appropriate course of action.

A 2nd CMC was also ordered for listing in October 2019, ahead of which the parties were expected to attempt to agree on issues that would be deliberated in a trial of preliminary issues.

At the 2nd CMC, the Master gave directions to facilitate a trial of preliminary issues in a ‘prompt and timely fashion’ and also ordered the parties to reach an agreement on the issues that would be deliberated at the trial. Failing this, the issues would be decided at a subsequent hearing.

However, this hearing was vacated after the claimant sought permission to amend her Claim Form to plead Singaporean law before HHJ Gore QC (sitting as a High Court Judge). Following on from this, he presided over a hearing to determine orders consequential to the permission application.

Having approached the ensuing court appearance as a ‘show cause’ hearing, this resulted in a judgment debarring the defendant from contesting the executrix’s accusation that the deceased ‘was exposed to and inhaled substantial and injurious quantities of asbestos’ in the course of his employment (the factual case). HHJ Gore QC went on to overturn the Asbestos Master’s order for a trial of preliminary issues on the basis that it was ‘no longer suitable’ and then ordered a single trial of all the residual issues (applicable law on liability, limitation, damages and the assessment of damages) as the ‘only fair, realistic and proportionate option’.

Pursuant to  CPR r.3.1(7), HHJ Gore QC reasoned that the court was empowered to vary the Master’s case management order after the 2nd CMC. The fact that the parties were yet to agree a list of issues for the preliminary trial, he said, constituted a ‘material change in circumstances’.

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The Court of Appeal has since dealt with the defendant’s appeal against the judgment and order of the Circuit Judge, unanimously ruling that neither the debarring order, nor the single trial order could stand:

‘The two matters stand or fall together’.

Haddon-Cave LJ, with whom Laing LJ and Underhill LJ concurred, found that the judge below did not have the power to vary Master Thornett’s original order, as there had in fact been no ‘material change in circumstances’.

They viewed the claimant’s assertion that the Master had merely made observations on the matter of ‘show cause’, devoid of reaching a conclusion, as erroneous. Indeed, at paragraph 4 of the 1st CMC judgment, the Master had stated that:

‘…[O]bviously, this is a sophisticated case where jurisdiction has a primary issue before one even gets to the centrality of the allegations on exposure. I am therefore going to treat this as I would do any other case in the general QB list’.

This position was somewhat cemented by the fact that both parties were evidently proceeding under the impression that the 'show cause' procedure had been abandoned.

The Court of Appeal judges further discerned that HHJ Gore QC had failed to have proper regard to the fact that the 1st CMC was not a full ‘show cause’ hearing, which explains why, for example, the defendant was not formally excused from the ‘show cause’ requirement – see the part of the Notice for the 1st CMC which recorded the following passage:

‘[T]he Defendant[s] must be prepared to ‘show cause’ in brief as to why judgment on liability should not be entered at that stage…If the Court thinks there may be merit in the Defendant's submissions the matter will be adjourned for a full ‘show cause’ hearing’.

Although the claimant was correct to identify that in theory, the ‘show cause’ requirement can be imposed on successive occasions (note the White Book commentary at paragraph 3DPD.6.1), it was not envisaged that this would apply to the present case, where the Judge had raised ‘show cause’ without warning or invitation from counsel and where ‘show cause’ had already been dispensed with by the Asbestos Master.

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Full text judgment can be accessed here.