10 January 2007

To Admit or not to Admit

In Sowerby v Elspeth Charlton [ 2005 ] EWCA Civ 1610 and re-affirmed in Walley v Stoke on Trent City Council, The Times 25/8/06 the Court of Appeal established that a pre-action admission is not binding on the defendant in multi track cases having regard to the provisions of CPR Part 14.1. As from 6th April, 2007 the situation will change. The Civil Procedure ( Amendment No 3 ) Rules 2006 provide for a change to CPR Part 14 in that under the new provision CPR Part 14.1A ( 1 ) “ a person may, by giving notice in writing , admit the truth of the whole of any part of another party’s case before commencement of provisions ( “ a pre-action admission “ ) “. The rule is not retrospective and only applies to an admission made on or after 6th April, 2007. The admission must be made in writing.

The pre-action admission applies only if (a) it is made after the defendant has received the letter of claim in accordance with the relevant pre-action protocol, or alternatively, (b) it is made before such letter of claim has been received, but is said to be made under Part 14.

Under CPR Part 14 (3) a defendant may by giving notice in writing, withdraw a pre-action admission (a) before commencement of proceedings, if the Claimant agrees (unlikely), and (b) after commencement of proceedings, if all parties to the proceedings consent ( unlikely ) or with the permission of the court.

After commencement of proceedings any part may apply for judgment on the pre-action admission, or the defendant or party who made the admission may apply to withdraw it. Either application should be made in accordance with the provisions of CPR Part 23 and may be made as a cross application.

No guidance is provided in the amended Rules as to the criteria to be had with regard to any application to withdrawal post commencement of proceedings .It is likely that on any application to withdraw the admission ( except where the parties agree by consent to its withdrawal ) post commencement of proceedings that the court will apply the discretionary test set out at Paragraph 45 of the judgment of Sumner J in Braybrook v Basildon & Thurrock University NHS Trust 7/10/04 and approved by the Court of Appeal in Sowerby ante in relation to admissions made post commencement of proceedings. In this context, the court is to exercise its discretion by considering all the circumstances of the case, and amongst other matters to consider :

a. The reasons and justification for the application ;
b. The balance of prejudice ;
c. Whether any party has been the author of any prejudice that they may suffer ;
d. The prospects of success on any issue arising from the withdrawal of the admission ; and
e. The public interest in avoiding satellite litigation.
In essence, it is likely that there has been a reversion to that which was in place prior to the decision in Sowerby. In the meantime, defendant insurers have a window of opportunity of several months to put there house in order in relation to the procedures to be adopted with regard to the provision or otherwise of pre-action admissions.