Shahram Sharghy successfully persuades the High Court to reject an Appeal
ROYAL AUTOMOBILE CLUB LTD v WRIGHT (2019) QBD (William Davis J) 26/03/2019
Shahram Sharghy successfully persuades the Appeal Court to reject the Defendant's challenge to a Master's decision to dismiss its application to withdraw an earlier admission of liability in respect of the claimant's injuries under CPR PD 14 Para 7.2. The Appeal Court held that the Master had correctly determined the issue under his case management powers in the light of the Defendant's grounds for withdrawing the admission, the parties' conduct, prejudice to the parties, the stage the proceedings had reached, the interests of justice and the claim's prospects of success.The Appellant employer appealed against the refusal of its application to withdraw an admission of liability in respect of the respondent employee's personal injury. The Respondent had worked for the Appellant and in June 2015 she was injured when she fell down a flight of stairs at work. She claimed that the accident was caused by the absence of a handrail along the staircase, which was negligent and in breach of statutory duty (namely Regulation 12(5) of the Workplace (Health, Safety and Welfare) Regulations 1992. As a result of her accident, she sustained a significant fracture to her leg which had given rise to Complex Regional Pain Syndrome.
The Appellant's senior claims handler had insisted that notwithstanding the injuries, the matter should be dealt with by the small claims court because the quantum of the claim would be less than £25,000. The Respondent rejected that approach, stating that her claim would clearly exceed £25,000. After investigating the circumstances of the accident, the Appellant admitted liability in September 2016. Relying on this admission, the Respondent proceeded to gather medical evidence from orthopaedic, pain and psychiatric consultants and the Appellant made a number of interim payments which exceeded £40,000.
In view of the Appellant's desire to engage in ADR, the Respondent served a 'without-prejudice' Schedule of Loss in August 2017 totalling just over £1 million. The Appellant responded by giving the Respondent notice that it was re-opening an investigation into the circumstances of the accident and refining its case to allege contributory negligence. It indicated that its earlier admission of liability might have been unwarranted, and invited the Respondent to consent to the withdrawal.
The Respondent declined and issued proceedings relying on the admission. The Appellant applied for permission to withdraw the admission under CPR PD 14 Para 7.2 on the grounds that the increased quantum of the Respondent's claim amounted to a change of circumstances and that it had obtained new expert evidence that put in doubt the initial advice obtained from another expert.
The Master rejected that contention as well as other factors advanced by the Appellant including its prospects of success in light of new expert evidence. The Appellant asserted that the absence of a handrail on the stairs was not causative of the accident. However, the Master found that the accident was of the kind which a handrail was intended to prevent and that a trial judge would resolve the issue in the same way. The Master, having gone through the factors he was obliged to consider under the rules, concluded that there was no proper basis on which to permit the Appellant to withdraw its pre-action admission.
On Appeal, the Appellant contended that the Master had failed to consider the issue of causation separately to breach of duty and that the Respondent's case could only be properly tested at trial once the factual and expert evidence had been considered.
William Davis J held that the Master had not been engaged in a trial of the proceedings, but considering the Appellant's application as part of the case management process. He was therefore obliged to, and had, considering all the circumstances of the case by reference to the matters set out in Para 7.2. Those were (a) the grounds on which the admission was sought to be withdrawn; (b) the parties' conduct; (c) the prejudice that the parties would suffer if the admission was, or was not, withdrawn; (d) the stage the proceedings had reached; (e) the interests of justice; (f) the claim's prospects of success. It was clear that the Respondent's claim, involving expert evidence from a number of medical specialists, was anything but straightforward and it had been unreasonable for the Appellant to expect that a modest amount of damages would be claimed.
The Respondent would suffer prejudice if the admission was withdrawn: the accident had happened over four years earlier and the admission had been made one year later, and she had not engaged in any recollection of our investigation into the circumstances of the accident. The prejudice to the Appellant of upholding the admission was self-evident because it would face a significant claim, but that was bound up with the nature of the claim. Whilst the Appellant's application to withdraw its admission had been made shortly after the claim had been issued, that was a long time after the admission had been made and some months after the Schedule of Loss had been served. Seeking to withdraw an admission of liability at a late stage after interim payments had been made and when an investigation into the accident would be more difficult demonstrated a 'cavalier attitude' to the administration of justice, Cavell v Transport for London  EWHC 2283 (QB) applied. It was doubtful whether the Master had needed to conclude that the Respondent was bound to succeed, but he had had to consider the parties' prospects of success, and those were not such as to inevitably lead to a conclusion that leaves to withdraw the admission should have been given. The Master had been right to conclude that it was not appropriate to permit the admission's withdrawal and therefore the Appeal was dismissed with costs.