Is it secret? Is it safe?

The very basic background of this case is that members of the Caine family established the Claimant. Around 2015, they sold the claimant to Health Innovations (UK) Limited for about £1.1 million. The Caine family remained as directors or employees of the claimant for a time after the sale had taken place but they no longer hold such positions with the claimant now.

The full judgement can be found here (Vitrition UK Ltd v Caine & Ors [2022] EWHC 51 (Comm) (13 January 2022) ( ) and makes for an interesting read in totality. However, for the purposes of the consideration of relief from sanctions, we will limit ourselves to the matters pertaining directly to the outcome of the application, with reasoning.

The main allegations against the defendants relate to setting up in competition and/or diverting the claimant’s business or had business of the claimant’s diverted to them and/or misused confidential information and/or misappropriated tangible property containing confidential information. Disclosure was ordered by 27 November 2020 or the defence would be struck out and they would be debarred from further defending the proceedings.

The First – Seventh defendants made their disclosure in ‘dribs and drabs’ and by 27 November 2020 had not made full disclosure which was acknowledged by their own ‘legal representative’, Mr Robinson, in his witness statement dated 31 December 2020 which accompanied the application for relief from sanctions. Up until this point, the defendants asserted that they had complied with the order to the best of their ability and they required further ‘guidance’ from the claimant as to the scope of disclosure required.

As many of you are aware, the Denton case set out the principles in relation to relief from sanctions:

  1. Is the relevant breach serious and/or significant;
  2. Why did the relevant breach or default occur?
  3. If the breach was serious and/or significant and there is an inadequate reason for the default then the court must consider all the circumstances to decide whether or not relief should be granted. In so doing the court will give weight to the need for litigation to be conducted efficiently and at proportionate cost and the need to enforce compliance with rules, practice directions and court orders.

Technically, the defendants should all have had their position considered separately, however, the case was put forward “where they stand or fall together”, as stated by HH Judge Davis-White QC.

So, let’s take a look at the case with the Denton principles in mind. It was admitted by the defendants’ counsel, Mr van Heck, that the breach in the case was serious and significant because the disclosure documents were drip-fed to the claimant. Denton principle one met.

There were a number of reasons as to why the disclosure did not take place. Mr Robinson appears to receive the brunt of it in that he appeared to have advised the defendants inaccurately. However, the defendants did at one point have a solicitor representing them and it is ludicrous to believe that no advice in relation to disclosure was imparted. Further to this, once it was noted that the disclosure had not taken place as it should have, it still did not occur. The defendants were acting as litigants in person, however, that does not mean that they can ignore the CPR or Practice Directions, or even a court order. It, therefore, was averred that the failings were down to the defendants themselves with no material mitigation. Denton principle two met.

With the first and second principles in Denton met, attention is turned to considering the case ‘in all circumstances’. The defendants failed to disclose obviously disclosable documents and even at the point of the defendants’ relief from sanctions application hearing disclosure remained incomplete, with no proposals or indications as to when it would be dealt with. It was suggested that the trial date could be retained if relief was granted. The trial was due to take place in November 2021 over 15 days, and in June 2021 a considerable amount of trial preparation was outstanding as it hinged on disclosure. One of the reasons for the original unless order was trial proximity. HH Judge Davis-White QC stated that on weighing all relevant circumstances, he was of the firm view that relief from sanctions should not be given and the application was dismissed. He went on to state that judgment on liability should follow and if the parties were unable to agree the terms of the order, then a short hearing should be listed.

The defendants’ application for relief from sanctions was dismissed on the grounds that the Denton principles were met. The defendants’ own conduct went against them during the application hearing.

PIC are costs experts and are able to assist in application costs for all types of applications, not just relief from sanctions applications. In instances such as this case, PIC would also be able to assist in preparing a Bill of Costs which relate to all recoverable inter partes costs.

Susie Power, Costs Consultant