Litigation – operating in the new world

The circumstances we have all been operating under have brought certain challenges and for law firms these can be acute when dealing with substantial or urgent court hearings, or trials. In a more normal situation, extensions of time and adjournments are possible but require justification and the conduct of the parties is a relevant consideration. It would be fair to say that we have seen a more lenient approach to such issues during recent times, but that is likely to change as we enter the next phase.

What do the courts say?

The Liverpool TCC decision in Muncipio De Mariana v BHP Group Plc gathers together recent guidance and case law about applications for adjournments and extensions of time as a result of the lockdown.  The decision contains important messages about the role of solicitors and their obligation to get on top of remote working and sort out technical difficulties for themselves (and their clients if necessary) to ensure hearings can go ahead.

The case concerns the largest class action ever brought in England and arises out of the collapse of the Fundao Dam in Brazil in 2015.  The defendants asked for an extension of time to get their evidence together before a jurisdictional challenge hearing listed for 8 June 2020.  HHJ Eyre QC gave them an extension of time for their evidence of about 5 weeks and relisted the hearing for 20 July 2020.

As we understand it, the defendants’ problems caused by the lockdown were substantial and credible but still did not give them the adjournment to the autumn or beyond that they sought.  As such, the need to press ahead with hearings is clear and the fact that they have to be heard (and prepared for) remotely is not in itself a reason for extra time.

The judge referred to the overriding objective at PD51ZA of the CPR, which is Covid-19 based, and para 4 reads as follows:

“In so far as compatible with the proper administration of justice, the court will take into account the impact of the Covid-19 pandemic when considering applications for the extension of time for compliance with directions, the adjournment of hearings, and applications for relief from sanctions.”

The judge went on to note at para 32 of the judgment that:

• The objective if it is achievable must be to be keep to existing deadlines and where that is not realistically possible to permit the minimum extension of time which is realistically practicable. The prompt administration of justice and compliance with court orders remain of great importance even in circumstances of a pandemic.
• The court can expect legal professionals to make appropriate use of modern technology. Just as the courts are accepting that hearings can properly be heard remotely in circumstances where this would have been dismissed out of hand only a few weeks ago so the court can expect legal professionals to use methods of remote working and of remote contact with witnesses and others.
• While recognising the real difficulties caused by the pandemic and by the restrictions imposed to meet it the court can expect legal professionals to seek to rise to that challenge. Lawyers can be expected to go further than they might otherwise be expected to go in normal circumstances and particularly is this so where there is a deadline to be met (and even more so when failing to meet the deadline will jeopardise a trial date). So the court can expect and require from lawyers a degree of readiness to put up with inconveniences; to use imaginative and innovative methods of working; and to acquire the new skills needed for the effective use of remote technology. As I have already noted metaphors may not be particularly helpful but the court can expect those involved to roll up their sleeves or to go the extra mile to address the problems encountered in the current circumstances. It is not enough for those involved simply to throw up their hands and to say that because there are difficulties deadlines cannot be kept.
• The approach which is required of lawyers can also be expected from those expert witnesses who are themselves professionals. However, rather different considerations are likely to apply where the persons who will need to take particular measures are private individuals falling outside those categories.
• The court should be willing to accept evidence and other material which is rather less polished and focused than would otherwise be required if that is necessary to achieve the timely production of the material.
• However, the court must also take account of the realities of the position and while requiring lawyers and other professionals to press forward care must be taken to avoid requiring compliance with deadlines which are not achievable even with proper effort.
• It is in the light of that preceding factor that the court must be conscious that it is likely to take longer and require more work to achieve a particular result (such as the production of evidence) by remote working than would be possible by more traditional methods. In the context of the present case the Defendants said that meetings conducted remotely took twice as long and achieved less than those conducted face to face. The Claimants challenged the precise calculation but accepted that such meetings would be likely to take longer and that is readily understandable particularly in a case such as the present involving large quantities of documents and requiring at least to some extent the use of interpreters.
• In the same way the court must have regard to the consequences of the restrictions on movement and the steps by way of working from home which have been taken to address the pandemic. In current circumstances the remote dealings are not between teams located in two or more sets of well-equipped offices with fast internet connections and with teams of IT support staff at hand. Instead they are being conducted from a number of different locations with varying amounts of space; varying qualities of internet connection; and with such IT support as is available being provided remotely. In addition those working from home will be working from homes where in many cases they will be caring for sick family members or for children or in circumstances where they are providing support to vulnerable relatives at another location.
• Those factors are to be considered against the general position that an extension of time which requires the loss of a trial date has much more significance and will be granted much less readily than an extension of time which does not have that effect. That remains the position in the current circumstances and before acceding to an application for an extension of time which would cause the loss of a trial date the court must be confident that there is no alternative which is compatible with dealing fairly with the case.

What does this mean?

In short, this is a further risk area for law firms (and by implication their insurers), and perhaps more so for smaller law firms with less resource available to them. The courts will clearly allow some leeway. However, the message is very much “learn fast, and get on with it” and that can translate into a lawyer’s duty of care when acting in the current environment.

Accordingly, law firms will need to exercise due caution when taking on new work, and when assessing the requirements of existing work, so as to ensure they have the capacity and the relevant skill base to meet these challenges. As we enter a phase where some redundancies are starting to be announced, resource will be tight and (like all businesses) law firms will look to use capacity to the full.

As we approach the 1 October renewal date, the extent of a firm’s litigation practice is likely to be in greater focus for underwriters, and understanding the financial viability of the business to be insured will be more critical than ever before.