Case update – Arkin v Marshall


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The Court of Appeal (CofA)  handed down its judgment in Arkin v Marshall [2020] EWCA Civ 620 yesterday afternoon after permission  was granted for a leapfrog appeal to provide some much needed clarity on the validity of the imposed stay of possession proceedings due to Coronavirus under Practice Direction 51 (PD 51Z). The CofA's decision provides important clarification as to how possession proceedings should be conducted as the Covid 19 pandemic continues.

Whilst we do not intend to detail all of the background and underlying issues in this matter, this case considered, amongst other things;  

  • whether the PD 51Z was ultra vires;
  • whether parties should continue to comply with agreed directions in light of the stay imposed under PD 51Z; and 
  • whether a Judge has jurisdiction to lift a stay under PD51Z.

At first instance, the Judge held a strict interpretation of the wording of the stay imposed by PD 51Z, concluding that the stay would put a halt on all aspects of the possession claim including the parties complying with their obligations as required by the agreed directions. In no circumstances would the Judge have the power or discretion to lift the stay. The Claimant challenged the first instance decision which was heard by the CofA on 30 April 2020.

The CofA firstly confirmed that PD 51Z was vires and was not inconsistent with the Coronavirus Act 2020. 

In considering the Claimant's appeal, the CofA analysed what the stay in PD 51Z had intended to do. Reviewing the wording of paragraph 1, the CofA reiterated PD 51Z was intended to be a temporary stay of possession proceedings being trialled in order to assess whether it was an effective way to ensure the administration of justice does not endanger public health. Predominately the CofA concluded the purpose of PD 51Z was to relieve pressures on the administration of justice and reduce the risk of spreading the virus by the enforcement of possession orders / the requirement of parties to attend court.

In light of this, the CofA then considered how the stay should be imposed and how cases should be conducted in light of PD51Z and determined as follows:

Continued compliance with directions

The CofA held that where parties are capable of complying with agreed directions, they should continue to do so. If however the current agreed timetable and directions are not possible, the CofA further saw no reason why parties should not be able to agree directions on a voluntary basis during the stay and thereafter seek to adjust any post-stay case management timetable. 

Where parties do agree directions, the CofA highlighted the amended wording at paragraph 2 and 2A of PD 51Z carved out a provision which allows the court to embody the parties agreed case management directions in an order, notwithstanding the stay. This would not amount to a lift of the stay of proceedings but would avoid the rush to make applications immediately when the stay is lifted. 

Failure to comply with agreed directions

Where a party does not comply with the agreed directions, strictly they will be in default. 

The CofA however confirmed that during the period of the stay, a party will not be able to make an application to enforce compliance.  During the stay a Judge cannot order   compliance of the agreed directions which have been made under the express exclusion at paragraph 2A (c). 

Of course it is possible that once the stay is lifted, a Judge would take into account the conduct of the parties in relation to any directions agreed between them and deal with future directions (and possibly sanctions) accordingly.

Court's power to lift the stay

The CofA restated that whilst courts must retain the power to lift the stay pursuant to CPR 3.1, the proper exercise of that power is informed by the nature of the stay and the purpose for which it was imposed. 

As the purpose of PD 51Z is to relieve the burden on courts having to deal with these cases and avoid the risk to public health, the purpose of the blanket ban would be undermined if parties were entitled to rely on their particular circumstances to have stays lifted in a large amount of cases. 

The CofA commented that they could not see a circumstance in which it would be proper to lift a stay imposed under PD51Z but did not rule out that there might be the most exceptional circumstance in which this may be necessary. As such, a lift in the stay under PD51Z would only be granted in very extreme circumstances and is highly unlikely in most cases.

Summary

This decision emphasises that the implication and consequence of the blanket stay imposed by PD 51Z is to protect public health and the administration of justice generally. During the stay possession claims are not being dealt with on a normal case by case basis and a more blanket approach is being taken with the intention of reducing the burden and pressure on the court system and to reduce the risk to public health

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