Unit 1 - Pre-action steps

Question 1

What are the different options for dispute resolution?

Answer 1

Mediation

Arbitration

Litigation

Question 2

What happens when a party does not engage with ADR?

Answer 2

Any party not engaging must serve a witness statement giving reasons within 21 days. The statement should not be shown to a judge unless questions of costs arise.

Cost penalties from the court can also arise.

Courts can now also stay proceedings or order for the parties to engage in a non-court based DR process.

Question 3

What should solicitors advise their client about ADR?

Answer 3

They need to try and settle

Give them all available options

Advise on the possible costs sanctions if they fail to settle

Question 4

What experience should the independent third party have during an ADR process?

Answer 4

Appropriate industry or commercial knowledge required to understand the dispute.

Question 5

What is mediation?

Answer 5

Where parties will send a mediator (the independent third party) written statements from both parties and the mediator will then discuss the case on a ‘without prejudice’ basis.

Question 6

What are the disadvantages of mediation?

Answer 6

Limited disclosure
Enforcement is not automatic

Question 7

What is arbitration?

Answer 7

A ‘parallel’ dispute resolution system where a panel of arbitrators would make a decision.

It is governed by statute (Arbitration Act 1996).

Question 8

How can arbitration arise?

Answer 8

In two ways:

The parties may be contractually bound and it may be contained as a clause within their business contracts.

The parties may agree to arbitration once a dispute has arisen and may choose their own arbitrator with the relevant expertise.

Question 9

What are the advantages of arbitration?

Answer 9

Likely quicker than court proceedings and may be cheaper

The procedures are less formal

The decision is made by an impartial third party with expertise

Private and confidential

Solutions are more practical than what a court could offer

Question 10

Is arbitration binding or non-binding?

Answer 10

Binding (as opposed to mediation)

Question 11

What are the disadvantages of arbitration?

Answer 11

The dispute may not receive the depth of investigation it would receive in the courts

Certain remedies such as injunctions are not available.

Question 12

How can a party enforce an arbitration decision?

Answer 12

Once a decision is made, the winning party to an arbitration can apply to the High Court for permission to enforce the award as if it was a judgment.

Question 13

What is civil litigation governed by?

Answer 13

The Civil Procedure Rules 1998 (CPR)

Question 14

How do you calculate a limitation period?

Answer 14

Step 1: identify the cause of action.

Step 2: ascertain the relevant limitation period for that cause of action

Step 3: identify the day the limitation period starts on, normally when the cause of action accrued.

Step 4: identify the day the limitation period expires

Question 15

What happens if a claim falls outside of the limitation time period?

Answer 15

Unless there are exceptional circumstances, the claim becomes ‘statute barred’ and the claimant is unable to bring the claim.

Question 16

What are the limitation periods for contract and tort claims?

Answer 16

The claimant has six years from the date of the cause of action to commence their proceedings.

For contract - this is the date the breach of contract occurs, usually date of delivery.

For tort - this is the date the tort is committed. In negligence, this is when damage occurs as a result of a breach of duty.

Question 17

What is the limitation period for personal injury claims?

Answer 17

Three years from the date of the cause of action OR the date of knowledge of the person injured.

Question 18

What is the limitation period for personal injury claims for children?

Answer 18

The same time limits apply, but the time limit does not start to run until their 18th birthday.

Question 19

What is the limitation period for a negligence claim where the damage is hidden at the date where the cause of action has happened?

Answer 19

The later of:
Six years from the date of action
Three years from the date of knowledge

BUT
No later than 15 years after the date of the negligent act or omission.

Question 20

What if a contract has a different limitation period specified?

Answer 20

The claim should be commenced within the contractually specified period.

Question 21

Can a limitation period be extended?

Answer 21

Only in exceptional circumstances e.g. where the defendant (currently imprisoned, hence why no claim was originally brought) has come into substantial monies as they had won the lottery.

Question 22

What is a litigation friend?

Answer 22

Someone who will fairly and competently conduct court proceedings on behalf of an under 18 or a person who cannot manage their own affairs due to a mental disorder defined by the Mental Capacity Act 2005).

They must have no adverse interest.

Question 23

What are the types of claims?

Answer 23

Specified claims - where the claim is specified for a fixed amount of money because the amount is already known.

Unspecified claims - where the court needs to investigate to determine the amount of money payable (usually damages claim).

Question 24

What is a cause of action?

Answer 24

The legal basis of a claim e.g. a breach of contract of negligence.

Question 25

What are possible causes of action for contract claims? What is the purpose of damages?

Answer 25

Breach of express terms Breach of statutory implied terms Damages would be to put the claimant in the position they would have been in had the contract been performed properly.

Question 26

What are the possible causes of action for tort negligence claims? What is the purpose of damages?

Answer 26

Negligence (RTAs/medical negligence) Negligence mis-statement (inadequate advice by financial adviser) Damages would be to put the claimant in the position they would have been in had the negligent act not occured.

Question 27

What are the possible causes of action in tortious nuisance claims? What is the purpose of damages?

Answer 27

Excessive noise from a neighbour Tree roots causing damage to an adjoining property Water flooding from another's property Damages would be to put the claimant in the position they would have been had the nuisance not occured.

Question 28

What are the possible causes of action for a misrepresentation claim? What is the purpose of damages?

Answer 28

When someone falsely induces another into purchasing a vehicle by false representation (e.g. a car salesman with expertise) Damages would be to put the claimant back in the position they were in before the contract was entered into.

Question 29

What are pre-action protocols?

Answer 29

Actions to be taken prior to issuing court proceedings.

Question 30

What pre-action protocols apply if there is no specific guidance for the particular type of claim being pursued?

Answer 30

The Practice Direction on Pre-Action Conduct and Protocols contains general guidance to be followed in such cases.

Question 31

What sanctions can the court impose if the PDPAC is not followed? (3)

Answer 31

The party at fault pays some or all of their opponent's costs Depriving a claimant who is at fault of some or all of the interest they may subsequently be awarded on damages recovered Requiring a defendant who is at fault to pay interest on any damages awarded to the claimant at a rate of up to 10% per annum above the base rate

Question 32

What happens if a person knowingly makes a false statement in any pre-action protocol documentation?

Answer 32

They may be subject to proceedings for contempt of court.

Question 33

What pre-action protocol is followed for debt claims?

Answer 33

Pre-Action Protocol for Debt Claims (PPDC)

Question 34

What type of debt claims are covered by the Pre-Action Protocol for Debt Claims?

Answer 34

Any business including sole traders Public bodies that bring claims against debtors who are either individuals or sole traders

Question 35

What information must be given between parties under the Pre-Action Protocol for Debt Claims?

Answer 35

The potential claimant must give full information on the debt owed, including an up-to-date statement of account with details of interest and charges, and how the debt can be paid. The standard Reply Form, Information Sheet and Financial Statement Forms must be included.

Question 36

How long do debtors have to respond under the Pre-Action Protocol for Debt Claims before court proceedings can be issued?

Answer 36

30 days

Question 37

What pre-action protocol is followed for professional negligence claims?

Answer 37

Pre-Action Protocol for Professional Negligence

Question 38

What additional requirements are there under the Pre-Action Protocol for Professional Negligence against the Practice Direction on Pre-Action Conduct?

Answer 38

Send a Preliminary Notice to the professional The claimant should write a Letter of Claim The professional should respond with a Letter of Response or Letter of Settlement after investing the claim If resolved, parties should consider negotiations/ADR on a settlement. If NOT resolved, parties should complete a review of their position (Stocktake) before proceedings are issued.

Question 39

What is a Preliminary Notice and what should it contain in respect of a professional negligence claim?

Answer 39

A letter in writing outlining any intended claim. The letter should contain: Any information about the claimant A brief outline of the claimant's grievance Financial value of the claim

Question 40

What should a professional do once they receive the Preliminary Notice?

Answer 40

Inform their insurers Respond to the letter within 21 days of receipt

Question 41

What is a Letter of Claim and what should it contain in respect of professional negligence claims? What should a professional do upon receipt of such a letter?

Answer 41

A letter which sets out full details of the issues and attaches any key documents. The professional should acknowledge this in writing within 21 days and they have three months to investigate and respond via a Letter of Response.

Question 42

What should be outlined in a Letter of Response from a professional in respect of professional negligence claims?

Answer 42

Whether they admit the allegations.

Question 43

What outcomes are there following a Letter of Response in respect of professional negligence claims?

Answer 43

If yes, a Letter of Settlement may be sent if they intend to settle all or part of the claim. If not, the claimant and professional should try to resolve any issues within six months of the Letter of Acknowledgement. Once all avenues are exhausted and a final 'stocktake' has been completed, the parties should take the claimant can issue court proceedings.

Question 44

What is the EU's jurisdiction over proceedings issued in an English court?

Answer 44

They are no longer valid and each country will apply its own domestic rules to cases where the UK is involved.

Question 45

How do you determine which country's laws should apply to the dispute?

Answer 45

There should be an express clause in the contract which outlines which jurisdiction should apply if a dispute arises.