The Shorter Trials Scheme has seen its first case reach judgment in 2016, but take up and the impact of appeals remain to be seen.
The Shorter Trials Scheme and Flexible Trials Scheme initiatives were piloted in the courts in the Rolls Building from 01 October 2015, with the aim of making business litigation cheaper and simpler. The Shorter Trials Scheme provides that cases are managed by docketed judges with the aim of reaching trial within ten months from the issue of proceedings, and judgment within six weeks thereafter. Please see our article here for a summary of the procedures.
On 18 November 2016, the second judgment under the Shorter Trials Scheme was handed down by the High Court in National Bank of Abu Dhabi v BP Oil International. The claim concerned an alleged breach of warranty and representation in relation to a purchase letter for a receivable debt. Judgment was granted in favour of the claimant in the sum of US$68,881,854.52 (approximately £55.5m) plus interest, with costs to be agreed between the parties.
The parties had agreed (with the Court’s approval) to proceed with the claim under the pilot for the Shorter Trials Scheme. This resulted in a one day hearing, with “very limited disclosure”, no witness statements and no oral evidence. The total costs of the action on each side were estimated to be approximately £350,000. The judgment was handed down within two weeks of the hearing. In her judgment, Mrs Justice Carr congratulated the parties and their lawyers for “the cooperative spirit in which the litigation has been conducted which has resulted in an effective and speedy process, all as envisaged by the Shorter Trials Scheme”.
The prospects for Shorter Trials
The National Bank of Abu Dhabi judgment would appear to be an early success for the Shorter Trials Scheme and demonstrates its potential for quickly and efficiently dealing with cases that do not require substantial documentary and witness evidence. The case was appropriate for the Scheme as there was only a single issue of interpretation to be resolved, requiring minimal disclosure and evidence (even though the value of the claim was significant). The first case decided under the scheme, Vitol E&P Ltd v Africa Oil and Gas Corp was similarly an energy sector dispute that turned on the interpretation of a contract and only one witness was called at the trial.
However, the National Bank of Abu Dhabi case may still be appealed, which is noteworthy. If appeals become more likely under the Shorter Trials Scheme than in cases using the full procedure, that may undermine the Scheme, particularly as delays in the Court of Appeal are becoming critical due to escalating workload and a lack of resources.
However, demand clearly exists for quicker and cheaper litigation. Protracted disputes can be expensive, time-consuming and jeopardise commercial relationships and opportunities. A similar parallel can be observed in arbitration, with many arbitral institutions introducing expedited or "fast-track" processes into their rules. For more on this see our article.
At the time of writing, there are currently 20 cases under either the Shorter Trials or Flexible Trials Schemes: ten in the Chancery Division (including two in the Patents Court, and four concerning other intellectual property matters), three in the London Mercantile Court, six in the Commercial Court and one in the Technology and Construction Court.
What it means for you
Should these proceedings result in efficient, time and cost-saving outcomes for parties, it is expected that uptake of these initiatives will increase for appropriate cases. If your opponent issues proceedings in the Shorter Trials Scheme and you consider that your case is not suitable for it because, for example, it is factually complex and merits wider disclosure, then it will be open you to apply for the case to be taken out of the scheme soon after it has been issued. You should do so promptly, well before the CMC.
Update: August 2017
The first instance decision in National Bank of Abu Dhabi v BP Oil International was overturned on appeal - see our update here.
This document (and any information accessed through links in this document) is provided for information purposes only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.