Fairacres Ltd v Mohamed

Factual and Procedural Background

The Defendant is the lessee of a flat located at 64 Fairacres, Roehampton Lane, London, SW15, including an associated garage. The Plaintiff is a company owned by the leaseholders of the block containing the flat. The Plaintiff brought a claim for arrears of service charges, which the Defendant had not paid since mid-2006, amounting to approximately £30,000. The Defendant asserted a setoff based on alleged damage caused by contractors working on the premises.

The claim was initially commenced in Wandsworth County Court on 8 February 2007, with the arrears then about £9,000. The Defendant counterclaimed for damages due to alleged negligence by the Plaintiff's contractors. Directions were given on 4 May 2007 allocating the case to the multitrack and setting deadlines for disclosure and witness statements, with a trial date fixed for 8 August 2007.

The Defendant failed to properly serve a list of documents as required, omitting Appendix A from the disclosure form. Despite reminders and orders to comply, the Defendant did not provide the required document list by the deadlines set, resulting in the Plaintiff applying for an order to debar the Defendant from defending the claim and striking out the counterclaim unless compliance was met. An Unless Order was made on 11 September 2007, with liberty to apply to set it aside.

The Defendant applied to set aside the Unless Order and vacate the trial date, citing service of the list of documents in an alternative manner and pending an appeal. The Defendant failed to attend the hearing on 15 October 2007, leading to the dismissal of his application and the standing of the debarring order. The trial proceeded on 26 October 2007, where judgment was given for the Plaintiff for approximately £9,500 plus costs of around £25,000.

The Defendant's subsequent application to set aside the order of 15 October and to vacate the trial date was refused on the basis that proper notice had been given and that the Defendant or his representative had effectively placed themselves in a position where they did not receive the notices. The Defendant's appeal against this refusal was elaborately argued but ultimately dismissed.

Legal Issues Presented

1. Whether the Defendant was properly served with notice of the hearing on 15 October 2007, and if failure to attend justified dismissal of the application to set aside the Unless Order.
2. Whether the Defendant’s failure to comply with court orders regarding disclosure and service of documents warranted the imposition of the sanction to debar from defending the claim and striking out the counterclaim.
3. Whether the trial judge’s exercise of discretion in refusing to set aside the Unless Order and refusing relief from sanction under CPR 3.9 was appropriate.
4. Whether the Defendant was denied a fair trial due to procedural default and subsequent debarring order.

Arguments of the Parties

Defendant's Arguments

• No prejudice was caused to the Plaintiff as the Defendant had effectively remedied the disclosure default by providing the documents before the debarring order took effect.
• The Defendant was denied the right to a fair trial due to a recent procedural default that was promptly addressed.
• The Defendant did not attend the 15 October hearing because he was unaware of the hearing date, which he contended was due to postal strike and absence from the flat.
• Fairness and justice required that the Defendant be granted an opportunity to argue the merits of setting aside the debarring order.

Plaintiff's Arguments

• The Defendant failed to comply with multiple court orders regarding the service of a proper list of documents.
• Proper notice of the 15 October hearing was given by the court and supplemented by the Plaintiff through fax and email due to postal difficulties.
• The Defendant and his representative had placed themselves in a position to avoid receiving notice and thus cannot rely on lack of actual notice as a valid ground to set aside the order.
• The Defendant’s conduct indicated an attempt to delay and avoid payment of service charges legitimately due.

Table of Precedents Cited

No precedents were cited in the provided opinion.

Court's Reasoning and Analysis

The court acknowledged the Defendant’s failure to comply with three separate orders requiring service of a proper list of documents and found that the Defendant was in default. The court accepted the trial judge’s finding that proper notice of the 15 October hearing had been given, both by the court and supplemented by the Plaintiff’s communications due to a postal strike. The Defendant’s absence was attributed to his own actions in not being at the fax location or the country, thereby failing to receive the notices.

The court held that personal service was not required in this context, and the Defendant’s failure to attend the hearing was not excusable on the grounds of lack of notice. The discretion exercised by the trial judge in refusing to set aside the Unless Order and not granting relief from sanction under CPR 3.9 was upheld as appropriate, given the Defendant’s repeated breaches and attempts to delay proceedings.

The court rejected the Defendant’s argument that the sanction deprived him of a fair trial, noting that the Defendant had acted stubbornly and that the sanction was justified to prevent further delay and injustice to the Plaintiff.

Holding and Implications

The court’s final decision was to DISMISS THE APPEAL.

The direct effect of this decision is that the Defendant remains debarred from defending the claim and the counterclaim is struck out. Judgment for the Plaintiff for the service charge arrears and costs stands. No new legal precedent was established; the ruling reinforces the principle that failure to comply with disclosure orders and court directions, combined with failure to attend hearings after proper notice, justifies the imposition of sanctions including striking out defences and counterclaims.