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Applications to Strike Out For Abuse of Process

Litigants in proceedings have opportunities to apply to strike out opponents’ cases where they can show that the proceedings are an abuse of process. This usually consists of making an application on the relevant form in the relevant forum.

In the case of Bedford v Paragon Asra Housing Limited [2021] UKUT 266 (LC) the appellant leaseholder, Mr Bradley brought such an application pursuant to rule 9(3)(d) of the Tribunal Procedure (First-tier Tribunal) (Property Chamber) Rules 2013 to strike out the landlord’s application to determine a breach of lease.

The Rules

If the Tribunal considers the proceedings or case (or a part of them), or the manner in which they are being conducted, to be frivolous or vexatious or otherwise an abuse of the process of the Tribunal, then the Tribunal may strike out the whole or a part of the proceedings or case.

This rule has similarities to what is contained in CPR 3.4(2)(b), where the Court has power to strike out a statement of case, if it is found to be an abuse of the court’s process or is otherwise likely to obstruct the just disposal of the proceedings.

As such, Bedford v Paragon contains a brief summary of what constitutes an abuse of process in the Courts and Tribunals.

Abuse of process

The Upper Tribunal summarised the approach to take when considering an application to strike out for abuse of process. It referred to the two-stage test in Cable v Liverpool Victoria Insurance Co Ltd [2020] EWCA Civ 1015, which is as follows:

  1. The Court should determine if the conduct is an abuse of process.
  2. If it is, then the Court has to exercise discretion as to whether or not to strike out the claim.

At stage 2 the Court must look into considerations of proportionality.

The case of Summers v Fairclough Homes Limited [2012] UKSC 26 was noted as to what the Court should assess when striking out a case for abuse of process. In deciding whether to exercise the power, “the Court must examine the circumstances of the case scrupulously in order to ensure that to strike out the claim is a proportionate means of achieving the aim of controlling the process of the Court and deciding cases justly”.

Additionally, the case of Attorney General v Barker [2000] 1 FLR 759 was cited to provide a working definition of abuse of process, as “a use of the Court process for a purpose or in a way which is significantly different from the ordinary and proper use of the Court process”.

Background of Bedford v Paragon

The appellant leaseholder was facing an allegation that he had breached his long residential lease, due to him continuing to sublet his property beyond the initial 1-year period that the respondent landlord had allowed him. As a shared ownership lease, it contained an absolute prohibition on sublets.

The landlord had issued an application to determine the breach of lease pursuant to section 168(1) Commonhold and Leasehold Reform Act 2002. Pursuant to this section, if the Tribunal determines that a breach has occurred, then this can offer the landlord the opportunity to forfeit the lease.

The leaseholder argued that despite the breach of lease, the landlord had “waived” its right to forfeit the lease. This was due to the landlord continuing to accept payments of the leaseholder’s rent, despite allegedly knowing about the breach of lease. The doctrine of “waiving” the right to forfeit, is a defence to forfeiture proceedings. It operates on the basis that when a landlord is faced with a breach of lease, it must either elect to forfeit the lease or allow the lease to continue, thus “waiving” the right to forfeit the lease for that particular breach. Effectively, the leaseholder was looking to pre-empt a defence in waiving the right to forfeit the lease as a reason why the application for a breach of his lease was now an abuse of process.

Upper Tribunal Decision

The Upper Tribunal did not favour the leaseholder’s arguments. It detailed that the landlord had other remedies open to it, in addition to that of forfeiture, such as an injunction compelling the leaseholder to comply with the lease terms or a claim for damages. If a breach of lease was to be found, then the landlord could still pursue these other remedies, regardless of whether the right to forfeit had been waived.

In addition, the Upper Tribunal determined that if the application would have been dismissed as an abuse of process, there would have been a significant waste of resources in preparing for the case, as the landlord still would have been entitled to commence proceedings in the County Court for an injunction and for damages based on the same evidence. However, starting again would be without the benefit of the Tribunal’s determination in relation to the breach of lease. The Tribunal commented that it should not be side-tracked by the leaseholder’s procedural manoeuvrings.

Comments

Striking out a case for abuse of process is a discretionary power of the Court (or Tribunal). There needs to be an assessment of whether a party’s right for their case to be heard is obstructing other users of the system from accessing justice. In the case of Bedford v Paragon, an appreciation was given to the possibility that if the Tribunal was to strike out the case, then this could have a knock on impact of clogging up the Court forum at a later date, due to the landlord having to issue fresh proceedings within the Court forum. The case would therefore appear to be a reminder that there is a high threshold for striking out cases for the reason of abuse of process.

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