KERRY’S LAW BECOMES LAW – 28 DAY EXTENSION APPROVED BY PARLIAMENT
Following yesterday’s key decision in the Hallam Estates case – see my blog Jackson Allows Relief From Sanctions – there is more good news in that Parliament has now passed secondary legislation allowing parties to extend the period for carrying out any step by 28 days subject to the restrictions dealt with below.
Lord Justice Jackson’s ruling yesterday anticipates these changes and gave advance guidance:
“12. By way of digression I comment that rule 3.8 will shortly be amended so that in the ordinary way parties can, without reference to the court, agree extensions of time up to 28 days, provided that this does not put at risk any hearing date. A variety of circumstances may arise in which one or other party (however diligent) may require a modest extension of time. Under rule 1.3 the parties have a duty to help the court in furthering the overriding objective. The overriding objective includes allotting an appropriate share of the court’s resources to an individual case. Therefore legal representatives are not in breach of any duty to their client, when they agree to a reasonable extension of time which neither imperils future hearing dates nor otherwise disrupts the conduct of the litigation. On the contrary, by avoiding the need for a contested application they are furthering the overriding objective and also saving costs for the benefit of their own client.”
The Civil Procedure (Amendment No 5) Rules 2014¬ in force 5 June 2014 – allow parties to extend time by consent without reference to, or permission of, the court. Although technically this does not statutorily repeal Mitchell v News Group Newspapers Limited  EWCA Civ 1537 it does overturn many of the decisions purporting to follow Mitchell and represents a significant assertion by Parliament of its sovereignty over the courts in the Justice or Administration of Justice debate. Parliament favours Justice. One would have hoped that the courts did too.
The extension must be “by prior written agreement”, that is it must be an “in time” agreement made before the time for complying with a particular deadline has expired.
Consequently retrospective agreements are not allowed by the new rule.
The maximum extension allowed is 28 days.
The date and time of the extension must be made clear and it is best to put in the agreement that the step must be carried out
“On or before the [ ] day of [ ]”
rather than simply referring to a “21 day extension” or whatever.
This was an issue in the case of Thomas, considered below, where the parties had orally agreed an extension of one month and there was then a dispute as to whether the extension ran from the date of the conversation or the date of expiry of the period for serving the claim form.
The Court of Appeal said
“…it is always desirable that agreements between solicitors be reduced to writing and – given the ease of communication by email – these days, hardly a burden. Second, when agreements (or court orders) about the date by which a thing is to be done are made, it is always better to specify that date precisely rather than by reference to a period such as a week or a month. There is always room for misunderstandings or accidentally fixing a weekend or Bank Holiday if time periods are used.”
It must be a written agreement.
What constitutes a “written agreement” was considered by the Court of Appeal in the context of extending time for service of the claim form, where CPR 2.11 states that time limits can be varied by “the written agreement of the parties.”
the Court of Appeal held that the fact that an oral agreement had been reached between the parties does not stop one party challenging the agreement on the basis that it is not in writing, that is the doctrine of estoppel cannot apply.
Here the parties agreed an extension of time for service of the claim form, but the District Judge struck out the claim on the basis that the parties could not extend time for service. The Court of Appeal held that the parties could extend time for service but that the agreement had to be in writing and here it was not and so the claim remained struck out.
Lord Justice Neuberger, then in the Court of Appeal and now President of the Supreme Court, set out what is required by CPR 2.11.
“22. It is accepted on behalf of the claimant that the requirements of r.2.11 that there be “a written agreement between the parties” means that there must be some written document. However, there was a sharp division between the parties as to what type of document or documents would satisfy that requirement.
23. Before deciding that point, it is, however, necessary to consider an anterior point made on behalf of the claimant, namely that once there has been one variation which is a “written agreement”, any subsequent variation will be valid even if made orally. This argument, as reformulated by Lloyd LJ in argument, is that r.2.11 is concerned with stipulating that a variation to the time limit in r.7.5 must be in writing, but that any subsequent variation, being a variation to the time limit agreed in the written variation, is not a variation of the time limit “specified by a rule”.
24. Ingenious though that argument is, it must be rejected, in my view. First, as a matter of principle, it seems to me little short of ridiculous to conclude that r.2.11 requires the first variation to be in a “written agreement”, but permits any further variation to be oral, or even to arise implicitly in some way. Secondly, ignoring r7.6 for the moment, it seems to me that where a claim form is served outside the time limit specified in r.7.5, the court could only hold that the claim form had been validly served if satisfied that there had been a variation (or series of variations) of the time limit, and such variation or variations would all have to satisfy r.2.11. Thirdly, as pointed out by Jacob LJ, the logic of the claimant’s argument in this connection is that, once there has been one written variation, there could be no further variations, because there would, on this argument, be no express right to vary the initial variation, and the natural effect of the rules I have been discussing is that the only variations (whether by the court or by the parties) to the time limits contained in r.7.5 are those permitted expressly in the CPR.
25. That brings me, then, to the question of what constitutes a “written agreement of the parties”. Clearly, it would encompass a single document signed by both parties. However, contrary to Mr Serr’s submissions, I see no grounds, either in principle or as a matter of language, for limiting it to a single document. I can see no reason why an exchange of letters between the two solicitors concerned, in which the extension of time is agreed, would not constitute a “written agreement”.
26. An oral agreement which is then confirmed in writing by both sides appears to me also to be within the concept of a “written agreement”. The oral agreement itself would not, of course, be capable of being a written agreement. However, it seems to me that where following the oral agreement, the two solicitors exchange letters confirming what they have agreed, the exchange of letters amounts to an agreement in writing that they have agreed (albeit orally) an extension of time: to my mind, it would, at best, be no more than a quibble to contend that an agreement in writhing that the parties have agreed something orally does not constitute a “written agreement of the parties”. If the oral agreement, because of the very fact that it was oral, could not validly effect a variation, then it seems to me that there is no reason why it cannot be said that the time limit has been “varied by the written agreement of the parties” even though that written agreement was an agreement between the parties that they had orally agreed the variation.
27. I think things get more difficult where the parties, having orally agreed a variation, each subsequently refer to what has been agreed in correspondence passing between them. An example, albeit of a slightly unusual nature, may be found in the facts of the present case. The claimant’s solicitors effectively confirmed the extension to the 1 April in their letter of 24 February 2005 (and if the defendant’s solicitor had replied in a letter confirming this extension, then there would, for the reasons I have just given, have been a written agreement in my view). However, what happened is that, almost four weeks later, the defendant’s solicitor wrote to the claimant’s solicitors in connection with a different matter, namely the expert evidence, and enclosed a letter to the expert in which the solicitor stated that an extension to 1 April 2005 had been agreed.
28. With some hesitation, I have reached the conclusion that this was simply insufficient to amount to a “written agreement” as contemplated by r.2.11. First, it seems to me to involve an impermissible stretching of the expression to cover the contents of a letter, whose purpose had nothing whatsoever to do with agreeing, but was merely communicating to a third party what had been orally agreed. Secondly, it appears to me undesirable that the question of whether or not there has been a valid agreement should turn on what a solicitor happens to write in subsequent correspondence which was not intended to bear on the question of agreement at all. To my mind, the concept of a “written agreement between the parties”, particularly in the context of the CPR, involves a document or exchange of documents which is intended to constitute the agreement or to confirm or record the agreement. Because one cannot envisage every possibility which might eventuate, I would not want this to be seen as being entirely prescriptive.
19. Having said that, it seems to me clear that an oral agreement between two solicitors, subsequently recorded in a letter sent by one solicitor to the other but not replied to by the other, cannot possibly be said to constitute a “written agreement of the parties”. Similarly, an oral agreement between two solicitors, evidenced by an internal confirmatory note by one solicitor, or even by each of the solicitors, cannot constitute a written agreement, unless, of course, the internal notes are exchanged (or, for instance, one solicitor sends its internal note to the other, and the other in some way confirms in writing its relevant contents).”
Text of relevant change:
“Amendments to the Civil Procedure Rules 1998
3. In rule 3.8 –
(a) in paragraph (3)(b) after “agreement between the parties” insert “except as provided in paragraph (4)”;
(b) in paragraph (3) insert-
“(4) In the circumstances referred to in paragraph (3) and unless the court orders otherwise, the time for doing the act in question may be extended by prior written agreement of the parties for up to a maximum of 28 days, provided always that any such extension does not put at risk any hearing date.”