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(4.1) Additional claims and changing parties - Coggle Diagram
(4.1) Additional claims and changing parties
Counterclaims and other statements of case
Defence of Set-Off:
Facts that give rise to a counterclaim may also amount to a
defence
in the main claim (i.e. defence of set off)
Defence of set off may be a partial or incomplete defence to the main claim
Has the effect of 'extinguishing' any claim up to the same amount against D
example 1:
D makes a counterclaim
facts underlying the counterclaim can also be used a a defence of set-off, and D sets out this defence in its defence (and counterclaim; and
both parties 'win' in their respective claims
example 2:
C will only be able to enforce its judgemen against £10k of D's assets i.e. £20k minus £10k
Essentially the £10k owing to D by C (pursuant to D's counterclaim) is 'set off' against C's judgement against D.
Judgement in the main claim:
C is successful
C is unsuccessful
C is successful
judgement in the counterclaim:
D is successful
D is successful
D is
un
successful
Consequences:
The set off applies to extinguish £10k of C's judgement against D. C is therefore only entitled to £10k
There's no judgement in favour of C for the set off to attach to. Judgement will simply be entered for D against C in the sum of £10k
The set off won't be 'triggered' and judgement will simply be entered against D for the full £20k claimed
Legal basis for set off
There's only certain circumstances where D can actually 'set off' its judgement in the counterclaim against C's judgement in its substantive claim. These are the most important ones:
Mutual debt: Sales of Goods Act 1979
If C and D each owe each other money, one debt can be set off against the other debt. Note that this applies to debts, not damages:
Where the seller sues for the price of goods sold and delivered, the buyer can set off a claim for breach of implied terms as to quality and fitness for purpose
Mutual debt: Defective services
If C and D each owe each other money, one debt can be set off against the other debt. Note that this applies to debts, not damages:
Where a claim is made for the price of services, D can set off a claim for damages for poor services
Mutual debt: Equitable set-off
If C and D each owe each other money, one debt can be set off against the other debt. Note that this applies to debts, not damages:
This has been developed by the courts when it considers that there is such a close connection between the 2 transactions that it would be manifestly unjust to allow enforcement of one claim without taking into account the cross-claim
Form of set off:
The defence of set-off should be set out in the
defence
part of the Defence and Counterclaim (as opposed to the counterclaim part) (CPR 16.6). It's usually pleaded like this:
"Further or in the alternative, if the Defendant is held liable to the Claimant, the Defendant will seek to set off against the Claimant's claim as much of the sum awarded by way of counterclaim in these proceedings as to reduce it or extinguish it altogether".
The above paragraph will usually be the last paragraph of D's defence before the start of the counterclaim
Defence of Counterclaim:
C needs to respond to any counterclaim against them, just as any other claim against a party needs a response. D's counterclaim can be either
admitted
or
defended
by C
Time for serving defence to counterclaim:
There is no requirement for C to acknowledge service of the counterclaim using an acknowledgement service(CPR 20.4(3)). C's defence to a counterclaim must however be filed and served in accordance with usual rules for defences (CPR 15). This means the defence to a counterclaim must be served
within 14 days after service of the counterclaim
If C wishes to defend a counterclaim fails to service a defence within the requisite time limit, a judgement might be entered by D (CPR 12(3)(2)(b)
Form of defence to counterclaim:
A defence to a counterclaim is very similar to a 'normal defence'. It's contents must therefore comply with the usual rules in relation to defences (CPR 16.5 and 16 PD)
Reply:
It's an optional SOC served by C if they wish to allege facts in answer to the defence which were not included in the claim (CPR 15.8)
When to file a reply:
Must be filed with the directions questionnaire (a case management document which the court directs should be filed after a claim is defended). Parties are given at least 14 days notice of the deadline for doing this
The time limit is different in some specialist proceedings (e.g. Commercial Court claims) so its necessary to
check the relevant rules and court guides if dealing with a specialist claim
A reply must be verified with a statement of truth (CPR 22.1(1)(a))
Form of reply:
As this SOC is usually being prepared at the same time as C is considering their response to any counterclaim that has been made, the 'Reply and Defence to Counterclaim' normally form 1 document with the defence to counterclaim following on from the reply (CPR 15.8(b))
Last SOC:
The reply should be the last SOC in a claim confirms that permission of the court is needed to file any statement of case after the reply (CPR 15.9)
Counterclaims by D:
They are form of additional claim and dealt with in CPR 20
There's number of different types of additional claims. But the one important rn is the 'classic' counterclaim by D against C (CPR 20.4)
Other types of claim is stated in CPR 20 (aka "additional claims" or "other additional claims")
A counterclaim is different from a separate claim and is normally made at the same time as D files its defence
If a counterclaim is made
after
the defence has been filed, you need permission from the court (CPR 20.4(2))
How it works:
D's counterclaim against C is pursued in the same proceedings as the main claim and is accordingly dealt with under the same claim number as the main (substantive) claim by C against D
D can also start an entirely separate claim but its usually easier for D to combine their counterclaim with the main claim
Content of a counter-claim:
Like any other claim, they need to be based on a case analysis that confirms that a viable cause of action exists. D in their counterclaim must be able to establish duty, breach, causation and loss against C
Counterclaim may or may not have anything to do with C's substantive cause of action against D. But the parties
must
be suing/sued in the same capacities as in the main claim
If court does not think counterclaim should be heard with main claim, it can order that counterclaim to be struck out (CPR 3.4) or heard separately (CPR 3.12(e))
Form of counterclaim:
If counterclaim is made at the same time as defence, should form a single document with defence (CPR 15.7). It normally follows directly from defence (within the same document) and is clearly labelled as counterclaim
Document normally labelled "Defence and Counterclaim'
Counterclaim is basically a particulars of claim by another name. Must therefore comply with rules on POC. Must contain elements of a claim:
duty
breach
causation
loss
Must also comply with CPR 16.4 (and corresponding provisions in 16 PD)
Must also pay court fee for filing a counterclaim
Request for further information
What is obtaining further information:
A party can obtain further information from the other party to clarify or give additional information in relation to any matter which is in dispute in the proceedings
Usually whether or not a matter is "in dispute" will be apparent only from reading SOC and hence disputed matter will be often be contained or referred in SOC
Examples of why a party wishes to request further information:
To obtain admissions (although this is rare)
To obtain info which may reveal weaknesses in the other party's case
To obtain info about facts which the other party needs to prove to make good their case
To acquire advance details of what a witness may say before exchange of witness statements
To obtain clarification of the other party's case (a common and useful function as it limits the other party's liability to depart from it later)
To narrow the issues between the aprties to save time and costs
Making a request for further info:
A party is expected to seek info from the other party on a voluntary basis first and should only make an application to the court if the request cannot be resolved (18 PD 1)
The party seeking info serves a written request on the other party stating a date for a response (allowing the other party a reasonable time to respond)
The request should be concise and specifically on matters which are
reasonably necessary and proportionate
to enable the requesting party to prepare its own case/understand the opponent's case
The CPR contain instructions as to the format and layout of the request
Responding to a request:
The response must be written, dated and signed by the party or its legal representative and include a statement of truth (18 PD 2)
The response must be sent to the other party and filed at court
If a party objects to providing a request, it must inform the party who made the request giving reasons for the objection and object within the timeframe set out in the request (18 PD 4)
If request can only be complied with at disproportionate expense, the reasons why must explained e.g. the request is about matters that are irrelevant, disproportionate, not reasonably necessary or priveged
Request to the court for further information:
Court can order a party clarify any matter which is in dispute in the proceedings or give additional information relating to such matter where or not the matter is contained or referred in a SOC (CPR 18.1)
An application to the court is appropriate when the other party haven't responded or has responded with an objection to provide the info (18 PD 1.1)
The application should be made as an interim application (CPR 23 and 18 PD 5). if the other party has not responded after 14 days passed, application can still be made without notice to the opponent and court can deal with the application without a hearing
If a court makes an order for further information, the party against whom the other made must file its response and serve its response on the other parties within the time specified by the court. The response must be verified by a statement of truth
Restriction on the use of further info (CPR 18.2):
Court can direct that further info given by a party to another party either voluntary or pursuant to an order in CPR 18.1 is not to be used for any purpose other than the current proceedings
Introduction to multiple causes of action, counterclaims and additional claims
Sometimes after a claim has started, there's need for additional causes of action, claims or parties that exist, the viability (i.e. case analysis, cost risk benefit analysis and priority to client) of any new potential matter should be considered in detail ASAP, and advice given to C about how they wanna proceed
If new causes of action, claim or party is directly concerned with or closely connected to the
existing claim
, the rules may direct or allow it to become part of the original claim as it will save time + costs. Approach also avoids court hearing multiple case on the same or very similar facts and evidence that could lead to inconsistent judgements
The rules of
limitation
apply to all new claims whether they're brought as a separate action or added to an existing claim that already started.