The rules of engagement – repeal and revision of the CPR in the BVI

The new CPR comes into effect on 31 July 2023 (i.e. on the day before the summer vacation) for all proceedings commenced after that date.  For proceedings commenced prior to that date, the new rules will not apply where a trial date has been fixed (unless that trial date is adjourned); and in cases where no trial date has been fixed, the new rules will apply from the date of the case management conference is fixed after the defence has been filed.

The revisions to the CPR are extensive.  Some of the more significant amendments can be summarised as follows:

1. Service Out of the Jurisdiction

Procedure

By far the most significant amendment is to the rules relating to service out of the jurisdiction.  The new rules have abolished the need to obtain leave to serve proceedings out of the jurisdiction, a change intended to streamline litigation, with the byproduct of avoiding arid arguments around full and frank disclosure. The right to apply for permission to serve out of the jurisdiction is preserved (presumably, intended to facilitate service in any jurisdiction which would require a court order as a pre-requisite to effecting service).

However, the abolition of the requirement to seek leave to serve out is not intended to create a jurisdictional free-for-all.

Under the new CPR, a “Court Process” may be served out of the jurisdiction where a Legal Practitioner signs a certificate to the effect that (i) the claim falls within a relevant jurisdictional gateway, (ii) the case is a proper one for the Court’s jurisdiction, and (iii) that “in the belief of the person signing the certificate, the claim has a good arguable case” (the Service Out Conditions).

The Court’s jurisdiction to set aside service remains.  On such an application, the burden rests upon the Claimant to show that the Service Out Conditions have been satisfied.

Breadth of the Jurisdiction

In addition to simplifying the procedure for service out and consigning challenges on full and frank disclosure grounds to history, there has been a significant broadening of the Court’s jurisdiction.  The nomenclature “Court Process” is itself significant: historically, the relevant rule permitted service out of the jurisdiction of a Claim Form, but that has been extended to any other form of process, including an interim remedy made before proceedings have been commenced, and an application.

The relevant gateways have also been expanded: an application may now be served out of the jurisdiction for relief in support of a foreign proceeding (CPR 7.3(11), and of an application for a costs order against a non-party (CPR 7.3(12)).  In practice, it is the first of these changes which is likely to generate the most activity: in Broad Idea v. Convoy Collateral [2021] UKPC 24, the applicants failed to obtain relief against a Hong Kong resident, on the grounds that he was not within the jurisdiction and the rules did not permit service out of the jurisdiction of an application for injunctive relief.

2. Service within the Jurisdiction

The rules historically contained the quaint anachronism of anticipating that service might take place by fax.  That rule has been repealed, and a new Part to the CPR (Part 5A) has been introduced which gives effect to a separate body of rules applicable to matters which are filed through the E-Litigation Portal.  In such cases, service is deemed to take place by the mere filing of the document (CPR 5A.12).

3. Open Justice

At present, the Claim Form, any Notice of Appeal, and a Judgment or an Order made or given in Court are available for public inspection on the Court file.  Subject to exceptions designed to protect settlement agreements and the welfare of children, that category of documents has been expanded, so that a Statement of Claim (but not any documents attached to it), and a Notice of Application under CPR 8.1(6) may be inspected.

This Rule does not apply to documents filed before the rule came into force.

An important change has also been made to the rules relating to whether or not a hearing takes place in public or in private, itself significant in the context of the collateral restrictions on the use of documents.  Historically, the rules appeared to muddle “a hearing in chambers” as distinct from public hearings with the terminology of a hearing in public or one in private.  CPR 2.7 clarifies this distinction by having two classes of hearings: public hearings and private hearings.  By CPR 2.7(2) a hearing that takes place in chambers shall be treated as if it were a public hearing.

The Court is entitled to direct that a hearing shall take place in private, and subject to any contrary order any hearing which is (i) concerned with the welfare of children, (ii) is an application by a trustee, or court appointed officer (such as a liquidator) which is concerned with the administration of a trust, asset or an estate, or (iii) is concerned with an arbitration shall be deemed to take place in private.  The other circumstances in which the Court might direct that the hearing shall take place in private are if (i) publicity would defeat the object of the hearing, (ii) it relates to national security, (iii) it is concerned with confidential information, including personal finances, (iv) it is the hearing of an application made without notice, or (v) the Court considers it necessary to hold the hearing in private in the interests of justice.

4. Judicial Settlement Conferences

A new regime has been introduced by CPR 38A which operates akin to a Financial Dispute Resolution Hearing in English family proceedings, by which a Judge or Master from a central roster may be assigned to conduct an early neutral evaluation.  Any Judge or Master so doing so is then prohibited from taking any further part in the proceedings.

5. Procedural Defaults & Striking Out

A change which will be almost universally welcomed is a liberalization of the Court’s discretion in cases where relief from sanctions is required, or an application is made to set aside a default judgment.  As matters stand, relief from sanctions is available only where the cumulative conditions of CPR 26.9 are satisfied, specifically that the failure to comply was not intentional, that there was a good explanation for the failure and that the party in default had generally complied with all relevant rules, practice directions and orders.  Instead, under the new CPR 26.9, the Court will be entitled to exercise a broad discretion to which those three factors will be relevant.

Similarly, as matters stand, a (regular) default judgment may be set aside only where the defendant applied to the Court as soon as reasonably practicable after finding out that judgment had been entered and gave a good explanation for the failure to acknowledge service or to file a defence.  Now the only requirement is that the defendant has a real prospect of successfully defending the claim; the reasons for the failure and the promptitude of the application are now merely discretionary factors in the Court’s evaluative exercise.  Substantially similar changes have been made at CPR 18.9 to ameliorate the effect of deeming provisions which engaged where a defendant to an ancillary claim failed to file a defence within the permitted time.

6. Enforcement of Arbitral Awards

The revised rules have also brought clarity to the proper process by which an arbitral award is to be enforced.  Historically, practices have varied as to whether an arbitral award was to be enforced on an originating application, or by a Fixed Date Claim Form.  Some firms have taken the former view, but accompanied the application with a Fixed Date Claim Form so as to protect against the ability to obtain ancillary relief in the future.

CPR 43.12 provides that such an application is to brought by Fixed Date Claim Form.

A small but significant change has also been made to CPR 74.8 (the provisions relating to the enforcement of judgments), permitting the Court to enable execution upon the registered judgment before the time period for applying to set it aside has expired.

7. Appeals

A number of significant changes have been introduced to the procedures for appealing:

(i)           Time limits.  At present, the CPR provides that in cases where leave to appeal is required, leave must be sought within 14 days.  A nasty sting in the tail awaits those who unsuccessfully apply for leave from the Judge below: in such a case, their application for leave is due within 7 days.

The new CPR extends the period within which leave must be sought – to 21 days.  In cases where leave is sought in the Court below, leave from the Court of Appeal must be sought either within 7 days of that date, or within 21 days of the date of the decision, whichever is the later.

(ii)          Respondents’ Notices.  At present, the rules provide for service of a Counter Notice of Appeal, but have not defined the circumstances in which a counter  notice must be served.  The CPR now provides, additionally, for a Respondents Notice which must be served where the Respondent invites the Court to uphold a decision on other grounds.  Historically, prudent litigants served a Counter Notice in such cases.  Inferentially, a Counter Notice now serves the purpose only of enabling the Respondent to bring an appeal against orders or decisions which it challenges.

(iii)         Expedition.  The CPR also formalizes the existing practice of the Court relating to appeals which are urgent, creating a freestanding procedure by which expedition can be sought.

8. Assessment of Costs

At present, the Rules provide for a regime by which costs may be the subject of a detailed assessment.  A practice has developed in the Commercial Division in the BVI by which parties will serve Points of Dispute, but this is not a practice which is universally followed.

English lawyers will recognize the regime introduced into the CPR: the rules provide for the service of points of dispute, and default costs certificates in cases where the claim for costs is not defended.  Administrative fees will be payable to the Court both on the filing of the bill of costs, and upon the assessment.

9. Translations

Perhaps a more controversial change is the new rule at CPR 31.4 relating to the translation of documents.

The CPR now provides that a party that discloses a document in a foreign language may not rely upon that document unless the party produces a certified English translation of the document.  In many ways, that is a statement of the obvious: it has been conventional for parties to produce translations of key documents at trial.  However, particularly in document heavy cases, the Court will no doubt need to case manage (i) the identification of documents which are to be relied upon, (ii) the stage of the proceedings at which translations are produced, and (iii) whether it is sufficient to translate only relevant parts of the document.  It is probable that this will bring about an earlier focus upon the need for translation, and potentially the need for the translation of documents (and decisions to be taken as to the documents to be relied upon) at a much earlier stage of the proceedings.

10. Practice Directions

Finally, the CPR foreshadows the potential introduction by Practice Direction of:

• A standard form of freezing order (see CPR 17.1(6));
• The circumstances in which a civil restraint order (see CPR 26.2(6).  In advance of the introduction of that practice direction, the CPR has been amended to require the Court to certify an application, action or appeal as being “totally without merit” if the application, action or appeal warrants that label.
• A practice direction regulating the conduct of Judicial Settlement Conferences.
• A practice direction the conduct of detailed assessment proceedings and the Administrative fees payable to the Court on the bill of costs and the assessment (see CPR 65.16).