Out-Law Legal Update
Individuals advised to check whether they can still claim entrepreneurs' relief
Out-Law Guide | 04 Dec 2012 | 11:19 am | 8 min. read
This guide was last updated in December 2012.
What is the Technology and Construction Court?
The TCC operates in London and eleven other regional centres, with designated full-time TCC judges sitting at courts in London, Birmingham, Manchester and Liverpool. Continuing previous traditions, TCC judges have specialist expertise in technical and scientific matters.
What are the typical steps in civil proceedings?
While an IT claim in TCC proceedings generally follows the same path as other civil claims, there are some important differences between TCC cases and those in other courts. For more information about the litigation process in general, see our Out-Law guide to civil proceedings in England and Wales.
There are some aspects of civil proceedings that are unique to the TCC:
Civil Procedure Rules
The TCC operates under the same Civil Procedure Rules (CPR) that govern procedures in the English civil court system. However, CPR Part 60 sets out rules that are specific to the handling of claims in the TCC, such as the types of claims that can be heard and multi-track case management.
Identifying a permitted claim
Under CPR Part 60, a claim can be brought in the TCC if it involves issues or questions which are technically complex or if a trial by a TCC judge is desirable. More specifically, the Practice Direction to Part 60 specifies that claims relating to the design, supply and installation of computers, computer software and related network systems fall under the TCC's jurisdiction.
Pre-action protocols for IT disputes
Prior to initiating proceedings in court, parties are encouraged to act reasonably in exchanging information and setting out the details of their claim and response. The Civil Procedure Rules incorporate a number of pre-action protocols, which may be relevant depending on the nature of the dispute and the issues presented.
The Pre-Action Protocol for Construction and Engineering Disputes is likely to apply to IT disputes where technically complex issues or questions are presented. Alternatively, the Pre-Action Protocol for Professional Negligence may apply where the issues are not technically complex but they involve allegations of professional negligence. Where a dispute does not necessarily engage one of the above protocols, the parties are encouraged to follow the procedure set out in the Practice Direction – Pre-Action Conduct.
There are some subtle differences between the pre-action protocols, and this can be used to strategic advantage. For example, the Pre-Action Protocol for Construction and Engineering Disputes goes further than other pre-action protocols and provides that the parties should normally meet to consider, among other points, what the main issues in the case are, how the dispute might be resolved without recourse to litigation and, if not, how to conduct the litigation in accordance with the overriding objective.
In general a TCC claim is issued in the High Court in London if it is over £250,000. Where the claim is less than this amount the claim should be issued in a county court or district registry outside London but may, in some instances, be transferred to the TCC in London. International cases or complex technical cases involving claims of less than £250,000 may be issued in the High Court in London.
If a party wishes to file a document with the TCC and is not required to pay a fee, the parties can choose to file via an email addressed to the Court, including within the subject and body of the email the relevant case number and the details of the parties.
Confusingly, the TCC Guide and associated practice directions set out comprehensive guidance as to the use of electronic filing of all court documents which require the payment of a fee. However, it is important to note that this practice was largely discontinued due to escalating costs and a lack of interest from litigants and their representatives. As at the date of this article, a period of consultation is currently underway reviewing the use of electronic filing at the TCC.
Once a claim is initiated a TCC judge is assigned to manage the case. The aim of case management is to progress disputes as quickly as possible. This includes encouraging the parties to explore alternative dispute resolution prior to trial. However, should the matter progress to trial, the case management judge will generally also be the trial judge, based on the assumption that a trial judge who has been involved in the case from the beginning will be more familiar with the issues and would be in a better position to hear the claim.
After the defendant has filed an acknowledgment of service or has filed a defence, the parties attend a Case Management Conference (CMC), which is an oral hearing before the assigned TCC judge. The purpose of the CMC is to fix a trial date and set out a timetable for the case leading up to the trial, as well as to consider other matters, such as whether any further pleadings are required, and whether any orders are necessary for the disclosure of evidence and the exchange of witness statements and expert evidence. For more information about disclosure of evidence and electronic disclosure, please see our guides on disclosure and privilege and electronic disclosure.
Before attending the CMC the parties must file and serve on the other parties a case management information sheet. The case management information sheet identifies to the court whether the parties have thought through the litigation process, such as in which court they believe the claim should be heard; if the parties have complied with the relevant pre-action protocol; the amount of the claim and counterclaim; any witnesses of fact or expert witnesses the parties intend to call at trial, and an estimate of the trial length and costs. The parties must also file and serve on the other parties a case management directions form, which sets out a timetable for the exchange of pleadings and a framework of directions that will be required to prepare the case for trial.
If necessary, the judge will set another CMC during through the case management process to review the progress of the matter.
During the case management process, the parties are permitted to seek a Preliminary Issues hearing to resolve the proceeding in whole or in part, or to reduce the scope of the proceeding ahead of trial.
Alternative dispute resolution
The parties are encouraged to consider settlement before trial including the use of various alternative dispute resolution (ADR) methods. A number of options are open to the parties including mediation and non-binding Early Neutral Evaluation.
Mediation is encouraged and the parties can elect between arranging their own private mediation process or, alternatively, judicial mediation. The court settlement process is a form of mediation carried out by TCC judges, which has proven useful for parties in smaller TCC claims; particularly because of the expertise of the TCC judges with complex technical issues.
The TCC also provides for Early Neutral Evaluation, which allows parties to, by agreement, seek a written evaluation from a TCC judge on a non-binding and without prejudice basis. The evaluation is based on the arguments and evidence put forward by the parties at the time, and may be used to assess a TCC judge's opinion prior to trial. That judge will take no further part in the proceedings once the Early Neutral Evaluation has been produced, unless the parties expressly agree otherwise.
For more information about private ADR, please see the separate Out-Law guide. [Link to Guide on Dispute Resolution]
Use of expert evidence
The use of expert statements is often vital to a TCC case. Experts may be appointed by the parties at an early stage in the proceedings, and a cap on experts' fees may be set at the first CMC. The court may appoint a single joint expert to be used by both parties in order to save on costs.
The parties may arrange for without prejudice meetings of experts to define the parties' technical case and identify the issues on which the experts give evidence. The appointed experts are encouraged to meet at least once before they exchange their reports, and after the meeting, may be required by the court to produce a joint statement setting out the issues that have been agreed on and any reasons for disagreement.
Because of the highly technical aspects of IT disputes, the use of industry experts is an important part of the TCC process. TCC judges place a high value on the proper selection and appointment of experts. It is recommended that parties seek experts who are well-regarded in the industry, have extensive experience in the area and hold appropriate accreditation, such as membership in the British Computer Society or other professional regulatory bodies.
If the parties are unable to settle the matter before trial, the court will hold a pre-trial review four to eight weeks before the trial hearing date. The purpose of the pre-trial review is to plan the trial timetable. Before the pre-trial review the parties are required to file a pre-trial review questionnaire setting out the directions which have been taken or need to be taken before trial; the names of any witnesses and expert witnesses who will be called, and a case summary. The parties will also need to submit a list of issues to be determined at the trial, and may need to provide a note setting out ways in which these issues may be dealt with.
The mechanisms of the TCC encourage the parties to explore settlement of the claim before trial. For more information about settlement, please see the separate Out-Law guide to part 36 offers to settle. However, if the parties are unable to settle the matter, the trial will go ahead with the TCC judge presiding.
After the trial the judge may issue an oral judgment immediately after the closing submissions or reserve judgment up to three months after the trial, although in exceptional cases, a judgment may be issued even later. A judgment takes effect upon the date it was given or at a specified later date.
A judgment is often associated with an order for costs. Costs refer to the expenses, disbursements and legal fees incurred by a party during the litigation proceeding. Generally, the court will order the unsuccessful party to pay the costs of the successful party, although the court may vary the costs order where the successful party's conduct was inappropriate during the course of the proceeding, such as if the party had acted in breach of the Civil Procedure Rules. In determining the amount of a costs award, the court will take into account the conduct of the parties prior to and during the proceeding, whether the party has succeeded in his claim, and whether the party made any offers to settle.
A party may appeal a TCC judgment to the Court of Appeal in accordance with Part 52 of the Civil Procedure Rules. Under Part 52, the appellant must first obtain permission to appeal from the TCC judge who made the order, or to the Court of Appeal. Leave to appeal is only granted if the court believes the ground of appeal has a realistic prospect of success, or if the there is a compelling reason for the appeal to be heard. Generally, the court is more likely to grant leave to appeal where the ground for appeal is based on an issue of law, rather than an issue of fact.
Out-Law Legal Update
Individuals advised to check whether they can still claim entrepreneurs' relief