In this article Sophie Howard and Julian Horne, of our Personal Injury team, set out the legal principles and practical considerations in making or responding to an application to withdraw an admission, and offer some words of caution. They also discuss applications to withdraw admissions of liability in claims that initially appear to be within the Portal limit, but where the value of the claim later increases significantly.
An unfortunate admission
Withdrawing admissions under CPR 14
It should hardly need saying that “a person may… admit the whole or any part of another party’s case”, and yet CPR 14.1(1)(a) and 14.2(1) provide precisely that, prescribing only that the admission should – whether it comes before or after the issue of proceedings – be “by notice in writing”. And of course almost every Defence contains some admissions, because the admission of agreed or uncontroversial elements of another party’s case is an important part of the efficient conduct of litigation. At least in theory, refusing to admit something and putting the other party to proof puts one at risk of the costs incurred in proving it, though one might reasonably question how real that risk is in everyday personal injury practice.
The most important kind of admission, made in thousands of cases every year and usually long before proceedings are issued, is an admission of liability. In low value personal injury claims, a failure to admit liability will cause a case to exit the Portal process, and so lose a defendant the potential benefit of a tightly constrained fixed costs regime. Especially since qualified one-way costs shifting effectively means defendants must now pay to prove that they are not liable, there is every incentive for a defendant in a low value claim to admit liability in the Portal and settle as soon as practicable.
Having made an admission, however, defendants occasionally have second thoughts. If proceedings have not been commenced, an admission can be withdrawn only with the agreement of the other party under CPR 14.1(1)(b). After proceedings have been started, anyone wanting to withdraw an admission requires the permission of the court (whether the admission itself was made before or after proceedings).
The exercise of that permission is in the discretion of the court, but a non-exhaustive list of factors to be considered is set out in CPR 14.5, which enjoins a judge to “consider all the circumstances of the case, including:
(a) the grounds for seeking to withdraw the admission;
(b) whether there is new evidence that was not available when the admission was made;
(c) the conduct of the parties;
(d) any prejudice to any person if the admission is withdrawn or not permitted to be withdrawn;
(e) what stage the proceedings have reached; in particular, whether a date or period has been fixed for the trial;
(f) the prospects of success of the claim or of the part of it to which the admission relates; and
(g) the interests of the administration of justice.”
The list was previously contained in CPR PD14, and while the presentation of those factors in the list has been tweaked a little – (a) and (b) used to be one factor, while (d) used to be two – there is no indication that there has been any change of emphasis or approach.
West v Bedfordshire Hospitals
It is perhaps a trite observation that the interplay of these factors depends very much on the facts of an individual case, so comparisons with reported decisions are often of limited assistance. But a recent example of the general approach can be seen in West v Bedfordshire Hospitals NHS Foundation Trust [2024] EWHC 1774 (KB), a claim for wrongful birth brought by the mother of a child born with spina bifida.
Sitting as a deputy judge of the High Court, Charles Bagot QC characterised the second defendant’s application to withdraw various admissions of breach of duty as ‘not attractive’. He was deciding the application in February 2024, and the admissions had been made in D2’s letter of response back in August 2020 and repeated in its Defence in January 2021 – more than three years before the hearing. The case was only four months from a liability trial listed for June 2024, which would have to deal with events nearly nine years earlier. The ‘new evidence’ which formed the basis for the application came from an existing witness, who had originally been interviewed in 2020, but was not asked the crucial questions about her usual professional practice until seen in consultation with leading counsel in August 2023. And even then, D2 had not told the other parties about her new evidence until October 2023, and did not make the application until January 2024.
All of that was, in the judge’s words, an ‘inauspicious start’. But he ended up allowing D2 to withdraw its admission nevertheless. What seems to have weighed particularly heavily in his decision was a lack of forensic prejudice to the claimant, and an absence of anything suggesting bad faith or sharp behaviour on the part of D2.
(a) grounds for seeking to withdraw
Thus under factor (a) the judge recognised that the basis for the application was D2’s own mistakes and misunderstandings in preparing its case, which he described as “deeply regrettable” – but he contrasted this with “deliberate or tactical conduct to which the court should be giving short shrift.” Yet almost every application of this sort will identify some sort of error or change of heart that underlies it. The analysis here seems a far cry from the quest for the elusive ‘good reason’ in a relief from sanctions application, for example.
(b) new evidence
Similarly in considering factor (b) the judge said that there was “no material on which [he] could proceed or infer otherwise than that the second defendant has acted in good faith”: it had not “made an economic or a tactical decision to make an admission and then had a change of heart later or taken a conscious decision not to investigate a particular aspect of a case which it later regrets”. So although the ‘new evidence’ came from a known witness, it was merely “an error and an oversight” that it had not been elicited sooner.
(c) conduct
One might think that factor (c) would have weighed particularly heavily against D2 given the litany of delays and acknowledged errors leading to the application. And the judge accepted that D2 “should have acted more quickly”, had not been ‘prompt’, and had ‘waited too long’ to disclose the new evidence and then to make its application – all of which he again described as ‘regrettable’. But, he said, one should not assume “that because a considerable amount of time has passed that is fatal to the application” – unless the lack of expedition “has some impact which goes against the overriding object such as rendering the position unfair when otherwise it would have been fair.” The court, he said, “is not in the business of automatically punishing parties for failing to act with sufficient alacrity if, in reality, that has not had a material impact on the conduct of the case.”
(d) prejudice
The kernel of the judge’s approach therefore seems to have been his observation that “there is no suggestion that there is evidential prejudice to the claimant here”. Although the claimant would be ‘disappointed’ that she had to face additional defences, breach of duty had never been admitted in full, and there were no missing witnesses and no effect on the trial. Meanwhile the prejudice to D2 was ‘significant’ and while it had brought that on itself “it has not done so intentionally or deliberately and it [has] certainly not done so in a way which is tactical or knowing.” A fair trial was still “eminently possible”: indeed it seems tolerably clear that the judge thought that the trial would have been unfair (to D2) had he not granted the application.
(e) stage of proceedings
It is rare for factor (e) and the timing of the application to be of much significance unless a trial fixture will be lost, and the judge considered that, with effort from the parties, a trial date four months later could be kept even if the admissions were to be withdrawn.
(f) prospects of success
In considering factor (f) it is now well established that a court should not make any very detailed assessment of the prospects of success or ‘conduct a mini-trial’. Referencing the well-known decision of Lambert J in Arboleda-Quiceno v Newham London Borough Council [2019] EWCA 2660 (QB), the judge commented that this was not a case that “manifestly has glaring difficulties” or where “the evidence is so flawed that it is not going to have any prospect of success”. It was “at least reasonably arguable, and that is sufficient”.
(g) administration of justice
Finally in relation to factor (g), the interests of the administration of justice, the judge rejected the claimant’s argument that to allow the application would ‘devalue the currency of an admission’, encouraging parties “to make decisions which are not based on a proper investigation knowing they might be able to retrieve the position later.” That was not the case here because “there are none of the hallmarks of a party which has played games or made any deliberate or conscious economic or other decisions not to properly investigate”.
Since few if any of those factors could really be characterised as weighing significantly in D2’s favour, it was plainly crucial to his decision to allow the application that the judge did not consider that doing so would have “a material impact on the fairness of the proceedings or the ability of the other party to advance its claim”. And if there is a lesson here for claimants in responding to such applications, it is to search for and highlight such prejudice as clearly and distinctly as possible: in the judge’s words, “evidential prejudice certainly cannot be assumed; it must be established.”
Applications to resile from an admission of liability in cases of increased value
Doing so will usually be far easier than showing bad faith on the part of the defendant, and while the judge in West deprecated the idea of ‘tactical’ or ‘economic’ changes of heart, there is at least one species of these applications where the importance of taking a commercial approach to early admissions has been clearly recognised. In a run of decisions involving cases which started in the Portal but ultimately turned out to be worth significantly more than the £25,000 upper limit, the courts have repeatedly allowed defendants to reconsider even full admissions of liability.
The classic example is the decision of the Court of Appeal in Wood v Days Healthcare [2017] EWCA Civ 2097. This was a case that actually pre-dated the Portal, but where the claimant’s solicitors had said within six months of the accident that they thought it would be a fast-track case. One defendant’s insurer ‘formally conceded’ liability a few months later. But by the time the claim was issued the claimant’s symptoms had developed and the Particulars of Claim indicated damages ‘in excess of £300,000.
Allowing the defendant to withdraw the admission it had made years earlier, Davis LJ (with whom Sharp and David Richards LJJ agreed) recognised the importance of the procedural context in which the admission had been made. “Changes in litigation procedures and in the applicable costs regime provided… every incentive on grounds of proportionality for parties – and particularly, perhaps, defendants and their insurers – speedily to settle such claims.” Holding them to admissions made in those circumstances would tend to discourage admissions made “having regard to considerations of saving costs and of proportionality… for fear of a subsequent withdrawal of admission of liability being refused… even where quantum has in the interim enormously and unexpectedly increased.”
As noted above, the introduction of QOCS has greatly increased the incentive to settle smaller claims at an early stage – and with the extension of the fixed costs regime even more cases may involve the same sort of commercial assessment as to whether it is likely to be worth trying to win them. The decision in Days is an explicit recognition that it can be acceptable for a defendant to make a deliberate tactical or commercial decision to admit liability without careful or exhaustive assessment of a case, and then to reconsider that decision when the only ‘new evidence’ is of a substantial increase in its value. The CPR expects parties to approach cases in a way proportionate to their value, and that must mean that when the value changes significantly, so may the approach.
That is not to say that in any case where the value has increased from an initial indication a defendant will necessarily be permitted to withdraw an early admission. Concrete evidence of prejudice, for example, may still enable a claimant to resist such an application. But where claimants and their solicitors become aware that the value of a claim has significantly increased since an admission was made, it may well be necessary to bear in mind the likelihood of the defendant wanting to withdraw the admission when it finds out, and either to keep it appraised of developments, or in appropriate cases to preserve relevant evidence notwithstanding the admission.