Court of Appeal rejects challenge to stay all possession proceedings for three months

The Court of Appeal has now held in the case of Arkin v Marshall [2020] EWCA Civ 620 that the stay on possession proceedings for 90 days until 24 June 2020 imposed by Practice Direction 51Z (PD 51Z) is lawful and can only be lifted in exceptional circumstances. Please see our previous update giving details of the case.

Issues before the Court of Appeal

The grounds of appeal concerned the questions of (i) whether the stay was lawful, and if so (ii) whether in the absence of agreement between the parties, stays in individual cases can be lifted thereby requiring parties to comply with case management directions.

Court of Appeal’s decision

Although the case was heard before the Court of Appeal on April 30, 2020, Judgment was reserved and eventually handed down on May 11, 2020. In dismissing the appeal, the Court confirmed that it had jurisdiction to consider the lawfulness of PD 51Z and ruled as follows:

• The creation of PD 51Z was properly authorised as a pilot scheme under Rule 51.2 of the Civil Procedure Rules (CPR). In short, Rule 51.2 enables Practice Directions to alter or dis-apply the CPR for set periods during the “operation of pilot schemes for assessing the use of new practise and procedures in connection with proceedings”. The Court explained the rationale behind PD 51Z, stating that it “is intended to assess modifications to the rules and [PDs] that may be necessary during the Coronavirus pandemic and the need to ensure that the administration of justice, including the enforcement of orders, is carried out so as not to endanger public health”.
• PD 51Z is not inconsistent with the provisions contained in Schedule 29 of the Coronavirus Act 2020, the latter introducing changes to the statutory notice periods for bringing possession claims.
• PD 51Z is compatible with the right to a fair trial afforded by Article 6 of the European Convention on Human Rights, as well as the fundamental principle of access to justice. The Court held that “the short delay to possession litigation enshrined in PD 51Z is amply justified by the exceptional circumstances of the coronavirus pandemic”.
• The fact that the parties in this case agreed directions before PD 51Z came into force, did not provide justification for lifting the stay. This means that neither party can apply to the Court to enforce compliance with previously agreed directions whilst the stay remains in force. Nevertheless, parties are still required to carry out the agreed steps during the length of the stay and, should they fail to do so, the Court may subsequently take their conduct into account in making revised directions.
• The Court retains a theoretical power to lift the stay imposed by PD 51Z in the most exceptional circumstances, even though “it would almost always be wrong in principle to use it”.

So where does this leave us?

This ruling makes it abundantly clear that public interest is at the forefront of the rationale for upholding the stay imposed by PD 51Z. Courts are unlikely to lift the stay unless the facts of the individual case give rise to ‘exceptional circumstances’. Notwithstanding the high bar for lifting the stay, parties would be well-advised to comply with any agreed directions throughout the length of the stay to avoid facing potential sanctions at a later stage.

Please note that previously PD 51Z was amended to clarify that the stay imposed by this practice direction does not apply to claims against trespassers under rule 55.6 CPR, to applications for interim possession orders or to applications for case management directions agreed by the parties.

For further information on the issues raised in this case, please contact Joanna Osborne or any member of our Property Litigation team.

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