Court Of Appeal Confirms Defendants Not Obliged To Make Enquiries Of Third Parties Before Pleading Non-Admissions

The Court of Appeal has rejected an argument that a defendant must make reasonable enquiries of third parties before pleading in its defence that it is unable to either admit or deny an allegation and requires the claimant to prove it: SPI North Ltd v Swiss Post International (UK) Ltd and Asendia UK Ltd [2019] EWCA Civ 7.

A defendant is under a positive duty to admit or deny an allegation where it is able to do so, and may only put the claimant to proof of a fact which it is unable to admit or deny. This decision confirms that a defendant may properly plead that it is unable to admit or deny an allegation where the truth or falsity of the allegation was neither within its actual knowledge (including attributed knowledge in the case of a corporation) nor capable of being easily ascertained from documents or other information at the defendant's ready disposal. It is not required to undertake investigations beyond that level, including consulting with any third parties.

This is not surprising but is nevertheless a welcome confirmation. A contrary conclusion could have given rise to significant practical difficulties, given the short period allowed by the rules for filing a defence.

Background

Under CPR 16.5(1), a defendant must state which of the claimant's allegations it admits, which allegations it denies, and which allegations it is unable to admit or deny but requires the claimant to prove.

In the present proceedings, the defendant companies had pleaded that they were unable to admit or deny various of the claimant's allegations. The claimant applied for the defences to be struck out unless certain of those pleadings were amended, arguing that the defendants would, or at least might, have been able to admit those allegations had they taken reasonable steps to make enquiries of key former employees.

The strike out application was refused at first instance but, as the question had apparently not been the subject of previous authority, permission to appeal was granted.

Decision

The Court of Appeal (Henderson and Lewison LJJ) upheld the High Court's decision, agreeing with the trial judge's assessment of the circumstances in which a defendant is entitled to neither deny nor admit an allegation.

Specifically, the court held that a defendant may state that it isunable to admit or deny an allegation where the truth or falsity of the allegation isneither within...