A strike out application is a type of application to the court to bring all or part of a civil claim or defence to an end without a full trial. It can be a powerful litigation tool, but making an applications is risky even where there are grounds to apply.
The Civil Procedure Rules (CPR), which govern civil court proceedings in England and Wales, allow various applications during a case. Some can significantly change its direction at an early stage by narrowing issues or potentially bringing a claim or defence to an end. Knowing when to make or resist an application can therefore be an important part of litigation strategy.
Our commercial litigation lawyers advise on strike out applications as part of the wider strategy of substantial disputes. We assess not only whether there are legal grounds to apply or resist an application, but the prospects, costs risk, likely response from the opponent and what the application would actually achieve. Tactical judgement can be as important as the underlying legal argument.
We recently acted for a company pursuing damages exceeding £9 million against a bank, successfully resisted the bank's strike out application and subsequently negotiated a settlement of the dispute.
What is a strike out application?
Under rule 3.4 of the Civil Procedure Rules, the court can strike out all or part of a party's formal case, including a claim, defence or counterclaim.
In practical terms, this means the court can bring all or part of a claim or defence to an end without waiting for a full trial.
The three grounds generally relevant to commercial disputes are where:
there are no reasonable grounds for bringing or defending the claim;
the case amounts to an abuse of the court's process or is otherwise likely to obstruct the fair disposal of the proceedings; or
a party has failed to comply with a court rule, practice direction or court order.
There is also a separate provision dealing with certain strategic lawsuits against public participation (SLAPPs).
The court can exercise its strike out powers following an application by one of the parties or, in appropriate circumstances, on its own initiative.
When might a claim have no reasonable grounds?
This is one of the most common grounds for seeking strike out.
The issue is generally whether there is a legally viable case based on what has actually been pleaded. Examples can include a claim which does not properly explain the facts relied upon, is incoherent, or sets out facts which, even if proved, would not establish a legally recognisable claim.
A defendant might therefore apply where, even taking the claimant's case at its highest, there is no viable legal basis for the remedy being sought.
There is an important distinction between a legally defective case and one which is simply disputed on the facts.
Strike out is not normally a shortcut for asking a judge to decide whose version of events is correct. Where the outcome depends on disputed evidence, contracts, correspondence or questions about what the parties did, those issues may need to be determined later in the proceedings or at trial.
Is making a strike out application a good idea?
This can be more important than simply asking whether there are legal grounds to apply.
A successful application may end a claim or defence before the parties incur the much greater costs of disclosure, witness evidence, expert evidence and trial. Even partial success can be valuable if it removes important issues and substantially narrows the dispute.
The value of the underlying claim also affects the calculation. Tactical applications can be more common in high-value commercial litigation because there is more at stake. Where a claim is worth millions of pounds and the costs of taking it to trial could be substantial, the cost and risk of trying to dispose of it early may be commercially justified.
However, an unsuccessful application can have the opposite effect. It creates another contested hearing, increases costs and may result in the applicant paying the opponent's costs while the underlying case continues.
There is also little value in spending heavily on an application if the result is simply that the opponent is allowed to correct the problem by amending its case.
Before applying, important questions include:
how serious is the defect in the opponent's case?
does it affect the whole case or only part of it?
can the problem simply be corrected?
does the issue depend upon disputed evidence?
would strike out, summary judgment or another application be more appropriate?
what is the opponent likely to do in response?
what are the costs and potential costs consequences? and
what would success actually achieve?
The fact that you can apply does not necessarily mean that you should.
What should you do if the other side applies to strike out your case?
A strike out application needs to be taken seriously because losing could bring some or all of your claim or defence to an end.
However, the fact that an application has been made does not mean it is well founded.
The first step is to understand exactly what the applicant says is wrong with the case and whether that problem genuinely justifies strike out.
Depending on the circumstances, resisting the application may involve showing that:
the facts relied upon do establish a legally recognisable claim or defence;
the applicant is trying to determine factual disputes which require evidence;
contracts, correspondence or other documents need to be considered;
the problem can be dealt with by clarification or amendment; or
any defect affects only a limited part of the case.
The response should also be tactical. Sometimes the right approach is to defend the case as pleaded. In others, an amendment may remove the objection quickly and avoid unnecessary cost.
Can a defective claim or defence be amended?
Strike out is not necessarily all or nothing.
A problem with the way a claim or defence has been prepared does not automatically mean that the entire case should end. Depending on the problem and the stage reached, there may be scope for amendment or clarification, or for only part of the case to be struck out.
This is particularly important where the underlying claim is viable but has not been pleaded properly.
It also matters to someone considering an application. If the likely outcome is simply that the opponent will be allowed to correct the defect, the commercial value of making an expensive strike out application may be limited.
What does abuse of process mean?
A claim or defence may also be struck out where it amounts to an abuse of the court's process or is otherwise likely to obstruct the fair disposal of the proceedings.
Examples in the relevant court guidance include claims which are vexatious, scurrilous or obviously ill-founded. This ground concerns the proper use of the court process and can apply beyond cases where there is simply a legal defect in the claim. An allegation of abuse of process should have a proper basis. It is not simply another way of arguing that the opponent's case is weak.
What if a party has failed to comply with a court order?
The court can also consider strike out where a party has failed to comply with a court rule, practice direction or order.
Courts have a range of powers for dealing with procedural failures, with strike out being one of the most serious.
Whether it is appropriate will depend on the nature and seriousness of the failure and the surrounding circumstances.
Apply for strike out or summary judgment?
Strike out and summary judgment applications are sometimes made together, but they are different.
Strike out commonly focuses on a fundamental problem with the opponent's case. For example, the facts alleged may not establish a legally recognisable claim even if they are proved.
Summary judgment, governed by Part 24 of the Civil Procedure Rules, considers whether a party has a real prospect of succeeding on a claim, defence or issue and whether there is another compelling reason for a trial.
Summary judgment can therefore involve greater consideration of the merits and evidence.
Depending on the circumstances, a party may apply for strike out, summary judgment or both. Choosing the appropriate route matters. An application made on the wrong basis can incur substantial cost without achieving the intended result.
How does a strike out application work?
An application will normally identify the part of the opponent's case being challenged, the grounds relied upon and the order being sought.
Not every application requires extensive evidence. Where facts need to be established, however, evidence may need to be prepared and served.
The opposing party can respond before the court considers the parties' arguments and any relevant evidence.
If the whole claim or defence is struck out, that may effectively bring that part of the litigation to an end and can lead to judgment or other orders. Alternatively, the court may strike out only part of the case and allow the remaining issues to continue.
Court guidance states that strike out applications should be made as soon as possible and, where possible, before the case is formally allocated to its procedural track.
Costs and tactical risks
Costs and risk should always be a major part of the decision.
A successful defendant may avoid the substantial expense of defending a claim through disclosure and trial. A claimant might remove an unsustainable defence or significantly narrow the issues in dispute.
An unsuccessful application means both sides have incurred additional costs, the applicant may face an adverse costs order and the underlying case continues.
Applications can have other tactical consequences. They may expose arguments earlier than intended, prompt the opponent to improve or amend its case, or affect the timetable and dynamics of the litigation.
The decision should therefore be based on more than whether there is a technical argument for strike out. The prospects, cost, likely response, potential benefit and impact on the wider case all matter.
The importance of preparing a claim or defence properly
Strike out applications demonstrate why the initial preparation of a substantial commercial claim or defence matters.
A claimant seeking significant damages will generally need to set out clearly the relevant contractual or other legal obligations, what the defendant is alleged to have done wrong, how that caused loss and what losses are claimed.
A defendant considering strike out needs to identify precisely why that case is legally or procedurally inadequate.
These issues can be particularly important in complex commercial disputes involving contracts, extensive correspondence, disputed evidence and substantial financial losses.
Our experience successfully resisting a strike out application
In a recent case, we acted for a claimant company pursuing damages exceeding £9 million arising from the alleged restriction of access to its business bank account.
The defendant bank applied to strike out the claim. We successfully resisted the application, allowing the claim to continue, and subsequently negotiated a settlement of the dispute.
The case illustrates why strike out applications can be particularly significant in high-value litigation. Where the potential liability and future legal costs are substantial, there can be a strong incentive to try to dispose of a claim early. For the party facing the application, successfully resisting it can be a crucial stage in progressing the underlying claim and potentially creating the conditions for settlement.
How we can help
Strike out applications are a good example of why experienced and tactically astute legal advice matters in commercial litigation.
Good litigation strategy involves spotting opportunities and risks as a case develops, deciding when an application is worth making, anticipating the opponent's response and avoiding procedural battles which add cost without sufficient benefit.
Our commercial litigation lawyers advise on strike out as part of the wider strategy of the dispute. Whether you are considering an application or facing one, we can assess the legal position, prospects, costs risk and tactical options and advise on the approach most likely to protect and improve your position.
