The Court of Appeal has delivered a judgment that should give pause to any litigator drafting the terms of an unless order or seeking a strike out on its breach. In Midland Premier Properties Limited v. Doal[1], the court allowed an appeal against a striking out order, emphasising that unless orders must be strictly construed and that debarring a defendant from defending is a remedy of last resort – even where there have been genuine failures in the disclosure process.
Background
The proceedings arose from a property development dispute. Sanman Property Management Limited (Sanman) had agreed to lend 2020 Living Limited £1.5 million to purchase a property known as ‘The Square’ in Birmingham. The contract entitled Sanman to 50% of the profit from any on sale. Sanman alleged that to avoid paying its profit share, 2020 Living disposed of its interest in ‘The Square’ to a related company, Taylor Grange 2 Limited, for no consideration. Sanman brought claims for breach of contract, inducing breach of contract and unlawful means conspiracy against Samuel Ginda and various corporate defendants he controlled.
During the litigation, concerns arose about document deletion. The defendants had disclosed that Ginda’s practice was, and had been, to routinely delete his emails at the end of each day. This prompted the claimants to apply for an order requiring Ginda to preserve documents and permit forensic imaging of his electronic devices and online storage accounts.
On 3 July 2024, the High Court approved a consent order requiring the defendants to instruct an e-disclosure provider, Consilio, to take forensic images of Ginda’s devices and online accounts, interrogate them for deleted documents and produce a schedule and report detailing the results. On 31 July 2024, an unless order was made providing that the defendants’ defences would be struck out unless they complied with certain provisions of the 3 July order within specified time frames.
Critically, two problems emerged with Consilio’s work. First, Consilio was unaware that one of Ginda’s email accounts contained data in a separate Microsoft 365 tenant and did not image it. Second, Consilio applied a date range ending on 31 January 2023 to another account, even though the order imposed no such limitation. The result was that the schedule served on the claimants was incomplete.
The central legal question was whether the defendants had breached the unless order and, if so, whether they should be granted relief from sanction or have their defences struck out.
The High Court’s decision
The High Court concluded that the defendants had breached the unless order by failing to serve a complete and sufficient schedule. The judge held that the schedule was ‘plainly incomplete and insufficient’ because it did not contain information from all of the online storage accounts that should have been imaged.
The judge found that the defendants’ solicitor ought to have known that the schedule was incomplete because Consilio had not imaged all the online storage accounts that they were meant to image. He refused relief from sanction and struck out the defendants’ defences, debarring them from defending.
The judge also held that even if the unless order had not been breached, he would still have considered it appropriate to strike out the defences on account of the defendants’ failure to comply with court orders. He concluded that the disclosure exercise could not be completed in time for trial and that it was proportionate to take the draconian step of striking out.
The Court of Appeal’s decision
The Court of Appeal, in a judgment delivered by Lord Justice Newey (with Lord Justice Lewison and Lord Justice Cobb agreeing), allowed the appeal and ordered a retrial before a different judge.
The court’s first key finding was that the judge had misconstrued the unless order, which obliged the defendants only to ‘instruct’ Consilio to produce a schedule and ‘supply a copy of what Consilio provided’. It did not require the defendants to guarantee the completeness or accuracy of Consilio’s work. The court reasoned that this interpretation made sense because the preparation of the schedule had been entrusted to an external contractor and it would not be surprising if the appellants had assumed responsibility for giving the instructions rather than guaranteeing the result.
The court confirmed that the instructions given to Consilio complied with the terms of the order and took into account comments made by the claimants’ solicitors under the scheme set out in the order. There was no complaint about the instructions. Since the defendants had done what was required of them, namely given the specified instructions and supplied a copy of the resulting schedule, the order was not breached.
On the general principles governing unless orders, the court emphasised that such orders must be restrictively construed given the severe consequences of noncompliance. An unless order must make it clear what the party concerned has to do – ‘any order dealing with the dismissal of an action unless something is done should be absolutely and perfectly precise in its terms’.
Turning to the judge’s alternative ground for striking out, the court identified the key problem as the judge’s failure to address the possibility of making a further unless order instead of immediately debarring the defendants from defending. The court observed that: ‘an order debarring a defendant from defending is draconian and must be seen as a remedy of last resort’.
Takeaways
This judgment offers important guidance for commercial parties and their legal advisors.
First, unless orders must specify with precision what the party concerned must do. If the sanction attaches to giving instructions to a third party, compliance will be judged on whether those instructions were given, not by the quality of the third party’s output. Parties seeking to enforce unless orders should ensure that the order imposes clear obligations on the defaulting party itself, rather than relying on implied requirements.
Second, where third-party service providers are involved in compliance, those instructing them should consider whether the unless order makes them responsible for the result or only for the instruction. In this case, the defendants avoided sanction because they were required only to instruct Consilio; not to guarantee its performance.
Finally, parties should pay close attention to how draft instructions to e-disclosure providers are handled. The defendants benefited from having shared their draft instructions with the claimants for comment under the scheme in the order, and the claimants had not suggested any improvements. This collaborative approach ultimately provided a shield against allegations of noncompliance.
[1] [2026] EWCA Civ 117
Contributors
Alex Radcliffe