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The boundary between substantive procedural guidance and substantive advice

The boundary between substantive procedural guidance and substantive advice (orig. published in SvJT[1] 2002, p. 736)

By Claude D Zacharias

Translated by James Hurst (Authorised Translator), ELT - English Law Translations

The purpose of this article is to discuss, from a practitioner’s perspective and based on examples from real litigation, substantive procedural guidance in contentious cases that are amenable to out-of-court settlement where the parties are represented by counsel. The article has no ambition to represent the universally prevailing opinion. There is literature discussing these issues, often from a theoretical and academic angle that is sometimes quite difficult to understand. The dispute that I refer to throughout this article can simply be described as follows.

1. Background

1.1 The parties to the dispute are business operators X and Y. The parties are represented by counsel, in which connection I represented Y. X is the party that instituted the main action while Y instituted a cross action. X’s action refers to a payment obligation of just under SEK 30,000. Y’s action refers to damages of just over SEK 80,000. The case is listed for a two-day main hearing. The case subsequently advances on the second day up to the pleadings. X’s representative presents his pleading and Y’s representative presents his pleading. X’s representative is afforded an opportunity of rebuttal, which he takes. One feature of the case is that X contested the reasonableness of Y’s claim yet failed to explain in detail why the application was unreasonable, either in the opening presentation or in the pleadings or in the rebuttal, although Y’s representative amplified on the reasonableness of Y’s application in his pleading. In this situation, where all that remains is to explain that the hearing has been concluded, the court tried through repeated questions to induce X’s counsel to expand on why Y’s application was unreasonable. Y’s counsel objected, which is hardly greeted with any particular appreciation on the part of one of the members of the bench, while the chair decided to conclude the questioning yet nevertheless noted the reasons adduced by Y’s representative in response to the questions.

2. Substantive procedural guidance

2.1 Does the action of the district court thus constitute ‘substantive procedural guidance’? In my opinion, the answer to this is ‘no’. The issue involved here constitutes unpermitted ‘substantive advice’. One very obvious reason for this is that – in a contentious case that is amenable to out-of-court settlement represented by counsel – the consequence of a party contesting an issue relating to the reasonableness of an application without providing any further explanation ought to be that the objection is not taken into consideration, with wording that could be formulated ...

[…] because X has not provided any detailed support for his objection …. (cf. RH[2] 1986:11).

2.2 However, there are further and better fundamental reasons to suggest that the situation described above goes beyond what is allowed. As is common knowledge, a dispute is dealt with in three stages at court. The first stage is the actual institution of the judicial process by applying for a summons. Such application must contain, among other things, the applications and grounds (42:2 of the Code of Judicial Procedure (RB)). The provisions of 42:6–8 RB govern how proceedings are to be dealt with at the district court and the formal requirements imposed on the plaintiff and defendant. Then there is stage two – the preparation – following which the third stage is the main hearing when the case is adjudicated. A central part of the processing of contentious cases at court is that the case shall be investigated at the preparatory stage. In this connection the courts are expected to pursue the preparation, focussing on an expeditious ruling on the case, which reflects one of several express aims set out in Government Bill 1986/87:89 for a reformed district court procedure (the 1987 Reform). According to 42:8 RB, the parties shall each individually state the additional circumstances that they wish to adduce and also express their views on what the other party has stated. In so far as this aspect is of interest, 42:8:2 RB and 43:3 RB constitute the core provisions. It is prescribed by 42:8:2 RB that:

[...] During the preparation, the court shall proceed with a view to ensuring that, depending upon the nature of the case, the issues in dispute are elucidated and the parties state everything that they wish to invoke in the case. By questions and observations, the court shall attempt to remedy unclear and incomplete statements made by the parties.

2.3 This provision in itself indicates that the court’s substantive procedural guidance shall essentially take place at the preparatory stage with the aim of clarifying the contentious issues and what the parties wish to invoke. Herein lies the core of the court’s function with substantive procedural guidance. The central and overall purpose is that the court “… should pursue active procedural guidance without this turning into advisory activities” (Government Bill 1986/87:89, p. 103).

2.4 There is discretionary scope for the courts to determine how extensive the substantive procedural guidance may be in each individual case. Consequently the boundaries are unlimited. The point of departure for contentious cases amenable to out-of-court settlement is thus that:

[…] owing to the parties’ contractual freedom, it [is] largely their own matter to determine what scope the proceedings should assume and what investigation should be conducted. ... Considering the importance of the courts being perceived as objective and the risk of unnecessary frivolous or perverse proceedings, quite narrow limits … should be set in respect of the courts’ duty to investigate (cf. Government Bill 1986/87: 89, p. 104).

2.5 As additional support for there being boundaries, it should also be mentioned that the court may not base:

[...] its judgment on any circumstance (legal fact) other than those invoked by the parties. … Procedural guidance shall basically be restricted, to the extent required, to helping the parties to sort out what they want to claim and invoke and what evidence they wish to present (cf. Government Bill 1986/87:89, p. 106 f.)

2.6 Indeed it must be borne in mind that the parties make their own decisions about what they want to put before the court, including a right to refrain from invoking circumstances or arguments in support of a claim. (cf. Ekelöf et. al., Rättegång [Litigation], First Booklet, 7 u., p. 52 f.) There is only scope for more extensive procedural guidance in special situations, including the introduction of new applications, new grounds and new evidence. Likewise, more active substantive procedural guidance has been permitted with regard to evidence. It is also indicated throughout that the scope of substantive procedural guidance narrows if a party is represented by counsel. But how should the boundaries be defined?

2.7 The point of departure is, as already stated, that if and when there is substantive procedural guidance in a contentious case amenable to out-of-court settlement, this should essentially be provided in the course of the preparation. Examples of less appropriate measures on the part of a court referred to in the 1987 Reform include situations where the court makes statements about the inadequacy of the evidence presented or the grounds invoked being untenable.

2.8 The provision contained in 42:8 should be read together with the provisions contained in 42:6–7 and 43:3 RB in order for the frames of the substantive procedural guidance to be reasonably tangible. It consequently becomes more logical to share the view of the legislator that substantive procedural guidance is appropriate when the court, for example, considers it important to deliberate on whether there are reasons to appoint an expert or whether it would be appropriate to order a security measure under Chapter 15 RB. Substantive procedural guidance may also come into question with regard to purely procedural issues. The overall objective is to “prepare the case so that it can be settled as swiftly and efficiently as possible” (Government Bill 1986/87:89, p. 193 and 196).

2.9 As a consequence of this, the meaning of 43:4 RB is that the chair of the court during the main hearing must:

[…] ensure that the hearing essentially relates to such matters as are contested between the parties and that the hearing is not delayed owing to investigations into circumstances that, at the time of the preparation, were undisputed or considered to be irrelevant (cf. Peter Fitger, Rättegångsbalken II [Code of Judicial Procedure II], Supplement 18, p. 43:19).

2.10 Substantive procedural guidance during a main hearing, in any event after the opening presentation, should only be permitted in exceptional cases (cf. Peter Fitger, Rättegångsbalken II [Code of Judicial Procedure II], Supplement 25, p. 43.11. Ekelöf appears to have a slightly different view, which is explained in Ekelöf, Rättegång [Litigation], Fifth Booklet 6 u.edition, p. 89, final paragraph. What Ekelöf is probably referring to is a situation where one party is not represented by counsel, a view also supported by the systemic structure of Ekelöf’s work).

2.11 However, a court must be permitted to intervene in situations where a party invokes ambiguous applications and grounds, so that these ambiguities are avoided once the case has been taken up for adjudication. Substantive procedural guidance is also justified when completely new grounds are suddenly introduced in conjunction with the main hearing (cf. Peter Fitger, Rättegångsbalken II [Code of Judicial Procedure II], Supplement 25, p. 43:11).

2.12 The same applies when applications and grounds presented during the preparation are unexpectedly not presented during the opening presentation at the main hearing. Such a situation might arise owing to counsel during their opening presentation at the main hearing summarising one or more of the grounds referred to during the preparation, and the members of the court consequently overlooking the fact that this really involves multiple grounds. In my opinion, if counsel later refers to circumstances in the course of the pleading that obviously relate to grounds that the members of the court have not considered as having been invoked during the main hearing, the court is obliged to investigate whether the grounds being invoked are new. This obligation becomes all the more pertinent if the judge dealing with the matter during the preparation is also on the bench at the main hearing. If the district court fails to do this and then states in its judgment that, for example, the party has not even invoked the grounds in question, a procedural error of crucial, substantive importance would be deemed to exist (cf. comments of Peter Fitger, Rättegångsbalken II [Code of Judicial Procedure II], Supplement 25 p. 43:11).

2.13 In light of the above the frameworks for ‘substantive procedural guidance’ in contentious cases amenable to out-of-court settlement, where the parties are represented by counsel, and accordingly the boundary in relation to ‘substantive advice’ could possibly be expressed as follows. Substantive procedural guidance:

  1. shall essentially take place during the preparatory stage so that the case at a main hearing can be swiftly and efficiently adjudicated and be adapted to the nature of the case.
  2. shall be adapted considering whether or not a party has counsel.
  3. may be permitted to a greater extent in terms of issues relating to evidence, procedure or experts.
  4. may in special cases ex officio include the introduction of new applications and grounds.
  5. shall be provided when a party introduces new grounds during the main hearing.
  6. shall be provided when it is unclear whether a previous ground invoked during the preparatory stage is still being invoked at the main hearing.
  7. Substantive procedural advice

2.14 How then should counsel react when the district court, in the view of counsel, has exceeded the frames for permissible substantive procedural guidance? In my opinion, counsel that does not object to the action of the court commits an omission in relation to their client. Sweden’s judges exercise their office in a professional way, and do not take personal offence to objections asserting impermissible substantive procedural guidance; in any event this should not be the case. The converse also applies, i.e. even if counsel does not convince them of their standpoint, then counsel has no reason to take this personally. Differences of opinion may at the time in the ‘heat of battle’ obscure the disposition of the individuals, though it may be assumed that such thoughts will melt away after some time has passed and everyone can see the case in perspective.

2.15 What then are the consequences of a court not keeping within the frames for substantive procedural guidance? The answer to this question is complicated as several factors are often involved in the course of adjudicating a case. The outcome of a case may involve several different sub-questions, but basically it should be possible to say with justification that in the case used as an example here, it ought to be possible to concede the objection in respect of unreasonableness. One possibility is to reject the main claim, but to adjust the claim made by way of cross claim in full or by so much that the adjusted amount exceeds the application in the main claim. The consequence in the case of the above example would thus be that Y, in accordance with the main rule contained in 18:1 RB, must bear X’s litigation costs despite the rejection of the main claim. Furthermore, as reasonableness is introduced in the judgment, it is unavoidable that the issue will also be considered by the Court of Appeal in the event of an appeal. What legal remedies are available to a party in a case where a court exceeds what may be deemed to constitute permissible substantive procedural guidance?

2.16 Besides the customary Parliamentary Ombudsman procedure, official liability can probably be claimed pursuant to 3:2 of the Tort Liability Act. In other words, impermissible substantive advice that is detrimental should constitute an error or neglect in the exercise of official powers in activities for whose performance the state is responsible. The court is actually a collective and as such there should be no question of a private party instituting proceedings against an individual judge. Instead it appears to be more appropriate to regard the hearing as a concrete exercise of official powers in the course of which action has been taken that caused pure financial loss. Some concluding comments: The scope for the district courts’ substantive procedural guidance is subject to limits, albeit unclear, on how extensive such guidance may be pursued. It appears that the courts, primarily the district courts, take liberties far too often that border on providing substantive advice and at times also do constitute such advice. The later substantive procedural guidance is provided when a case is being dealt with, the greater the risk that substantive advice is involved. Errors that are detrimental may, as a general principle, result in a liability for damages for the state. Counsel rarely objects to courts exceeding the frames for substantive procedural guidance. The outer limit for substantive procedural guidance is only considered in the course of the interplay between the court’s action and counsel’s procedural objections. Any discomfort that counsel might feel when criticising the court is an irrelevant consideration of a purely personal nature that should not take precedence over the client’s justified interest in having their rights protected. Counsel for a party has an obligation to object to substantive advice and similarly, when it occurs, to notify their client of the opportunities to have their rights respected.

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[1] Translator's note: Svensk Juristtidning – a renowned Swedish legal journal.

[2] Translator's note: Rättsfall från hovrätterna [Court of Appeal Cases] - a renowned Swedish law report series

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