Mulholland v Hughes (18 September 2015, unreported; HHJ Freedman) has finally been the subject of an appeal and approved in a decision that binds the County Court. Elisabeth Laing LJ, giving the leading judgment of the Court of Appeal in the combined appeals of London Borough of Islington v Bourous; Davis v Yousaf [2022] EWCA Civ 1242 confirmed at [147] that “a defendant cannot object, at Stage 3, to a particular head of damages except on grounds raised at Stage 2.”

It has now been 7 years since Mulholland was decided. Since then there had been a broad level of acceptance that issues had to be raised at Stage 2 to be relied upon at Stage 3. However, in the absence of binding authority it always remained open for defendants to ambush claimants at Stage 3 with new issues and for judges to be persuaded to allow them to do it.

Whatever the rights and wrongs of the rough and ready approach of the RTA Protocol certainty of what issues are ‘up for grabs’ at Stage 3 hearings is to be welcomed. Presumably the same applies for the EL and PL Protocols as well, albeit Stage 3 hearings in those are something of a rarity. The question now is whether this will result in an explosion of ‘all but the kitchen-sink’ list of issues by defendants at Stage 2 or merely the quiet death of the Stage 3 ambush. Given the new Small Claims RTA Protocol, it may of course just be something of a moot point.

It must also be noted that the Court of Appeal also commented on the power to transfer Protocol cases from Part 8 to Part 7. The note in the White Book at 8BPD.7.1 suggested the power was for ‘rare and exceptional cases only’. The Court of Appeal confirmed this interpretation was incorrect and the power was not constrained in that way. Of course this may potentially open up more arguments for transfer out to Part 7… The Court of Appeal giveth, and the Court of Appeal taketh away.