ON APPEAL FROM QUEEN’S BENCH DIVISION
HIS HONOUR JUDGE YELTON
SITTING AS A DEPUTY JUDGE OF THE QUEEN’S BENCH DVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Before :
LORD JUSTICE WARD
LADY JUSTICE ARDEN DBE
and
LORD JUSTICE DYSON
Between :
|
Jacqueline Adam |
Appellant |
|
- and - |
|
|
Rasal Ali |
Respondent |
(Transcript of the Handed Down Judgment of
Smith Bernal WordWave Limited
190 Fleet Street, London EC4A 2AG
Tel No: 020 7421 4040 Fax No: 020 7831 8838
Official Shorthand Writers to the Court)
Robert Leonard (instructed by Murdochs) for the Appellant
Jason Evans-Tovey (instructed by Messrs Jacobs) for the Respondent
Judgment
Lord Justice Ward:
Introduction:
This appeal gives rise to another troublesome limitation point spawned by Walkley v Precision Forgings Limited [1979] 1 W.L.R.606. The appellant, Jacqueline Adams, was injured in a road traffic accident which happened as long ago as 5 July 1999 when a vehicle driven by the respondent, Rasal Ali, smashed into the rear of her motor car whilst it was stationary at traffic lights in Fenchurch Street EC3. By 8 November 1999 the respondent’s insurers were writing to the appellant’s solicitors, Messrs Judge and Priestly, informing them that liability was not disputed and setting in train the obtaining of medical reports to investigate the whiplash injuries the appellant had suffered. Her injuries were perhaps more serious than might have been anticipated and several experts became involved but if progress was slow it was not unusual. Unfortunately for the appellant, the solicitor’s clerk dealing with her case was experiencing personal difficulties which led him to neglect his responsibilities. He did not issue her claim in the Bromley County Court until 12 July 2002, a week outside the primary three year limitation period provided by Section 11(4) of the Limitation Act 1980 (“the 1980 Act”). He then compounded his dereliction of duty by failing to serve particulars of claim within four months or at all. Evidence filed in the case on the respondent’s behalf is to the effect that had he done so, the defendant would have taken the pragmatic view that it would not have been worth taking the limitation point given the very short delay because in the experience of the defendant’s solicitor, “judges almost invariably exercise their discretion under section 33 [of the Act] and disapply the provisions of Section 11”. Nothing much seems to have happened although the appellant herself was led to believe that all was proceeding smoothly: indeed at one point she was even asked to supply dates when it would be convenient for her to attend trial. Far from there being a trial, the claim was struck out by the District Judge, as far as I can tell of his own motion, on 15 August 2003.
Judge and Priestley’s response was to issue this claim out of the High Court on 20 August 2003. It is a substantial claim which could, as pleaded, exceed £100,000 in damages. The issue of these second proceedings gives rise to the question we now have to resolve: does the court have the discretion to disapply the limitation period pursuant to section 33 of the 1980 Act or does the application of the principle established by Walkley preclude any exercise of that discretion?
To resolve that question the Master ordered the trial of four preliminary issues which His Honour Judge Yelton, sitting as a judge of the High Court, answered on 8 November 2004 as follows:
The claimant’s date of knowledge pursuant to section 14 of the 1980 Act was 5 July 1992.
Her first claim in the Bromley County Court was not brought before the expiry of the limitation period specified in Section 11.
The court did not have a discretion pursuant to section 33 of the 1980 Act to disapply Section 11.
If the judge had a discretion he would not have exercised it in favour of the claimant.
In the result the claim was struck out. Ms Adams appeals against that order with permission granted by Scott-Baker L.J.
The legal background
One needs to bear in mind the historical development which culminates in the 1980 Act. The Limitation Act 1939 provided a limitation period of six years from the date on which the cause of action accrued for actions founded in tort. The Law Reform (Limitation of Actions, etc.) Act 1954 reduced this period to three years in actions for personal injuries. That worked some hardship in cases of long-maturing industrial diseases which the Limitation Act 1963 was intended to overcome. That Act proved to be unsatisfactory and the Limitation Act 1975 attempted again to address the problem. This introduced Sections 2A and 2D by way of amendment to the Limitation Act 1939 and these sections are now replaced in virtually identical terms by Sections 11 and 33 of the 1980 Act.
For present purposes it is enough to recite the following from the 1980 Act:
“Special time limit for actions for personal injuries
11(1) Except where sub section (5) below applies, the period applicable [in personal injury claims] is three years from-
(a) the date on which the cause of action accrued; or
(b) the date of knowledge (if later) of the person injured.”
Section 14 defines the date of knowledge for purposes of Section 11. Section 33 provides for a discretionary exclusion of time limits for actions in respect of personal injuries or death and for the moment I set out only sub-section (1) as follows:
“33(1) If it appears to the court that it would be equitable to allow an action to proceed having regard to the degree to which -
(a) the provisions of section 11… of this Act prejudice the plaintiff or any person whom he represents; and
(b) any decision of the court under this sub section would prejudice the defendant or any person who he represents;
the court may direct that those provisions shall not apply to the action, or shall not apply to any specified course of action to which the action relates. ”
It may be instructive to look at the way Walkley progressed through the court on its way to the House of Lords. Towards the end of 1969 Mr Walkley became aware of the fact he had contracted Raynauld’s disease and believed that it had been caused by the nature of his employment. His union doubted it but solicitors were instructed and in October 1971 issued and served the original writ. No further steps were taken in that action because counsel advised it had no chance of success and Mr Walkley was informed accordingly. New solicitors were instructed in the summer of 1973 but the defendants saw them off by threatening to apply to dismiss the action for want of prosecution if steps were taken to proceed with it. A third firm were instructed and they issued the second writ in December 1976. The employers entered a conditional appearance and applied to strike out the second writ on the ground that it was brought on exactly the same grounds as the action started by the original writ. The Master struck it out for being frivolous and vexatious and an abuse of the process of the court. On appeal, Mr Walkley asked for his first action to be discontinued and the second action allowed to proceed asserting that he had been advised he had a reasonable chance of obtaining the exercise of the court’s discretion under what is now section 33. The judge did not purport to exercise his discretion but simply set aside the Master’s order on the undertaking to discontinue the original action. The employers appealed. No steps actually appear to have been taken to file a proper application for the exercise of the section 33 discretion. In dismissing the appeal the majority of the court considered that Mr Walkley’s advisors should be given a further opportunity to produce evidence to bring him within section 2D [section 33]. Waller L.J. would have allowed the appeal because no further evidence could exist that was capable of overcoming the prejudice to the defendant. The employer’s further appeal to the House of Lords was allowed.
Lord Wilberforce said this at page 609:
“My Lords, as a matter of principle I have very great difficulty in understanding how in this case or indeed in any case that I can imagine where an action has been started within the normal limitation period, [section 33] can be invoked at all. The section opens with the words:
“(i) If it appears to the court that it would be equitable to allow an action to proceed having regard to the degree to which –
(a) the provisions of [section 11]… of this Act prejudice the plaintiff…”
The provisions of [section 11] are those which require an action for personal injuries to be brought within three years. So [section 33(1)(a)] must be contemplating a case in which, because the three years have expired without an action being brought, [section 11] applies to the prejudice of the plaintiff. But if the plaintiff has brought his action within three years, how has he been prejudiced by [section 11]? This I fail to understand. If this argument is sound, the respondent’s case fails in limine. He brought his first action within the normal limitation period, and if he has suffered any prejudice, it is by his own inaction and not by the operation of the Act.” (I have substituted references to the 1980 Act and I have added the emphasis).
Lord Diplock said this at page 619:
“So, to entitle the court to give a direction under [section 33(1)], there must be some prejudice to the plaintiff and the cause of that prejudice must be the requirement under [section 11] that he should start his action before the expiry of the primary limitation period.
My Lords, in my opinion, once a plaintiff has started an action (the first action) within the primary limitation period it is only in the most exceptional circumstances that he would be able to bring himself within [section 11] in respect of a second action brought to enforce the same cause of action. If the first action is still in existence, as it was in the instant case when the matter was before the Master or the judge, cadit quaestio; he has not be prevented from starting his action by [section 11] at all, so the provisions of [that section] cannot have caused him any prejudice. Does it make any difference if the first action is no longer in existence at the time of the application under [section 11] either because it has been struck out for want of prosecution or because it has been discontinued by the plaintiff of his own volition? In my view, it does not. These are self inflicted wounds. The provisions of [section 11] caused him no prejudice at all; he was able to start his action. The only cause of the prejudice to him in the case of dismissal for want of prosecution is dilatoriness which took place after the action was started whether on his own part or on the part of his legal advisors. In the case of discontinuance the only cause of prejudice is his own act. …
I would allow the appeal upon the ground that Mr Walkley, having previously started an action for the same cause of action within the primary limitation period prescribed by [section 11], cannot bring himself within [section 33] at all. Any application by him under that section would fail in limine.” (Emphasis added by me.)
Having decided the matter in that way it was, of course, unnecessary for their lordships to consider the exercise of discretion but there was unanimous approval for the approach of Waller L.J. that the case was hopeless and no further evidence could ever possibly rescue it. One senses their Lordship’s impatience and irritation at the way the case had come to them and it is no surprise to learn from counsel who appeared for the employers that the point on which they succeeded was taken for the first time in the House of Lords. One can understand why they were anxious to find a quick quietus to a case so wholly without merit. But from small acorns great oaks may grow unless pollarded by later gardeners and so I must examine to what extent, if at all, growth of the principle in Walkley has been stunted by the courts since then.
The Judgment under Appeal
Judge Yelton thought the Claimant’s argument was “an extremely unattractive one”. He described the point taken by counsel who then appeared for the Claimant as follows:
“Because we were negligent, in effect, in not issuing within the primary limitation period therefore Walkley does not apply and therefore you (the Judge) retain your discretion to disapply the limitation period under section 33.”
In his view the facts were different because the defendant’s solicitor said and the Judge accepted that he was not going to take the limitation point. So he held:
“14. It seems to me that this case is stronger than Walkley. It is not, as the Claimant says, an opportunity to escape from that which was laid in Walkley, rather as I say it was a stronger case because in this case the Claimant had already issued late. The defendant decided not to take the limitation point, but had he taken the limitation point the Claimant could hardly say I am starting again. In fact what happened was that the Claimant failed to serve … the proceedings within the appropriate time and the proceedings came to a halt [and] were struck out as I have described.
15. It seems to me, therefore, and I have looked at the other cases, none of which seem directly in point, that the principle of Walkley does apply to this case and that therefore I have no discretion to allow the claimant to proceed under section 33. ”
The argument before us
The short and simple submission made by Mr Robert Leonard, Counsel for the Appellant, who did not appear below, is in essence this. Walkley should be rigorously confined to similar facts; the crucial fact in Walkley was the issue of the first proceedings before the time limit expired; that did not happen here; therefore Walkley does not apply.
Mr Jason Evans-Tovey has a more subtle argument. He submits first that the power under section 33 does not arise where a claimant has been prejudiced, not by reason of section 11, but by his own failure to proceed with an earlier, properly constituted claim.
Secondly he points out that section 11 does not require a claimant to bring an action “within” a prescribed period of time; it does not extinguish a claimant’s right to damages but simply provides a defendant with a defence which the defendant may or may not decide to take. It is only if the defendant does plead the limitation point that the claim is barred. He says that it is mere judicial shorthand to refer to “the effect of the expiry of the primary limitation period” and relies on the speech of Lord Diplock at page 618 D in support of the submission:
“Despite the use of the phraseology “an action shall not be brought,” it is trite law that technically the Limitation Act does not prevent the commencement of an action by the Plaintiff after the limitation period has expired. What it does is to provide the defendant with a cast-iron defence if he chooses to avail himself of it; which he may do either by pleading it or, in a case where the action is in indisputably statute-barred, by taking out a summons to have it dismissed as vexatious. For the sake of brevity, however, I shall speak of the effect of the expiry of a primary limitation period as preventing the starting of the action.”
Although Mr Evans-Tovey may be right about this I do not see that it takes his case much further.
Thirdly, and this does lie at the heart of his case, he submits that the Walkley principle only applies whenever in the first action between the same parties based on the same cause of action the defendant did not successfully avail himself of a limitation defence. If the first claim was not prejudiced by section 11 because the section 11 point would never have been taken or successfully taken, the second claim is not prejudiced by it either.
The developments since Walkley
Lord Diplock explained Walkley in Thompson v Brown [1981] 1 W.L.R. 744, 749 as follows:
“Walkley … was a case in which the plaintiff had issued and served his writ within the primary limitation period; so section [11] had not affected him at all. No further steps were taken in the action within the primary limitation period and it was ripe to be dismissed for want of prosecution. In an attempt to avoid this fate a second writ founded on the same cause of action was issued by the plaintiff’s new solicitors. Considerable procedural manoeuvring by both parties followed, in the course of which application was made under section [33] to allow the action started by the second writ to proceed. This House took the view that, the plaintiff having brought within the primary limitation period an action for damages for the very negligence which constituted the cause of action alleged in the second writ, he had not been affected by section 2A [11] at all, let alone prejudiced by it.”
At p. 751 he added:
“In Walkley … the primary period of limitation had not expired when the plaintiff had started his action against the tortfeasor. That was the only reason why section [33] did not apply to his case”, (with emphasis added by me).
At p. 752 he acknowledged that:
“It may seem anomalous that a defendant should be better off where, unknown to him, a writ has been issued but not served than he would be if the writ had not been issued at all …”
In Deerness v Keeble & Son [1983] 2 Lloyds L.R. 260, 262 Lord Diplock encapsulated the essentials of Walkley by describing it as a case where-
“a plaintiff who has actually started an action before the expiry of the primary limitation period has not been prejudiced by … section 11 of the Limitation Act, 1980, and therefore cannot bring himself within the provisions of section 33 (1).”
Thus at p.263 he spoke of:
“the fatal obstacle … that is presented by the fact that the solicitors did cause a writ to be issued within the primary limitation period” (with the emphasis added by me).
It seems to me quite clear that Lord Diplock himself saw the bringing of the first action within the primary limitation period as the characteristic feature of the case which prevented the claimant from seeking the exercise of the court’s discretion under section 33.
There have been many trips to the Court of Appeal on this point. Chappell v Cooper [1980] 1 W.L.R. 958 was the first. Counsel for the plaintiffs sought to distinguish Walkley on the very narrow ground that there was no question there of the first action being struck out or discontinued: there the writ had not been served within the time permitted for service and it was too late to extend the validity of the first writ. Dealing with that, Roskill L.J. held at p. 964:
“…I cannot accept the submission that [Walkley] is a decision only on the facts of that case. It seems to me plainly a decision on principle that if a plaintiff starts but then does not for any reason proceed with an action, whether it is because the plaintiff chooses not to serve or his solicitors fail to serve the writ timeously or because the action is subsequently struck out for want of prosecution, or because for good reason or bad the plaintiff or his solicitors give notice of discontinuance, it is not open to the plaintiff thereafter to seek to take advantage of the provisions of section [33] … because as their Lordships have laid down (and we are of course bound by their decision) the cause of his prejudice is not the provisions of section [11], that is to say, the existence of the primary limitation period, but is the act or remission of himself or his solicitors in acting or failing to act as he or they have done in relation to their action.”
All the court was saying in the first sentence was that the distinction counsel were attempting to draw on the facts was ill-founded. The facts which the court did identify were more material. Mr Evans-Tovey seizes on the words I have highlighted in order to found a submission that because Roskill L.J. does not expressly say “in time”, the principle in Walkley extends to cover the case whether started in time or after the expiration of the three year period and so cover the situation before us. I regard that as an utterly hopeless submission. It leaps off the pages of the decision in Walkley that it was the bringing of the first action within the primary limitation period that was the defining characteristic. Moreover Roskill L.J. went on in the very next paragraph to refer to the judgment of Megaw L.J. in the Court of Appeal in Walkley where he referred to the first action having “started in time” and “a first writ… issued within the primary period”. I refuse to accept that the Court of Appeal in Chappell were extending the ratio of Walkley by extending its application regardless of when the first action commenced.
Walkley has been distinguished by this Court. In White v Glass (Court of Appeal Transcript) February 17th, 1989, the plaintiff sued his club, an unincorporated association, under its name. That first action brought within the primary limitation period was, however, struck out as improperly constituted and ineffective. The plaintiff was entitled to rely upon section 33. Kerr L.J. observed:
“There was no action in being against the present defendants at the time when the limitation period expired or thereafter when the application under section 33 was made. … But it seems to me that the plaintiff is now prejudiced by section 11, since he cannot bring this first properly constituted action unless he can avail himself of section 33. … In my view, the position is now that he is prejudiced by section 11 and is entitled to rely on section 33. … This is not a case of a mere repetition of an identical action which has been instituted during the limitation period. In the present case the action which had started during the limitation period was defective and invalid and not capable of resurrection… The Court is therefore entitled to conclude that the provisions of section 11 prejudiced the plaintiff in relation to the present action. Accordingly I would dismiss this appeal and allow this action to proceed by reason of section 33.”
That was applied in In re Workvale Ltd [1992] 1 W.L.R. 416. There the circumstances were quite exceptional. The writ had been issued in time against the defendant company subsequently discovered to be in liquidation. The claimant’s solicitors reasonably believed that the writ was accordingly a nullity and allowed it to be struck out. The Court did not apply Walkley in those exceptional circumstances.
Then we have Shapland v Palmer [1999] 1 W.L.R. 2068. This was a claim for personal injuries in a road accident when the plaintiff’s car was struck by a company car driven by the defendant in the course of her employment. The first action commenced on the last day of the three year limitation period and the claim was brought against the defendant’s employers. Because the proceedings were not served in time the action was struck out. Subsequently the plaintiff commenced her second proceedings, but this time against the defendant driver himself. The plaintiff was allowed to seek the exercise of the court’s discretion under section 33. Simon Brown L.J. said this at p. 2071:
“Lord Wilberforce was there [p. 609 cited above] saying that as a matter of construction the particular prejudice to which the section 33 discretion is directed is that occasioned by the plaintiff not having issued his proceedings within the primary three-year limitation period. Once he has issued his proceedings within that period, then, for whatever reason they have ceased to exist – whether through failure to serve, strike out for want of prosecution, or discontinuance – section 33 simply has no application.
Although Lord Wilberforce observes that any prejudice resulting from the ultimate ineffectiveness of the first proceedings is due rather to the plaintiff’s inaction than to the act (i.e. the proceedings not having being issued in time), this observation seems to me strictly outside the ratio. It is, after all, plain that the section 33 discretion arises notwithstanding a plaintiff’s solicitors’ perhaps far greater negligence in failing ever to have issued proceedings within the primary limitation period in the first place. Indeed, as Lord Diplock expressly recognised in Thompson v Brown [1981] 1 W.L.R. 744, 752 that is an undoubted anomaly arising from the Walkley principle.
I accordingly understand the Walkley principle to exclude from section 33 only actions which involve the same defendant and the same cause of action as was the subject of the earlier, timeous proceedings.”
He reviewed earlier authorities and said at p 2073:
“The general tendency of those cases, I have no doubt, is to support the plaintiff’s argument. In the first place, they suggest a marked unwillingness on the Court’s part to apply the Walkley case … unless it is plainly indistinguishable. …
By the same token that the Walkley principle itself rests upon a narrow and somewhat technical construction of section 33, so too it is, in my judgment, possible to escape it on just such grounds. That, moreover, is particularly appropriate given the undoubted anomalies that in any event arise from the application of the principle – most notably, as already pointed out, its failure to impact on cases of perhaps greater negligence where no writ was ever issued in the first place. I would accordingly rule that the section 33 discretion arises in all cases save those which fall four-square within the Walkley principle.”
Those sentiments met with the approval of the other members of the Court, Clarke L.J. confirming that Walkley “should be confined to its own facts especially having regard to the anomaly which derives from the Walkley case which Lord Diplock described in … Thompson v Brown” as cited above. He also observed - with force if I may say so – that:
“The reason why …the provisions of section 11 “prejudice the plaintiff” within the meaning of section 33(1) is that the action, that is the second action, is brought after the three-year period, with the result that in that action the defendant can plead section 11 by way of defence and the action will fail” (with the emphasis added by me).
With the agreement of the other members of the court, Simon Brown L.J. in Young v Western Power Distribution [2003] EWCA Civ 1034, [2003] 1 WLR 2868 repeated:
“The rationale of the Walkley principle is, as already explained, that it is not the time limit in section 11 which prejudices the claimant in such circumstances but rather the fact that he had previously commenced timeous proceedings which, for whatever reason, were not then successfully pursued.”
Analysis
I too agree that the anomalies of Walkley should be carefully confined. We are bound by the case but we are not bound to extend its application beyond its narrow ambit. The ambit is not determined by the fact that for good reason or more likely for bad reason the first action had collapsed whether through discontinuance, strike out or failure to serve or renew the writ – see my comment on Chappell v Cooper. Rather the ambit is defined by the salient feature in all cases that the first action between the same parties began within the primary time limit of three years. That is the characteristic Lord Diplock himself identified when discussing Walkley in Thompson v Brown and Deerness v Keeble & Son. That is the “fatal obstacle”. The point taken in the House of Lords in Walkley was only there for the taking because their Lordships failed to understand how the plaintiff could be prejudiced by section 11 if the first action had been brought within three years – see Lord Wilberforce’s speech quoted above.
It seems to me to be inconceivable that this jurisprudence would ever have seen the light of day if the facts of our case were the start of it. I simply do not understand how it can be argued that because the first action brought out of time would not have been prejudiced by section 11 if the defendants did not or would not successfully have taken the limitation point, therefore the second action is not prejudiced by section 11. The second action is under direct threat of being defeated by a time-bar defence. Ascertaining whether the first action was commenced in time between the same parties on the same cause of action is a clear-cut test capable of swift and easy application. To introduce the test for which Mr Evans-Tovey contends which will involve what may be a wholly hypothetical enquiry into whether or not the defendant would have refrained from asserting the time-bar, seems to me to introduce wholly undesirable uncertainty into this class of litigation and should for that reason be rejected. The broad discretion given by section 33 is apt to cater for the justice or injustice of any case and all of them.
I do see the force of his submission that the judgment of this court in Chappell v Cooper is framed as a causation test and to that extent is not easy to reconcile with Shapland v Palmer. As I have shown, however, Lord Diplock’s own views expressed after Chappell v Cooper do abstract the kernel of Walkley in terms which are now reflected in the judgment of this court in Shapland and Young. The experience of this court has shown why Walkley must be kept within narrow confines and I would not wish to alter that progression. In any event Chappell does not get the respondent home. He may well be able to establish that the solicitor’s negligence caused the strike out of the first claim but he still has to convince us that Walkley can apply where the first action is started outside the three year limit.
His insurmountable obstacle is that Walkley is acknowledged to be an anomalous decision. I would not wish to extend the anomaly. The rule is that the court has no discretion under section 33 if the claimant had begun an action between the same parties within the primary period of three years. The rule must be confined to that narrow situation. It was not the situation here. It follows that the judge erred and the appellant succeeds on her first ground of appeal.
The exercise of the section 33 discretion
I need not repeat section 33(1) which sets the test, namely, whether it would be “equitable” to allow the action to proceed having weighed the balance of prejudice to the plaintiff due to the operation of section 11 against the prejudice to the defendant if the action is allowed to proceed. Sub-section (3) sets out the specific fact as to which the court has to have regard as follows:
“(3) In acting under this section the Court shall have regard to all the circumstances of the case and in particular to –
(a) the length of, and the reasons for, the delay on the part of the plaintiff;
(b) the extent to which, having regard to the delay, the evidence adduced or likely to be adduced by the plaintiff or the defendant is or is likely to be less cogent than if the action had been brought within the time allowed by section 11 … ;
(c) the conduct of the defendant after the cause of action arose, including the extent (if any) to which he responded to requests reasonably made by the defendant for information or inspection for the purpose of ascertaining facts which were or might be relevant to the plaintiff’s cause of action against the defendant;
(d) the duration of any disability of the plaintiff arising after the date of the accrual of the cause of action;
(e) the extent to which the plaintiff acted promptly and reasonably once he knew whether or not the act or omission of the defendant, to which the injury was attributable, might be capable at that time of giving rise to an action for damages;
(f) the steps, if any, taken by the plaintiff to obtain medical, legal or other expert advice and the nature of any such advice he may have received.”
The judge’s approach
Although he found that section 33 did not apply the Judge did go on to consider how he would have exercised that discretion and we must pay due deference to his observation. His starting position seems to have been to regard this as “a narrow discretion, because the claimant would only have got in through the eye of the needle.” He was influenced by the Civil Procedure Rules which “laid down that proceedings should be proceeded with expedition.” As to delay he found that there was unexplained delay of over a year and added that “the reasons for the delay were because the claimant failed properly to deal with the first action, so that does not go in her favour.” As to the cogency of the evidence he took it to be a point in the claimant’s favour that liability was not in dispute; on the other hand it always becomes more difficult to investigate causation and injury after a lapse of time but he did not consider that to be a strong argument for the defendant. He considered the defendant had behaved very sensibly and responsibly throughout in not taking the limitation point. As for the claimant acting promptly, he said that:
“The trouble in this case is that which I set out earlier on, that the claimant knew immediately after the accident at the time of the accident she had a good cause of action and proceedings were not issued, not even attempted to be issued, until the very end of the limitation period. It is standing on the edge of Beachy Head hoping the wind does not blow too hard to do that and I am afraid solicitors do time and time again; one sees it all the time.”
He accepted it was the fault of her solicitors, a firm of good reputation and a substantial practice but the fact that it was her solicitors fault and not hers was not conclusive in one direction or the other. He concluded:
“So it seems to me that however one looks at it, if I had to weigh up those matters in the balance I would without hesitation find that the claimant should not be given leave to proceed with the proceedings out of time.”
Discussion
In my judgment the judge misdirected himself in two crucial respects, first in saying that he only had a narrow discretion. The discretion is in fact unfettered: see Thompson v Brown at p. 752 per Lord Diplock:
“The onus of showing that in the particular circumstances of the case it would be equitable to make an exception lies on the plaintiff; but, subject to that, the court’s discretion to make or refuse an order if it considers it equitable to do so is, in my view, unfettered.”
Secondly the judge went straight to the factors specifically set out in section 33(3) of the Act. He did not address the essential question posed by subsection (1) which requires the court to judge whether it would be equitable to allow an action to proceed having regard to the balance of prejudice to the claimant if the action is time-barred against the prejudice to the defendant if it is allowed to continue. As this Court put it in KR & ors v Bryn Alyn Community Ltd [2003] EWCA Civ 85, [2003] QB 1441, para 68:
“The overall question is one of equity, namely, whether it would be ‘equitable’ to disapply the limitation provisions having regard to the balance of potential prejudice weighed with regard to all the circumstances of the case, including those specifically mentioned in s 33(3).”
I take that as the starting point and, after all the relevant factors have been weighed, and the case is looked at in the round, it is also the end point.
As for section 33(3)(a) – the length of, and the reasons for the delay on the part of the plaintiff – this delay is the same as the delay in paragraph (b); so “it means the delay after the primary limitation period has expired”: see Lord Diplock in Thompson v Brown at p. 751. Donovan v Gwentoys Ltd [1990] 1 W.L.R. 472, 478 adds this gloss per Lord Griffiths:
“It does not, however, follow that, in weighing the prejudice to the defendant, the court is not entitled to take into account the date upon which the claim is first made against the defendant. Compare the facts in Thompson v Brown with the facts of this case. In Thompson v Brown the claim had been made within a few weeks of the accident and liability and damage had been fully considered by the defendants’ insurers at an early stage. At the time the limitation period expired, the defendants’ insurers were in a position to settle the claim on its true merit. The fact that the plaintiff’s solicitors slipped up so that the writ was issued 37 days late was a totally unexpected windfall benefit for the defendants’ insurers. The primary purpose of the limitation period is to protect a defendant from the injustice of having to face a stale claim, that is, a claim with which he never expected to have to deal. … I entirely agree with the following passage from the judgment of Stuart-Smith L.J.:
‘The time of the notification of the claim is not one of the particular matters to which the court is required to have regard under s 33(3); although it may come in under paragraph (e). But to my mind it is an extremely important consideration, and is always so regarded by judges who have to consider these questions. …’.”
Here the relevant delay was a period of thirteen months. That is a long time. On the other hand, the defendant was notified of the claim within days of the accident and liability was soon admitted. Steps were being taken by the defendants’ insurers to agree a general practitioner’s report and to arrange examinations by their own orthopaedic and rheumatology experts.
Some of this delay is unexplained. The judge erred in saying that “The reasons for the delay were because the claimant failed properly to deal with the first action.” Nothing in the evidence suggests she personally failed at all. She consulted solicitors immediately and they soon had the admission of liability as I have indicated. The reasons for the failure to prosecute her claim properly lie entirely with her solicitors, and that is not her fault. Thompson v Brown makes that plain at p. 752, albeit there dealing with paragraphs (e) and (f):
“If he has acted promptly and reasonably it is not to be counted against him, when it comes to weighing conduct, that his lawyers have been dilatory and allowed the primary limitation to expire without issuing a writ. Nevertheless, when weighing what degree of prejudice the plaintiff has suffered, the fact that if no direction is made under s [33] he will have a claim over against his solicitor for full damages that he could have recovered against the defendant if the action had proceeded must be a highly relevant consideration.”
Accordingly, although the delay is not insubstantial, the reasons for it are not due to fault on the claimant’s part. So far as she was concerned she was being misled by her own solicitor and duped into believing all was well.
As to section 33(3)(b) and the extent to which the evidence is likely to be less cogent, here an important fact is that liability has not been in dispute and I agree with the judge that any difficulties in investigating causation and injury are not a strong argument on behalf of the defendant in this case. Complaint is made before us in his respondent’s notice that there has been inadequate discovery. It is suggested that there is no evidence of the availability of financial documents to prove the special loss and damage nor of the continuing availability of medical records. We are reminded that the burden of proof is on the claimant. I fully appreciate that the crucial effect of a delay should be measured by the defendant’s difficulty in properly defending the claim but, that said, I do not see anything in this comparatively simple case which puts the defendant at significant disadvantage. If the claimant cannot support her claim for pecuniary loss by the production of relevant documents, she will lose or at least suffer the disadvantage and the defendant can sit back and make the most of her discomfort. As for her injuries, time will have allowed them to settle and the court will be in a better position to judge precisely what the effects of this accident had been. On the facts of this case the prejudice to the defendant is not significant.
No conduct of the defendant needs to be brought into the balance, nor does any disability of the claimant and so paragraphs (c) and (d) are not material.
As to the extent to which the claimant acted promptly and reasonably once she knew whether or not the act of the defendant might be capable of giving rise to an action for damages, she acted very promptly. She saw her solicitors immediately and, as I have indicated, the defendants were in a good position to defend the claim had it been brought promptly. That it was not and that her solicitors compounded their negligence by further delay is, as I have indicated, not her fault. As I have already observed, her claim against her solicitors is a highly relevant consideration. That must, however, be put in its context. Lord Diplock explained in Thompson v Brown at p. 750:
“The degree to which the plaintiff would be prejudiced by being prevented from proceeding with his action would be affected by how good or bad would have been his prospects of success; so too it will be affected by the extent to which the plaintiff will be able to recover in an action for negligence against his own solicitor the value of his lost prospects of success. But even where, … , if the action were not allowed to proceed the plaintiff would have a cast-iron case against his solicitor in which the measure of damages will be no less than those he would be able to recover against the defendant if the action were allowed to proceed, some prejudice, although it may be only minor, will have been suffered by him. He will be obliged to find and instruct new and strange solicitors; there is bound to be delay; he will incur a personal liability for costs of the action up to the date of the court’s refusal to give a direction under section [33]; he may prefer to sue a stranger who is a tortfeasor with the possible consequences that may have on the tortfeasor’s insurance premiums rather than to sue his former solicitors with corresponding consequences on their premium.”
The steps taken by the claimant to obtain advice does not seem a material factor in this case and paragraph (f) does not apply.
Conclusion
Because the judge misdirected himself in material respects, we must exercise our own discretion. The question is whether it is equitable to allow the action to proceed. The answer is given by balancing the prejudice to the plaintiff against the prejudice to the defendant having regard to the specific factors and all the circumstances of the case. In summary this is a long delay, some of it unexplained. That delay is, however, mitigated by the fact that the defendant had very early notice of the claim, admitted liability and was well on the road to preparing to meet the damages claim when the guillotine fell. The cogency of the evidence will undoubtedly have been affected to some extent because memories fade, records may be lost or destroyed and opportunities for inspection and report may have been lost. But I am not persuaded that the defendant will suffer any greater prejudice than the claimant in this respect; perhaps the deficiencies in mounting the claim for pecuniary damage will redound to the defendant’s advantage and there is no great problem about marshalling the medical evidence. The claimant herself was largely blameless and the sins of her solicitors must not be visited upon her. To refuse to allow the claim to proceed in the circumstances of this case gives what Lord Griffiths in Donovan v Gwentoys Ltd described as “a totally unexpected windfall benefit for the defendants’ insurers.” In his inimitable way Ormrod L.J. observed in Chappell v Cooper that:
“The result is that the game will continue to be played between defendants’ insurance companies and solicitors’ insurance companies. That is not a situation which I personally find at all satisfactory …”
Nor do I find that to be a satisfactory solution in this case. Standing back and looking at the case in the round I am satisfied that the justice and fairness of the case dictates that it is equitable that the claimant be permitted to proceed with her action because the prejudice to the defendant does not outweigh the prejudice to the claimant in having her claim struck out as time-barred.
I would allow the appeal accordingly.
Lady Justice Arden:
I agree.
Lord Justice Dyson:
I also agree.