City & General (Holborn) Ltd v Royal & Sun Alliance Plc

This is a renewed application for permission to appeal from a judgment of Christopher Clarke J sitting in the Technology and Construction Court, in which he refused to extend time for service of a claim form or, more accurately, set aside the ex parte order which had been made extending that time. It is a slightly complicated case because there are three causes of action against insurers under a construction policy. There is a claim in respect of a crane collapse; there is a claim in respect of water ingress; and there is a claim in respect of alleged pseudomonas infection, which may be a freestanding claim or may be associated with the water infection claim.

The proposed grounds of appeal are that the judge failed to consider each of the claims separately and assess the question whether they were time-barred separately and that although, insofar as he decided that the crane collapse was time-barred, he was correct, he was not correct insofar as he decided that the water ingress claim was time-barred, because time accrued day by day from the time when the water ingress first occurred, which may have been April 2002, and therefore it cannot be said that the whole claim was time-barred.

The usual way of proceeding in these cases is that if there is a dispute as to whether claims are time-barred for the purposes of a claim form which needs renewal, the court will usually say: “Well, let that be fought out in a new action when the time-bar point can be taken and responses to it can be assessed.”

Mr McMullan says that there is a particular difficulty in this case, because as far as the water ingress claim is concerned, the judge decided that it was time-barred and it is now said by the defendant insurers that that is a final decision on which an issue estoppel arises, so that any new claim would be automatically defeated not as such by limitation but by issue estoppel.

There is a further contention that, in any event, the insurers acknowledged the claim, and so time started to run from that date.

We have decided that it is appropriate, in all the circumstances, to grant permission to appeal. We have been concerned as to whether the day-by-day point was taken below and Mr McMullan has taken us through his skeleton argument, which does not take the point in terms, mainly, he says, because limitation was not pursued very actively. After the defendants put in their own skeleton argument, it was clear that limitation was very actively pursued, and Mr McMullan assures us that in his oral argument he did take the day-by-day point, which we accept of course from him on this ex parte application. It does appear that the judge may not have taken that into consideration as fully as he might have done when he decided that the claim was time-barred. He made no finding as to the pseudomonas infection. And although the acknowledgment point is, as Mr McMullan accepts, a wholly new point, we nevertheless think it right that it should be ventilated in the course of the appeal for which we propose to give leave, because it may have some relevance to the issues to be raised and anyway is an issue which would have to be raised separately and might as well be dealt with at the time the Court of Appeal hears this.

So we will give permission to appeal. For my own part, I am amazed that Mr McMullan says in his skeleton argument that it ought to be done in two hours. It seems to me much more like a four-hour case. Three Lords Justices, and we think there should be one Technology and Construction Court-qualified Lord Justice on the panel.

I agree.