Hyde & Anor v Nygate & Anor

Introduction

This is an application by the joint liquidators (the ‘JLs’) of One Blackfriars Ltd (‘the

An earlier application to amend the Particulars of Claim was made at a case management conference on 9 November 2018. That application was unsuccessful for the reasons set out in my judgment [2018] EWHC 3267(Ch) of 28 November 2018.

This application to amend is made under an application notice issued on 8 April 2019. It is accompanied by a draft amended particulars of claim (‘DAPOC’).

Many of the amendments are not objected to by the FAs. I was provided with a helpful table identifying the amendments to which objection was taken (in whole or in part) and which were consented to. The proposed amendments to paragraphs 4, 5, 6, 10-12, 16(1), 26,41, 44-46A, 47-49, 50-53, 54(1)-(4), 55, 56, 57 and the Prayer are not opposed.

Between the last application and this application disclosure has taken place based on the existing pleadings. This has clearly informed some of the amendments. The FAs have a few outstanding complaints about some of the amendments they have consented to. These have been set out in correspondence and they have reserved their right to serve Part 18 requests but I am satisfied that it is appropriate to grant permission for the unopposed amendments pursuant to CPR 17.1(2)(b).

The amendments which are opposed by the FAs are those which set out a case that the FAs were negligent in failing to pursue a rescue of the Company as a going concern under paragraph 3(1)(a) of Schedule B1 to the Insolvency Act 1986 (‘Objective 1’).

Paragraph 55C of the DAPOC pleads that:

“Expert evidence will show that … the Company would have secured a joint venture partner and the finance necessary to continue to trade until completion of the Site”.

Paragraph 55E pleads that the loss arising from the negligent failure to pursue Objective 1 is £250 million. This may be contrasted with the more modest claim in the current Particulars of Claim (‘POC’) which is in following terms:

“53.

… The Respondents’ breaches as aforesaid resulted in the sale of the Site at substantially below the best price reasonably obtainable.

54.

The Applicants say that this price was at least £115,000,000 so that the Company (and by it the creditors) sustained a loss of at least £37,600,000 or such other sum as the Court may find”

The FAs did not seek to resist the amendments which relate to the Objective 1 claim in on the ground that they did not have reasonable prospects of success.

The FAs object to all the amendments which relate to the Objective 1 claim on two grounds:

The JLs accept that if the Objective 1 claim is a new claim which does not meet the requirements of Section 35 of the Limitation Act 1980 and CPR 17.4, then it is statute barred. They do not seek to obtain permission in the form referred to in Mastercard Inc & Others v Deutsche Bahn AG [2017] EWCA Civ 272 at [3] i.e. to introduce a nonstatue barred version of the Objective 1 claim without the benefit of ‘relation back’.

The JLs’ application is thus an all or nothing application.

Evidence

The JLs relied on two witness statements by Toby Starr, the first dated 8 April 2019 (‘Starr 1’) and the second dated 14 May 2019 (‘Starr 2’). Mr Starr is a solicitor and partner in the firm of Humphries Kerstetter LLP (‘HK’). The JLs also relied on a witness statement of Adrian Hyde dated 8 April 2019.

The FAs relied on a witness statement by Mr Oulton dated 2 May 2019. Mr Oulton is a solicitor at Mayer Brown International LLP (‘MBI’).

Statutory context

Central to this application is paragraph 3 of Schedule B1 to the Insolvency Act 1986

Mr Davenport QC, who appeared on behalf of the JLs, submitted that paragraph 3 of Schedule B1 to the IA 1986 is structured as a hierarchy of objectives with Objective 1 as the paramount objective. Paragraph 3(3) is sufficient to demonstrate, he says, that Parliament clearly intended to prioritize the rescue of the company, or at least its business, over piecemeal realization of the company’s assets for the benefit of secured creditors. Mr Fenwick QC, who appeared for the FAs, did not dispute this.

Mr Davenport also submits (and I accept) that the power to pursue the ‘lower priority’ objectives is made available to the administrator only if an appropriate combination of the conditions listed in subparagraphs (3)(a) and (b), and (4)(a) and (b) are satisfied.

Mr Davenport emphasised that the alleged failure of the FAs to obtain a proper valuation of the Site has been at the heart of the claim from the outset. He says that this fundamental criticism of the FAs is a common component to a claim that they failed to pursue Objective 1 and the existing claim in the POC. I accept what Mr Davenport says. However, for companies in administration with a single asset to develop and sell, the choice between Objective 1 and Objective 3 is stark. They are diametrically opposed and mutually exclusive objectives.

This can be illustrated by the following comments made by Snowden J in Davey v Money [2018] 766 (Ch) about the alleged failure by the administrators in that case to pursue Objective 1 in respect of a company called Angel House Developments Limited (‘AHDL’ in the passage below). His comments in my judgment apply equally well to the Company in this case:

The FAs point out by way of a prefatory comment that it is now over eight years since they reported to creditors on 7 December 2010 that in their view the Paragraph 3(1)(c) objective was the only one which was reasonably practicable for them to pursue and that from 7 December 2010 until the exchange of contracts for the sale of the Site on 19 October 2011, Objective 3 was in fact the only objective pursued by the FAs. In these circumstances, they say it is highly surprising that it should have taken over eight years for a fully pleaded case based on a negligent failure to pursue Objective 1 to emerge.

The JLs for their part prefaced their submissions by pointing out that when they first suggested amending the POC to add an Objective 1 claim, the FAs consented ‘in principle’ and then invited the JLs to submit a draft pleading without mentioning any potential objection based on limitation.

Whilst these submissions might have an impact on discretion or costs, they are not relevant to the matters of law under the Limitation Act 1980 which I have to decide.

Procedural Background

The procedural background to this application can be summarised as follows.

Section 35 of the Limitation Act 1980 (“LA 1980”) provides in relevant part:

“(1)

For the purposes of this Act, any new claim made in the course of any action shall be deemed to be a separate action and to have been commenced— (a)in the case of a new claim made in or by way of third party proceedings, on the date on which those proceedings were commenced; and

(b)in the case of any other new claim, on the same date as the original action.

(2)

In this section a new claim means …any claim involving either—

(a)the addition or substitution of a new cause of action…

(3)Except as provided by section 33 of this Act or by rules of court, neither the High Court nor the county court shall allow a new claim within subsection (1)(b) above, … to be made in the course of any action after the expiry of any time limit under this Act which would affect a new action to enforce that claim….

(4)

Rules of court may provide for allowing a new claim to which subsection (3) above applies to be made as there mentioned, but only if the conditions specified in subsection (5) below are satisfied, and subject to any further restrictions the rules may impose.

(5)

The conditions referred to in subsection (4) above are the following— (a) in the case of a claim involving a new cause of action, if the new cause of action arises out of the same facts or substantially the same facts as are already in issue on any claim previously made in the original action;…”

CPR 17.4 provides in relevant part:

“(1)

This rule applies where –

(a)

a party applies to amend his statement of case in one of the ways mentioned in this rule; and

(b)

a period of limitation has expired under –

the Limitation Act 1980…

It was common ground that there was a four-stage test for the Court to apply when determining whether to grant permission for the disputed amendments. This is derived from Ballinger v Mercer [2014] 1 WLR 3597 at [15] and Diamandis v Willis [2015] EWHC 312 (Ch):

The first stage is not in issue in this application so the live questions in this case are:

In relation to these questions, the parties referred me to no less than 35 authorities, which together occupied two lever arch files and many more unreported authorities. The existence of some of the unreported decisions is marked only by means of a footnote or precis in McGee on Limitation.

I derived most assistance from (a) two recent decisions of the Court of Appeal namely: Mastercard v Deutsche Bahn AG [2017] EWCA Civ 272 and Samba Financial Group v Byers and Others [2019] EWCA Civ 416 and (b) Diamandis v Willis [2015] EWHC

The four points which I derive from Mastercard are as follows:

I reject Mr Davenport’s submission that Mastercard is a case which ought to be regarded as being confined to the specialist world of competition law. The four points I have identified above seem to me to be of general application.

As to the Samba case, I take the following four points from it:

The helpful assistance on the content of Stages 2 and 3 from Diamandis which I set out below has to be read in light of Mastercard and Samba:

Is the Objective 1 claim a new claim for limitation purposes? (Stage 2)

Mr Davenport’s first submission is that he is entitled to rely on a special and more generous amendment rule which applies to insolvency proceedings. He submits that because claims brought pursuant to paragraph 75 of Schedule B1 to the IA 1986 are commenced by means of application notice and accompanying evidence, the Stage 2 enquiry is not confined to comparing the unamended pleading with the draft amended pleading. He says that the Court may look back to the application notice and the evidence served in support of the application for the purposes of Section 35 of the Limitation Act 1980.

I have no hesitation in rejecting Mr Davenport’s submission. He was unable to point to any support for his submission in any specialist textbook, commentary or case law.

I accept Mr Fenwick’s submission that the applicable principle in all proceedings is that described by Jackson LJ in Chandra v Brooke North [2013] EWCA Civ 1559 at [92]:

“…[O]nce the claimant serves particulars of claim on a defendant, he pins his colours to the mast as against that defendant. Particulars of claim are normally narrower in their scope than the original claim form. Those particulars then constitute the ongoing claim against that defendant. If the claimant applies to amend as against that defendant, what the court has to do is to compare the original particulars of claim with the proposed amendments. If the claimant is seeking to add a new claim after expiry of the limitation period, he cannot escape from the tentacles of section 35(3) to (5) of the 1980 Act by relying upon the broad wording contained in his original claim form”

The Chandra case of course involved an ordinary Part 7 claim but I can see no reason for treating Part 8 claims or claims under paragraph 75 of Schedule B1 to the IA 1986 any differently. True it is that some insolvency and Part 8 proceedings may proceed to a final hearing without any pleadings at all being served. However, where pleadings have been served and a party wishes to amend them to add a claim which is said to be statute barred, what is being said in Chandra is that the court dealing with that application should not be required to refer back to the originating process. That principle it seems to me must apply whether the originating process is a Part 7 claim form, a Part 8 claim form or an Insolvency Act Application Notice.

Furthermore, Mr Davenport did not seek to persuade me that the following was an inaccurate statement of the true position:

“Para 75 merely creates a procedural framework in which any breaches of duty or other misfeasance has to be proved in the usual way and pursuant to the normal rules of duty, breach, causation and loss – see Totty and Moss Insolvency C2-21”.

For those reasons I reject his submission. The ordinary rule in Chandra applies.

Even if Mr Davenport had persuaded me that his special Insolvency Proceedings rule should be applied, it would not in my judgment make any difference in this case in any event.

In their Insolvency Act Application Notice issued on 3 October 2017, the JLs sought the following remedy:

“A declaration that in negotiating and effecting the sale of the development site 1-16 Blackfriars Road, London, SE1 in December 2011, the Respondents acted negligently and/or in breach of trust and/or in breach of fiduciary duty and/or in breach of their equitable duty of care and/or in breach of statutory duty and/or were otherwise misfeasant within the meaning of paragraph 75(3) of Schedule B1 of the Act” (my emphasis)

The natural reading of the above passage is that all breaches of duty relied upon arise from the way the sale of the site in December 2011 was negotiated and conducted rather than arising from the decision taken a year earlier in December 2010 to pursue Objective 3 (rather than Objective 1 or 2). The two gerunds ‘negotiating’ and ‘effecting’ are both clearly intended to be read as attaching to the noun ‘sale’ which is itself qualified by a definite rather than indefinite article and a date.

The application notice goes on to say that the Applicants will rely on evidence to be filed and served no less than 4 days before the date fixed for the hearing and that they will seek an order at the first hearing that “particulars of claim and defence are to be delivered in accordance with Rule 12.11”. The first hearing date was fixed for 31 January 2018.

On 15 January 2018, the JLs filed and served a short witness statement by Adrian Hyde which exhibited a draft Particulars of Claim. The clear intention of proceeding in this way was, it seems to me, that the JLs wished to set out the nature and scope of their allegations in a formal document.

I would make the following observations on the structure and content of the draft Particulars of Claim (all of which apply with equal force to the POC served subsequently on 1 May 2018):

The particulars of breach of duty set out in paragraph 45.6.3 - 6 listed above selfevidently exclusively support a sale of the Site at an undervalue case.

The only two parts of section H of the pleading where one might conceivably find a pleading of negligent failure to pursue Objective 1 are those referred to in paragraph 45.6.1 - 2 above.

As to the first of these (failure to obtain a proper valuation), it is perfectly conceivable that one of the potential results of failing to obtain a proper valuation at the outset is that the FAs failed thereby to realise that the Company had an asset which could be used to refinance the Company. However, that is not the way the case is pleaded. In paragraph 39 the JLs plead four specific results, all of which are confined to the negligent pursuit of Objective 3 by effecting a sale (at an undervalue).

As to the second (the decision to pursue only Objective 3), Mr Davenport is right to submit that by pleading that the FAs were negligent in concluding that Objective 3 was the only result which could be achieved the JLs opened the door to a potential plea that they ought to have concluded that Objective 1 was a realistic and achievable aim. However, this is not what the pleading in fact does. Paragraph 42 is the key paragraph which was clearly intended to define the scope of this part of the JLs’ case on breach of duty. It states (with emphasis added):

“42.

The Respondents were negligent in concluding that only the objective specified in paragraph 3(1)(c) of Schedule B1 could be achieved in that:

(1)

They reached this conclusion without having obtained any valuation of the Site. Had a valuation been obtained, this would have indicated that the objective specified in paragraph 3(1)(b) of Schedule B1 could have been achieved, since the value of the site was sufficient to achieve a distribution to creditors other than first-ranking secured creditors;

(2)

They failed to review or reconsider their conclusion that only the objective specified in paragraph 3(1)(c) of Schedule B could be achieved when:

(a)

The valuations provided to them (as referred to in paragraph 36 above) indicated that a sale could be achieved at a price at which a distribution to creditors other than first-ranking secured creditors could be achieved; and

(b)

The bids that were in fact received, and in particular the initial bid from Sellar, indicated that the value attributed to the Site by CBRE was significantly below the price that might reasonably be obtained.”

There is in my judgment not the slightest hint anywhere in paragraph 42 (or 43) that the JLs were suggesting that the FAs were negligent in failing to conclude that Objective 1 could not be pursued. The words “in that” limit the scope of the alleged breach in clear terms. If a case was going to be made that Objective 1 ought to have been pursued but was not, paragraph 42 is where one would have expected to find it. It is simply not there.

Mr Davenport is, in my judgment, correct to submit that the JLs’ case as set out in the draft Particulars of Claim supplied before the first hearing is not a simple sale at an undervalue case. It makes a whole series of complaints about how the administration was conducted from the very beginning, including a failure to obtain a proper valuation and a poor choice of agents. It also pleads that Objective 2 could and ought to have been pursued. What it does not do in my judgment is plead a case of a breach of duty in failing to pursue Objective 1, still less one which sounds in a corresponding pleaded case of loss and damage.

It follows that even if Mr Davenport is right that it is permissible to go back to the Application Notice and the evidence served with it to check whether an Objective 1 claim has already been made, his case that the Objective 1 claim was in issue, in my judgment, fails because no such claim was advanced at that stage.

An objective reader of the Application Notice, Mr Hyde’s witness statement and the draft Particulars of Claim could in my judgment only reach one conclusion which is that the claim advanced by the JLs is an Objective 2 and 3 case in which what is being alleged is that the FAs could and should have realised more from the sale of the Site for the creditors of the Company. No objective reader could possibly conclude that a claim was being advanced that the FAs had negligently failed to pursue Objective 1, still less that had they done so a corporate rescue would have succeeded.

Finally, Mr Davenport submits that the court may have regard to the expert evidence served before the hearing of the permission application. He relies, in particular, on paragraph 2.8 in the draft report of Mr Laughton served on 29 March 2018. In that paragraph, Mr Laughton says this:

“The expert valuation evidence of Mr Peter Clarke (instructed by Humphries Kerstetter LLP) is that the property was worth in the region of £115million in October 2010. That evidence, on which I base my assumption that a valuation in the region of £115m would have been available to a reasonably skilled insolvency practitioner shortly have his appointment as administrator, supports my view that a reasonably skilled practitioner would seek to pursue objective (a), rescuing the company as a going concern, in the circumstances of the Company” (emphasis added)

Objective 1 is referred to again as a reasonable option in paragraphs 3.4, 3.5 and 3.6 of Mr Laughton’s draft report. In paragraphs 7.2 and 7.3 Mr Laughton suggests that a reasonably skilled insolvency practitioner ought to have explored “twin solvent solution and realisation tracks” before criticising the FAs again in paragraphs 8.7 and 9.1 for failing to explore and/or maintain focus on a “solvent solution”.

The sections I have referred to from Mr Laughton’s draft report undoubtedly provide an evidence base which could have supported a pleaded case that the FAs were in breach of their duties by failing to pursue Objective 1 either as the sole objective or as part of a twin track strategy.

However, on the same day that the JLs served Mr Laughton’s draft report, the JLs also served what Mr Davenport referred to at the permission hearing as an “augmented” Particulars of Claim. At the permission hearing on 13 April 2018, Mr Davenport took the judge through the changes and explained that he was seeking 7 days in which to serve a final version of the document.

At the end of the hearing, he was given permission to serve a Particulars of Claim “materially in the form of the draft” provided at the hearing. I have a version of the pleading with the changes made on 28 March 2018 marked in red and those made on 1 May 2018 marked in green. This colour coded document was provided as part of the exhibit to Mr Oulton’s witness statement.

The problem for Mr Davenport is that even if he were permitted to refer back to Mr Laughton’s draft report served just before the permission hearing, the views expressed in paragraphs 3.4, 3.5, 3.6, 7.2, 7.3, 8.7 and 9.1 of that report about how a reasonably skilled insolvency practitioner would have focussed on a corporate rescue in the circumstances of this case do not assist him because those points were not incorporated in either the draft Particulars of Claim served on 29 March 2018 or the final version served on 1 May 2018. The breaches of duty pleaded remained as described above.

In my judgment, in these circumstances the FAs were entitled to ignore those sections of Mr Laughton’s draft report which were not reflected in the draft Particulars of Claim. The JLs pinned their colours to the mast by pleading an Objective 2 and 3 claim notwithstanding that they had evidence available to them which would have permitted an alternative claim to be advanced that it was negligent of the FAs to have failed to focus on and pursue Objective 1.

For all those reasons, even if I were to apply the wider test suggested by Mr Davenport, he has failed to persuade me that his Objective 1 claim was part of the JLs’ claim at the time permission was applied for and granted no matter how wide the permissible net of enquiry is cast.

I turn now to the standard approach to the stage 2 question. Mr Davenport submits that if I am against him on his insolvency proceedings argument, I should apply paragraph 48(2) in Diamandis v Willis, namely:

“Where a claim is based on a breach of duty, whether arising in contract or tort, the question whether an amendment pleads a new cause of action requires comparison of the unamended and amended pleading to determine (a) whether a different duty is pleaded (b) whether the breaches pleaded differ substantially and (c) where appropriate the nature and extent of the damage of which complaint is made: Darlington at 370C-D and see also Berezovsky §59. (Where it is the same duty and same breach, new or different loss will not be new cause of action. But where it is a different duty or a different breach, then it is likely to be a new cause of action).”

He makes five points in support of his submission that the Objective 1 claim does not constitute a new cause of action because:

In response, Mr Fenwick submits:

I accept Mr Fenwick’s submissions.

A comparison of paragraphs 35, 38, 42 and 55 in the existing pleading with paragraphs 35, 38, 40C, 42, 42A, 55 and 55A-G (as set out in the Table attached to this judgment as an Annex) is sufficient in my judgment to demonstrate that the factual basis of the claims being advanced against the FAs is very significantly expanded in respect of both the alleged breaches of duty relied upon and the loss said to have been caused as a result. In particular,

As to Mr Davenport’s points:

Stage 3: Does the new claim arise out of the same or substantially the same facts?

In relation to the stage 3 enquiry, Mr Davenport makes five points in support of his submission that the new claim does arise out of the same or substantially the same facts as are already in issue. He submits as follows:

Mr Fenwick for the FAs submits as follows:

Mr Davenport is right to remind me that at Stage 3 the court is not examining whether the facts to be proved are the same or not. To do that would be to repeat the stage 2 exercise of putting just the POC and the DAPOC side by side and comparing them.

At Stage 3, the enquiry is necessarily broader and less abstract than the Stage 2 enquiry.

Save as a useful tag by which to be reminded of the difference between the nature of the enquiry at Stages 2 and 3, I did not gain much assistance from being taken to the precis of the unreported case of Dickinson v Lowery contained in paragraph 23.027 of McGee on Limitation. In the absence of a transcript or report of the decision all that it seems to me that can safely be said about that case is that Auld J must have come to the conclusion on the evidence he was presented with that the third party claim which the Defendant wished to bring against the solicitor arose out of the same facts or substantially the same facts as the claim already made by the Claimant against the Defendant and the same solicitor. It does not appear to establish any new point of principle which assists me.

I am also not convinced that it is helpful to use the phrase “foundational facts” in the context of the Stage 3 enquiry. I am inclined to treat the phrase as a reminder to avoid being distracted by differences between the proposed claim and the existing issues in dispute which are only of peripheral importance. What I am enjoined to do is to carry out a “real evaluation of the new claim against the facts in issue in the old claim.” (per McCombe LJ in Samba at [49]) and in doing so I should not be distracted by

“differences merely collateral to the main substance of the new claim” (per Colman J in P&O Nedlloyd BV v Arab Metals Co [2005] 1 WLR 3733 at [42]).

The core of the Stage 3 test is very simple indeed. It is whether the new claim introduces new facts not already substantially in issue: Society of Lloyd’s v Henderson [2008] 1 WLR 2255 [53]; Goode v Martin [2002] 1 WLR 1839 [42].

Mr Davenport placed a great deal of weight on the FAs’ decision in their Defence to plead a positive case on the decision not to pursue Objective 1. He referred me to the following:

Mr Davenport also referred me to Requests 20 and 21 from the FAs’ own Part 18 Request dated 4 July 2018 and to the JLs’ Responses dated 31 August 2018:

“Under paragraphs 42 and 43

Request

20.

Do the Applicants accept that the Respondents were entitled to think that it was not reasonably practicable to achieve the purpose specified in paragraph 3(1)(a)?

21.

Accordingly, are these allegations premised purely on the case that the Respondents should have pursued the purpose specified in paragraph 3(1)(b), rather than that specified in paragraph 3(1)(c)?

Response

20.

This is not a request for further information in relation to the Applicant’s pleaded case. It is nevertheless clear from the Particulars of Claim and the Reply that the answer is no.

21.

No. The breach as pleaded in paragraph 42 of the Particulars of Claim is that the Respondents were negligent and acted in breach of duty in concluding that the only objective which could be pursued was paragraph 3(1)(c) of the Schedule. Because the Respondents did not obtain a valuation they failed to consider whether the site could be refinanced and/or built out in accordance with their primary statutory objective. The Applicants also refer to paragraphs (3) and 17(2) of the Reply”

Request 20 seems to me to be an attempt to elicit an admission rather than a request that the JLs provide any further particulars of their case. Request 21 is clearly wider and is asking whether the FAs’ case is confined to a failure to pursue Objective 2 or not. However, in my judgment, all that one really derives from the Response to Request 20 is that insofar as the FAs considered Objective 1 and decided it was not feasible to pursue it, the JLs do not admit that they were entitled to reach this conclusion. It is no more than a non-admission in those limited terms.

What one derives from the first and second sentences in the Response to Request 21 is that the JLs’ allegations of breach of duty are not purely premised on a failure to pursue Objective 2 rather than 3. The third and fourth sentences seek to import into the Particulars of Claim a positive allegation of a failure to consider Objective 1 and that there was sufficient equity to fund a build-out of the Site.

However, for the reasons given in Mastercard at [64], it is not permissible to use a Reply as a Trojan Horse to smuggle in a new claim which is not pleaded in the Particulars of Claim as a means to assert that the point is already in issue in the proceedings for the purposes of an application to amend. In my view, the same applies to Response 21 above which seeks to incorporate factual allegations made for the first time in the Reply.

However, even if I am wrong about that and I am entitled to treat the allegations referred to in the second and fourth sentence of Response 21 as being allegations already in issue and I set these alongside the FAs’ own positive averments in paragraph 145 of the Defence, in my judgment the JLs still fall a long way short of demonstrating that the new Objective 1 claim arises out of substantially the same facts as are already in issue for the following reasons:

The Objective 1 claim as pleaded in the DAPOC in my judgment involves the addition of a plethora of new factual allegations to the existing issues in the claim, including, in particular, the following:

I accept Mr Davenport’s submission that there are areas of overlap between the new claim which the JLs wish to make and the existing issues:

I also accept that each and every step in the administration has been documented and is available for interrogation in the FAs’ disclosure.

However, in my judgment, there is no getting away from the fact that the Objective 1 claim is fundamentally different in character to the existing claim. It is premised on a failure by the FAs to pursue a completely different statutory objective to those in issue in the existing claim. The existing issues for trial are concerned with an alleged failure to pursue Objective 2 at all and a failure to Objective 3 competently. The whole thrust of the present claim is that a series of mistakes and errors (including in relation to the appointment of CBRE, the conduct of the bidding process, the failure to explore the possibility of planning consent) led to the sale of the Site at an undervalue. The Objective 1 claim, by contrast, not only involves a completely new breach of duty but also necessarily requires a completely new counterfactual case of loss and damage which involves a complex interaction of corporate finance, construction costing and timelines, commercial broking, the marketing and sales of completed units and tax, none of which is currently in issue.

I accept Mr Fenwick’s submission that the JLs’ new counterfactual case on causation loss and damage would not only involve extensive further expert investigation in the areas which he identified but more importantly for the purposes of this application would require the FAs to conduct wide ranging factual investigations on the matters set out in paragraph 69.2.2 above, none of which are issues on the basis of the POC.

In my judgment, this is not a borderline case where it might be said to be permissible to fall back on an assessment based on ‘impression’. A comparison between the material facts of the new Objective 1 claim and the facts in issue in the existing pleadings, is in my judgment capable of demonstrating clearly that the new claim does not arise out of anything like the same or substantially the same facts as are already in issue.

The conclusion is no different even if, contrary to my understanding of the present law, it were permissible to treat what is pleaded in the Reply and the Response to Requests

Conclusion

For these reasons, my conclusion is that insofar as the amendments for which the Applicants seek permission set out a claim that the Respondents acted in breach of duty by failing to pursue the objective set out in paragraph 3(1)(a) of Schedule B1 to the IA 1986, the court has no discretion to allow them because the conditions of Section 35 of the Limitation Act 1980 and CPR 17.4(2) are not met.

In light of my conclusion, I do not consider it is appropriate to consider how I would have exercised the discretion under CPR 17.1(2) which I have found is not available to