Royal Courts of Justice
Strand, London, WC2A 2LL
Before :
MR ROGER ter HAAR QC
(Sitting as a Deputy High Court Judge)
Between :
Glenluce Fishing Company Limited | Claimant |
- and - | |
Watermota Limited | Defendant |
Mr Jack Macaulay (instructed by Myton Law Limited) for the Claimant
Mr Jay Jagasia (instructed by Kitsons LLP) for the Defendant
Hearing date: 8th July 2016
JUDGMENT
Mr Roger ter Haar QC :
Introduction
There is before the Court an application by the Claimant to amend the Claim Form to reflect the sums now claimed in the Particulars of Claim. This application is resisted upon the basis that with due diligence the claim now put forward could and should have been recognised in the Claim Form. It is said that that not having happened, an inappropriate fee was paid when the proceedings were commenced, with the consequence that the amendment to introduce a new head of claim outside the limitation period should not be allowed.
The Facts
At all material times, the Claimant owned and operated a fleet of fishing vessels, based principally in Kilkeel, Northern Ireland. One of the Claimant’s boats was the “Stardust N227”.
At all material times, the Defendant was a company specialising in the supply of marine and industrial engines, gearboxes and marine spares parts.
In late 2008 the Claimant decided to install a new engine in the Stardust.
On the 23rd December 2008 the Claimant placed an order with the Defendant for a new engine and gearbox. Pursuant to that order the Defendant supplied and installed a Doosan V158TiM engine.
It is the Claimant’s case that following the installation of that engine, the Stardust suffered significant mechanical problems, particularly it suffered from vibration when the propeller shaft was turning, caused by a tortional damper which was incompatible with the engine installation. This required extensive investigation, preventing the Stardust from being out at sea for about 10 weeks during 2009.
The Claimant’s case is that this engine suffered a catastrophic failure whilst at sea on the 1st February 2010, which the Claimant suggests was due to “hosing” of the fuel injectors.
Thereafter, on the 9th March 2010 a contract was formed between the parties whereby the Defendant agreed to supply, install and commission a new engine for the Stardust (“the Second Engine”). There is a dispute as to the terms of this contract.
In or around March 2010 the Second Engine was installed in the Stardust.
The Claimant contends that there were repeated problems with the fuel injectors in the Second Engine.
On the 14th August 2013, Mr. Orr of the Claimant wrote to the Defendant as follows:
The injectors have been changed 12 times in 8820 hours since this second engine was installed in 2010.
As for time lost it has varied from 2-3 days to 2 weeks depending on availability of Injectors and engineers.
The boat has been tied up since 5/8/2013 at a loss of £2000 to £3000 per day as this is our lucrative fishing season June to Sept.
The financial loss to Glenluce Fishing Co has been considerable ranging from re-engining in 2010 for 10 weeks to the boat being tied up at present, the loss of fishing time and the cost of repairs. Also we have devaluation of Stardust in her present condition.
Taking everything into consideration this could be several hundred thousand pounds.
A more detailed costing will follow after consideration with our auditors, KPMG.
The Claimant pleads at paragraphs 26 to 28 of the Particulars of Claim:
By September 2013:
The reason for the repeated premature failures of the fuel injectors had still not been identified or corrected.
The Claimant was no longer confident that it was safe to go to sea in Stardust.
Stardust’s mechanical problems had become well-known within the fishing community. It was no longer realistically possible to secure crew for the vessel. Stardust had no sale value as a reliable and functioning vessel.
Consequently Stardust was sold for scrap.
It is likely that the repeated premature failure of the fuel injectors was caused by excess pressure in the fuel return line when the engine was working at sea.
After September 2013 there was a certain amount of correspondence between the parties, with the Claimant engaging solicitors at a relatively early stage. In a second witness statement dated the 6th July 2016, the Claimant’s solicitor, Mr. Minall explains what happened between September 2013 and February 2016 as follows:
Finally, we note that the Defendant has complained of delays in progressing this matter and also of breaches of the pre-action protocol. The relevance of this to the present application is unclear but we thought it prudent to briefly refer to the chronology in this matter by reference to the correspondence usefully included in exhibit KS2.
As the court will note from the correspondence at KS 2 the majority of the delays in progressing this matter are attributable to the Defendant’s delay in disclosing key technical documentation which it was necessary for the Claimant’s expert to review before advising on the cause of the failures.
These delays can clearly be seen from the correspondence exhibited to Ms. Sandel’s statement:
Between 2010, when the defective engine was installed, and toward the end of 2013 the parties had been in ongoing discussions and co-operated in multiple attempts to identify the causes of the failures and remedy the same.
It became clear towards the end of 2013 that these attempts to resolve the ongoing issues had failed and the Claimant instructed solicitors to pursue the Defendant in respect of losses they had suffered.
In light of the potential jurisdiction issues (the Claimant being based in Northern Ireland, the Defendant in England and the engine having been installed in Scotland) the Claimant received advice from solicitors in Northern Ireland, Scotland and England.
On 6 November 2013 the Claimant requested copies of “all reports records findings communications with all third parties (including Doosan) pertaining to the complete engine installation process and all remedial steps taken to date”.
On 9 December 2013 the Defendant’s solicitors confirmed they would provide the documents requested.
A number of chasers were sent for these documents in January 2014, August 2014, September 2014 and I reasserted this request when I assumed conduct of the matter in October 2015.
There was a period between September 2014 and October 2015 where this firm were not sending repeated requests to the Defendant for disclosure (as appears to be the Defendant’s complaint) as the lawyer with conduct of the matter was dealing with a similar matter involving failures of another Doosan engine which was thought to have been connected (albeit no connection is now thought likely).
A number of technical documents which had been requested (and which had been promised in December 2013) were finally provided in November 2015, almost 2 years after they had been promised.
Once the above documents were provided, which included test results and technical reports, our client instructed an engineering expert to advise on the cause of the failures, which is clearly crucial to liability in this matter.
Our client instructed an expert and that expert provided their initial comments in early 2016. The expert took some time to provide their comments due to the extensive history of the matter which meant our client had to take some time to consolidate and organise the documents they had in relation to the matter. That expert report is not yet in a disclosable format but the Claimant continues to liaise with their expert with a view to disclosing a copy of that report as soon as possible.
Once the documents were disclosed our client had only 4 months to finalise their liability investigations before preparations had to be made to issue proceedings, in order to ensure their claim did not become time barred.
On 15th February 2016 a Claim Form was issued. Mr. Minall said in his first witness statement dated the 17th June 2016 that this was done to protect the Claimant’s position on limitation while the analysis of the claim continued and the Particulars of Claim were drafted.
The Claim Form was in the following terms:
Brief details of claim
The Claimant’s claim is for damages for breach of a vessel repair contract made in writing between the parties in March 2010 arising out of or in connection with the replacement of a marine engine in the MFV “STARDUST”, together with interest to be assessed pursuant to Section 35A of the Senior Courts Act 1981.
Value
The value of the claimant’s claim (including interest in the sum of £17,694.06 calculated at 5% annually accrued) is approximately £69,694.06 but is likely to increase once the claimant has finally quantified their loss of use claim.
In his first witness statement, Mr. Minall says the figure of £69,694.06 was calculated as follows:
The value of the engines: £37,000.
The cost of repeatedly replacing the fuel injectors: £15,000.
Interest at 5%: £17,694.06.
At the time of issue of the Claim Form, a Court fee of £3,484.70 was paid.
On the 8th June 2016, Particulars of Claim were served. Under the heading “Loss and damage” the pleading set out the following:
As a result of the Defendant’s breach of contract the Claimant has suffered loss and damage as follows.
The value of the Second Engine: the Second Engine was installed as a replacement for the First Engine; as such the Claimant adopts the cost of the First Engine as the measure of this loss.
£22,409.13 claimed.
The cost of installation of the Second Engine: this was in fact paid by the Claimant, but should have been paid by the Defendant.
£2,308.65 claimed.
The value of Stardust: had the original re-power of stardust been successful the vessel would have been worth about £210,000 - £220,000. The fishing licence was worth about £50,000 and was not exclusive to Stardust, so the value of the vessel itself would have been about £160,000 - £170,000. The Claimant adopts the midpoint of that range, £165,000, but reserves the right to obtain expert evidence on this point in due course. The scrap value of Stardust was only £12,000. £165,000 less £12,000, less £22,409.13 (the cost of the First Engine) is £130,590.87.
£130,590.87 claimed.
Extra maintenance and wasted expenditure: making allowance for work unrelated to the maintenance of the Second Engine, the Claimant spent £6,823.41 keeping Stardust fishing between the installation of the Second Engine and Stardust’s scrapping.
£6,823.41 claimed.
Total: £162,132.06.
Further, as a result of the unreliability of the Second Engine Stardust’s ability to go to sea was significantly curtailed, causing loss of profit to the Claimant. This will be the subject of accounting evidence in due course.
The Particulars of Claim were sent to the Defendant’s solicitors under cover of an email which said:
You will note from the attached that the value of the claim has increased since the claim form was issued. It is our client’s intention to apply to the court to amend the claim form to increase the value of the claim (and pay the appropriate fee once permission is granted).
I would be grateful if you could please confirm your client’s consent in principle to that application.
On the 13th June 2016 the Defendant’s solicitor said in an email:
I have taken my client’s instructions upon your Application. My client is not prepared to consent to the same. This is principally on the basis that any element of your client’s claim that is sought to be included after March 2016 is potentially out of time by virtue of the Limitation Act, and my client cannot consent to the inclusion of losses in such circumstances.
On the 17th June 2016 the Claimant issued the application presently before me for the Claimant to have permission to increase the value stated on the claim form to £162,132.06.
That was supported by the first witness statement of Mr. Minall, to which I have already referred.
In response, the Defendant served a witness statement from the Defendant’s solicitor, Ms. Sandel, dated the 5th July 2016. Mr. Minall responded in a second witness statement dated the 6th July 2016.
The parties made written and oral submissions to me at a telephone hearing on the 8th July 2016 and, at my request, supplemental written submissions on the 12th July 2016.
Discussion
The arguments before me raise an interesting point as to the interrelationship between, on the one hand, authorities as to the circumstances in which a claim is to be treated as having been “brought” for the purpose of the Limitation Act and, in particular, authorities as to the significance of payment of Court Fees in that context, and, on the other hand, the powers of the Court to allow amendment of claims even when that may permit a new claim to be advanced outside a Limitation period laid down by statute.
Consideration of the CPR appears to make the principle to be applied by the Court simple (although, of course, the application on the principle to particular cases may involve difficult exercises of judgment and discretion). CPR rule 17 provides:
A party may amend his statement of case at any time before it has been served on any other party;
If his statement of case has been served, a party may amend it only -
with the written consent of all other parties; or
with the permission of the court….
This rule applies where –
a party applies to amend his statement of case in one of the ways mentioned in this rule and –
a period of limitation has expired under
the Limitation Act 1980;
….
The court may allow an amendment whose effect will be to add or substitute a new claim, but only if the new claim arises out of the same facts or substantially the same facts as a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings.
For the Claimant, Mr. Macaulay draws the Court’s attention to the decision of the Court of Appeal in P & O Nedlloyd BV v Arab Metals Co, Stena Trading AB, Ireland Alloys Ltd [2006] EWCA Civ. 1300 in which Thomas L.J. considered a case where a judge at first instance had upheld an objection made to an amendment on the basis that the claims sought to be put forward were statute barred and said this:
I approach the issue of the exercise of the discretion on the following factual basis, which arose from the earlier part of this judgment: 1) no new facts were relied upon by the claimant; 2) there was no evidence of express prejudice put forward by the defendants. They only point to that type of prejudice which would ordinarily follow from a claim being investigated a few months later than would have been the case had the claimants put forward the alternative claims within the limitation period, which for these purposes I must assume to have expired in May 2004; 3) no reasons were advanced by the claimants to explain why the new case has not been pleaded originally.
I approach the exercise of the discretion on this factual basis; this was not a case where there was any real prejudice put forward. It is not therefore a case where the court has to balance the prejudice to the claimant against the reasons why the claimant had not advanced the alternative cases earlier. As it is not such a case, to refuse to exercise the discretion in favour of the claimants would be to penalise the claimants for not putting their case at the outset on every alternative basis that might have been available on those facts. However obvious it might appear now that it could have been put on those alternative bases, it is well known in the experience of many that, even if late in the day it may be seen how obvious things were, it is not always obvious to the person at the time; it would not be right to adopt an approach to this case which would in effect penalise the pleader.
Relying upon that case, Mr. Macaulay says that the present case is on all fours: this is a case where the new heads of claim arise out of the same or substantially the same facts as formulated in the Claim Form, that there is no prejudice to the Defendant in allowing the amendment, and therefore the application should be allowed.
For the Defendant, Mr. Jagasia says that CPR rule 17.4 must be read in the light of the evolving case law as to the effect of an incorrect Court Fee being paid.
The first case referred to was Aly v Aly The Times 27th December 1983; (1983) 126 SJ 65. Although not officially reported, I have been provided with a transcript of the judgments of the Court of Appeal (Eveleigh and O’Connor L.JJ). That was a case in which the Defendant had been held to be unable to apply to set aside a writ because as a result of delay in the court office the summons to set aside a writ was not issued in accordance with the relevant time limit laid down in the Rules of the Supreme Court. Giving judgment allowing the defendant’s appeal, Eveleigh L.J. said this:
It would be indeed surprising and harsh if a party who had done all that was required of him, should find himself unable to obtain the assistance of the court because the court itself had failed in some matter of procedure. Furthermore, when the rules lay down a time limit which has to be observed by a party to the litigation, their aim is to achieve whatever particular purpose is in mind by controlling the action of the party, and where on the reading of the appropriate rule that seems to me to be its intention it would be quite ridiculous, as I see it, to make the party responsible for anything that has subsequently to be done by the court.
…. Consequently, one can only treat the words “apply to the Court” as meaning doing all that is in your power to do to set the wheels of justice in motion according to the procedure that is laid down for the pursuit of the relief which you are seeking….
Reference was then made to Barnes v St. Helens Metropolitan Borough Council [2006] EWCA Civ. 1372; [2007] 1 WLR 879 (Practice Note). There the issue before the Court of Appeal was when proceedings are “brought” for the purposes of the Limitation act 1980: the date when the claim form as issued is received by the Court, or the date when the claim form is issued by the Court, if later. Tuckey LJ said this:
…The time at which a claimant “brings” his claim form to the court with a request that it be issued is something he has to do; the time at which his request is complied with is not because it is done by the court and is something over which he has no real control. Put another way one act is unilateral and the other is transactional. Looked at in this way I do not agree with the judge or Mr. Norman that in this context the verb “to bring” has the same meaning as the verb “to start”. The 1980 Act can perfectly properly be construed so that in the context of the CPR a claim is brought when the claimant’s request for the issue of a claim form (together with the court fee) is delivered to the court office.” (Emphasis added)
These two decisions were considered by the Court of Appeal in Page v Hewetts [2012] EWCA Civ 805. In this case the Court had evidence from the claimants’ solicitor that a Claim Form was sent to Court by DX on the 3rd December 2008. However, it was the claimants’ case that that first Claim Form was lost or mislaid by the Court, so a fresh Claim Form was sent to the Court and issued on the 17th February 2009. If the claimants could rely upon the first Claim Form, then part at least of their claims would have been brought in time. If the relevant claim form was the second Claim Form, then the claims were all out of time, if the material date was the date of issue of the Claim Form by the Court. However, it was the claimants’ case that there was delay in the issue of the second Claim Form by the Court.
Lewison L.J., having referred to those previous decisions of the Court of Appeal, held:
If, therefore, the claimants establish that the claim form was delivered in due time to the court office, accompanied by a request to issue and the appropriate fee, the action would not, in my judgment, be statute barred ….
That was a decision in respect of a strike out application. The Court of Appeal held that the Master and the judge at first instance had been wrong to strike out the claim. The Court of Appeal directed a trial of a preliminary issue as to the limitation issue on the assumption that the limitation period of six years began to run on or about 6 February 2003. This came before Hildyard J. His judgment is at [2013] EWHC 2845 (Ch).
Hildyard J. held that the claimants had failed to establish that the first Claim Form had arrived at Court and gone astray there. Accordingly the claimants could not rely upon the first claim form as defeating the limitation defence. It was, however, established that the second Claim Form was received at court on the 6th February 2009, giving rise to a neat question as to whether that was on the last possible day, or a day too late.
Hildyard J. declined to decide that point because another point rendered it unnecessary to do so. When the second Claim Form was submitted, it was accompanied by a cheque for £990, which the claimants’ solicitors regarded as the appropriate Court Fee. However, the Court office took a different view, regarding the appropriate fee as being £1,390, which was only paid on the 17th February 2009, after which the second Claim Form was issued. There was argument before the judge as to whether the correct fee was £1,390 or £990. He held that it was £1,390.
Having so held, he held that the claim was out of time:
It is, in a way, concerning that the fate of a claim should depend upon the miscalculation by such a relatively small amount of a court fee. I have considered whether it is so de minimis that the court should not take it into account, or make some exception or allowance.
However, as I read Lewison LJ’s judgment in the Court of Appeal, the rationale of treating the receipt by the court of the required documents as sufficient and as transferring to the court the risk of loss or delay thereafter … is that it is unfair to visit such risk on a Claimant after he has done all that he reasonably could do to bring the matter before the court for its process to follow. Lewison L.J. expressly described what had to be established by the Claimants: that the claim form was (a) delivered in due time in the court office, accompanied by (b) a request to issue and (c) the appropriate fee. In my judgment, the failure to offer the appropriate fee meant that the Claimants had not done all that was required of them; and they had left it too late to correct the error, which was a risk they unilaterally undertook.
Of course, it is highly unlikely that the claimants personally took any risk as to the consequences of a miscalculation of the Court Fee. Doubtless they treated that as a matter of mechanics to be dealt with by their solicitors. However, the Claimants stand or fall with the decisions and actions of the solicitors acting on their behalf.
Some might find it surprising that because of a bona fide error by the claimants’ solicitors as to the calculation of a court fee by a few hundred pounds, the claimants found themselves unable to pursue a claim which they contended was worth six figures, thus being thrown onto the tender mercies of a battle with their solicitors and the professional indemnity insurers behind those solicitors – this in a case where the whole basis of their claim was that they had been wrongly treated by their previous solicitors.
The Defendant also referred to the decision of Mr. John Male Q.C. in Lewis v Ward Hadaway [2015] EWHC 3503 (Ch); [2016] 4 WLR 6. In that case the defendant firm of solicitors faced a number of claims for alleged negligence arising out of “buy to let” property transactions. On the findings of the learned deputy judge, there were a number of cases where Claim Forms were issued showing a stated value of the relevant claim where the value stated was significantly less than the amount truly being claimed. He held that the claimants always intended to amend their claim forms at a later stage by increasing considerably the amount of the claim. The purpose of taking this course was to avoid paying the court fee which would otherwise be payable. He held, at paragraph 48:
….I consider that what the claimants did was to use the ordinary court process for a purpose or in a way which was significantly different from the ordinary and proper use of that process. The ordinary and proper use of that process would be that the claimants would state at the outset the amount at which they genuinely valued their claims and would also state what they genuinely expected to recover and would pay the necessary court fees accordingly.
Arguments were put before the Court that what had been done was not an abuse of process. The Court held that there had indeed been an abuse of process. However it was not considered that the mere fact that claims and fees were limited would necessarily amount to an abuse of process:
Next, Mr. Evans [counsel for the claimants] argued that there could be a spectrum of cases where claims and fees might be limited, with the spectrum ranging from acceptable conduct to unacceptable conduct. This case, he said, was at the acceptable conduct end of the spectrum.
I agree that, as Mr. Evans argued, there could be a spectrum of cases where claims and fees might be limited and where a lesser fee was paid at the outset and where conduct might be acceptable. So, at one end of the spectrum might be an example like that given by Mr. Evans in oral argument of, say, a financially strapped litigant who knows that he will soon receive a substantial legacy, who informs the defendant of his parlous financial position and of the imminent legacy, who seeks the defendant’s agreement to his paying the fees in the way in which Robinson Murphy [the claimants’ solicitors] paid them and who also informs the court of what he is doing. In other words, there would be complete transparency in what was done and the agreement of both the defendant and the court would be sought. It may well be that, in that sort of case, there would be no abuse of process.
Having held that there had been an abuse of process, the learned deputy judge then considered whether to strike out the claims on that ground. He declined to do so on the basis that it would be disproportionate to do so.
He then considered an application to grant summary judgment in favour of the defendant on the grounds of limitation. In that context, after consideration of the authorities to which I have referred above, he said this:
For the purposes of this application, it is common ground between the parties that the claim form was delivered in due time to the court office, accompanied by a request to issue. The only question which I have to determine on this application is whether the claim form and the request were accompanied by the “appropriate fee”. In determining that question, bearing in mind what the Court of Appeal said in Page v Hewetts was the policy underpinning Barnes v St. Helens Metropolitan Borough Council, and also bearing in mind what the Court of Appeal said in Aly v Aly, I have to consider whether, in this case, the claimants did all that was in their power to do to set the wheels of justice in motion according to the procedure that was laid down for the pursuit of the relief which they were seeking. And, as per Hildyard J. in Page v Hewetts, I must also have in mind the underlying rationale, which is whether the claimants had done all that they reasonably could do to bring the matter before the court for its process to follow, in order for the claimants’ risk to cease.
Applying that test, and given the finding that the there had been an abuse of process in the way in which the claim forms had been prepared, the court held that the claimants had not done all that was in their power to set the wheels of justice in motion and summary judgment was accordingly given for the defendant against those of the claimants whose claims were out of time. In the context of claims where the claimants had deliberately flouted the rules of court, that decision is understandable.
Finally my attention has been drawn by Mr. Macaulay to a decision of Warby J. in Bhatti v Ashgar [2016] EWHC 1049 (QB); [2016] 2 Costs LR 493 in which he reviewed the authorities referred to above and said at paragraph 34:
These authorities appear to identify a clear principle by which the court is to determine whether a claim has been “brought” for the purposes of stopping the limitation [period] from running, the principle being that a claim is only brought for those purposes when the party concerned has done all that is in his power .. to set the wheels of justice in motion. If he has done that, then the risk of any failing on the part of the court is cast upon the court and the opposite party. Doing all that is in one’s power often, and perhaps ordinarily, involves proffering the correct fee to the court at the same time as presenting the claim form and the applicable particulars of claim. In Page and Lewis, a failure to do that led to the failure of the claim. It is however possible in principle that a failing on the part of the court at that stage of the process might lead to the claim being brought for limitation purpose, even though the correct fee was not paid. If, for instance, the court assumed the burden of calculating the appropriate fee and made an error, for which the claimant was in no way to blame it might, in appropriate circumstances, be said that the claimant had done all that was in his power or, to adopt the words of Mr. Male Q.C., all that he reasonably could to bring the matter before the court in the appropriate way.
In my view, the three first instance decisions to which I have referred, Page, Lewis and Bhatti, significantly extend the practical ambit of the Court of Appeal decisions upon which they are based. What the Court of Appeal cases were primarily concerned with was the question whether a party (in Aly v Aly a defendant, in the other two cases a claimant) could lose his rights to bring a claim or to make an application because of an error in the court office. It is unsurprising that the Court of Appeal repeatedly set its face against that proposition. In none of those cases did the Court of Appeal specify precisely what a party had to do in order to transfer the risk, as it is put, to the Court.
From those appellate cases has developed a somewhat hard edged principle as those cases have been applied at first instance whereby a claimant whose lawyers miscalculate the fee due, or absentmindedly pay the wrong amount, may cause a claimant to lose his or her right to bring an otherwise meritorious claim to court. At present it seems that the fact that the Defendant has suffered no prejudice and indeed may receive an unexpected benefit finds no place in the principle, and there appears to be no relief from sanction available from the court. It may be that as this principle is discussed and developed in future cases, those hard edges will be softened.
What I am concerned with in this case is, in my judgment, an attempt to extend that principle further to a case where a claim has been properly “brought” for the purpose of the Limitation Act, but an application to amend a claim form is made.
The argument has these stages, as I understand it:
The claim form stipulated a value of the claim, namely £69,694.06;
The appropriate fee for a claim of that size was paid;
The claim is now valued at £162,132.06;
Had the claim been valued at that figure in the Claim Form a significantly higher Court Fee would have been paid;
With due diligence, the Claimant could and should have identified at the time that the Claim Form was issued that the amount claimed was understated;
The Limitation Period has now expired;
Therefore, applying the authorities to which I have referred, the application to amend to increase the claim should be refused.
The Defendant does not suggest that there has been an abuse of process here, but for the avoidance of doubt I would have rejected any suggestion that the course adopted was adopted for any extraneous purpose, as in Lewis, and I think the Defendant was entirely realistic not to make any such suggestion.
I do not understand the Defendant to point to any prejudice which it has suffered by reason of the fact that the value of the claim was stated in a lesser sum in the Claim Form than in the Particulars of Claim. In any event, in my judgment there was no such prejudice.
The Court Service will not be the loser since the Claimant proposes to pay the appropriate increase in Court Fee.
Whilst there has been some criticism of the time taken by the Claimant to get its claim together, I accept the evidence of Mr. Minall set out at paragraph 13 above that at least a significant part of the delay in issue of proceedings was the agreement by the Defendant to supply documents, an agreement which in the event the Defendant did not honour. However, I also accept the Defendant’s case that with due diligence the Claimant could have proceeded faster, and, if it had done so, it would have identified the true value of the claim earlier.
Thus, if the test is whether the Claimant did all that it reasonably could to bring the matter before the court in the appropriate way, including identifying before issue of the Claim Form the true value of the claim, reflecting that in the Claim Form and paying the resultant fee, then I would be bound to resolve this matter adversely to the Claimant.
However, if that is the true position in law today, it appears to me to be a significant departure from the way such amendment applications have been approached certainly since the equivalent of the present CPR rule 17.4 was first introduced, an approach set out in the Court of Appeal decision to which I have referred at paragraph 27 above. In particular the approach advocated by Mr. Jagasia on behalf of the Defendant eliminates from the factors to be taken into account by the Court whether any prejudice will be suffered by the Defendant if the application to amend is granted. If that is right, the recent decisions have effected a significant change in the extent of CPR rule 17.4 without any change having been considered by the relevant Rules Committee.
Moreover, in the passage from the judgment of Thomas L.J. which I have set out above, he recorded that “no reasons were advanced by the claimants which explain why the new case has not been pleaded originally”. Thus, in his judgment, an investigation as to whether the claimants had done all that they reasonably could to bring the matter before the court earlier was not necessary (albeit there are many cases where such matters would be relevant to the exercise of the court’s discretion). If the recent authorities are to be applied to the exercise of the court’s discretion to permit amendment in the manner now suggested, it seems to me that in every case such as the present such an investigation would be necessary with the claimant bearing the burden of establishing the exercise of all diligence to the satisfaction of the court.
In my view the recent first instance decisions upon which Mr. Jagasia relies should be limited in their application to the circumstances expressly considered in those cases, namely applications to strike out claims on the basis that those claims were not “brought” within the applicable limitation period. I do not consider that any of those decisions justify a root and branch revision of the approach to be adopted to an application to amend.
I recognise that the situation might be different if the situation were analogous to that considered in Lewis, where the underpayment of fees amounted to an abuse of the process of the Court. Such abuse might be relevant to the exercise of the court’s discretion under CPR r. 17.4.
Accordingly I approach this application along “traditional” lines. To the extent that the amendment introduces a new “claim” (which Mr. Macaulay for the Claimants does not accept, and which is certainly an arguable point), it does not introduce a new cause of action, but only significantly altered heads of claim.
True it is that the increase is significant in monetary terms and as a multiple of the claim first put forward. However in the absence of any prejudice to the Defendant if the amendment is allowed, and the significant potential prejudice to the Claimant if it is disallowed, in my view this is an amendment which should be allowed.
Conclusion
For the reasons set out above I allow the application to amend.