COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM MANCHESTER COUNTY COURT
Mr Recorder Brunnen
Strand, London, WC2A 2LL
B e f o r e :
Vice President of the Court of Appeal (Civil Division)
LORD JUSTICE MANCE
MR JUSTICE PARK
| MS ELAINE WILLIAMS
|- and -
|FANSHAW PORTER & HAZELHURST
Andrew Sander (instructed by Weightman Vizards) for the Respondents
Hearing date : 14th January 2004
Crown Copyright ©
Mr Justice Park:
2. An action founded on tort shall not be brought after the expiration of six years from the date on which the cause of action accrued.
5. An action founded on simple contract shall not be brought after the expiration of six years from the date on which the cause of action accrued.
32 (1) where in the case of any action for which a period of limitation is prescribed by this Act, either
(a) the action is based upon the fraud of the defendant, or
(b) any fact relevant to the plaintiff's right of action has been deliberately concealed from him by the defendant, or
(c) the action is for relief from the consequences of a mistake,
the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable diligence have discovered it.
(2) For the purposes of subsection (1) above, deliberate commission of a breach of duty in circumstances in which it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty.
i) In January 1990 Ms Williams attended at the medical practice of which she was a patient. She says that a doctor gave to her a repeat prescription for six months supply of a birth control drug known as Femodene. One of the doctors at the practice was Dr Salahuddin.
ii) In May 1990 Ms Williams had a stroke, the consequences of which have been serious and enduring. She says that the stroke was caused by her having taken the Femodene. Because she had fluctuating blood pressure that drug was unsuitable and dangerous for her in that it exposed her to the risk of strokes. She also says that before the Femodene was prescribed for her the doctor ought to have checked her blood pressure, but he did not do so.
iii) Ms Williams obtained legal aid to consider whether she could bring a claim for professional negligence against the doctor. In October 1991 she instructed FP & H to act for her. From an early time her case was conducted by Mr Brown. He is now a fully qualified solicitor and the managing partner of FP & H, but in 1991 he was an employee of the firm, and was still qualifying as a legal executive.
iv) Ms Williams' initial instructions to Mr Brown were that it was Dr Salahuddin who had prescribed the Femodene for her and who had omitted to check her blood pressure.
v) On 17 May 1994 FP & H, acting by Mr Brown, commenced an action by Ms Williams in the Birkenhead County Court against Dr Salahuddin. This was case BI 423528. It should be noted that the claim was brought against Dr Salahuddin alone, not for example against a partnership of which he was a member.
vi) Dr Salahuddin, no doubt supported by the Medical Defence Union or some similar body, instructed Hempsons to act as solicitors for him to defend the claim. On 15 July 1994 they wrote to FP & H: Dr Salahuddin denied that he had seen Ms Williams or that he had prescribed the Femodene; he should be 'struck out of the proceedings'. This was supported by an affidavit of a solicitor at Hempsons.
vii) On 22 July 1994 Mr Brown had a meeting with Ms Williams. She apparently said that she was now not sure whether it was Dr Salahuddin or another doctor who had prescribed the Femodene for her.
viii) On 10 August 1994 Hempsons served a notice of application for a hearing in the Birkenhead County Court on 25 August 1994. They were obviously going to apply for the action against Dr Salahuddin to be struck out.
ix) On or before 25 August 1994 Mr Brown agreed with Hempsons that on behalf of Ms Williams he would consent to the court making an order of the kind which Hempsons were applying for. It is important for the purposes of this case that he did not obtain instructions from Ms Williams to do this, and it is even more important that he did not inform her about it after he had done it. On 25 August 1994 the court made the consent order. Dr Salahuddin was to cease to be a party, and the claim against him was dismissed.
x) Mr Brown says that he agreed to the making of the consent order in order to get some relief from pressure from Hempsons while he investigated whether it had or had not been Dr Salahuddin who had issued the prescription. He believed that he would be able to rejoin Dr Salahuddin to the action if he wished. However, he was wrong in that belief, and the actual effect of the consent order was to extinguish the possibility of Ms Williams pursuing a case for professional negligence against Dr Salahuddin as subsequent events were to show. It is now agreed (at least for the purposes of this preliminary issue) that Mr Brown was negligent in consenting to the order, and that a cause of action against FP & H then accrued to Ms Williams. The action would have been one for the loss of a chance of recovering damages from Dr Salahuddin. If the limitation period for such an action commenced when the cause of action accrued, then the action had to be commenced before 25 August 2000.
xi) On 15 September 1994 Mr Brown met Ms Williams again. It appears that on this occasion Ms Williams had a firmer recollection that it had indeed been Dr Salahuddin who had prescribed the Femodene. In evidence Mr Brown said that he thought that he told Ms Williams something about Dr Salahuddin having been 'dropped out of the action'. However, the Recorder found that he did not.
xii) On 3 October 1994 Mr Brown wrote a letter to Ms Williams, telling her that he had not been able to trace a record of the prescription, and that whether it had been Dr Salahuddin who prescribed it would be a matter of evidence, with her evidence to be evaluated against the doctor's. He said he 'could see no reason why we should not at this stage proceed with the claim'. He concluded: 'There are a number of procedural matters which I now have to attend to, but I shall revert to you as soon as I have any news.' This invites the comment that the consent order which had been made six or seven weeks earlier was a major item of news, but Mr Brown had not told his client about it yet, and he did not tell her about it in this letter of 3 October 1994 either.
xiii) On the same date, 3 October 1994, Mr Brown wrote to Hempsons asking them to agree to Dr Salahuddin being rejoined to Case BI 423538.
xiv) On 17 October 1994 Hempsons replied, refusing to consent.
xv) On 26 October 1994 Mr Brown served an application to the court to rejoin Dr Salahuddin as a party to Case BI 423528.
xvi) 15 December 1994: nothing specific happened on this date, but it was six years before the date when the present action by Ms Williams against FP & H was commenced. Therefore, if the limitation period had not yet started to run and only ran from some time after this date, the action is not statute barred.
xvii) On 16 December 1994 the District Judge at Birkenhead considered Mr Brown's application for Dr Salahuddin to be rejoined to action BI 423528. The District Judge dismissed the application. He pointed out, unanswerably, that, because Dr Salahuddin had been the only defendant to the action and because the action against him had been dismissed (by the consent order of 25 August 1994), the action did not exist any more. It was impossible for Dr Salahuddin to be rejoined to a non-existent action. The District Judge ordered FP & H to pay the defendant's costs of the application, thereby indicating, as it seems to me, his opinion of the ineptness of how FP & H, through Mr Brown, had conducted the case. FP & H did not appeal from the decision, but instead (as I will explain below) Mr Brown applied his mind to starting a new action against Dr Salahuddin.
xviii) Mr Brown did not tell Ms Williams of the failed application to rejoin Dr Salahuddin. Indeed, he still did not tell her of the consent order of four months earlier which was the source of all the problems. With reference to the application and the District Judge's dismissal of it Mr Brown says in his witness statement: 'I was embarrassed by the result of the application and for that reason alone did not tell the Claimant of the same but sought advice from Counsel.' I can sympathise with Mr Brown's predicament. He was at an early stage in his legal career and was not yet qualified, and he had got out of his depth. Nevertheless there is no doubt that his professional duty was to inform his client of what had happened. He did not comply with that duty.
xix) There is a finding by the Recorder 'that Mr Brown was not aware at this stage that he had been negligent.' I accept that the facts are primarily to be found by the first instance judge, not by the Court of Appeal, but I must nevertheless comment on this finding. Given what had happened before the District Judge, including the order that FP & H should pay the defendant's costs and the absence of any appeal from the decision, it seems to me that Mr Brown must have known that he had been negligent in the sense that agreeing to the consent order had been a bad mistake for which he was responsible. The Recorder's real point must surely be that Mr Brown still thought that the negligence could be cured by the commencement of a new action. On that basis Mr Brown believed that a claim in negligence against FP & H could be averted.
xx) In March 1995 counsel advised that 'the only way forward might be the issue of fresh proceedings against him [Dr Salahuddin] or any other party.' This was tentatively expressed and there was in fact no way forward at all.
xxi) There is no evidence that Mr Brown did anything about it until he received a telephone call from Ms Williams asking him to watch a television programme about Femodene. This led to another meeting with her on 18 July 1995 (the first time he had met her since September 1994). His attendance note merely says: 'We discussed the position as regards her claim and I advised her what was going on.' The Recorder finds that Mr Brown 'explained the then current position to the claimant'. This probably carries the implication that at this meeting on 18 July 1995 Mr Brown finally told Ms Williams about the consent order, whether or not he also told her about the effect that it had had on the now defunct Case BI 423528. Mr Bartley Jones says that that was a distinctly charitable finding to Mr Brown. That may be so, but in this respect I would be very slow to go behind the Recorder's finding.
xxii) On 14 November 1995 FP & H, acting by Mr Brown, commenced a new action against Dr Salahuddin and another doctor: Case BI 509333. I mention at this point that the claim against the other doctor was later discontinued, and nothing turns on her having at one stage been a party to this new action.
xxiii) On 1 December 1995 Hempsons applied for an order striking out the new claim against Dr Salahuddin as an abuse of process: Ms Williams, having sued Dr Salahuddin once and having consented to the action being dismissed, could not thereafter turn round and try to sue Dr Salahuddin again for exactly the same thing as before. There is a file note of Mr Brown of 6 December 1995 in which he wrote that he could 'see no justification for Hempsons's application'. The Recorder's comment is that 'Mr Brown still did not realise his breach of duty.' I make a similar comment to one which I have made earlier. Despite the way that the Recorder expresses it, what he must mean is that Mr Brown still thought that, by the procedural technique of commencing a new action, Ms Williams' claim against Dr Salahuddin could be pursued notwithstanding the consequences of the consent order.
xxiv) On 26 February 1996 the District Judge heard Hempsons's application for the new claim against Dr Salahuddin to be struck out. He acceded to the application and struck out the claim.
xxv) Mr Brown, on behalf of Ms Williams, appealed against the District Judge's decision. On 13 May 1996 the appeal was dismissed by HH Judge Bernstein. It seems that at that point Mr Brown recognised the fact that there was no prospect of Ms Williams maintaining an action against Dr Salahuddin.
xxvi) On 10 June 1996 Mr Brown and Ms Williams met. He advised her to consult other solicitors. If he had not told her about the consent order at the meeting on 18 July 1995, he must have told her about it on this occasion.
xxvii) On 3 July 1996 she did consult other solicitors, who are the firm now acting for her.
xxviii) 24 August 2000: nothing specific happened on this date, but it was the last day to commence an action against FP & H which would have been in time if the limitation period had started to run when the cause of action accrued, that is on 25 August 1994. No action had been begun by this date.
xxix) On 14 December 2000 Ms Williams, acting by her present solicitors, commenced this action against FP & H in Manchester County Court.
xxx) On 13 September 2002 the District Judge directed that limitation be tried as a preliminary issue.
xxxi) On 3 March 2003, after a trial of that issue, Recorder Brunnen held that s.32(1)(b) did not apply, with the result that the limitation period had run from 25 August 1994 to 24 August 2000. Accordingly the limitation defence pleaded by FP & H succeeded.
The Recorder's judgment
i) Mr Brown gave evidence, and clearly impressed the Recorder as a totally sincere and frank witness:
"I considered him to be an open and frank witness, who was ashamed of the way he had handled the Claimant's case but was doing his best to give a truthful account of what had been in his mind at the time." [Judgment para. 27].
ii) Although Mr Brown did not tell Ms Williams about the consent order until considerably later than he should have done, his motive in not telling her was not that he wished to conceal from her the existence of a possible negligence action against FP & H. His motive was to avoid embarrassment for himself. That did not make what he did right, but it was something which might be viewed with a degree of sympathy given the way that he, an unqualified legal executive, had been put in charge of a quite tricky matter and had found that he could not cope.
iii) At all times at least until the decision of the District Judge on 26 February 1996 (striking out the second claim against Dr Salahuddin), and possibly until the dismissal of the appeal by Judge Bernstein on 13 May 1996, Mr Brown honestly and genuinely believed that the situation created by the consent order could be cured, and that Ms Williams would still be able to bring her action against the doctor.
Analysis and discussion
i) The paragraph does not say that the right of action must have been concealed from the claimant: it says only that a fact relevant to the right of action should have been concealed from the claimant.
ii) Although the concealed fact must have been relevant to the right of action, the paragraph does not say, and in my judgment does not require, that the defendant must have known that the fact was relevant to the right of action. In most cases where s.32(1)(b) applies the defendant probably will have known that the fact or facts which he concealed were relevant, but that is not essential. All that is essential is that the fact must actually have been relevant, whether the defendant knew that or not. The paragraph does of course require that the fact was one which the defendant knew, because otherwise he could not have concealed it. But it is not necessary in addition that the defendant knew that the fact was relevant to the claimant's right of action.
iii) The paragraph requires only that any fact relevant to the right of action is concealed. It does not require that all facts relevant to the right of action are concealed.
iv) The requirement is that the fact must be 'deliberately concealed'. It is, I think, plain that, for concealment to be deliberate, the defendant must have considered whether to inform the claimant of the fact and decided not to. I would go further and accept that the fact which he decides not to disclose either must be one which it was his duty to disclose, or must at least be one which he would ordinarily have disclosed in the normal course of his relationship with the claimant, but in the case of which he consciously decided to depart from what he would normally have done and to keep quiet about it.
"This review of the history leads me to find that it was only on the dismissal of the appeal [by Judge Bernstein on 13 May 1996] that it became clear to Mr Brown that by consenting to the order of 25 August 1994 he had committed a blunder which made the Claimant's position in relation to Dr Salahuddin irretrievable and amounted to a breach of duty on his part."
I can accept that it was only on the dismissal of the appeal in May 1996 that it became clear to Mr Brown that the consequences of his earlier 'blunder' could not be averted, but I do not accept that it was only at that late stage that it became clear to Mr Brown that agreeing to the consent order had been a blunder. That must have become clear to him not later that 16 December 1994, when the District Judge refused to rejoin Dr Salahuddin to the original action. It is a commonplace of human experience that someone who has made a mistake may realise it in time to take steps which prevent the mistake having harmful consequences. If he can do that it does not change the fact that he made a mistake in the first instance. The Recorder erroneously proceeds on the basis that, if the consequences are successfully averted, there never was a mistake (or a blunder) to begin with.
"I find that at that stage he did not appreciate that he had done anything wrong, both because he did not consider that what had happened was his fault and because he believed that the situation could be rectified."
I cannot agree with the thinking behind that sentence. The stage to which the Recorder was referring was when, although Mr Brown had agreed to the consent order in the belief that, if he later wished to resuscitate the claim against Dr Salahuddin, it would be a straightforward matter to get Dr Salahuddin rejoined as a defendant to Case BI 423528, the decision of the District Judge had shown that Mr Brown's belief was entirely wrong, and the District Judge had ordered Mr Brown's firm to pay the costs. How can Mr Brown possibly have not appreciated that he had done something wrong?
"A claimant who proposes to invoke section 32(1)(b) in order to defeat a Limitation Act defence must prove the facts necessary to bring his case within the paragraph. He can do so if he can show that some fact relevant to his right of action has been concealed from him either by a positive act of concealment or by a withholding of relevant information, but, in either case, with the intention of concealing the fact or facts in question."
In my judgment the analysis of s.32(1)(b) which I have adopted in the foregoing discussion is consistent in all respects with that passage. Further, the conditions which Lord Scott identifies are fulfilled. The fact of the consent order is relevant to Ms Williams's right of action against FP & H; it was concealed from her by Mr Brown's withholding of information about it, and that was done with the intention of concealing the facts about the order (albeit with a motive of avoiding embarrassment rather than with a motive of reducing the risk of being sued for negligence).
"In my opinion s.32 deprives a defendant of a limitation defence in two situations: (i) where he takes active steps to conceal his own breach of duty after he had become aware of it; and (ii) where he is guilty of deliberate wrongdoing and conceals or fails to disclose it in circumstances where it is unlikely to be discovered for some time."
In my view (i) in that passage has in mind s.32(1)(b) by itself, and (ii) has in mind s.32(2). If that is right Lord Millett's summary of s.32(1)(b) (on which this case depends) is that it applies where a defendant 'takes active steps to conceal his own breach of duty after he has become aware of it'. I would accept that if those words were the words of the statute itself the question of whether they covered this case would be marginal. But they are not the words of the statute. I do not think that Lord Millett intended to do more than to give a condensed summary of the normal case to which para. (b) applies. Lord Scott's analysis tracks the statutory words more fully and closely, and, as I have said, exactly fits the circumstances of the present case. I believe that my own conclusion is based with precision on a close analysis of the entire wording of the statute. Lord Millett's brief summary does not persuade me to depart from it.
"the period of limitation shall not begin to run until the plaintiff has discovered the concealment or could with reasonable diligence have discovered it."
Ms Williams did not discover the concealment from her of the consent order until Mr Brown told her about it, and it has not been suggested that with reasonable diligence she could have discovered it any earlier. It must be remembered that she was a legally aided litigant, and would be totally dependent on her solicitors (which meant in practice Mr Brown) for all information about her case. Therefore the six years limitation period began to run when Mr Brown told her about the consent order. On the Recorder's findings that appears to have been on 15 July 1995, although Mr Bartley Jones did not give up on his contention that a more appropriate inference from the primary facts would have been that it was on 10 June 1996. Assuming that 15 July 1995 was the date, the six years period ran until 14 July 2001. If the date had been 10 June 1996 it would have run until 9 June 2002. The present action against FP & H was commenced on 14 December 2000, within the limitation period on either view.
Lord Justice Mance:
"any fact relevant to the plaintiff's cause of action has been deliberately concealed from him by the defendant."
" section 32 deprives the defendant of a limitation defence in two situations: (i) where he takes active steps to conceal his own breach of duty after he has become aware of it; and (ii) where he is guilty of deliberate wrongdoing and conceals or fails to disclose it in circumstances where it is unlikely to be discovered for some time."
" . deliberate concealment may be brought about by an act or an omission and, in either case, . the result of the act or omission, i.e. the concealment, must be an intended result. But I do not agree that that renders subsection (2) otiose. A claimant who proposes to invoke section 32(1)(b) .. must prove the facts necessary to bring the case within the paragraph. He can do so if he can show that some fact relevant to his cause of action has been concealed from him either by a positive act of concealment or by a withholding of relevant information, but, in either case, with the intention of concealing the fact or facts in question. In many cases the requisite proof of information might be quite difficult to provide. . Subsection (2), however, provides an alternative route. The claimant need not concentrate on the allegedly concealed facts but can instead concentrate on the commission of the breach of duty. If the claimant can show that the defendant knew that he was committing a breach of duty, or intended to commit the breach of duty I can discern no difference between the two formulations; each would constitute, in my opinion, a deliberate commission of the breach then, if the circumstances are such that the defendant is unlikely to discover for some time that the breach of duty has been committed, the facts involved in the breach are taken to have been deliberately concealed for subsection (1)(b) purposes. I do not agree therefore . that the subsection [i.e. subsection (2)], thus construed, adds nothing."
"I see no reason at this stage why we should not proceed with the claim"
without being conscious of the consent order whereby the claim had been withdrawn (even if he believed that it could be revived) and without having taken a deliberate decision not to mention the withdrawal. He said in this own witness statement that he appreciated that "it might not be quite straightforward" to "re-join" Dr Salahuddin, but that he did not tell Mrs Williams,
"in part because I did not appreciate quite what those difficulties were and in part because I did not believe that telling the Claimant that there might be problems would be of any help to her".
"I did not then believe that I was responsible for the "procedural mess". I had consented to the Order in August 1994 in good faith and now the Claimant was giving me more specific and clear instructions compared to the position in July 1994".
" Mr Brown must have known that he had been negligent in the sense that agreeing to the consent order had been a bad mistake for which he was responsible".
"embarrassed by the result of the application and for that reason alone did not tell the Claimant of the same but sought advice from Counsel".
Lord Justice Brooke: