England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM COLCHESTER COUNTY COURT
(HHJ THOMPSON)

		Royal Courts of Justice Strand London, WC2
		18th January 2005

Tuesday, 18th Tuesday 2005

1. LORD JUSTICE MAY: The claimant, Sean McGhie, is a very tall man, now aged about 30. He is apparently about 6-foot 5 inches tall. Very tall people sometimes are more susceptible to back problems than others and so unfortunately it was with Mr McGhie. These proceedings concern a back injury which he suffered on 26th August 1998. He was then working for the defendants, British Telecommunications Plc.
2. He had for some years, until about six weeks before this, been doing an office job for them. Then he moved to outside work which he was keen to do. On 26th August 1998 he was pushing rods, used to place cables along ducting, between manholes in the car park near a shopping precinct at Wickford in Essex. The rods he was pushing hit some obstruction and the jolt of this strained his back. He was off work for about three weeks but then returned because he was keen to do so.
3. It was not until 8th September 2003, rather more than five years later, that Mr McGhie started these proceedings claiming that his August 1998 back injury was caused by the breach of statutory duty or negligence of the defendants. The, to my mind, rather thin particulars in support of this claim said that the defendants had failed to provide Mr McGhie training in the use of hand rods and failed to provide him with suitable equipment such as quicks for the rods and had required him to enter the manhole to push the rods so that he had to work in a vulnerable crouching position.
4. The defendants had completed an incident investigation report form, dated 11th September 1998, soon after the incident but not the following day or two. Otherwise the next occasion when the defendants had reason to consider the matter was when they received a letter written by solicitors instructed by Mr McGhie and dated 30th May 2003. The letter was, to my reading, no more informative as to why it was alleged that the defendants were at fault than the subsequent particulars of claim.
5. Two things seem to have prompted Mr McGhie to start these proceedings when he did. First, he had had a back operation for a prolapsed disc on 10th June 2003 which happily has largely put right the back problems that he had suffered during the preceding four and a half years. He had been told in February 2003 that he needed this operation, and, at about the same time, he had spoken with one of his previous managers who told him that he should have been sent on a course and that there was special equipment of which he had no knowledge in August 1998. His evidence to the judge in the present case was that it was then that he realised that his condition was serious and that he might have a claim. So he took legal advice in April 2003.
6. On the face of it, Mr McGhie brought his claim rather more than two years outside the statutory limitation of three years for personal injury claims in section 11 of the Limitation Act 1980. The defendants pleaded that it was statute barred and the court ordered that limitation should be tried as a preliminary issue.
7. His Honour Judge Thompson heard this issue in the Colchester County Court on 22nd July 2004. Inferentially, but not I think explicitly, he decided (or perhaps the parties accepted) that the claim was brought outside the primary limitation period of limitation, but the judge went on to decide that it was nevertheless equitable to allow the claim to proceed and directed that the relevant limitation provision should not apply to Mr McGhie's claim under section 33 of the 1980 Limitation Act. The defendant appeals against this decision by permission of Kennedy LJ.
8. The three year period of limitation in section 11 of the 1980 Act runs from whichever is the later of the date on which the cause of action accrued - in this case 20th August 1998 - or date of knowledge of the person injured. The date of knowledge is defined in section 14. This relevantly provides:

"(1) [Subject to subsection (1A) below,] in sections 11 and 12 of this Act references to a person's date of knowledge are references to the date on which he first had knowledge of the following facts -

(a) that the injury in question was significant; and

(b) that the injury was attributable in whole or in part to the act or omission which is alleged to constitute negligence, nuisance or breach of duty; and

(c) the identity of the defendant;

...

and knowledge that any acts or omissions did or did not, as a matter of law, involve negligence, nuisance or breach of duty is irrelevant."

9. Subsections 2 and 3 provide:

"(2) For the purposes of this section an injury is significant if the person whose date of knowledge is in question would reasonably have considered it sufficiently serious to justify his instituting proceedings for damages against a defendant who did not dispute liability and was able to satisfy a judgment.

(3) For the purposes of this section a person's knowledge includes knowledge which he might reasonably have been expected to acquire -

(a) from facts observable or ascertainable by him; or

(b) from facts ascertainable by him with the help of medical or other appropriate expert advice which it is reasonable for him to seek;

but a person shall not be fixed under this subsection with knowledge of a fact ascertainable only with the help of expert advice so long as he has taken all reasonable steps to obtain (and, where appropriate, to act on) that advice."

10. As I have said, the judge inferentially decided (or the parties agreed) that the date of constructive knowledge for the purpose of sections 11 and 14 was firmly more than 3 years before Mr McGhie started proceedings. In my view this decision or concession was plainly correct. To my mind the important point here is that although Mr McGhie told the judge that he only realised that his injury was serious when he was advised to have an operation, evidence shows that his back condition had continued to be at least significant during most of the preceding four and a half years.
11. There is a medical report dated 10th September 2003, served with the particulars of claim, prepared by Mr Alan Gardner, a Consultant Orthopaedic Surgeon. This refers to records which indicate that Mr McGhie suffered from chronic pain for three years before 1st December 1998. That is in the period before his injury which is the subject of these proceedings.
12. The pain began suddenly when he was moving a Christmas tree around Christmas 1995, so it seemed. The report also tells of frequent back pain and troublesome left leg pain in the years after the August 1998 incident with references to an orthopaedic surgeon and for physiotherapy. August 1998 was but the start of "severe back symptoms" which culminated in surgery in 2003. The report also says that Mr McGhie's back was somewhat vulnerable before the August 1998 incident. He is, as I have said, very tall. Mr Gardner also expresses the opinion that on the balance of probability a similar chain of events might well have occurred within five years or so of when it did occur.
13. So the defendants would no doubt, if necessary, say that the claim cannot be for more than the acceleration of what was probably going to happen anyway. That, if it were correct, would affect the quantum of the claim. That in turn, as I shall show, has some relevance to the section 33 question.
14. Returning, however, to the date of constructive knowledge. Mr McGhie plainly knew that his injury was at least significant from August 1998 or soon afterwards. It was not a back injury from which he recovered only for it to reappear in 2003. He knew the identity of his employer. He knew that his significant back problem was attributable in whole or in part to the work he was doing on 28th August 1998. He also knew, or might reasonably have been expected to find out with the help of his union or other appropriate expert advice, that his injury was attributable, if it be the case, to the acts or omissions alleged to constitute negligence or breach of duty by the defendants.
15. I say this dogmatically and in summary because it is not in issue in this appeal and with reference to the recent discussion on this topic in the House of Lords in Adams v Bracknell Forest Borough Council [2004] 3 WLR 89, 2004 UKHL 29. The majority decision in that case on constructive knowledge was that the test is or is mainly objective. Baroness Hale put a somewhat different slant on this which does not affect the present appeal. Lord Hoffmann said at page 101G, paragraph 47:

"In my opinion, section 14(3) requires one to assume that a person who is aware that he has suffered a personal injury, serious enough to be something about which he would go and see a solicitor if he knew he had a claim, will be sufficiently curious about the causes of the injury to seek whatever expert advice is appropriate."

16. As I have said, the judge decided the section 33 issue in favour of Mr McGhie. Section 33 provides:

"(1) If it appears to the court that it would be equitable to allow an action to proceed having regard to the degree to which -

(a) the provisions of section 11 [or 11A] or 12 of this Act prejudice the plaintiff or any person whom he represents; and

(b) any decision of the court under this subsection would prejudice the defendant or any person whom he represents;

The court may direct that those provisions shall not apply to the action, or shall not apply to any specified cause of action to which the action relates."

So, the issue is a balance of prejudice.

17. Subsection (3) provides:

"In acting under this section the court shall have regard to all the circumstances of the case and in particular to -

(a) the length of, and the reasons for, the delay on the part of the plaintiff;

(b) the extent to which, having regard to the delay, the evidence adduced or likely to be adduced by the plaintiff or the defendant is or is likely to be less cogent than if the action had been brought within the time allowed by section 11 [, by section 11A] or (as the case may be) by section 12;

(c) the conduct of the defendant after the cause of action arose, including the extent (if any) to which he responded to requests reasonably made by the plaintiff for information or inspection for the purpose of ascertaining facts which were or might be relevant to the plaintiff's cause of action against the defendant;

(d) the duration of any disability of the plaintiff arising after the date of the accrual of the cause of action;

(e) the extent to which the plaintiff acted promptly and reasonably once he knew whether or not the act or omission of the defendant, to which the injury was attributable, might be capable at that time of giving rise to an action for damages;

(f) the steps, if any, taken by the plaintiff to obtain medical, legal or other expert advice and the nature of any such advice he may have received."

18. The judge in his judgment considered these matters. He said that the length of delay was two and a half years. It was in fact a little over two years. The reasons for the delay were that Mr McGhie gave no thought to a personal injury claim until it was triggered by something somebody said to him. The judge did not at this stage in his judgment evaluate this reason, but the fact that Mr McGhie had constructive knowledge for the purpose of section 14 at a much earlier date predicates that he might reasonably have been expected to find this and other things out with help at a much earlier date.
19. The judge accepted that the evidence likely to be adduced by the defendants was likely to be less cogent than if the action had been brought within the time allowed by section 11. A Mr Harrison had been working with Mr McGhie on 28th August 1998. All he could remember was that they were rodding at a site in Wickford and that Mr McGhie said that he had jarred his back. Mr Harrison could not remember anything else, it was such a long time ago. He no longer worked with Mr McGhie. It was urged on behalf of Mr McGhie that much the same would have applied at the end of the primary three year period.
20. Mr Pumfrey, who appeared for Mr McGhie at the trial, also referred to the author of the incident investigation report, a Mr Berry, from whom there was no witness statement. The judge said of him that he would no doubt be straining his memory to recall if he was asked to elaborate for the court. The judge considered that the defendant's evidence was likely to be less cogent than if the claim had been brought in time and inferentially that must prejudice the defendants.
21. There was no complaint about the conduct of the defendants. The claimant had never been under a disability. The judge noted that the defendant said that Mr McGhie did not act promptly and reasonably once he knew that the defendant's acts or omissions might be capable of giving rise to an action for damages. The judge did not consider that section 33(f) was significant because Mr McGhie did, in the end, get treatment which was successful and the evidence of Mr Gardner was clear.
22. The judge then cited a passage from the judgment of Lord Hoffmann in Adams at paragraph 54 itself citing, with approval, from the judgment of Sir Murray Stuart-Smith in Robinson v St Helens Metropolitan Borough Council [2003] PIQR 128 at 139-40, paragraphs 32 and 33, to the effect that the onus is on the claimant to establish that it would be equitable to allow the claim to proceed having regard to the balance of prejudice and that the question of proportionality is now important.
23. What Sir Murray Stuart-Smith said in paragraph 33 of the Robinson case was:

"The question of proportionality is now important in the exercise of any discretion, none more so than under section 33. Courts should be slow to exercise their discretion in favour of a claimant in the absence of cogent medical evidence showing a serious effect on the claimant's health or enjoyment of life and employability. The likely amount of an award is an important factor to consider, especially if, as is usual in these cases they are likely to take a considerable time to try."

24. Of this Lord Hoffmann said at paragraph 55 of Adams:

"Their Lordships think that these observations from judges with considerable experience of exercising and overseeing the section 33 jurisdiction carry great weight."

As the judge pointed out, the case of Adams concerned a claim relating to dyslexia.

25. On the question of proportionality, the judge noted the defendant's contention that Mr McGhie's claim was probably worth less than £10,000. Mr McGhie had in fact limited his claim in the particulars of claim to less than £50,000. His pleaded schedule of special damages amounted to £12,439, including past loss of earnings of £7,298 and estimated future loss to the dated presumably of trial of £2,431. Mr Pumfrey had suggested to the judge that the claim might be worth £20,000.
26. This court is not, of course, in a position to make any precise quantification, but I do note that Mr McGhie's 2003 operation was successful without apparently significant continuing consequences and that his claim was, as I have said, probably for acceleration of what was probably going to happen at some stage anyway.
27. Having rehearsed arguments on behalf of each of the parties the judge in his judgment then said at page 16:

"In my judgment this is a matter which is finely balanced. The arguments on behalf of the Defendants are strong ones. On the face of it Mr McGhie is an intelligent, capable young man who was not the sort of dull-witted employee who might be able to say that because he really had no skill or knowledge with making claims or getting advice that he was to be excused from not realising that he had a claim. On the contrary, Mr McGhie is plainly capable, intelligent and was doing a job which was a responsible job. He was working in a new environment only six weeks old from his point of view, although he had been working for BT in a draftsman's job for some years before that. The difficulty which he faces is persuading the court to exercise its discretion, when on the face of it a reasonable man might well have thought that the nature of the accident which he suffered was one which ought to give rise to a claim."

28. Then leaving out a sentence or two at the top of page 17:

"In my judgment in this case the responsibility of making the claim promptly was exercised reasonably by Mr McGhie. In my judgment he did have a devotion to his job. He had no reason to think that he had a claim available to him, and he acted reasonably as soon as it first percolated through to him that he was going to have a serious operation. That did not arise until the middle or early part of 2003.

"For that reason I am satisfied that he meets the requirements of section 33 and I am going to exercise my discretion in his favour. I say that because of the way in which he gave his evidence and I am satisfied on that evidence that he genuinely was a hard worker who was genuinely unaware that there was any claim available to him until the information reached him. There were two matters which he referred to specifically."

29. The two matters to which the judge refers are information about the special course and his realisation in 2003 that his condition was serious. The judge continued:

"Those two factors together seem to me to be the triggers for Mr McGhie to realise that he had a claim. As I say, in my judgment until then he acted reasonably and although the arguments in favour of the Defendants have been put to me very capably and fully by Mr Leech, I am satisfied that this is a case in which I should exercise my discretion in favour of the Claimant."

30. The first ground of appeal is that the judge did not, as section 33 requires, base his decision on a balance of prejudice at all. He simply decided that Mr McGhie acted reasonably, as, it is submitted, the passage I have just read indicates.
31. The second main ground of appeal is that the judge did not properly address and evaluate the issue of proportionality as discussed and approved in Adams. Another ground of appeal is that the judge did not, as he was urged to do by counsel, and as authority requires, address the strength of the claim on liability.
32. In answer to these grounds of appeal and submissions made in support of them, Mr Eastman points out that the judge's judgment was ex tempore, it was not a crafted reserved judgment, and you should expect, in those circumstances, to find wrinkles in it. This court, he submits, should approach the matter with a broad brush. There was, he submits, no fatal flaw in the judge's evaluation. The judge addressed, he submits, the elements he was required to address in section 33 and in accordance with authority. He submits that it is not correct to say that the judge only addressed a question of reasonableness. The question of reasonableness, he submits, and I do not think he is right about this, was in the context of whether Mr McGhie had acted reasonably once he realised that he was going to have an operation.
33. I do not think Mr Eastman is right about that because it is quite clear that the question of reasonableness is that which immediately precedes, and in the judge's language, justifies, the entirety of the decision that he was making. But, says Mr Eastman, the judge does address the factors in section 33(3) and he also had an eye to the value of the claim and therefore to the issue of proportionality. Certainly the judge mentioned the question of proportionality with reference to Adams, but, in my judgment, he did not perform any evaluation of that or other matters.
34. The fact, submits Mr Eastman, is that this was a modest County Court claim and it was correct for the judge to take that in Mr McGhie's favour on a question of proportionality. This is a submission to the effect that Sir Murray Stuart-Smith, as quoted by Lord Hoffmann in Adams, is not putting the question of proportionality one way or the other. He is simply drawing attention to it as a matter for consideration. Mr Eastman submits that there would be more prejudice if the claim was very large and that the judge was correct to regard the prejudice as less because this was a relatively modest claim.
35. In my judgment this is not a correct interpretation of what Sir Murray Stuart-Smith had said. The question of proportionality is, in my judgment, in the first place, a proportionality between the size of the claim and the legal and other costs of running it. The question of proportionality also has an eye, in my judgment, to the strength of the claimant's claim. In my judgment, taking the matters in the round, it would be a great prejudice to a claimant who was very badly injured and likely to suffer the consequences of that injury for many years to come if, what would otherwise be a very large claim, based upon very strong evidence, were to be lost through a refusal to exercise the discretion under section 33.
36. Mr Eastman sums up his submissions by saying that any imperfections which might be seen in this judge's judgment were a natural accident of it being ex tempore. He emphasises that there had been no disclosure and that judgment should not be made against Mr McGhie on the strength of his claim. He emphasises that the key matters in section 33 all feature in the judgment.
37. In my judgment the three main grounds of appeal to which I have referred are made out. Although the judge rehearsed the arguments and referred to the passage in Adams about proportionality, his decision appears simply to have been based on a judgment that Mr McGhie was devoted to his job and that he had acted reasonably.
38. This is just not the statutory test. The judge had found that the defendants were prejudiced by the delay evidentially. He referred to, but did not evaluate, the matter of proportionality. He did not refer to submissions made to him about the strength of the claimant's case or lack of it. He did not, as I read his judgment, identify any matter relevant to the balance of prejudice to help the claimant discharge his burden of proof, nor any matter to show that a proportionate judgment should fall in favour of allowing the claim to continue. This means, in my judgment, that the judge's reasons do not sustain his discretionary decision and that it is for this court to exercise the discretion again itself.
39. In addition, I have referred to Mr Leech's submission, correct in my view, that it is relevant to consider the strength of Mr McGhie's case. Mr Leech refers to another judgment of Stuart-Smith LJ in Forbes v Wandsworth Health Authority [1997] QB 402, the passage being at 417-418. Stuart-Smith LJ there said that a relevant consideration to the exercise of the discretion under section 33 of the 1980 Act was the strength of the plaintiff's case. He quoted from the judgment of Purchas LJ in Nash v Eli Lilly & Co [1993] 1 WLR 782 at 884 to the effect that if it is shown that the claim is a poor case lacking in merit there may be significant and relevant prejudice to the defendant if the limitation provisions are to be disapplied.
40. Stuart-Smith LJ had emphasised in Dale v British Coal Corporation [1992] PIQR 373 at 382 that the onus was on the plaintiff to satisfy the court that the primary limitation period should not apply. He must show that there is evidence which, if it is accepted, will establish the necessary ingredients of his cause of action. His own evidence on affidavit may suffice, but the matter cannot be tried on affidavit and it is normally inappropriate for the defendants to try and counter at that stage. Sir Murray Stuart-Smith then said:

"But where it is necessary to show that prudent employers customarily adopt specific precautions not taken by the defendants, or that the defendants knew or ought to have known of some special risk peculiar to the plaintiff, this may well have to be established by expert evidence, which should either be exhibited, or at the very least the plaintiff's solicitor should depose that he is so advised and the source of his information."

41. Mr Leech, as I have said, made submissions to the judge with reference to these authorities, but the judge made no reference to them, or the merits of Mr McGhie's liability claim, in his judgment.
42. I have already indicated my view that the pleaded case on liability is thin. Mr Leech submits that it is only substantiated by the hearsay contained in Mr McGhie's witness statement; someone told him four and a half years after the accident of a training course and special equipment. There is no evidence of what a prudent employer should have done in 1998, no particularity of the content of the training course, and scant particularity of the special equipment. The medical expert describes the incident as "a relatively minor jolting injury" and there is no evidence that training or equipment would have avoided it.
43. It is, of course, correct, as Mr Eastman says, that there has been no or no substantial disclosure. Mr Leech, however, might also point out that the defendant's near contemporary incident investigation report, admittedly their document, but nevertheless, has it in a box asking for reference to any instruction or guidance covering the activity undertaken that, "[Mr McGhie] & the gang were hand rodding using the proper procedure as far as they are aware," and that some document identified as EPT/UGP/EQ43 referred a box asking whether the person was aware of the instruction or guidance has it that Mr McGhie had been with them for six weeks and at the moment was reliant on advice from a senior colleague. In a box asking, "What immediate action [was] taken to prevent a recurrence?" is written, "Rebrief EPT/UGP/EQ43 at team talk. Make gang members aware of Sean's accident." In a box asking whether consideration had been given to disciplinary action if there had been neglect of BT's safety procedures the answer is, "This is not appropriate."
44. The report confirms that Mr McGhie was a relatively new recruit for this kind of outdoor work and that he was under instruction, but, taken at its face value, it also states that proper procedures were used with reference to some instruction manual and that the consequent action was to rebrief in accordance with that manual. This suggests that Mr McGhie had been instructed in accordance with what was regarded as contemporary procedure and there is also no mention of equipment that was lacking. The document does not speak of any neglect of BT's safety procedures. Generally speaking it does not support Mr McGhie's thin case on liability.
45. I turn to what I regard as the bones of the proper exercise of the judicial discretion under section 33 of the 1980 Act. The test is a balance of prejudice and the burden is on Mr McGhie to show that his prejudice would outweigh that to the defendants. Refusing to exercise the discretion in favour of a claimant who brings his claim outside the primary limitation period will necessarily prejudice the claimant who thereby loses the chances of establishing his claim.
46. That said, Mr McGhie seems to me to have nothing significant to put into his side of the balance. Mr Eastman on his behalf, in his written skeleton, in truth, in my judgment, had little to say. He points out, as he has in essence before us, that the judge concluded that the matter was finely balanced, a judgment with which, I am afraid to say, I disagree.
47. He submits that this was a discretionary judgment within the proper bounds and one which this court should not disturb. He submits, as I have said, that the judge addressed all the relevant issues. I disagree with the first part of this for the reasons which I have given. I disagree with the second because it seems to me that the essence of the judge's judgment did not address the main matters which he had to address.
48. On the defendant's side of the balance is: (a) the length of the delay which is substantial, more than two years, and the fact that once constructive knowledge is accepted there is no persuasive reason for it other than in purely human terms; (b) the accepted evidential prejudice to the defendants; (c) the fact that, as I think, Mr McGhie's case is thin; (d) the fact that his claim is, as these cases go, modest in financial terms so as to give rise to disproportionate legal costs. This is happily not a case where Mr McGhie will suffer long-term effects on his health and ability to work.
49. For these main reasons, addressing the issues in section 33 and re-exercising the discretion which the judge had to exercise, I would come down firmly on the defendant's side and refuse to exclude the primary provisions for limitation. For these reasons I would allow this appeal.
50. LORD JUSTICE BUXTON: I entirely agree. I would simply wish specifically to associate myself with what my Lord has said about the issue of proportionality in the context of the judgment of Sir Murray Stuart-Smith in the case of Robinson v St Helens Metropolitan Borough Council. There is nothing else I wish to add.

ORDER: appeal allowed; claim dismissed; respondent to pay appellant's costs agreed in the sum of £6,750.