The Law Commission

PART V

ADDITIONAL ISSUES

1. What the claimant needs to do to prevent the expiry of the limitation period: issue or service of proceedings?

5.1      In the Consultation Paper we provisionally recommended that no change should be made to the current law under which the limitation period stops running when proceedings are issued against the defendant.^[1] This provisional recommendation was overwhelmingly supported by consultees: over ninety-five per cent of those who responded on this point agreed.
5.2      Consultees agreed with our provisional view that the principal advantage of the present rule is that the date of issue is certain, so that there can be no argument as to whether the relevant step has been taken, and that it is simple, so that the claimant is able to act quickly in order to preserve his or her rights. Any change to a rule whereby the limitation period expired only on the date of service of the claim form on the defendant would result in uncertainty, and would require special provision to deal with cases where the defendant deliberately tried to evade service.
5.3      The Practice Direction supplementing Part 7 of the Civil Procedure Rules^[2] clarifies that proceedings are started when the court issues a claim form at the request of the claimant, but where the claim form as issued was received in the court office on a date earlier than the date on which it was issued by the court, the claim is 'brought' for the purposes of the Limitation Act 1980 and any other statute on that earlier date.^[3]
5.4      We therefore recommend that no change is needed to the present position that the limitation period should stop running when proceedings are issued (or, if earlier, the date on which the claim form was received in the court office).

2. Adding new claims in existing proceedings

5.5      The addition of new claims to existing proceedings^[4] is governed by section 35 of the Limitation Act 1980 as supplemented by the Civil Procedure Rules.^[5] The addition of a new claim may seem a matter of procedure, and therefore outside the scope of this Report. However, since the end result can be to allow a claim to be brought which would otherwise have been time-barred, substantive limitation issues arise. Since this area is governed by the Limitation Act 1980, it cannot be reformed without primary legislation. And the provisions of the current law have proved difficult to apply. We have therefore felt it appropriate and necessary to consider whether reform is needed in this area.
5.6      Where a party seeks to add a new claim^[6] to existing proceedings^[7] the new claim is treated as having been commenced on the same date as the original proceedings (that is, the claim is 'related back' to the date on which the original proceedings were commenced).^[8] Where any fresh proceedings to commence such a claim would have been time-barred, the effect of this provision is to deny the defendant to the new claim an opportunity to raise a limitation defence.^[9] For this reason special restrictions are imposed on the ability to add such new claims.^[10]

(1) New claims involving new causes of action after the expiry of the relevant limitation period

5.7      A new claim involving a new cause of action may not be added to existing proceedings after the expiry of any limitation period under the Limitation Act which would affect new proceedings to enforce the claim unless (i) "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"; and (ii) any relevant rules of court are satisfied.^[11] The relevant rules of court are contained in Part 17 of the Civil Procedure Rules 1998 and provide that the new claim is only allowed if it "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".^[12]
5.8      In the Consultation Paper we explained that the object of the restrictions in section 35 was to prevent a party from being able to circumvent the provisions of the Limitation Act by instituting proceedings in respect of a time-barred claim in the guise of an amendment to an existing claim. But we explained that there is also a conflicting principle, that when proceedings have been brought in respect of a claim, it should be possible for all matters relating to that claim to be resolved in the same proceedings. We suggested that section 35 failed to strike an appropriate balance by its narrow definition of the situations in which a new claim can be made. This restricted the ability of the court to deal adequately with new situations as they arose. We therefore provisionally proposed that "new claims should be permitted provided that they are sufficiently related to the original cause of action, even where the limitation period has expired since the proceedings were started".^[13]
5.9      Around eighty per cent of consultees who considered this question agreed with our provisional proposal. However, several consultees suggested that a test based on whether the new claim is 'sufficiently related' to the existing cause of action was vague, and asked whether it would be possible to provide additional clarification. The aim of a provision such as section 35 must be to ensure that where the court is in any event examining material for the purpose of deciding the claim brought on the original cause of action, new claims arising out of that same material can be added, so that the 'real issues in the case' can be decided. The defendant should not be unduly prejudiced, since he or she will know of the conduct or events described in the original pleading and so should not destroy any evidence relating thereto.^[14] We therefore recommend that the new test should be phrased in such a way as to ensure that the new claim is linked to 'the conduct, transaction or events' on which the existing claim is based. The Alberta Law Reform Institute recommended a similar test: "the added claims are related to the conduct, transaction or events described in the original pleading".^[15] The New Zealand Law Commission also recommended that a new claim may be added where it is "properly related to the subject matter of the original claims".^[16] However, we prefer to say that the new claim should "arise out of" the conduct, transactions or events already in issue, rather than being "related to" them, as this seems to be a clearer test.
5.10      An advantage of this test, by comparison with the current law, is that it does not depend as heavily on the facts which were pleaded by the claimant to the original claim. Under the present law, the claimant can only be certain that a new claim will be allowed if he or she does not need to plead any new facts to substantiate the claim. Thus, where the claimant has brought a claim for nuisance against the defendant because his excavations in land adjoining the claimant's land have undermined the claimant's land, the claimant will not be able to add a claim for breach of a restrictive covenant after the expiry of the limitation period. Although the claim arises out of the same conduct as the claim for nuisance (namely the excavations made by the defendant) so that it would be within our test, the claimant needs to prove a new fact - the existence of a restrictive covenant. The claim does not therefore arise out of the same facts as the claim already pleaded.^[17] Paragon Finance v DB Thakerar is another example where the test we propose may lead to a different result. The claimant, a mortgage lender brought a negligence claim against the solicitors who had acted for it in relation to mortgage loans made to five borrowers. In each case the borrowers immediately defaulted. The Court of Appeal refused to allow the claimant to amend his claim to include claims for fraud, conspiracy to defraud and fraudulent breach of trust after the expiry of the limitation period. The claimants needed to make allegations of fraud and dishonesty which had not been included in the original pleadings. Under our test, however, it would be open to the claimants to show that such a claim arose out of the same transaction as the claim already in issue. We believe that such a reform would result in the court being able to decide the 'real issues' between the parties, but without unduly prejudicing the defendant. And the claimant should no longer suffer as a result of sparsely worded original pleadings.
5.11      Accordingly, we recommend that the addition of new claims made between parties to existing proceedings after the expiry of the limitation period relevant to the new claim should be permitted where

(1) the new claim arises out of the conduct, transaction or events on which a claim in the existing proceedings is based; and

(2) the existing proceedings were commenced within the relevant limitation period.

We also recommend that the Rules Committee amend Rule 17.4(2) of the Civil Procedure Rules, which currently repeats the wording of the test laid down in Limitation Act 1980, section 35. (Draft Bill, Cl 25(2)).

(2) New claims involving the addition or substitution of a party after the expiry of the relevant limitation period

5.12      A new claim involving the addition or substitution of a party may not be added to an existing claim after the expiry of any limitation period under the Limitation Act which would affect new proceedings to enforce the claim unless (i) "the addition or substitution of the new party is necessary for the determination of the original action"; and (ii) any relevant rules of court are satisfied.^[18] The addition or substitution shall not be regarded as necessary unless either (a) the new party is substituted for a party whose name was given in any claim made in the original proceedings in mistake for the new party's name; or (b) any claim made in the original proceedings cannot be maintained by or against an existing party unless the new party is joined or substituted as claimant or defendant to those proceedings.^[19]
5.13      The relevant rules of court are Rules 19.5(2) and (3). Rule 19.5(2) states that the court may only add or substitute a party if (a) the relevant limitation period was current when the proceedings were started; and (b) the addition or substitution is necessary. Rule 19.5(3) states that the addition or substitution is necessary only if the court is satisfied that:

(a) the new party is to be substituted for a party who was named in the claim form in mistake for the new party;

(b) the claim cannot properly be carried on by or against the original party unless the new party is added or substituted as claimant or defendant; or

(c) the original party has died or had a bankruptcy order made against him and his interest or liability has passed to the new party.

5.14      Also relevant is Rule 17.4(3). This states that the court may allow an amendment to correct a mistake as to the name of a party, but only where the mistake was a genuine one and not one which would cause reasonable doubt as to the identity of the party in question.^[20]
5.15      Several consultees were concerned that our provisional recommendation (that new claims should be permitted provided that they are sufficiently related to the original cause of action) should not apply to the addition or substitution of new parties, and felt that justice required additional restrictions in these cases. We agree.
5.16      First, it may be unfair to add claimants. For example, say that two passengers are injured in a car accident. C1 brings timely proceedings, but C2 delays beyond the expiry of the relevant limitation period. C2 subsequently seeks to add him or herself as a claimant to C1's claim. His or her cause of action is undoubtedly related to the same events as the cause of action in respect of which the existing proceedings have been brought, but there would seem to be no good reason to deny the defendant a limitation defence against C2.
5.17      Secondly, it may be unfair to add defendants. It would be possible to add a new defendant to existing proceedings even though he or she was unaware that his or her liability may be questioned, and, since the limitation period has expired, the defendant might quite reasonably have disposed of relevant documents and let any insurance cover lapse. In recognition of this potential injustice, the Alberta Law Reform Institute recommended that the defendant must have had sufficient notice of the original proceedings before the end of the relevant limitation period such that he or she will not be prejudiced by being joined.^[21] However, the Institute conceded that even with this additional protection the policy reasons for a limitations system based on 'peace and repose' will not be satisfied.

Until the termination of the proceeding previously commenced, a potential defendant will be vulnerable to being drawn into it, he will enjoy neither peace nor repose, his economic mobility will be threatened by a potential liability of uncertain magnitude, he will have to continue protective insurance and he will have to retain his defensive evidence.^[22]

5.18      Is it necessary to relax the restrictions imposed on the addition of new parties? Any such reform must be viewed in the light of our overall recommendations for reform of the limitations regime. If the person seeking to add or substitute a new party has only just identified the correct claimant or defendant, then the relevant limitation period will not have expired (unless either the claimant ought to have identified the correct claimant or defendant at an earlier date, or the long-stop limitation period has expired). Section 35 of the Limitation Act 1980 will therefore most frequently be needed to correct mistakes, and these are permitted under the present provision.^[23] To some extent the position has been relaxed by the introduction of the Civil Procedure Rules. Unlike the Rules of the Supreme Court which they replaced,^[24] these no longer list the only five circumstances in which an addition is necessary to determine a claim, but simply repeat the wording of section 35.
5.19      Accordingly we recommend that there should be no reform in relation to the addition of new claims to existing proceedings where the new claim involves the addition or substitution of new parties. (Draft Bill, Cl 25(3), (4)).^[25]

3. The effect of the expiry of the limitation period

5.20      We have seen that as a general rule the expiry of the limitation period under the 1980 Act operates to bar the claimant's remedy, rather than extinguish his or her rights.^[26] The present exceptions to this general rule are land-related claims,^[27] claims for conversion,^[28] and claims barred by the long-stop under the Consumer Protection Act 1987.^[29]
5.21      In the Consultation Paper we provisionally proposed that no change should be made to the general rule that the expiry of the limitation period should merely bar the remedy. We explained that we could see no advantages in changing the present position, and that making 'extinction' the general rule could create difficulties, most notably in contribution cases.^[30] Nor did we think that it would be practicable to change the position in relation to the exceptional cases where the limitation period extinguishes the right, so that a uniform rule of barring the remedy could be applied. In land-related claims and conversion, such a reform would undermine the claimant's title acquired on the expiry of the relevant limitation period. The position relating to the expiry of the 'long-stop' period under the Consumer Protection Act 1987 is governed by European law and is consequently outside the remit of this Paper.
5.22      Our provisional proposals were overwhelmingly supported by consultees. Over ninety-five per cent of those who responded on this point agreed with the views expressed in the Consultation Paper that no change should be made to the present law on the effect of the expiry of a limitation period.
5.23      Accordingly we recommend that no change should be made to the present law on the effect of the expiry of a limitation period.

4. Restrictions on the claimant's right to sue

5.24      Although rare, situations exist where a cause of action has accrued and the limitation period commenced, but there is some procedural bar which prevents the claimant from commencing proceedings. The classic case illustrating this problem is Sevcon Ltd v Lucas CAV Ltd.^[31] The claimant argued that his patent had been infringed by the defendant at some point between the date on which the specification of the patent was published by the Patent Office and the date on which the patent was granted to the claimant. Under section 13(4) of the Patents Act 1949^[32] no proceedings could be commenced for infringement of a patent before the date of grant. But the House of Lords held that the cause of action for infringement accrued to the claimant on the date of the infringement, so that the limitation period started running at that point. As a result, the limitation period expired before the claimant was able to bring proceedings.
5.25      Although the position in relation to patent infringement has been much improved by the implementation of the Patents Act 1977, which restricts the period of time which may pass between the publication of a patent and its grant, a similar problem arises in miscellaneous other cases.^[33] In the Consultation Paper we therefore provisionally proposed the introduction of a general rule that, where the claimant's right to bring the claim is subject to a restriction, the running of time, for the purposes of the primary limitation period and long-stop limitation period, should be suspended from the date the claimant has done all that he or she could do to lift that restriction.^[34] Although this proposal in relation to the long-stop limitation period cuts across our general proposition that the defendant should not have to defend claims that relate to events which occur more than ten years before the claim is commenced,^[35] we believe that such is the unfairness to the claimant where a restriction prevents his or her ability to bring a claim within the long-stop limitation period, that the usual rule should be disapplied.
5.26      Our provisional proposal was greatly supported by consultees. Over ninety per cent of those who expressed a view agreed. Three consultees pointed out that it would be helpful if any new legislation further defined what was meant by a 'restriction'. First, it should be made clear that only legal restrictions, and not, for example factual restrictions such as a disability, were in contemplation. Secondly, the provision should exclude contractual restrictions. In particular, nothing should suggest that time does not run where the parties have agreed that obtaining an arbitration award is a restriction on their right to bring legal proceedings. We agree with both these suggestions and have included them in our recommendation. We will also make it clear that the fact that the cause of action has not yet accrued will not be considered a restriction suspending the long-stop limitation period.
5.27      In the Consultation Paper we proposed that time should stop running when the claimant has done all that he or she could do to lift the restriction. This is most relevant where the only restriction on the claimant is a requirement to obtain leave to make the claim. If the limitation period is only to be suspended when the claimant has done everything within his or her ability to remove any other restriction might not provide sufficient protection. For example, it may be that the restriction is imposed in year 1, and it is year 5 before the claimant could act to lift the restriction. Yet the primary limitation period, assuming that the cause of action is immediately discoverable, will have expired by this date. We therefore recommend that the suspension of the primary limitation period and the long-stop limitation period should commence as soon as the restriction is imposed, but that the claimant should not be considered to be under a restriction where leave is required to make the claim until he or she has taken all reasonable steps to obtain that leave.
5.28      Accordingly we recommend that

(1) the primary limitation period and the long-stop limitation period will be suspended during any period after the accrual of the cause of action in which the claimant is prevented from making a claim by any enactment or other rule of law (Draft Bill, Cl 30(1));

(2) the claimant will not be considered to be under a restriction if

(a) the claim could have been made by a litigation friend,

(b) the claimant is prevented from making the claim only because of the terms of a contract or

(c) if leave is required to make the claim, unless and until the claimant has taken all reasonable steps to obtain that leave (Draft Bill, Cl 30(2)).^[36]

5. The burden of proof

5.29      We explained in the Consultation Paper that under the current law it is not entirely clear who has the burden of proof on limitation.^[37] However, it seems to be the case that the burden of proof is on the claimant: that is, the claimant has the burden of disproving a limitation defence where the defendant has pleaded one.^[38] We provisionally proposed that, in general, the burden of proof should continue to rest on the claimant, but asked consultees whether they would favour placing the burden of proving the expiry of the long-stop limitation period on the defendant.^[39]
5.30      Over eighty per cent of the consultees who considered this issue agreed with our provisional proposal that, in general, the burden of proof on limitation should remain with the claimant. They endorsed the provisional view expressed in the Consultation Paper that it would be easier and less expensive for the claimant to provide evidence of his or her knowledge at any given time for the purpose of establishing the date of knowledge, than it would be for the defendant to provide such evidence. We agree. The same applies in the case of defences which are dependant not on the knowledge of the claimant, but on the knowledge, for example, of any person through whom the claimant claims, such as a previous assignor.^[40] Some concern was expressed as to how the proposal would work where the defendant alleges that the claimant had constructive as opposed to actual knowledge of the relevant facts. We suggest that where the claimant proves that he or she (or any person in whom the claim was previously vested) took all steps (if any) that a person in his or her circumstances and with his or her knowledge would reasonably have taken to acquire actual knowledge of the relevant facts, he or she would successfully discharge the burden of proof.
5.31      A substantial majority of consultees who expressed a view were of the opinion that, as an exception to the general rule, the burden of proving that the claim is barred by the long-stop should be placed on the defendant. Two principal reasons were given. First, the defendant is likely to be best placed to know when the cause of action accrues (or the date of the relevant act or omission which starts the long-stop limitation period running). Secondly, such a rule would be consistent with the general principle that a defendant must prove any 'defence' on which he or she intends to rely, and the objections to this which apply in the case of the primary limitation period do not apply to the long-stop limitation period.
5.32      Accordingly we recommend that:

(1) the burden of proof in relation to the primary limitation period and the date of knowledge of any person should be on the claimant (Draft Bill, Cl 37(1));

(2) the burden of proof in relation to any other defence under the Bill should be placed on the defendant. (Draft Bill, Cl 37(2)).

6. Commencement

5.33      In the Consultation Paper we provisionally proposed that the new Act should apply to all causes of action accruing before it commences, except where the cause of action has been barred by the expiry of a limitation period under the provisions of a previous Act or proceedings have been instituted in respect of a cause of action before the commencement of the Act. Where there is a discretion under the present law for the court to disapply the limitation period (as in personal injury, death and defamation cases) the claim would not be treated as time-barred unless that discretion had already been exercised in favour of the defendant.
5.34      We suggested that this limited form of retrospective application would have two advantages over a general rule of prospective application. First, it would allow for a more rapid implementation of the new Act's provisions. This is particularly important in those cases, such as sexual abuse claims, where the shortcomings of the present law are very evident. Secondly, it would prevent the present regime running in tandem with the new regime for an indefinite period of time into the future.^[41] At the same time the proposal would not act to deprive a defendant of an accrued limitation defence. We did, however, point out that where the relevant limitation period would be reduced under our proposals, the effect would be to deprive claimants of an existing right to bring a claim.^[42]
5.35      Consultees expressed considerable opposition to our provisional proposals (over thirty-five per cent disagreed with the proposals altogether). The most marked criticism of the provisional proposals came from insurance companies. They were concerned that the retrospective reduction in the limitation period applicable to claims for breach of contract from six to three years would have particularly harsh consequences for the insurance industry, since reinsurance receivables form a very important part of an insurance company's assets. It was suggested to us that the risk that an insurance company would be deprived of the right to bring a claim in respect of an existing cause of action under a reinsurance contract would result in a substantial reduction in the value of its assets and could ultimately lead in some cases to insolvency.
5.36      A similar problem applies in relation to claims on a specialty. In some cases, the parties will have entered into a contract in the form of a deed in order to take advantage of the present twelve year limitation period that applies to specialties. That is, the parties effectively agreed that the relevant limitation period for breach of their agreement should be twelve years, but rather than including this as an express term, they simply executed the contract as a deed. To apply the core regime to a claim in respect of the breach of such an agreement would risk upsetting the bargaining position between the parties, by effectively altering this one term of the contract. Accordingly, we recommend that where a specialty has been entered into prior to the commencement of the new Act, the present limitation regime only should apply to a claim on that contract, regardless of the date on which that cause of action arises.
5.37      Concern was also expressed on behalf of the Crown. The present limitation period in respect of such claims is thirty years, but we recommend that this should be reduced to ten.^[43] Without further provision, the Crown (and the Church of England) would be given only the length of the 'lead-in' time to the Act (together with any prior notice they may have of the proposed provisions as the Bill passes through Parliament) in which to survey all their land and, if necessary, commence proceedings against squatters. Some government departments with extensive holdings of land have told us that this would not be feasible.
5.38      In the light of these concerns, we have reconsidered our proposals, with a view to limiting their retrospective effect. In principle, the new Act will still apply to all claims accruing before its commencement except where the claim has been barred by the expiry of a limitation period under the provisions of a previous Act or proceedings have been issued in respect of the claim before the commencement of the Act and there will be a year's delay after the Act is passed before any provisions come into force. However, we propose to provide that, in addition, where the cause of action accrued before the commencement of the new Act, the limitation period should expire on the later of the following two dates:

(1) the date on which time would have expired under the previous law or

(2) the date on which time would expire under the new Act.

5.39      This will ensure that, in most cases, the claimant whose cause of action accrued before commencement will not be prejudiced by the implementation of the new Act. Where the old law would allow the claimant the benefit of a longer limitation period, that limitation period will continue to apply. This will be subject to the following exceptions. Where no limitation period at all applies to a claim under the current law, following this rule would mean that the limitation regimes under the old law would continue to co-exist with the new regime we propose for an indefinite period. We do not think that this is acceptable. We therefore propose that in this case, the claimant should be allowed at least six years from the date of commencement of the new Act, but no longer (unless the claimant would have the benefit of a longer period under the current law, because he or she does not have the relevant knowledge to trigger the limitation period). Similarly, we propose that the limitation period applying under the previous law in the case of a claim founded on fraud or mistake should not continue to apply for more than six years after the commencement of the new Act. We consider that it would be unfortunate if, for example, if the claimant who made a payment in reliance on a mistake of law shortly before the new Act came into force but only discovered the mistake twenty or more years later was still able to rely on the old law. In addition, in considering what date the limitation period would have expired under the previous we propose that no account should be taken of the effect of 'deliberate concealment' under the previous law. This is necessary to ensure that our provisions on deliberate concealment apply immediately the new Act comes into force.
5.40      Accordingly, we recommend that:

(1) The new Act should come into force one year after the day on which it is passed (Draft Bill, Cl 40(1)).

(2) The proposed new Act should apply to causes of action accruing before it commences, except where the claim has been barred by the expiry of a limitation period under the provisions of a previous Act or proceedings have been instituted in respect of a claim before the commencement of the Act. (Draft Bill, Cl 40(2), (3)(a), (b))

(3) Any claim arising under a contract entered into under seal before the commencement of the new Act shall be subject to a limitation period of twelve years from the date of accrual of the cause of action. (Draft Bill, Cl 40(3)(c)).

(4) Where the cause of action accrued before commencement, and no limitation period applied to that claim under the previous law, the limitation period will expire on the later of

(a) the date six years from commencement or

(b) on the expiry of the limitation period applying under the new Act. (Draft Bill, Cl 40(4)).

(5) In any other case, where the cause of action accrued before commencement, the limitation period will expire on the later of

(a) the date on which time would have expired under the previous law or

(b) the date on which time would expire under the new Act. (Draft Bill, Cl 40(5))

(6) In determining when the limitation period applicable under the previous law would have expired,

(a) no account shall be taken of the effect of deliberate concealment under section 32(1)(b) of the 1980 Act (Draft Bill, Cl 40(6)(a));

(b) section 32(1)(a) and (c) of the 1980 Act shall be considered to extend the limitation period for no more than six years from the date on which the Act comes into force (Draft Bill, Cl 40(6)(b)).

7. The decision in Arnold v Central Electricity Generating Board^[44]

5.41      In the Consultation Paper^[45] we drew attention to the decision of the House of Lords in Arnold v Central Electricity Generating Board.^[46] A claim was brought under the Law Reform (Miscellaneous Provisions) Act 1934 and the Fatal Accidents Act 1976 by the widow of a man who died in 1982 from mesothelioma caused by exposure to asbestos during his employment with the defendant's predecessor, a public authority. It was agreed that his cause of action accrued at the latest by April 1943, although the deceased only discovered his injury in 1981. The defendant pleaded a limitation defence under section 21 of the Limitation Act 1939, which applied a limitation period of one year from the date the cause of action accrued to claims against public authorities. This provision was repealed by the Law Reform (Limitation of Actions, etc.) Act 1954, which was itself followed by the Limitation Act 1963, the Limitation Act 1975 and the Limitation Act 1980. The question at issue was therefore whether any of these successive Limitation Acts had had the effect of reviving a previously time-barred cause of action.
5.42      It was not in dispute that the 1963 Act operated retrospectively, when certain conditions were satisfied, to deprive a defendant of an accrued time bar in respect of a claim for damage for personal injuries in which the cause of action had accrued since 4 June 1954 (the date of implementation of the 1954 Act). It was the 1963 Act that first introduced the concept of discoverability for personal injury claims in order to prevent injustice where the claimant suffered a latent disease. And it was quite clear that it was intended to have some retrospective effect. However, after detailed consideration of the relevant provisions of the Act, the House of Lords held that it did not operate retrospectively to remove an accrued time-bar in any personal injury case where the cause of action accrued before 4 June 1954, whether the claim was brought against a public authority or other defendant. This decision represented a considerable curtailment of the retrospective effect of the Limitation Act 1963.
5.43      In the Consultation Paper^[47] we noted that the decision clearly had potential to cause injustice and the Law Reform Advisory Committee for Northern Ireland had recommended that it should be reversed by legislation.^[48] However, since we believed that its likely future impact would be very limited, we did not recommend overruling it by way of legislation. These comments were made in the light of our provisional proposal that a thirty year long-stop limitation period should apply in personal injury claims. Under these provisional proposals, a claim in respect of a cause of action that accrued before 1954 would, therefore, have been in any event time-barred, so that a reversal of the Arnold decision would have no practical effect. However, we now recommend that no long-stop should apply in personal injury claims.^[49] We have reconsidered whether the new Act should overrule the effect of the Arnold decision in the light of this change to our recommendations. Clearly, therefore, without further provision, the Arnold decision could still, in some cases, operate to time-bar causes of action in respect of personal injuries. However, we remain concerned that the result of any such legislation would be to allow claims dating before 1954 to be brought fifty years or more after the events giving rise to the claims. After so long, it would be very difficult to give a fair trial to the matters concerned. Any such legislation would also deprive the defendants (after several decades) of an accrued limitation defence. We are not convinced that such a provision would be of sufficient benefit to justify this. Accordingly we do not recommend legislating to overrule the decision in Arnold v Central Electricity Generating Board.

Note 1    Limitation of Actions, Consultation Paper No 151 (1998), para 14.10.    [Back]

Note 2    The Civil Procedure Rules 1998, SI 1998/3132.    [Back]

Note 3    CPR Part 7, PD 5.1.    [Back]

Note 4    Limitation of Actions, Consultation Paper No 151 (1998), paras 9.28 - 9.33.    [Back]

Note 5    See paras 2.105 - 2.113 above.    [Back]

Note 6    A new claim is defined as being “any claim by way of set-off or counterclaim, and any claim involving either (a) the addition or substitution of a new cause of action; or (b) the addition or substitution of a new party”: Limitation Act 1980, s 35(2).    [Back]

Note 7    Third party proceedings are defined as being “any proceedings brought in the course of any action by any party to the action against a person not previously a party to the action, other than proceedings brought by joining any such person as defendant to any claim already made in the original action by the party bringing the proceedings”: Limitation Act 1980, s 35(2).    [Back]

Note 8    For detailed discussion, see Limitation of Actions, Consultation Paper No 151 (1998), paras 9.28 - 9.33.    [Back]

Note 9    Welsh Development Agency v Redpath Dorman Long [1994] 1 WLR 1409.    [Back]

Note 10    Two exceptions are made to the imposition of these special restrictions: Limitation Act 1980, s 35(3). First, no restrictions are imposed where the court exercises its discretion under Limitation Act 1980, s 33 to exclude the relevant time limits for actions in respect of personal injuries or death. Secondly, no restrictions are imposed where the new claim is brought by way of an original set-off or counterclaim. An original set-off or an original counterclaim is a claim made by way of set-off or (as the case may be) counterclaim by a party who has not previously made any claim in the action. The purpose of this second exception is to protect the defendant’s position where the claimant commences proceedings very close to the expiry of the limitation period. We do not intend to make any recommendations for reform in relation to these provisions. See Draft Bill, Cl 25(1).    [Back]

Note 11    Limitation Act 1980, s 35(3), (4) and (5).    [Back]

Note 12    CPR, r 17.4(2).    [Back]

Note 13    Limitation of Actions, Consultation Paper No 151 (1998), paras 14.11 - 14.14.    [Back]

Note 14    Institute of Law Research and Reform, Alberta Limitations, Report for Discussion No 4 (1986) para 5.22.    [Back]

Note 15    See Alberta Law Reform InstituteLimitations, Report No 55 (1989) pp 41 - 42 and s 6 of the Limitations Act 1996 c L-15.1.    [Back]

Note 16    New Zealand Law Commission, Report No 6, Limitation Defences in Civil Proceedings, NZLC R6 (1988) paras 430 - 433.    [Back]

Note 17    See, for example, Benzie v Happy Eater Limited, 18 May 1990 (unreported).    [Back]

Note 18    Limitation Act 1980, s 35(3), (4) and (5).    [Back]

Note 19    Limitation Act 1980, ss 35(5)(b) and 35(6).    [Back]

Note 20    Limitation Act 1980, s 35(7) permits rules of court to provide for a party to an action to be allowed to claim relief in a new capacity even though he had no title to make that claim at the date on which the action was commenced. We propose to preserve this power (see Draft Bill, Cl 25(5) and (6).    [Back]

Note 21    See Alberta Law Reform Institute, Limitations, Report No 55 (1989) pp 41 - 42, 81 - 82 and s 6 of the Limitations Act 1996 c L-15.1. The Law Reform Institute’s proposals were based on a model suggested by G D Watson in “Amendment of Proceedings after Limitation Periods” (1975) 53 Can Bar Rev 237.    [Back]

Note 22    Alberta Law Reform Institute, Limitations, Report No 55 (1989) p 89.    [Back]

Note 23    The Rules of the Supreme Court previously only included one provision (Ord 20 r 5(3)) in relation to the addition or substitution of new parties to rectify a mistake, in wording similar to that now in Rule 17.4(3). This had been construed narrowly, so that a distinction was drawn between a mistake as to the identity of the person intending to sue and a mistake as to the name of the party. An amendment was only allowed in the latter case: IBSSL v Minerals and Metals Trading Corporation [1996] 1 All ER 1017. However, new Rule 19.5(3)(a) also deals with the rectification of mistakes in broader terms, and has not had such a narrow interpretation: Gregson Channel Four Television Corporation, CA, The Times, 11 July 2000 and Re HHR Litigation, QBD, unreported, 26 February 2001.    [Back]

Note 24    RSC, Ord 15, r 6(6).    [Back]

Note 25    Although we recommend that the Rules Committee reconsider Rule 17.4(3), with a view to its repeal to the extent that it overlaps with Rule 19.5(3)(a).    [Back]

Note 26    See para 2.93 above.    [Back]

Note 27    Limitation Act 1980, s 17.    [Back]

Note 28    Limitation Act 1980, s 3.    [Back]

Note 29    Limitation Act 1980, s 11A(3). In addition, there are cases outside the ambit of the Limitation Act 1980, where the expiry of the limitation period extinguishes the right. For example, the expiry of the one-year limitation period imposed under article 3(6) of the Hague-Visby Rules also serves to extinguish the right, rather than merely bar the remedy.    [Back]

Note 30    Limitation of Actions, Consultation Paper No 151 (1998), para 14.21.    [Back]

Note 31    [1986] 1 WLR 462, HL.    [Back]

Note 32    Now replaced by the Patents Act 1977, s 69(2).    [Back]

Note 33    For example, a solicitor is forbidden to bring an action on a bill of costs until the expiry of one month from the delivery of the bill to his or her client. The cause of action for recovery of costs, however, accrues on completion of the work: Coburn v Colledge [1897] 1 QB 702. And a cause of action for false imprisonment against justices for exceeding their jurisdiction accrues on the date of the false imprisonment, even though the plaintiff is unable to bring proceedings until the order on which the imprisonment was based is formally quashed: O’Connor v Isaacs [1956] 2 QB 288.    [Back]

Note 34    Limitation of Actions, Consultation Paper No 151 (1998), para 14.27.    [Back]

Note 35    See paras 3.99 - 3.101 above.    [Back]

Note 36    We are grateful to Professor Andrew Tettenborn who suggested that we should adopt wording similar to this.    [Back]

Note 37    Limitation of Actions, Consultation Paper No 151 (1998), paras 9.23 - 9.25.     [Back]

Note 38    CPR, Part 16, PD 14.1 provides that in his or her defence, the defendant must give details of the expiry of any relevant limitation period relied on.    [Back]

Note 39    Limitation of Actions, Consultation Paper No 151 (1998), paras 14.31 - 14.32.    [Back]

Note 40    See paras 3.92 - 3.94 above.    [Back]

Note 41    As would be the case if the new Act were only to apply prospectively, for example, in defamation claims, in theft claims, claims by a beneficiary in respect of a fraudulent breach of trust or against the trustee, claims where the defendant has deliberately concealed relevant facts or has been fraudulent, and claims based on the claimant’s mistake.    [Back]

Note 42    Limitation of Actions, Consultation Paper No 151 (1998), paras 14.33 - 14.36.    [Back]

Note 43    See paras 4.138 - 4.144 above.    [Back]

Note 44    [1988] AC 228.    [Back]

Note 45    Limitation of Actions, Consultation Paper No 151 (1998), para 9.38.    [Back]

Note 46    [1988] AC 228.    [Back]

Note 47    Limitation of Actions, Consultation Paper No 151 (1998), para 9.38 n 107.    [Back]

Note 48    Law Reform Advisory Committee for Northern Ireland, Fourth Annual Report (1992-93) p 10 - 11 and Discussion Paper No 2 on Actions Arising out of Insidious Diseases (July 1992).    [Back]

Note 49    See paras 3.102 - 3.107 above.    [Back]