Analysis
The claimants were the administrators of their parents’ estates and they had engaged the defendants (a firm of solicitors and one of the firm’s legal executives) to advise them in the administration. The claimants commenced proceedings against the defendants for breach of duty and dishonestly procuring a secret profit in relation to the sale of the principal asset of the estate. Believing the matter to be time barred, the defendants made an application for summary judgment. The court allowed this application and dismissed the claims on the basis of expiration of the limitation period.
The claimants appealed and the Court of Appeal overturned the dismissal of the secret profits claim as it was considered that this was not a matter that should have been dealt with summarily. The matter was returned to the High Court to be heard as a preliminary issue.
The issue before the High Court was whether the secret profits claim had been brought in time for limitation purposes. Both parties agreed that the cause of action arose on 6 February 2003 and therefore that the date for limitation purposes was 6 February 2009. The claim was formally issued by the court office on 17 February 2009.
The solicitors for the claimants argued that the claim had been issued in time as they had originally sent the claim form, particulars of claim and the appropriate fee to the court on 3 December 2008 by DX. They gave oral evidence of their office procedures (no contemporaneous written record was kept of important paperwork leaving the office) and they considered this to demonstrate that the only explanation for the missing paperwork was that the court office had lost it. As the paperwork should have arrived on or before 5 December 2008, they were ‘in time’.
By way of secondary argument, they stated that by mid-January 2009 they had not received the issued claim form so they contacted the court office. They were advised that the claim had not been received and so the claim paperwork was resent together with the fee on 4 February 2009. This was received by the court on 6 February 2009. On 10 February 2009 the claimants’ solicitors were contacted by a court officer who advised them that the incorrect fee had been sent and a further £400 was payable. The claimants’ solicitors sent this and it arrived on 17 February 2009. The court office issued the claim on the same day. The claimants’ solicitors did not consider that the absence of the correct fee should mean that the claim was time barred as the claim paperwork had arrived on 6 February 2009.
Held:
- 1) The duty was on the claimants to ensure that the claim was issued before the expiration of the limitation period, or that at the very least they had done everything reasonably possible to ensure that the claim was issued within time.
- 2) Despite witness evidence of office procedures for sending documents in the DX at the claimants’ solicitors and of the ‘impossibility’ of these papers accidentally being left in the office, the claimants had not provided any contemporaneous records evidencing that this paperwork was sent. The court office, on the other hand, had a record receipt system which could identify the date of receipt of documentation. While it could not be said that the court’s system was faultless, the procedures that were in place meant that, on balance, it was more likely than not that the court office had not received the December 2008 paperwork.
- 3) Although the second set of paperwork arrived at court on 6 February 2009, the appropriate fee was not attached. This was only received on 17 February 2009. The Court of Appeal had identified the need to include the appropriate fee as an essential requirement for a claim to be complete and capable of issue. The High Court was of the same view.
- 4) The claimants had therefore not done all they could reasonably be expected to do to ensure that the claim was issued within limitation. Further steps could have been taken by them. The fact that they were not was a risk which they unilaterally took.
- 5) Unless s21 of the Limitation Act 1980 can be applied, the claim was time barred. The application of s21 was the reserve of the Court of Appeal and the case was to be remitted to that court.
Continue reading "Page & anr v Hewetts [2013] EWHC 2845 (Ch)"