PAYING THE CORRECT COURT FEE AND LIMITATION: HIGH COURT DECISION CONSIDERING THE RELEVANT PRINCIPLES

One decision that has led to interlocutory skirmishing and opportunistic applications is  Lewis v Ward Hadaway [2016] 4 WLR 6, [2015] EWHC 3503 (Ch) and the consequences of failing to pay the correct court fee on issue.  This has left many ancillary issues open ended, and no end of interlocutory sparring in some cases. Some of those issues were considered by Mr Justice Stuart-Smith in Dixon -v- Radley House Partnership [2016] EWHC 2411 (TCC).

“…I hold that “the appropriate fee” for the purposes of the principle enunciated by the Court of Appeal in Page v Hewetts is the fee required by the relevant order which is to be determined by reference to the claim or claims articulated in the claim form (and, if issued simultaneously, the Particulars of Claim). In the absence of abusive behaviour, it is not to be determined by reference to claims which are articulated later, whether or not the later claims are ones which the Claimant hoped or even intended to bring later at the time of issuing proceedings.”

“To my mind, the undesirability of the principle for which the Defendants contend is brought into sharp focus when it is remembered that the payment of fees is a matter for the benefit of the Court and is very largely irrelevant to the opposing parties. When asked what actual prejudice their clients had suffered as a result of the asserted underpayment of issue fees in this case, Counsel for RHP and CRA were unable to identify any substantial prejudice at all. The best that could be suggested was that the underpayment of issue fees left the Claimants more money with which to fight the Defendants. In the context of the overall costs of this action, that suggestion pales into insignificance.”

KEY POINTS

  1. The question of whether the correct fee has been paid for the purpose of the issue of proceedings under the Limitation Act is to be assessed by reference to the claim set out on the claim form.
  2. In the absence of abusive behaviour the later amendment or increase in value of the claims is not relevant to the issue of whether proceedings have been issued correctly.
  3. The judge refused the defendants’ applications for amendment to plead limitation on the grounds that they had no prospect of success.

THE CASE

The claimants were bringing an action in contract and tort claiming breach of contract/negligence.

Proceedings were issued on the basis of the claim form claiming £35,894.78. The correct fee for this claim (£395) was paid.   However the Particulars of Claim made various, much higher, claims for damages.

A second set of proceedings were issued were the claim was put “to be assessed” and a court fee of £2,500 paid. There were various stays and the proceedings were consolidated and transferred to the TCC.

THE DEFENDANTS’ AMENDMENTS

In April 2016 the defendants proposed to amend the Defence to plead limitation and asked the claimants to agree. The defendants argued that, because the incorrect court fee was paid, the action was statute barred.

THE HEARING

The defendants applied for permission to amend their defences to plead limitation.

THE JUDGMENT ON THIS ISSUE

The judge set out the history of arguments relating to payment of the correct fee in detail and then considered the Ward Hadaway decision.
  1. A similar situation arose in Lewis v Ward Hadaway [2016] 4 WLR 6, [2015] EWHC 3503 (Ch), with the added ingredient of abusive behaviour on the part of the Claimants. They brought a number of negligence claims against a firm of solicitors. Some sets of proceedings were issued in time; but some were not issued until after the expiry of the limitation period although the claim forms had been delivered to the court before expiry. In each case the pre-action letter of claim sought substantial sums, but the value of the claim stated in the claim form was considerably lower and the court fee paid by the Claimants was that which was payable for the lower value claim. In every case the issued claim form was subsequently amended to claim the larger amount referred to in the pre-action letter of claim, and the appropriate court fee was paid on amendment. The Defendant applied to strike out all of the claims on the basis that the Claimants had deliberately understated the value of their claims in order to defer payment of the correct fee, which it contended was an abuse of the process. In the alternative, it applied for summary judgment in those claims where the claim form had not been issued until after the expiry of the limitation period, on the ground that they had not been “brought” within the periods in sections 2 and 5 of the Limitation Act 1980. Mr John Male QC, sitting as a deputy Judge of the Chancery Division, dismissed the first application (to strike out all of the claims) but acceded to the second application (for summary judgment where the claim forms had not been issued in time).
  2. The first application in Lewis differed fundamentally from the present application to amend, since there is no allegation of abusive behaviour on the part of the present Claimants and no application to strike out. However, it is to be noted that – even in a case where the failure to pay the proper fee amounted to an abuse of the process of the Court – it was not held either (a) that the eventual issuing of proceedings was a nullity (in the sense of being of no effect at all) or (b) that time had not ceased to run on and from the date that proceedings were issued or (c) that the claims which had been issued before the expiry of the limitation period were statute barred because of the failure to pay the fee that was appropriate to the claim that the Claimants had always intended to bring.
  3. The second application was only brought in respect of those claims where the Claim Forms had been issued after the limitation period had expired. The decision of Mr Male QC on the second application was that the Claimants had not done all that was required of them so as justify a finding that their claims were “brought” before proceedings were issued. At [44]-[48] he highlighted the conduct of the Claimants in deliberately understating the quantum of the claims in the Claim Forms so as to defer payment of the full and proper fee for the claims they always intended to bring; he referred to the public interest in all Claimants paying the full fees that are due on their claims; and he suggested that the Claimants may have gained some unspecified advantage over the Defendant by stopping time running without paying the full fees. Taking these factors together led him to conclude that the Claimants’ behaviour was an abuse of the process in the sense explained by Lord Bingham of Cornhill in Attorney-General v Barker [2000] 1 FLR at [19] – “a use of the court process for a purpose or in a way which is significantly different from the ordinary and proper use of the court process.” That conclusion paved the way for him to decide (at [101]) that “paying the appropriate fee” (as discussed by the Court of Appeal in Page v Hewetts) “does not cover the payment of a fee in circumstances where the act of payment was an abuse of process.” On the facts with which Mr Male QC was dealing, I respectfully agree. However, he did not say or imply that a non-abusive under-payment of a fee means that the issuing of the claim form by the Court is ineffective to stop time running. I do not consider that, properly understood, Lewis v Ward Hadawayprovides any support for the Defendants on the present application in relation to the period after proceedings had been issued.
  4. The only authority to which I have been referred that is capable of supporting the Defendants’ applications in relation to the period after proceedings had been issued is the ex tempore judgment of Warby J in Bhatti v Ashgar [2016] EWHC 1049 (QB). The transactions at issue took place between 2007 and 2009. Proceedings were issued in October and December 2014. Defences were served in March 2015. On 10 February 2016 the Defendants issued an application for summary judgment or to strike out the proceedings. The application notice did not specify the basis for the application but it was subsequently said that (a) the Claimants had acted in a manner that amounted to an abuse of the process of the Court and (b) the Claimants had not paid the appropriate fee on issuing proceedings in 2014 and that, on that basis, the Claimants’ claims were (still) not “brought” for the purposes of the Limitation Act, with the result that (if they were now to be “brought”) they would be time barred: see [14]-[16]. At the hearing of the application, a month before the scheduled date for trial, the Defendants did not press the allegations of abuse of process, although they continued to assert that there had been deliberate understatement of the claim leading to underpayment of the fee required by the Civil Proceedings Fees Order 2008 and successor provisions. Warby J was satisfied that there was underpayment of the required fees on issue of the claims: see [35]. He was also satisfied that the limitation period for claims in contract had expired, though limitation was not being put forward as an answer to all the claims: see [36] and [37(7)].
  5. The Defendants cited Page v Hewetts and Lewis v Ward Hadaway in support of submissions that (1) an action is only “brought” within the meaning of s. 5 when a claimant has done all he can to set the wheels of justice in motion; and (2) a claimant has not done that if he has failed to pay the appropriate fee for the issue of the claim form: see [28]. In his very brief summary of what was decided in Page v Hewetts, Warby J said at [29] that “the claim was ultimately dismissed on limitation grounds on the basis that the claimant’s request to the court for the issue of the claim, submitted on the last possible date, had not been accompanied by the appropriate court fee.” Referring to Lewis v Hadaway he said that “in that case the Judge held that the fact that the appropriate fee had not been paid on the issue of the claim form (my emphasis) meant that the claim was not “brought” for the purposes of the Limitation Act and granted summary judgment accordingly.”
  6. It is clear that these brief summaries were not intended to be detailed expositions of what the cases had decided. However, I do not feel able to adopt the summary of Lewis v Hadaway, even allowing for its brevity, since the point of the second application in Lewis (on which the Defendants had succeeded) was that it related to claims where the proceedings had been issued out of time. The issue was whether time had been stopped within time by the Claimants’ earlier (abusive) presentation of claim forms with an inadequate fee, as described above. The fact that an inadequate fee was paid “on issue of the claim form” was irrelevant to the decision of Mr Male QC in Lewis v Hadaway. It does not appear from the judgment that this point of distinction was taken by the Claimants in Bhatti.
  7. At [34], Warby J summarised the position on the basis of the submissions and authorities that had been cited to him as follows:
“These authorities appear to identify a clear principle by which the court is to determine whether a claim has been “brought” for the purposes of stopping the limitation [period] from running, the principle being that a claim is only brought for those purposes when the party concerned has done all that is in his power … to set the wheels of justice in motion. If he has done that, then the risk of any failing on the part of the court is cast upon the court and the opposing party.”
This summary, to my mind, does not draw the necessary distinction between (a) the possible effect of the Claimants’ actions before the wheels of justice are set in motion by the issuing of the claim form and (b) the actual effect when the wheels of justice are set in motion by the issuing of the claim form (even if an inadequate fee has been paid). The authorities to which the Learned Judge was referred in Bhatti v Ashgar (which included additionally the decision of the Court of Appeal in Barnes v St Helens MBC [2006] EWCA Civ 1372 [2007] 1 WLR 879) seem to me to provide no support for the proposition that, at least in the absence of abusive conduct, a claim is not “brought” for the purposes of the Limitation Act 1980 if the appropriate fee for issue is not paid when the Court issues proceedings.
  1. In rather different circumstances, the authorities to which I have referred were cited to Mr Ter Haar QC, sitting as a Deputy Judge of the Queen’s Bench Division in Glenluce Fishing Company Ltd v Watermota Ltd. [2016] EWHC 1807 (TCC) on a Claimant’s application to amend to increase the value of its claim outside the limitation period. With suitable restraint and courtesy he made clear his concern at the significant extension of principle and the apparent introduction of a new “hard-edged” principle in the first instance decisions culminating with Bhatti. I respectfully agree with his concerns.
  2. In a case where (a) abusive conduct is not present and (b) the court sets the wheels of justice in motion by issuing proceedings but (c) the Claimant has not paid and the Court has not required the correct fee, I reject the submission that an action is not brought for the purposes of the Limitation Act 1980 at the moment of issue. There is no support for the submission either in statute or in authority other than in Bhatti. For the reasons set out above I am not able to follow the path taken by Bhatti.
  3. Where a Claimant wishes to establish that time stopped running before the date on which the Court issued proceedings, the principle established byPage v Hewetts applies: time will only stop running once the claim form is delivered to the court office, accompanied by a request to issue and the appropriate fee. The Court of Appeal did not define what it meant by “the appropriate fee”. It concentrated on the injustice of risk being left with the Claimant where the Claimant “had done all that was required of him” or had done “all that was in [his] power to set the wheels of justice in motion”: see [34] and [35]; and upon the injustice to the litigant in being “responsible for any shortcomings of the court” or responsible where “the court is itself responsible for delay in issuing or loss of the originating process”: see [36] and [37]. And, at [33] Lewison LJ said that “It does not seem to me that the reason why the court fails to process the request in time alters the justice of the case.”
  4. There may be cases where it is clear that, as a purely mathematical calculation, the fee proffered by the Claimant is not appropriate. A simple example would be where a liquidated claim is identified in the submitted claim form, and the relevant order specifies a greater fee for a claim of that value than is proffered. Many claim forms may, however, identify one liquidated sum in respect of one claim but allow for the possibility that the sum claimed in respect of that one claim may increase; or that other claims may be developed which are not currently identified as liquidated sums; or may claim further or other relief that could affect the fee payable then or later. Sometimes there may be a dispute about what is the appropriate fee, even before proceedings are issued. Thus in Page v Hewetts, when the papers were received in the Registry on 6 February 2009, they were accompanied by a cheque for £990. The Registry took the view (correctly, as Hildyard J found) that the correct fee was £1390 and informed the solicitors. The full £1390 was received on 17 February 2009 and proceedings were issued by the Court on that date: see the decision of Hildyard J at [27] and [46]-[54].
  5. The decision of Hildyard J that the claim as presented was both a money claim and an additional non-money claim meant that the appropriate fee was then certain, and was £1390. That fee was not offered before the limitation period expired on 6 February 2009 and the Court did not issue proceedings until the increased fee was paid. Hildyard J did not address the question that arises in the present application where there is a dispute about the value of the money claim that is being advanced and whether it falls within one bracket or another for the purposes of determining the appropriate fee. Nor did he directly address what the outcome should have been if the Court had not demanded the additional fee payment but had issued the proceedings on the payment of £990.
  6. In Lewis, although the fee that was proffered was the fee that matched the sum (abusively) identified in the claim form as the sum claimed, Mr Male QC at [100] approached the question by asking whether the Claimants had done all that was in their power to do to set the wheels of justice in motion:
“Again, the claimants could have acted in a manner which was not an abuse of process. So, at the outset they could have paid the fees properly due for the claims which they always intended to make. …
[101] In my judgment, paying “the appropriate fee” does not cover the payment of a fee in circumstances where the act of payment was an abuse of process.”
Mr Male QC did not determine what the outcome should be in a case where (a) the Claimant’s conduct is not abusive and (b) the Court accepts the proffered fee, which is subsequently said to be inadequate, and issues proceedings.
  1. In Bhatti, Warby J held that the appropriate fees had not been paid, for the reasons summarised at [35], where he said:
“First, the assessment of what was a correct fee must be based on the documents presented to the court at the time of issue, that is to say the claim form and, if it is available, Particulars of Claim. One must take the claim to be as stated in those documents. Secondly, the money claim for this purpose must include any interest on a claim for a specified sum, because the Statutory Instrument so provides. Therefore, the interest on the liquidated claims in these cases must be included. Thirdly, the inclusion of a non-money claim, even one as generalised as in this case, for “further or other relief” of an unspecified nature, appears to me to trigger an obligation to pay the £480 provided for by paragraph 1.5 of the schedule. In the Aslam claim therefore, the fee should have reflected the liquidated claim, the interest on that claim, and the unliquidated claim. The aggregate of these, as pleaded, plainly exceeded £150,000, so the additional £200 should have been paid. Since further and other relief was claimed another £480 should have been paid. I accept therefore that there was an underpayment of about £680. In the Rashid claim a further £480 should have been paid, because of the claim for further or other relief.”
  1. These authorities leave open two possibilities for what should be regarded as “the appropriate fee” for the purposes of the principle laid down by the Court of Appeal in Page v Hewetts when applied to a case where the Court has issued proceedings on payment of a fee which is subsequently said to have been inadequate and therefore inappropriate. The more favourable to Claimants would be to hold that the fee proffered, even if it could be shown to be less than that required by the relevant order, was appropriate because it has proved to be all that the Claimant was required to do to set the wheels of justice in motion. The advantage of this approach would be to discourage satellite litigation such as the present, which could (as Pageshows) involve not merely enquiry into the actions of the Claimant but also into the actions of the Court, including investigation into why the Court had issued proceedings as and when it did. It could also be said to meet the justice of the case as articulated by the Court of Appeal: see [47] above. The more rigorous approach is to say that the “appropriate fee” in this context is the fee dictated by the terms of the relevant order. In principle this seems to me to be preferable, because there is no obvious reason why a Claimant should be said to have “brought” a claim for the purposes of the Limitation Act 1980 or any other act when it has failed to proffer the fee to which the Court is entitled and which the Court should normally have demanded as the price for issuing proceedings. Where the proffered fee is less than required by the relevant order, the fact that the Court has subsequently issued proceedings should be seen as good fortune for the Claimant rather than as validating the proffered fee: it does not prevent the Court from requiring payment of the shortfall either on issue or later.
  2. It also seems right in principle that, as Warby J indicated at [35] of Bhatti, the “appropriate fee” should be determined by reference to the terms of the claim form that is issued (or, if Particulars of Claim are issued simultaneously, the claim form and Particulars of Claim combined). Subject to one qualification, the fact that the quantum of a claim or claims is subsequently increased is irrelevant to the calculation of the fee payable on issue, assuming always that the Claimant’s behaviour is not abusive. Thus, assuming that the Claimant’s behaviour is not abusive, the fact that the Claimant hopes or intends to bring a claim which cannot be either articulated or quantified at the time of the issuing of proceedings should not require payment of the fee that would have been payable if it had been articulated or quantified. It is common experience that a Claimant will issue a claim form when he is able to articulate and quantify one claim or one aspect of a claim but not others, even though he hopes and intends to bring them when he can. In such a case it is, in my judgment, both conventional and proper for the Claimant to protect himself by including general words which, he hopes, will be sufficient to be a vehicle for the further claims or quantification if they can subsequently be pleaded. If and when the further claims or quantification can be pleaded, further fees may become properly payable.
  3. The qualification to which I have referred is the statutory provision introduced shortly before March 2015 that, where a claimant does not identify the value of the claim when starting proceedings to recover a sum of money, the fee payable is the one applicable to a claim where the sum is not limited. The effect of this provision is to alter the position both where the sum of money claimed is entirely unquantified and where the claim is partially but not fully quantified. Before that provision came into force, a claim which was partially quantified but which left open the possibility of further articulation of claims generally covered by the terms of the claim form would have required payment of the fee appropriate to the quantified sum (including interest); after the provision came into force, it would be regarded as a claim where the sum is not limited.
  4. For these reasons, I hold that “the appropriate fee” for the purposes of the principle enunciated by the Court of Appeal in Page v Hewetts is the fee required by the relevant order which is to be determined by reference to the claim or claims articulated in the claim form (and, if issued simultaneously, the Particulars of Claim). In the absence of abusive behaviour, it is not to be determined by reference to claims which are articulated later, whether or not the later claims are ones which the Claimant hoped or even intended to bring later at the time of issuing proceedings.
  5. Where a party engages in abusive behaviour a range of responses are open to the Court, up to and including striking out a case altogether. Since there is no allegation that the Claimants’ conduct in this case has been abusive it is neither necessary nor desirable to attempt to define or calibrate what the likely response of the Court would be if it decided that a Claimant had been guilty of abusive conduct in relation to the under-payment of fees where proceedings had been issued. It is worth noting, however, that even where a Claimant’s failure to pay the correct fee on issue is not abusive conduct, a range of options would be available to the Court. If identified before issue, the Court may simply refuse to issue the proceedings until the proper fee is paid. If proceedings are issued, the Court could direct the payment of the missing fee either at the time of issue or later. Non-compliance with that order could result in the proceedings being stayed or in a succession of peremptory orders of increasing severity that could, at least in theory, lead to a claim being struck out for non-compliance. The existence and potency of these procedural responses demonstrates that the nuclear option (i.e. holding that all proceedings that are issued without the correct fee being paid are ineffective to stop time running) is unnecessary as well as being unwarranted.
Application of relevant legal principles to the present applications
  1. The starting point when considering the present application is the terms of the proposed amendments, which I have summarised at [21] and [22] above. The central tenet, that a party which fails to pay the correct fee when issuing proceedings therefore fails to prevent time from continuing to run both before and from the time when proceedings are issued, is without foundation either in the statutory regime requiring the payment of fees to the Court or in authority. Subject to the question of abusive conduct, that is so whether or not a Claimant knows or ought to know that the claim it is bringing or will bring in the future is one for which the Court could (and under the Fees regime should) demand a higher fee.
RHP’s Proposed Amendment
  1. RHP’s proposed amendment does not distinguish between the period between 25 October 2013 and 7 November 2013 on the one hand, and the period from 7 November 2013 on the other. In its skeleton argument for the hearing, RHP submits that “the limitation defence is based upon the fact that when the Claimants sent the Claim Form … to the Court to be issued on 25 October 2013, they did not pay the appropriate Court Fee for a claim over £50,000.” This submission fails to distinguish between two separate periods and principles, namely the possible effect of sending the claim form to the Court and the actual effect of the Court issuing proceedings as it did on 7 November 2013. The elision of the two periods continues throughout the written submissions. The later synthesis of RHP’s written submission is at [28] of the skeleton argument and is as follows:
“RHP’s proposed defence is based upon 3 propositions:
(a) …
(b) A claim is brought for the purposes of the Limitation Act 1980 if the Claimant have delivered in due time to the court office, the claim form, accompanied by a request to issue and the appropriate fee.
(c) Claimants will not have paid the appropriate fee if the fee is in accordance with the value of the claim stated on the Claim Form, but the claim Form has understated the value of the Claimants’ claim.”
  1. When expanding on (c), RHP submits that the facts set out in the Draft Amended Defence are sufficiently similar to those of Lewis to make it reasonably arguable that it should be followed. In listing the supposed similarities on which it relies RHP identifies the following, namely that:
“(a) The RHP Claim Form was issued limiting the claim to less than £50,000 and the fee for that value paid.
(b) When the RHP Claim Form was served, the value of the claim was effectively increased by the accompanying Particulars of claim that claimed over £500,000.
(c) When the Claimants issued the RHP Claim Form they knew that their claim would exceed £50,000 (see paragraph 115E of the draft Amended Defence).” (Emphasis added)
  1. For the reasons I have set out above, I consider the central tenet upon which this submission is based to be misconceived and the failure to distinguish between the periods before and from the time when proceedings are issued to be wrong in law. Lewis did not address the question whether the actual issuing of proceedings prevented time running. Nothing in Lewis or the other authorities to which I have referred would justify the conclusion that a failure to pay the proper fee when the proceedings against RHP were issued on 7 November 2013 prevented the action from being “brought” for the purposes of the Limitation Act 1980 on that date. Therefore, the amendment as drafted has no real prospects of success in relation to the period from the time of issue and must be disallowed.
  2. In oral submissions, RHP submitted that, because the proceedings were not issued until 7 November 2013, the misrepresentation claim was statute barred because the cause of action underlying that claim accrued on or about 27 October 2007. RHP submits that the Claimants’ conduct before 7 November 2013 was not sufficient to stop time running before the proceedings were issued. This point is not separately articulated in the draft Amended Defence or in RHP’s written submissions on the application.
  3. As a preliminary point, a letter such as the letter from the Court dated 19 November 2013 was not a judicial determination of when time stopped running and cannot determine the outcome of this application.
  4. RHP submits at [39] its skeleton argument that “the RHP Claim Form was issued limiting the claim to less than £50,000 and the fee for that value was paid.” I agree. The amount claimed did not take into account interest, but it has not been shown that interest would have taken the quantum of the misrepresentation claim over £50,000 so as to require a greater fee. I do not accept that the reference to “and/or a claim for Damages for negligence to be assessed” or the additional details in the “Brief details of claim” amounted to a claim falling under paragraph 1.5 of the Order so as to require an additional fee: in this respect it is to be distinguished from the unspecified claims for “further or other relief” relied upon by Warby J inBhatti. To my mind, under the terms of the Order then prevailing, the Claim Form advanced a claim to recover a sum of money (£35,894.78) and left open the possibility of future claims for other sums of money.
  5. It follows that the Claimants proffered the correct fee, which was received by the Court on 25 October 2013. For the purposes of the Limitation Act 1980 the action was “brought” on that day.
  6. That being so, it is not necessary to consider separately whether, if I had considered that the proposed amendment had real prospects of success if allowed, I should nevertheless refuse to allow it. Two comments may, however, be relevant for the future. First, the chronology and evidence provided to the Court, as outlined above, indicates a significant failure by the Claimants to progress the claim against RHP with the speed or vigour that the Court expects to see when a claim is issued late. The repeated extensions of time should not have been necessary. Second, I do not think it was sufficient for RHP simply to assert in their letter of response that the Claimants’ claim against them (which by then was articulated in the Particulars of Claim) was capped at £35,895. Whatever the technicalities of that assertion, it was obvious that the claim was now being brought in a much larger sum. At the very least, if RHP wished to maintain that as a line of defence, it should have pleaded it. It did not do so, even as an alternative or in addition to the detailed response that it in fact provided in March 2016.
  7. For these reasons, RHP’s proposed amendment, if allowed, has no real prospects of success.
CRA’s proposed amendment
  1. In its submissions, CRA relied upon the decision in Lewis on the understanding that it held that “the claimants’ failure to pay the appropriate fee when issuing their claim forms meant that their claims had not been “brought” for the purposes of the Limitation Act 1980.” For the reasons set out above, this is a misunderstanding of the decision in Lewis, which was concerned with the period before the issuing of the proceedings by the Court. That misunderstanding led CRA to submit that “the Claimants have still not paid the fee due in respect of the Design Claim and it is statute barred.” That submission is misconceived and must fail.
  2. On the evidence, the cause of action in relation to the Design Claim could have accrued in March 2008. The Design Claim proceedings were issued on 14 March 2014. The proposed amendment which is the subject of the present application does not include a plea that the Design Claim was statute barred on 14 March 2014. As set out above, it is based upon the same central tenet as RHP’s application, namely that time has not yet stopped running (or, alternatively, had not stopped running by 2 June 2015) because the Claimants paid inadequate fees on issue. That central tenet fails in relation to CRA’s proposed amendment for the same reasons as set out before.
  3. CRA’s submissions conducted a detailed analysis of the state of the Claimants’ minds when proceedings were issued. The end point of those submissions was, in the case of the Design Claim, that “when the Design Claim was issued in March 2014, it was or ought to have been obvious to the Claimants that the total value of their potential claim against the Claimants was at least £431,305 plus VAT… because” of the terms of the RHP Particulars of Claim, the recent issuing of the final certificate and the knowledge on the part of the Claimants that they had suffered other alleged loss and damage, such as loss of amenity, rental costs and other expenses: see [75] of the Skeleton. In the case of the Inspection Claim the end point was that “by March 2015, the Claimants knew or should have known that they had a potential claim against CRA in respect of the same design and inspection issues that were pursued against RHP in the February 2014 Particulars of Claim because it must have been obvious.”
  4. In the absence of an allegation of abusive conduct, intention to claim further amounts or even knowledge that their claims would be greater than claimed in the claim form does not prevent the proceedings as issued from being effective to stop time running for matters that can subsequently be advanced given the terms of the Claim Form. The risk for a Claimant adopting this approach is that a failure to identify the claim with sufficient clarity in the proceedings as initially issued may lead the Court to hold that a later amendment involves a new claim which may engage s. 35 of the Limitation Act. This is axiomatic; and it is reasonable. I would regard a principle that left the validity of proceedings to be determined by satellite litigation that investigates the (non-abusive) state of a Claimants mind and intentions on issue as detrimental to the efficient and fair conduct of litigation. To my mind, the undesirability of the principle for which the Defendants contend is brought into sharp focus when it is remembered that the payment of fees is a matter for the benefit of the Court and is very largely irrelevant to the opposing parties. When asked what actual prejudice their clients had suffered as a result of the asserted underpayment of issue fees in this case, Counsel for RHP and CRA were unable to identify any substantial prejudice at all. The best that could be suggested was that the underpayment of issue fees left the Claimants more money with which to fight the Defendants. In the context of the overall costs of this action, that suggestion pales into insignificance.
  5. For these reasons, the CRA proposed amendment, if allowed, has no reasonable prospects of success.

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One comment

  1. Neil Davies · · Reply

    Gordon-we were involved in an application to amend the value of a claim for damages for professional negligence for our claimant client-that came before HH Judge Wooster in the Mercantile court in Birmingham on Tuesday 11 October.

    DRS Welding limited v Christie and Co.

    We were instructed post issue, to replace the clients original solicitors and at a time after limitation had expired.

    The former sols specifically advised the client , in writing back on 8 April 2016, that they should issue for 20k , pay the 1k issue fee but then seek to amend if the valuation evidence panned out. The claim was issued for 20k.

    The claim was always for 336k. Permission to amend was refused-held that it was an abuse of process and that the proportionate sanction was to restrict the claim to 20k , as issued.

    Needless to say , the litigation guns are now pointing at the former solicitors…

    Best.

    Neil

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    The contents of this email are confidential to the intended recipient at the email address to which it has been addressed. It may not be disclosed to or used by anyone other than this addressee, nor may it be copied in any way. If received in error, please contact Neil Davies and Partners, Calcameron House, 36B Water Street, Birmingham, B3 1HP +44 (0) 121 200 7040 quoting the name of the sender and the addressee and then delete it from your system.

    Please note that neither Neil Davies and Partners nor the sender accepts any responsibility for viruses and it is your responsibility to scan the email and attachments (if any). No contracts may be concluded on behalf of Neil Davies and Partners by means of email communications. Service of proceedings by way of email communication is not accepted.

    Neil Davies & Partners is a trading name (SRA number 591257) of N D & P Solicitors Ltd (SRA number 573278), registered in England & Wales under CRN 8125420. Directors: Neil W Davies BA (Hons) and Sukhbir Mall LLB (Hons). Neil Davies & Partners is authorised and regulated by the Solicitors Regulation Authority (www.sra.org.uk). For further information, please refer to http://www.ndandp.co.uk.

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