CAVE V ROBINSON JARVIS AND ROLF [2001] EWCA Civ 245
FACTS:-
In February 1989, the Claimant retained the Defendant in connection with the sale of land on the Isle of Wight. The relevant transactions took place in March 1989. It was alleged that the Defendant failed to (a) draft a deed as was necessary to secure the Claimant’s mooring rights (b) register the deed. However it was only in early 1994 that the Claimant found out that the existence of his mooring right was denied.
The trial judge held that the alleged breaches of duty occurred in circumstances in which it was unlikely that they would be discovered until the Claimant had reason to subject it to the scrutiny of another solicitor, and such reason did not arise until 1994.
Unless the Claimant could bring himself within the provisions of section 32 of the Limitation Act 1980, his claim in contract was statute barred under section 5. Similarly his claim in tort would have been barred by section 2 and although subject to the latent damage provisions of Section 14A, it was nonetheless time barred because the action was not brought within the period of latent damage extension.
The Claimant alleged that the Defendants (i) had in fact knowingly and deliberately concealed the Claimant’s right of action, and that, even if they had no knowledge or intention of concealment, (ii) they were nonetheless guilty of deliberate concealment within the meaning of Section 32(2) on the grounds that they had deliberately committed an act or omission which amounted to a breach of duty in circumstances where it was unlikely to be discovered for some time.
The trial judge had decided the second issue (ii) should be resolved in favour of the Claimant, relying on the case of Brocklesby v Armitage & Guest [2001] 1 All ER 172.
JUDGMENT:-
Lord Justice Potter examined the precise terms of Section 32, subsections (1) and (2). This stated:-
“(1) …..where in the case of any action for which a period of limitation is prescribed by this Act, either – (a) the action is based upon the fraud of the defendant; or (b) any fact relevant to the plaintiff’s right of action has been deliberately concealed from him by the defendant; or (c) the action is for relief from the consequences of the mistake; the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment, or mistake (as the case may be) or could with reasonable diligence have discovered it.”
(2) For the purposes of sub-section 1 above, deliberate commission of a breach of duty in circumstances in which it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty.”
The Defendants in this case contended that Section 32(2) required not only that the act or omission should be deliberate, but that the person committing it should be aware that it amounted to a breach of duty.
Potter LJ referred to the case of Brocklesbury v Armitage & Guest [2001] 1 All ER 172 where Morritt LJ approached the construction of Section 32(2) as a straightforward question of statutory constructions, free of the previous history and without regard to the equitable doctrine of “fraudulent concealment” or the notion of unconscionable conduct. Morritt LJ had said this in reliance on another case, Sheldon v RHM Outhwaite (Underwriting Agencies) Limited [1996] AC 102 where Lord Browne Wilkinson had commented on the provisions of Section 32(1)(b). It was said in Sheldon that section 32 of the Limitation Act 1980 did not encompass the old equitable doctrine of concealed fraud.
Morritt LJ in Brocklesbury had drawn a clear contrast between an action based on fraud (Section 32((1)(a)) and the concealment of any fact relevant to the Claimant’s right of action (Section 32(1)(b)). Subsection 2 of Section 32 then amplified what was meant by deliberate concealment. However knowledge of the legal consequences of the act committed, was not necessary.
The Defendants’ counsel in the present case attacked this reasoning, and said that the Brocklesbury construction was not a natural one. He invited the court to overrule the reasoning in that case.
Potter LJ considered the caselaw in relation to the Court of Appeal overruling a previous decision of the same court. He did not think that the decision in Brocklesbury was manifestly wrong. Therefore the concealment related merely to the deliberate nature of the relevant act or omission and not to the fact that it constituted a breach of duty. The breach of duty referred to in Section 32(2) was not simply the act of drafting the licence but the failure to include in it term appropriate to achieve that purpose. It was that omission, which was unlikely to be discovered for some time and which amounted to a deliberate concealment under Section 32(2), and it was that concealment which the Claimant did not discover, nor could with reasonable diligence have discovered prior to 1994. Consequently the Defendants’ appeal would be dismissed.
Sedley LJ and Jonathan Parker LJ agreed.
FACTS:-
In February 1989, the Claimant retained the Defendant in connection with the sale of land on the Isle of Wight. The relevant transactions took place in March 1989. It was alleged that the Defendant failed to (a) draft a deed as was necessary to secure the Claimant’s mooring rights (b) register the deed. However it was only in early 1994 that the Claimant found out that the existence of his mooring right was denied.
The trial judge held that the alleged breaches of duty occurred in circumstances in which it was unlikely that they would be discovered until the Claimant had reason to subject it to the scrutiny of another solicitor, and such reason did not arise until 1994.
Unless the Claimant could bring himself within the provisions of section 32 of the Limitation Act 1980, his claim in contract was statute barred under section 5. Similarly his claim in tort would have been barred by section 2 and although subject to the latent damage provisions of Section 14A, it was nonetheless time barred because the action was not brought within the period of latent damage extension.
The Claimant alleged that the Defendants (i) had in fact knowingly and deliberately concealed the Claimant’s right of action, and that, even if they had no knowledge or intention of concealment, (ii) they were nonetheless guilty of deliberate concealment within the meaning of Section 32(2) on the grounds that they had deliberately committed an act or omission which amounted to a breach of duty in circumstances where it was unlikely to be discovered for some time.
The trial judge had decided the second issue (ii) should be resolved in favour of the Claimant, relying on the case of Brocklesby v Armitage & Guest [2001] 1 All ER 172.
JUDGMENT:-
Lord Justice Potter examined the precise terms of Section 32, subsections (1) and (2). This stated:-
“(1) …..where in the case of any action for which a period of limitation is prescribed by this Act, either – (a) the action is based upon the fraud of the defendant; or (b) any fact relevant to the plaintiff’s right of action has been deliberately concealed from him by the defendant; or (c) the action is for relief from the consequences of the mistake; the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment, or mistake (as the case may be) or could with reasonable diligence have discovered it.”
(2) For the purposes of sub-section 1 above, deliberate commission of a breach of duty in circumstances in which it is unlikely to be discovered for some time amounts to deliberate concealment of the facts involved in that breach of duty.”
The Defendants in this case contended that Section 32(2) required not only that the act or omission should be deliberate, but that the person committing it should be aware that it amounted to a breach of duty.
Potter LJ referred to the case of Brocklesbury v Armitage & Guest [2001] 1 All ER 172 where Morritt LJ approached the construction of Section 32(2) as a straightforward question of statutory constructions, free of the previous history and without regard to the equitable doctrine of “fraudulent concealment” or the notion of unconscionable conduct. Morritt LJ had said this in reliance on another case, Sheldon v RHM Outhwaite (Underwriting Agencies) Limited [1996] AC 102 where Lord Browne Wilkinson had commented on the provisions of Section 32(1)(b). It was said in Sheldon that section 32 of the Limitation Act 1980 did not encompass the old equitable doctrine of concealed fraud.
Morritt LJ in Brocklesbury had drawn a clear contrast between an action based on fraud (Section 32((1)(a)) and the concealment of any fact relevant to the Claimant’s right of action (Section 32(1)(b)). Subsection 2 of Section 32 then amplified what was meant by deliberate concealment. However knowledge of the legal consequences of the act committed, was not necessary.
The Defendants’ counsel in the present case attacked this reasoning, and said that the Brocklesbury construction was not a natural one. He invited the court to overrule the reasoning in that case.
Potter LJ considered the caselaw in relation to the Court of Appeal overruling a previous decision of the same court. He did not think that the decision in Brocklesbury was manifestly wrong. Therefore the concealment related merely to the deliberate nature of the relevant act or omission and not to the fact that it constituted a breach of duty. The breach of duty referred to in Section 32(2) was not simply the act of drafting the licence but the failure to include in it term appropriate to achieve that purpose. It was that omission, which was unlikely to be discovered for some time and which amounted to a deliberate concealment under Section 32(2), and it was that concealment which the Claimant did not discover, nor could with reasonable diligence have discovered prior to 1994. Consequently the Defendants’ appeal would be dismissed.
Sedley LJ and Jonathan Parker LJ agreed.