MCDONNELL AND ANOTHER V WALKER [2009] EWCA Civ 1257
FACTS:-
On the 24th April 2001, the First Claimant was the driver of a car, with the Second Claimant as passenger, which was in collision with a car driven by Richard Walker, who was killed in the accident. The Claimants instructed Anthony Hodari & Co. solicitors and on the 31st July 2001, they wrote a Letter of Claim to Richard Walker’s family, which was forwarded to his insurers, Direct Line. In November 2001, Direct Line accepted liability for the accident. Anthony Hodari & Co. experienced problems getting instructions from the Claimants and it was not until March 2004, nearly three years after the accident that an appointment was set up with a medical expert for both Claimants. Proceedings were issued protectively on the 20th April 2004, limited damages to £15,000. Medical reports were then obtained but the Particulars of Claim were served one day late, on the 27th August 2004. A retrospective application was made unsuccessfully for extension of time for service.
At the time, the case of Walkley v Precision Forgings Limited [1979] 1 WLR 606 was still good law. The Claimants went to different solicitors, Pannone but the client care documentation was not returned until December 2006. In the meantime, on the 14th June 2006, the House of Lords gave their decision in Horton v Sadler [2007] 1 AC 307 and departed from Walkley. From that date, a Claimant whose claim failed (having been issued) could re-issue the claim and then try to persuade the court to exercise its discretion under Section 33 of the Limitation Act in his favour.
In July 2007, the solicitors representing Anthony Hodari & Co. suggested to Pannone that they try and re-issue proceedings against the estate of David Walker. On the 17th April 2008, fresh proceedings were commenced against the estate and the deputy judge waived limitation pursuant to Section 33. However by this time, the claims put forward were far greater and the Claimants were now claiming psychological injury. The Defendant appealed to the Court of Appeal.
JUDGEMENT:-
Lord Justice Waller set out the statutory provisions of the Limitation Act 1980 including Section 11 and 33. He referred to the case of Donovan v Gwentoys [1990] 1 WLR 472 in which the House of Lords said that the delay referred to in Section 33(3)(a) and (b) of the 1980 Act referred to delay since the date of the expiry of the limitation date, but the overall delay since the date of the accident was relevant as part of all the circumstances of the case.
Waller LJ considered the following cases:-
A v Hoare [2008] 1 AC 844
A B v Nugent Care Society [2009] EWCA Civ 827
KR v Bryn Alyn Community Holdings Ltd [2003] QB 1441
Waller LJ emphasised two points arising out of these cases:-
Waller LJ also referred to the case of Cain v Francis [2009] 3 WLR 551 which referred to the effect of delay on the case. In that case the limitation bar had been waived under Section 33. However the Defendant in that case could not show any forensic prejudice and the limitation defence was a complete windfall. That type of case had to be contrasted with a case where forensic prejudice was suffered by a Defendant who had not for many years been notified of a claim in any detail so as to enable him to investigate it.
Waller LJ said that the trial judge had concentrated on the 22 month delay since the decision of Horton had been handed down. However that misunderstood the judgment in Horton where there was no forensic prejudice. It was also suggested by the trial judge that the Defendant’s insurers should have investigated the case earlier, but reports relevant to general damages were only received three years after the accident, and no psychological reports were received at that time and no claim for loss of earnings present or future were received at all. The claim ultimately received 7 years after the accident was of a different magnitude. Clearly forensic prejudice had been suffered by the Defendant.
The court should also consider the cause of the delay. The delay which was relevant was the whole period since the accident occurred. The first delay of three years up to issue of proceedings was the fault of the solicitors or their clients. No excuse had been provided for that delay. The failure to serve on time was negligent. The period of 17 months might be excusable from the Claimants’ point of view, but this was certainly not a period where the Defendant was at fault. Finally there was the period of 22 month until the issue of the second set of proceedings. There was no excuse for that period. The solicitors discussing how the claim should be funded provided no excuse for the non-issue of the second proceedings vis a vis the Defendant.
In relation to prejudice to the Claimants, this seemed slight. They had a claim against Anthony Hodari & Co. which was a loss of chance case, but since liability had been admitted, they would be seeking to recover what would have been awarded at trial is proceedings had been properly served. If the evidence were the same in the negligence action as it would have at the trial, then there was no reason to apply a discount. However Waller LJ said that it could not be as straightforward as that. The Defendant’s case was that they were forensically prejudiced by the passage of time, and consequently there must be some prejudice to the Claimants. Some discount would have to be applied for the risk that the Defendant in the original action would have been able to challenge some aspects of the case, but it would not be high. Moreover some of the delay was the fault of the Claimants themselves, and if a deduction was made for that factor, the deduction could hardly be prejudice which the Claimants were entitled to rely on as against the original Defendant.
Anthony Hodari & Co. might say in the action against them, that the Claimants had failed to mitigate their loss by not commencing a second action as soon as the Horton decision was announced. If that were a good point, the Claimants could argue that they would be prejudiced because there was a risk that the would not recover from Anthony Hodari & Co. at all.
Waller LJ said that the answer to this point was that if the second action had been commenced shortly after June 2006, a court would still have taken the view that Section 33 of the Limitation Act 1980 should not be granted. By the time the first action had been brought an end, the Defendant’s insurers had still not been properly notified of the claim.
In conclusion the prejudice to the Claimants in having to sue their own solicitors was minor as against the forensic prejudice to the Defendant caused by the inexcusable delay in notifying the Claimants’ current claim.
FACTS:-
On the 24th April 2001, the First Claimant was the driver of a car, with the Second Claimant as passenger, which was in collision with a car driven by Richard Walker, who was killed in the accident. The Claimants instructed Anthony Hodari & Co. solicitors and on the 31st July 2001, they wrote a Letter of Claim to Richard Walker’s family, which was forwarded to his insurers, Direct Line. In November 2001, Direct Line accepted liability for the accident. Anthony Hodari & Co. experienced problems getting instructions from the Claimants and it was not until March 2004, nearly three years after the accident that an appointment was set up with a medical expert for both Claimants. Proceedings were issued protectively on the 20th April 2004, limited damages to £15,000. Medical reports were then obtained but the Particulars of Claim were served one day late, on the 27th August 2004. A retrospective application was made unsuccessfully for extension of time for service.
At the time, the case of Walkley v Precision Forgings Limited [1979] 1 WLR 606 was still good law. The Claimants went to different solicitors, Pannone but the client care documentation was not returned until December 2006. In the meantime, on the 14th June 2006, the House of Lords gave their decision in Horton v Sadler [2007] 1 AC 307 and departed from Walkley. From that date, a Claimant whose claim failed (having been issued) could re-issue the claim and then try to persuade the court to exercise its discretion under Section 33 of the Limitation Act in his favour.
In July 2007, the solicitors representing Anthony Hodari & Co. suggested to Pannone that they try and re-issue proceedings against the estate of David Walker. On the 17th April 2008, fresh proceedings were commenced against the estate and the deputy judge waived limitation pursuant to Section 33. However by this time, the claims put forward were far greater and the Claimants were now claiming psychological injury. The Defendant appealed to the Court of Appeal.
JUDGEMENT:-
Lord Justice Waller set out the statutory provisions of the Limitation Act 1980 including Section 11 and 33. He referred to the case of Donovan v Gwentoys [1990] 1 WLR 472 in which the House of Lords said that the delay referred to in Section 33(3)(a) and (b) of the 1980 Act referred to delay since the date of the expiry of the limitation date, but the overall delay since the date of the accident was relevant as part of all the circumstances of the case.
Waller LJ considered the following cases:-
A v Hoare [2008] 1 AC 844
A B v Nugent Care Society [2009] EWCA Civ 827
KR v Bryn Alyn Community Holdings Ltd [2003] QB 1441
Waller LJ emphasised two points arising out of these cases:-
- Depending on the issues and the nature of the evidence the longer the delay the more likely and the greater, the prejudice to the Defendant
- A judge should not reach a decision by reference to one circumstance or without regard to all the issues – he should conduct a balancing exercise at the end of his analysis of all the relevant circumstances and with regard to all the issues, taking them all into account.
Waller LJ also referred to the case of Cain v Francis [2009] 3 WLR 551 which referred to the effect of delay on the case. In that case the limitation bar had been waived under Section 33. However the Defendant in that case could not show any forensic prejudice and the limitation defence was a complete windfall. That type of case had to be contrasted with a case where forensic prejudice was suffered by a Defendant who had not for many years been notified of a claim in any detail so as to enable him to investigate it.
Waller LJ said that the trial judge had concentrated on the 22 month delay since the decision of Horton had been handed down. However that misunderstood the judgment in Horton where there was no forensic prejudice. It was also suggested by the trial judge that the Defendant’s insurers should have investigated the case earlier, but reports relevant to general damages were only received three years after the accident, and no psychological reports were received at that time and no claim for loss of earnings present or future were received at all. The claim ultimately received 7 years after the accident was of a different magnitude. Clearly forensic prejudice had been suffered by the Defendant.
The court should also consider the cause of the delay. The delay which was relevant was the whole period since the accident occurred. The first delay of three years up to issue of proceedings was the fault of the solicitors or their clients. No excuse had been provided for that delay. The failure to serve on time was negligent. The period of 17 months might be excusable from the Claimants’ point of view, but this was certainly not a period where the Defendant was at fault. Finally there was the period of 22 month until the issue of the second set of proceedings. There was no excuse for that period. The solicitors discussing how the claim should be funded provided no excuse for the non-issue of the second proceedings vis a vis the Defendant.
In relation to prejudice to the Claimants, this seemed slight. They had a claim against Anthony Hodari & Co. which was a loss of chance case, but since liability had been admitted, they would be seeking to recover what would have been awarded at trial is proceedings had been properly served. If the evidence were the same in the negligence action as it would have at the trial, then there was no reason to apply a discount. However Waller LJ said that it could not be as straightforward as that. The Defendant’s case was that they were forensically prejudiced by the passage of time, and consequently there must be some prejudice to the Claimants. Some discount would have to be applied for the risk that the Defendant in the original action would have been able to challenge some aspects of the case, but it would not be high. Moreover some of the delay was the fault of the Claimants themselves, and if a deduction was made for that factor, the deduction could hardly be prejudice which the Claimants were entitled to rely on as against the original Defendant.
Anthony Hodari & Co. might say in the action against them, that the Claimants had failed to mitigate their loss by not commencing a second action as soon as the Horton decision was announced. If that were a good point, the Claimants could argue that they would be prejudiced because there was a risk that the would not recover from Anthony Hodari & Co. at all.
Waller LJ said that the answer to this point was that if the second action had been commenced shortly after June 2006, a court would still have taken the view that Section 33 of the Limitation Act 1980 should not be granted. By the time the first action had been brought an end, the Defendant’s insurers had still not been properly notified of the claim.
In conclusion the prejudice to the Claimants in having to sue their own solicitors was minor as against the forensic prejudice to the Defendant caused by the inexcusable delay in notifying the Claimants’ current claim.