Practice and Procedure


PUBLISHED March 13, 2003

The action against the solicitors in negligent delay and contract would be struck out as being statute barred under the Limitation Act 1980.Appeal from an order made by Howarth HHJ in the Manchester County Court in June 2002 in which he dismissed an application to strike out the respondent's ('H') claim against his former solicitors ('C') for alleged negligence while they represented him in his claim for loss suffered as a result of negligence by his then accountants. In October 2000 H claimed damages for breach of contract and/or damages for breach of duty in tort. It was his pleaded case that the claim against the accountants had been struck out as a result of C's negligent delay. All the heads of loss were the loss of the chance of recovering damages from the accountants, H's liability for the accountant's costs pursuant to the strike-out and the costs wasted by H in pursuing the claim. C pleaded that H's claim was time barred. Before the judge handed down his judgment he was asked to reconsider it in the light of the recently decided case of Khan v Falvey & Co (2002) EWCA Civ 400. He declined to do so. Although the hearing was purportedly the trial of a preliminary issue the parties agreed that the appropriate order was that the application to strike out H's claim be dismissed. The essential question on appeal was whether H's claim was time barred on the facts, having regard to all the authorities including Khan (supra). C submitted that H's cause of action accrued before 13 October 1994, the relevant date for limitation purposes. H cross-appealed, seeking permission to amend the particulars of claim.HELD: (1) Where a significant decision of the Court of Appeal or the House of Lords became available before a judgment was formally handed down, the judge ought to be willing to reconsider his or her conclusions in light of the decision in order to minimise the possibility of an appeal with its attendant delay and expense. (2) The question was when H first suffered damage as a result of the negligent delay. Once he had suffered some relevant recoverable damage as a result of that delay, his cause of action was complete and the six-year period ran from that date. (3) In the instant case the damage was caused to H when he had no arguable basis for avoiding the claim being struck out. (4 On the facts there was no arguable defence to an application to strike out as at 13 October 1994. The claim was time barred in so far as it was a claim for loss of the chance of recovering damages against the accountants and at that date the claim had no value (see Khan). This was because any attempt to proceed with the action against the accountants in October 1994 would have been met with an application to dismiss for want of prosecution, and the application would have succeeded. The fact that the striking out order was made in 1999 did not alter the circumstances as they were in 1994. (5) At October 1994 H's cause of action in tort and contract by reason of C's negligent delay had accrued because H had already suffered relevant damage in that his cause of action against the accountants had become worthless and since the present action was brought more than six years later, it was time barred. (6) Section 14A Limitation Act 1980 could not save the action. H had both aspects of knowledge detailed in S.14A(1) (5) of the 1980 Act required for bringing an action for damages in respect of the relevant damage.Appeal allowed. Cross-appeal dismissed.

[2003] EWCA Civ 341