The judge was right as a matter of discretion to delete from an order restoring a company to the register a direction that the limitation period should not run against the company during the period of its dissolution and to rule that the company's claim against the defendant bank was statute-barred.Appeal by the claimant ('Regent') from orders made by HH Judge Overend deleting a limitation direction from an order restoring Regent to the register and giving summary judgment on the respondent's defence to an action by Regent. In 1998 the registrar of companies struck Regent off the register pursuant to s.652 Companies Act 1985 and the company was dissolved. In March 2001 two former directors of Regent applied to restore the company to the register pursuant to s.653 of the 1985 Act. The district judge restored the company to the register and directed that, in the case of any claim of the company which was not statute-barred on the date of dissolution, no period of limitation should run between that date and the date of the order. Regent then commenced proceedings against the respondent ('the bank') claiming damages for negligence and/or fraudulent misrepresentations said to have induced it to acquire certain non-viable assets in 1992. In proceedings by the bank against the directors on their guarantees the Court of Appeal set aside the guarantees on the basis that the directors had been induced to enter them by the bank's fraudulent misrepresentation (see Barton & Ors v County NatWest Bank Ltd (1999) Lloyd's Rep Bank 408). The bank successfully applied to be joined in the restoration proceedings and to vary the district judge's order by deleting the direction as to limitation during the period of dissolution. The bank then obtained summary judgment on its defence to Regent's action on the basis that the action was statute-barred because the directors and hence the company knew all the facts relevant to Regent's cause of action against the bank in 1993 so that the limitation period ran out at the latest in 1999 during the period of dissolution. Regent appealed from both orders. The issues on appeal were: (i) whether there was jurisdiction under s.653(3) to suspend the running of time in favour of Regent; (ii) whether the bank had a right to be joined in the restoration proceedings; (iii) whether the judge was right to delete the limitation direction as a matter of discretion; and (iv) whether Regent had a real prospect of showing that its claim was not statute-barred because Regent (as opposed to the directors) had not learned of the bank's fraud until less than six years before the commencement of the action.HELD: (1) There was no basis for the bank's submission that the jurisdiction conferred by s.653(3) to give a limitation direction was confined to a direction in favour of creditors. The subsection also conferred jurisdiction to give a limitation direction in favour of the company being restored where it seemed just to the court to do so. Such a direction inevitably operated to give back to the company an opportunity which it might otherwise have lost, ie a claim that might otherwise have become statute-barred during the period of dissolution. The court had to consider the position as at the date of dissolution and not at the date of restoration. Putting the company back in the same position as if it had not been struck off could in an appropriate case require ignoring the period of dissolution for limitation purposes (Tymans Ltd v Craven (1952) 2 QB 100 and Re Donald Kenyon Ltd (1956) 1 WLR 1397). (2) There was jurisdiction to join the bank to the restoration proceedings. Third parties who would be prejudiced by a limitation direction sought by the company were entitled to be heard in opposition to it (Re Blenheim Leisure (Restaurants) Ltd (No.2) (1999) LTL 25/10/99 EXTEMPORE and Smith v White Knight Laundry Ltd (2001) 1 WLR 616 applied).(3) The judge was right as a matter of discretion to delete the limitation direction from the restoration order. The jurisdiction to make such a direction in favour of the company should only be exercised in exceptional circumstances. The effect of such a direction under s.653(3) was to override the statutory regime under the Limitation Act 1980 and fairness would usually require that the company should be left to attempt to meet any limitation defence by recourse to the statutory regime under the 1980 Act. (4) Unless postponed by virtue of ss.14A or 32 of the 1980 Act, the primary six-year limitation period began to run in respect of Regent's claim in 1992 when the transaction was completed, and the claim was accordingly statute-barred. Section 14A could not assist Regent because the directors and hence Regent must have known the material facts about the damage and that it was attributable to the bank's misrepresentation before the company was struck off, ie more than three years before the commencement of the action. Regent's claim was based on fraud within s.32 but it was clear on the evidence that the directors and hence the company knew the relevant facts relating to the fraud in 1995. The judge was right to grant summary judgment to the bank on the basis that Regent's claim was statute-barred.Appeal dismissed.

[2003] EWCA Civ 391

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