Time up on Walkley
Horton v Sadler & Another [2006]
UKHL 27
1. For the past 36 years, by virtue of the rule in Walkley
v Precision Forgings Ltd 1979] 1 WLR 606, an injured Claimant whose
original claim has been struck out or discontinued has been precluded from
relying upon the Section 33 discretion to disapply the limitation period when
issuing a second claim out of time in respect of the same matter. The Law Lords
have now unanimously reversed the effect of that decision. Of the rule, Lord
Brown stated in Horton:
“That
it has stood for so long is a pity. It is certainly no reason to perpetuate it
any longer.”
The rule in Walkely
2. In Walkey, the Lords had concluded
that if a Claimant had brought his first action within the time-limit
prescribed by statute, any prejudice suffered by issuing a second set of
proceedings was caused by his own inaction or ineptitude rather than the
provisions in the Limitation Act. Accordingly, he should not be entitled to
rely upon the discretion to disapply the Limitation provisions in the second
action.
3. The consequence of the decision has long been the
subject of criticism, as a Claimant has been better off not issuing proceedings
at all within the primary limitation period than issuing proceedings towards
the end of primary limitation and then failing, for instance, to serve
proceedings validly. Wherever possible, the Courts have attempted to
distinguish the rule. Exceptions have been made for any case which did not fall
on all fours with the decision: for example, where the initial proceedings were
improperly constituted against the wrong party, where rules of estoppel
applied, where proceedings were issued without a representative or against a
different Defendant and different cause of action. However, for the vast
majority of cases, no exception could be found. There was an inevitable
injustice where, for example, the original proceedings had been struck out on some
technicality, the second proceedings were issued only a few days after the
expiry primary limitation and the Defendant had suffered no demonstrable
prejudice by virtue of the issuing of the second set of proceedings.
Inevitably, a Claimant has had to have recourse to a third bout of proceedings
against his former legal advisers.
The decision
in Horton
4. In Horton, the Lords unanimously
agreed that the reasoning in Walkley could not be supported.
Counsel for the Defendant argued that the conditions for departing from its own
precedent had not been met, even if the criticisms in Walkley had
been justified: that the decision affected only a small number of litigants who
fell foul of the rule and they had a redress against their solicitors, that the
rule had stood for 35 plus years, had been followed by the Lords on two
subsequent occasions and had survived substantive amendments on the enactment
of the Limitation Act in 1980. Whilst that was accepted to be the case in Horton,
they departed from Walkley on the grounds that it:
“unfairly
deprives Claimants of a right Parliament intended them to have; that it had
driven the Court of Appeal to draw distinctions which are ….so fine as to
reflect no credit on this area of law; and that it subverts the clear intention
of Parliament.”
5. However, the Lords went on to decline to give
guidance on the circumstances in which the Court should exercise its discretion
under Section 33 of the Act. Furthermore, although it was argued that the
decision in Walkely violated article 6 of the European Convention
by denying the appellant access to the Court, Lord Bingham stated that such a
submission would not have succeeded: the Claimant had:
“untrammelled
access to the court for three years after his injuries, of which he was fully
aware. Had Parliament conferred no discretion on the court to extend time he
could not, as he accepted, have complained. To the extent that Walkley unfairly gave better rights to some litigants than others, that is a defect
calling for correction by Parliament or the domestic courts but involving, as I
think, no violation of the appellant’s Convention rights.”
Post-Horton
6. Since the advent of the CPR, the Courts have
continued to apply the requirements for service strictly, sometimes with
draconian consequences. There has been a flurry of Court of Appeal judgments
scrutinising the effects of Part 6.7 relating to the deemed service proceedings
and the circumstances in which the Courts can dispense with service under Part
6.9. The motivation in taking a technical point over service which has been
effected one day out of time has primarily been driven by the absence of any recourse
by the Claimant to a second set of proceedings. Whilst the decision in Horton will not prevent service points being taken with costs consequences,
the inevitable inequity which follows in cases where no prejudice is suffered
by the delay will disappear. The professional indemnity bodies are no doubt
adjusting their profit margins accordingly.
Eliot Woolf
Christopher Wilson-Smith QC
Outer Temple Chambers
