“Limitation operates as a defence to a civil claim. It must therefore be raised by a defendant in answer to the claim. As such, even an unanswerable limitation defence does not lead to the conclusion that an otherwise viable case does not disclose reasonable grounds for bringing the claim. For that reason, if limitation is the sole basis for an application to strike out underCPR r 3.4 (2)(a), the application will be dismissed.”
“receipt, knowingly or otherwise in a manner which touches on their conscience, of assets in which the Claimants have an equitable proprietary interest in their assets that were transferred into the 9th and 10th Defendants and their traceable proceeds”
“A claim which appears in a claim form, but which is omitted from the Particulars of Claim is not deemed to have been irrevocably abandoned. The effect is that in an appropriate case, a party can seek to amend the pleading to include the claim. That is to say that it has ceased to be a part of the claim, but the Court has a discretion on application to allow it to be restored. “…There is no principle of law which says that a claim abandoned on the pleadings cannot be resurrected by amendment, or that an 'election', once made on the pleadings, cannot be revoked by a change of mind. This is a matter of procedural rather than substantive law. Whether a court permits the resurrection to take place is a pure matter of discretion. There may well be circumstances where the election or abandonment has in some way prejudiced the other party or it is otherwise too late for a change of direction. But those are matters which are weighed in the balance when the discretion is exercised.” per Morison J at para. 14, (and see paras. 11 – 17) in British Credit Trust Holdings UK v UK Insurance Ltd[2003] EWHC 2404 (Comm) The consequence is that the claim no longer forms part of proceedings in those circumstances, albeit that by amendment in an appropriate case, and subject to the discretion of the Court, it might again become a part of the claim.”
“English procedural law says that if you allege in your pleading facts which, if proved, would establish a cause of action, that is sufficient to support a claim for that cause of action: see e g Letang v Cooper[1965] 1 QB 232 and In re Vandervell’s Trusts (No 2)[1974] Ch 269 , 321. You do not have to spell out precisely the legal basis of the cause of action. Pleadings in England have a technical meaning. They are the documents which contain the assertions of fact which the party intends in due course to prove by evidence. They do not need to include arguments of law and seldom do.”
“Subject to subsections (3), (4A) and (4B) below, 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 a 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. References in this subsection to the defendant include references to the defendant's agent and to any person through whom the defendant claims and his agent. (2) For the purposes of subsection (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.”
“What is required is (1) a fact relevant to the claimant’s right of action, (2) the concealment of that fact from her by the defendant, either by a positive act of concealment or by a withholding of the relevant information, and (3) an intention on the part of the defendant to conceal the fact or facts in question.”
“For all these reasons, the reasoning of the Court of Appeal in relation to section 32(2) cannot be accepted. “Deliberate”, in section 32(2), does not include “reckless”
“The question is not whether the plaintiffs should have discovered the fraud sooner; but whether they could with reasonable diligence have done so. The burden of proof is on them. They must establish that they could not have discovered the fraud without exceptional measures which they could not reasonably have been expected to take. In this context the length of the applicable period of limitation is irrelevant. In the course of argument May LJ observed that reasonable diligence must be measured against some standard, but that the six-year limitation period did not provide the relevant standard. He suggested that the test was how a person carrying on a business of the relevant kind would act if he had adequate but not unlimited staff and resources and were motivated by a reasonable but not excessive sense of urgency. I respectfully agree.”
“I address the Applicants' /Claimants' factual position on limitation in section F of this witness statement below. This sets out the factual matters the Applicants/Claimants will say are relevant to the application ofsection 32(1) of the Limitation Act 1980 (the "LA80"). The essential point is that, as a matter of fact, the alleged "wrongdoers" in the claims brought in these proceedings - the former investment managers - were effectively in control of the Core VCTs from the time they were incorporated until they were originally dissolved in November 2016.”
“It is not accepted that, for the purposes of the Applications, the Claimants are required to identify individual facts relevant to the causes of action which were concealed by the Defendants (see, further, the response to request 3.6 below).”
“In circumstances where (as addressed in detail in Morrissey-4 and Pagden-6): (a) the Claimants had been under the control of the Former Manager and the Defendants; and (b) the Former Liquidators are also defendants to these claims for their participation in the New Core 2 transaction, acted in accordance with the directions of the Defendants and failed to perform any independent investigation; no knowledge is attributable to the Claimants in respect of the claims against the Defendants and the Claimants could not with reasonable diligence have discovered facts essential to the claims any earlier than is summarised in response 3.6.1 above”
“No positive case about section 32(1)(b) has been put forward by the claimant. The claimant has not set out the facts it possessed and explained which essential facts it was missing. In a claim of this type, it is not just the facts that have to be considered but also what inferences may reasonably be drawn from them. The claimant has not explained why Mr Grumbridge, as a director of and indirect shareholder in BPI, was not made a party to the First Claim. It is not for the court to speculate why that decision was taken and whether there were objectively justifiable grounds for it. The absence of such a case makes it impossible to assess what essential facts the claimant did not possess that might trigger reliance on section 32(1)(b) of the 1980 Act. In my judgment, the absence of any positive case about limitation is fatal to the claimant because the real prospect of success test is being applied to an issue in relation to which the burden of proof rest[s] on the claimant. The burden is of course on the defendant to establish the grounds of the application, but where the claimant declines to explain its case on section 32(1)(b), the court is entitled to conclude that the usual limitation period applies. This suffices to determine the application in favour of Mr Grumbridge.”
“It is incumbent on a party responding to an application for summary judgment to put forward sufficient evidence to satisfy the court that it has a real prospect of succeeding at trial.”
“The first issue is to identify the individuals who, on behalf of the claimant company, might discover the wrongdoing so as to start time running. It is, in my view, clear that it cannot be the alleged wrongdoers themselves: see Bilta (UK) Ltd v Nazir (No 2)[2016] AC 1 . It follows in the present case that knowledge by Mr and Mrs Fielding would not constitute knowledge by the company. There were three other directors of the company and it is not alleged that any of them were wrongdoers. It follows that discovery by one or more of them would constitute knowledge by the claimant company.”
“Finally, there remains the large policy objection noted by the trial judge, namely that there is no obvious reason why time should run in favour of the directors of a company who have committed a deliberate breach of duty, or deliberately concealed a breach of duty, for as long as they choose to retain control of the company as its Board. There is much to be said for adhering to the simple rule, based upon the separate personality of the company from even a sole shareholder, that shareholder knowledge of a breach of duty owed to the company by its directors, or the ability to discover the facts, is simply not to be attributed to the company at all, at least for as long as the allegedly delinquent directors retain control of it.”
“Where a company has been the victim of wrongdoing by its directors, or of which its directors had notice, then the wrongdoing, or knowledge, of the directors cannot be attributed to the company as a defence to a claim brought against the directors by the company’s liquidator, in the name of the company and/or on behalf of its creditors, for the loss suffered by the company as a result of the wrongdoing, even where the directors were the only directors and shareholders of the company, and even though the wrongdoing or knowledge of the directors may be attributed to the company in many other types of proceedings.”
“in an action for breach of duty against the directors there cannot be attributed to the company a fraud which is being practised against it by its agent, even if it is being practised by a person whose acts and state of mind would be attributable to it in other contexts”
“In most circumstances the acts and state of mind of its directors and agents can be attributed to a company by applying the rules of the law of agency. It has become common to speak of “the Hampshire Land principle” or the “fraud exception” as the exception to an otherwise general rule that attribution occurs. It is our view that “the fraud exception” is not confined to fraud but is simply an instance of a wider principle that whether an act or a state of mind is to be attributed to a company depends on the context in which the question arises. “The fraud exception”, applied to prevent an agent from pleading his own breach of duty in order to bar his principal’s claim against him, is the classic example of non-attribution.”
“The question is not whether the claimants should have discovered the fraud sooner; but whether they could with reasonable diligence have done so. The burden of proof is on them. They must establish that they could not have discovered the fraud without exceptional measures which they could not reasonably have been expected to take.”
“From the Commencement Date, the Manager agrees and acknowledges that it shall be liable to the Company for any loss or damage suffered or incurred by the Company recoverable at law arising out of any negligence, default or breach by Core Capital LLP (the “Old Manager”) under the management agreement between the Company and the Old Manager dated [date of 2005-06 Management Deed, as applicable] (the “Old Management Agreement”) or otherwise arising in respect of the provision by the Old Manager of its services in relation to or otherwise in connection with the Company (including, without limitation, in respect of the Company in connection with acting as operator and manager of the Company and, acting as adviser to the Company in respect of the Company’s Unquoted Portfolio) however and whenever the same may arise or have arisen.”
“The court may allow an amendment whose effect will be to add or substitute a new claim, but only if the new claim arises out of the same facts or substantially the same facts as are already in issue on a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings.”
“(1) The 'cause of action' is that combination of facts which gives rise to a legal right; (it is the 'factual situation' rather than a form of action used as a convenient description of a particular category of factual situation … (2) Where a claim is based on a breach of duty, whether arising in contract or tort, the question whether an amendment pleads a new cause of action requires comparison of the unamended and amended pleading to determine (a) whether a different duty is pleaded (b) whether the breaches pleaded differ substantially and (c) where appropriate the nature and extent of the damage of which complaint is made … (Where it is the same duty and same breach, new or different loss will not be new cause of action. But where it is a different duty or a different breach, then it is likely to be a new cause of action). (3) The cause of action is every fact which is material to be proved to entitle the claimant to succeed. Only those facts which are material to be proved are to be taken into account; the pleading of unnecessary allegations or the addition of further instances does not amount to a distinct cause of action. At this stage, the selection of the material facts to define the cause of action must be made at the highest level of abstraction. … (4) In identifying a new cause of action the bare minimum of essential facts abstracted from the original pleading is to be compared with the minimum as it would be constituted under the amended pleading … (5) The addition or substitution of a new loss is by no means necessarily the addition of a new cause of action … Nor is the addition of a new remedy, particularly where the amendment does not add to the 'factual situation' already pleaded …”
“In the quest for what constitutes a “new” cause of action, ie a cause of action different from that already asserted, it is the essential factual allegations upon which the original and the proposed new or different claims are reliant which must be compared. Thus “the pleading of unnecessary allegations or the addition of further instances or better particulars do not amount to a distinct cause of action” – see Paragon Finance plc v D B Thakerar and Co (a fi rm) (CA)[1999] 1 All ER 400 at 405 per Millett LJ. “So in identifying a new cause of action the bare minimum of essential facts abstracted from the original pleading is to be compared with the minimum as it would be constituted under the amended pleading” – see per Robert Walker LJ in Smith v Henniker-Major and Co (a fi rm)[2003] Ch 182 at 210.”
“On the other hand once the claimant serves particulars of claim on a defendant, he pins his colours to the mast as against that defendant. Particulars of claim are normally narrower in their scope than the original claim form. Those particulars then constitute the ongoing claim against that defendant. If the claimant applies to amend as against that defendant, what the court has to do is to compare the original particulars of claim with the proposed amendments. If the claimant is seeking to add a new claim after expiry of the limitation period, he cannot escape from the tentacles of s 35(3) to (5) of the 1980 Act by relying upon the broad wording contained in his original claim form.”
“However, it is, I think, correct that account can be taken in the present case of what is pleaded in the original particulars of claim against the fourth and fifth defendants in determining whether the claim (on this hypothesis, a new claim) against Biddle & Co made in the proposed amended particulars of claim arises out of substantially the same facts and matters as the claim against the fourth and fifth defendants.”
“The Claimants’ aver that Begbies’ close relationship with the Manager, built up through multiple appointments before the Claimants’ liquidations and in anticipation of further appointments after the Claimants’ liquidations, caused them to fail to apply a proper degree of scrutiny to the transfer of the Claimants’ assets to Manager-connected entity in the MVL.”