Dorne Mitchell v Leigh Day (a firm) [2025] EWHC 1081 (KB)

[2025] EWHC 1081 (KB)

Case No KB-2023-002577

IN THE HIGH COURT OF JUSTICE

KING'S BENCH DIVISION

Venue Royal Courts of Justice, Strand, London, WC2A 2LL

Date 06/05/2025

Before

MASTER STEVENS

Between

Dorne MitchellClaimant

Jamie Carpenter KC (instructed by Fieldfisher LLP) for Claimant

Marie Louise Kinsler KC & Daniel Edmonds (instructed by Reynolds Porter Chamberlain LLP) for Defendant

Hearing Hearing date: 30 th January 2025

Approved Judgment

This judgment was handed down remotely at 2pm on 6 th May 2025 by circulation to the parties or their representatives by e-mail and by release to the National Archives.

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MASTER STEVENS

Master Stevens:

[1]It is often said colloquially that lightning does not strike twice. I am asked by the Defendant, through this application, and in the interests of justice, to trigger that second lightning bolt against the Claimant and enter summary/reverse judgment on her claim. The claim is for damages for losses allegedly caused by the professional negligence of the Claimant’s former solicitors in allowing her high value clinical negligence claim to be struck out for failure to serve the claim form within the limitation period (“the underlying claim”). It was struck out after an extension of time for service of the claim form was set aside, so that service of the claim form had not been effected within the period of a previous extension of time for service to 10th December 2016. The Claimant had been seeking damages for the wrongful birth of her profoundly disabled daughter, which are now valued at around £26M including interest. The litigation was complicated by the fact that most of the Claimant’s antenatal care had been conducted in the UAE where the Defendants were based, thus involving the need to consider medical standards of care in the UAE, and use of the Foreign Process Section of the Royal Courts of Justice (“FPS”) for service of proceedings. She instructed a firm which has a reputation for being one of the leading clinical negligence specialist firms in London.

[2]Following the strike out of the underlying claim, the Claimant instructed another firm, whose status can also be described in similar terms to the former solicitors, to bring this action. By this application I am asked to rule that the causes of action in tort and contract, upon which the whole claim is based, have no real prospects of success as they were time-barred at the point in time when a limitation standstill agreement was entered into in relation to the professional negligence action.

[3]It is appropriate to record that this application was issued within three months of the first case management conference (CMC). That hearing was unusual, by the general standards of a high value clinical negligence CMC before a King’s Bench Division Master, in terms of the complexity and extent of legal argument and authorities cited at such an early case management stage. The Defendant sought an early preliminary trial on both limitation and applicable law, whilst the Claimant wanted a trial of all issues. Instead, due to the overlapping, but limited, number of witnesses on the two issues identified by the Defendant, plus breach of duty and causation, I ordered an early split trial on all issues but quantum. That is now listed for October 2025. However, by this application, the Defendant now urges that I “grasp the nettle” without a trial, as to whether the claim is in fact already time barred. It is of course important, and in furtherance of the overriding objective, that issues are narrowed as soon as reasonably, justly and proportionately practicable. The Claimant requested that I determine the application on the papers alone, but I did not consider that was possible without a hearing.

THE LEGAL TEST ON SUMMARY/REVERSE SUMMARY JUDGMENT

[4]The legal principles governing summary judgment applications were not in issue between the parties so I will not set them out at length, or by reference to the authorities. The notes to the White Book contain many of those helpful references, which are routinely argued before the Masters. Put simply, pursuant to CPR 24.2, I need to decide whether the claimant has no real prospect of succeeding on the claim and there is no other compelling reason why the case should be disposed of at trial.

[5]Summary judgment applications are useful where there is a short point of law or construction which can adequately be addressed in argument without a fuller investigation into the facts, because there are no reasonable grounds for believing they would add to, or alter the evidence available to a trial judge, and thereby affect the outcome of the case.

[6]The evidential burden is on the applicant to establish that there are grounds to believe there is no realistic prospect of success and no other compelling reason for trial. Only when the applicant has produced credible evidence supporting this proposition, does the burden fall to the respondent to prove the opposite. The test is not that the claim is “bound to fail” which is a higher threshold used for striking out proceedings, nor should it generally involve an assessment of the strength/weakness of any evidence, but there must be a realistic, i.e. not fanciful, prospect of success.

THE REMEDY SOUGHT IN THIS ACTION

[7]Prior to examining the law as to the timing of actionable damage in contract and tort, and the agreed factual history, I believe it is important, contextually, to be absolutely clear about what the Claimant is seeking by this action. She is claiming damages to reflect her lost opportunity of achieving a successful outcome in the underlying claim. That was more fully argued at the CMC where counsel for the Claimant helpfully cited key principles relating to that assessment, as identified by Simon Brown LJ in Mount v Barker Austin [1998] PNLR 493 [at 510]. In particular:(a) The legal burden is on the Claimant to prove that she lost something of value as a result of the Defendant’s negligence. However, “[t]he evidential burden lies on the defendants to show that despite their having acted for the plaintiff in the litigation and charged for their services, that litigation was of no value to their client, so that he lost nothing by their negligence in causing it to be struck out. Plainly the burden is heavier in a case where the solicitors have failed to advise their client of the hopelessness of his position…. If, of course, the solicitors have advised their client with regard to the merits of his claim (or defence) such advice is likely to be highly relevant”.

(b) Any greater difficulty which the Court has in discerning the strength of the original claim, than it would have done at the time of the original action, should count against the Defendant rather than the Claimant.

(c) “If and when the court decides that the plaintiff’s chances in the original action were more than merely negligible it will then have to evaluate them. That requires the court to make a realistic assessment of what would have been the plaintiff’s prospects of success had the original litigation been fought out. Generally speaking one would expect the court to tend towards a generous assessment given that it was the defendants’ negligence which lost the plaintiff the opportunity of succeeding in full or fuller measure”.

[8]Counsel for the Claimant also referred me at the CMC to the approach of the Court of Appeal in Sharpe v Addison [2004] PNLR 23, demonstrating that it will be a rare case in which a claim cannot be proceeded with, because the solicitors’ negligence will be held to have had no value. Rix LJ equated the test with that for obtaining summary judgment under Part 24 (at [27]). He submitted that a claim may face very great difficulties and yet have some value (see in particular at [28]). He reminded me that it does not involve rigidly multiplying together percentage chances and is to a large extent impressionistic. Finally, he submitted that it is only where “the evidence or the law is so clear that the subsequent court can treat the prospects as overwhelming or negligible” that the prospects could be assessed at 100% or nil (Hanif v Middleweeks [2000] Lloyd’s Rep PN 920 at [15] per Mance LJ).

[9]The overall claim is quantified on a 100% basis in the Claimant’s Provisional Schedule of Loss at £26,137,564 including interest to 10th July 2023,but her Particulars of Claim (“Particulars”) make it plain that the Defendant had originally assessed her prospects of success at 60% and it is acknowledged that, if the law of the UAE was the applicable law, her claim could not have succeeded. However it is asserted that there was a “substantial chance of English law being the applicable law” in the underlying action (paragraph 57 of the Particulars) such that she had “very good prospects of success” that her lost opportunity would result in damages in her professional negligence claim.

AGREED FACTUAL BACKGROUND

[10]As the relevant factual history of what happened and when, is now uncontested, I will not spend very much time on it. The chronology can usefully be summarised in the following Table which has been adapted from one helpfully appended to the Defendant’s skeleton argument: DATE UNDERLYING ACTION 20.06.2013 C instructs LD (“D”)to act for her 08.07.2015 D:(i) issues proceedings bringing claim in negligence in English law against UAE Defendants; and

(ii) applies for an order permitting service of the claim form out of the jurisdiction and an extension of time for service until 10 December 2016 (i.e., an additional 11 months). 22.09.2015 Master Cook makes order extending time for service to 10 December 2016 (“First Extension Order”) Jul 2016 D legalises the court documents at the UAE Embassy (12 months after the issue of proceedings). Aug-Sep 2016 There are a series of delays involving preparation of the packs of documents, paying FCO fees, and lodging the correct documents. 30.09.2016 D’s outdoor clerk attends the FPS to lodge the Court documents for service and is advised that a Form N244 needed to be completed for each defendant, and the FPS required the original Claim Form retained by the RCJ when the claim was issued. 03.10.2016 D’s outdoor clerk again attends the FPS to lodge the Court documents for service. The FPS advises D that the process of serving out of the jurisdiction would take around 8 months. 04.10.2016 D applies for a second extension of time for service 17.10.2016 Master Cook makes second order extending time for service to 10 June 2017 (“Second Extension Order”) 10.12.2016 Deadline for service under First Extension Order expires Feb and Apr 2017 Service effected in the UAE on the UAE Defendants under the currency of the Second Extension Order. 20.04.2017 UAE Defendants (D1-D6) apply to set aside the First and Second Extension Orders. 12.07.2017 Master Cook holds that the first extension of time had been properly granted, but the second had not, and therefore set aside his order of 17 October 2016. 01.08.2017 Witness statement (Wainwright 3) served on behalf of D explaining steps taken by LD in trying to effect service in the UAE. 15.03.2018 Foskett J allows appeal and reinstates Second Extension Order 27.06.2019 CA allows second appeal and overturns order of Foskett J DATE THIS ACTION 02.12.2022 Standstill Agreement entered into between C and D 07.06.2023 Claim form issued for this claim 06.07.2023 Particulars of Claim served 23.10.2023 Defence served D applies for a preliminary issue trial to be heard on limitation and applicable law 16.04.2024 CMC in 2023 Claim (includes consideration of D’s 26.03.2024 application). A split trial is ordered. 11.07.2024 Application made for reverse summary judgment of 2023 Claim 30.01.2025 Hearing of D’s application 20.10.2025 Split trial lasting 10 days listed to commence

THE CLAIMANT’S ALLEGATIONS OF PROFESSIONAL NEGLIGENCE

[11]In the Particulars of Claim the Claimant at paragraphs 53 and 54, under the heading “Breach of Duty” alleges:(a) “The Defendant ought to have been aware of the limited circumstances in which an extension of time for service of a Claim Form will be granted where a limitation defence has accrued…(case law cited) and accordingly of the need to take all reasonable steps to serve the Claim Form within the period of its validity;

(b) The Defendant failed to investigate and /or progress the Original Claim with reasonable speed after issuing proceedings. In particular, the Defendant did not instruct Dr McHugo until nine months after issuing proceedings;

(c) The Defendant delayed in contacting the Foreign Process Service of the High court (“the FPS”) :the Court documents were not taken to the FPS until five months after issuing proceedings.

(d) Having been told by the FPS that the Court documents needed to be legalised at the UAE Embassy, the Defendant failed to do so until July 2016, 12 months after issuing the Claim Form.

(e) The Defendant delayed during August and September 2016 in preparing the Court documents for service.

(f) The Defendant failed to serve the Claim Form on the Original Defendants by 10 December 2016. 54. The Claimant avers that the findings of the Court of appeal in its judgment of 27 June 2019 (when the Defendant was still acting for the Claimant) are determinative of the Defendant’s breaches of duty”

[12]In the Particulars of Claim the Claimant at paragraph 55, under the heading “Causation and Loss” alleges:

“As a result of the Defendant’s negligence and/or breach of contract as aforesaid, the Claimant has lost the opportunity to pursue the Original Claim. Accordingly, she claims the value of the lost opportunity from the Defendant”

THE LIMITATION PERIOD IN TORT: Statutory definition and submissions

[13]Whilst the claim is brought in both contract and tort, limitation periods are sometimes longer in tort than contract so it makes sense to consider the claim in tort first. The Limitation Act 1980 at section 2 defines the tortious time limit as six years from the date on which the cause of action accrues, being the date the alleged damage was suffered.

[14]The parties disagree as to when the damage was suffered. As set out in the Table above, the underlying claim was not served by 10th December 2016 which was the expiry date of the Court’s extension. If the damage was not suffered until 10th December 2016, the very latest date to commence the professional negligence action based in tort would have been 10thDecember 2022.

[15]However the Table also references the fact that the solicitors for the parties in this action entered a limitation standstill agreement on 2nd December 2022, to allow time for further pre-action correspondence and ADR, resulting in the time from then, and until 9th June 2023, being disregarded for the purposes of limitation. The standstill agreement expressly preserved the Defendant’s rights to argue limitation should it choose to do so.

[16]This claim was in fact issued on 7th June 2023 i.e. within the limitation moratorium period.

[17]The Defendant maintains that irreparable damage had occurred to the underlying claim in October 2016 and in any event before2nd December 2016, thus it is statute barred.

[18]As to public policy reasons for the statute, the Claimant argued that it was to protect defendants from stale claims, promote predictability and avoid satellite litigation. They further submitted that limitation periods should not be a trap for the unwary, and if a deadline is missed or an unless order is not complied with, the obvious and predictable date for accrual of the limitation period is the date of the default. The basic limitation period should be capable of determination without extensive factual investigation they argued. They maintained that to hold that the limitation period begins on an earlier date, when it is argued that compliance with the deadline became impossible, would defeat the policy aim of the law of limitation, and, if successful, result in a windfall for the Defendant.

[19]On the contrary, the Defendant argued that it was wholly inappropriate language to describe any favourable judgment on limitation as a “windfall”, and that a limitation defence is a fundamental right recognised by the English legal system; claimants have six years to bring a professional negligence claim and there is no reason for them to leave the issue of proceedings until the eleventh hour.

[20]The Claimant’s primary position in any event is that the issue of limitation cannot be separated out from an assessment of breach of duty, such that the most the Court can do is make a finding about when damage occurred, leaving the question of whether it was caused by a negligent act or omission to the trial judge. They concluded such that making a decision on reverse summary judgment is therefore impossible on this application. I will return to that submission in due course. The Defendant, somewhat curiously to my mind, submitted that for the purposes of the application alone they wanted me to proceed on the basis that all the allegations of negligence in terms of breach were made out, even though every allegation is actually robustly denied in the Defence. I now turn to consider the authorities on the timing of actionable damage which both parties addressed me on.

[21]The Defendant helpfully set out what they described as “guiding principles” as to what constitutes “actionable damage” in tort extracted from [15] of the Court of Appeal authority in Polley v Warner Goodman & Street (a Firm) [2003] PNLR 40, although all but the sixth principle had been identified in an earlier authority of that Court,as follows:(i) First, a cause of action in negligence does not arise until the claimant suffers damage as a result of the defendant’s negligent act or omission.

(ii) Secondly, the damage must be “real” as distinct from minimal.

(iii) Thirdly, actual damage is (with their emphasis added as underlining) :

“any detriment, liability or loss capable of assessment in money terms and includes liability which may arise on a contingency”

. To this principle the Defendant added the following words from the 1995 House of Lords case of Nykredit, “particularly a contingency over which a plaintiff has no control; things like loss of earning capacity, loss of a chance or bargain, loss of profit, losses incurred from onerous provisions or leases. They are all illustrations of a kind of loss which is meant by ‘actual’ damage. It was also suggested in argument . . . that ‘actual’ is really used in contrast to ‘presumed’ or ‘assumed’. Whereas damage is presumed in trespass and libel, it is not presumed in negligence and has to be proved. There has to be some actual damage.” (iv) Fourthly, the loss must be relevant, in the sense that it falls within the measure of damages applicable to the wrong in question. (v) Fifthly, a claimant cannot defeat the statute of limitations by claiming only in respect of damage which occurs within the limitation period if he has suffered damage from the same wrongful act outside that period ( meaning that a claimant cannot rely on their last pleaded breach to start time running against them, if an earlier breach exists) and (vi) Sixthly, damage often occurs before it can be crystallised, and difficulties of quantification do not prevent damage from being said to have occurred( this last principle was drawn from the House of Lords decision in Nyekredit Mortgage bank Plc v Edward Erdman Group Ltd (No.2)

[1997] 1 WLR 1627

at [1632] (“Nykredit”) which I will summarise below).

[22]The context of the decision in Nyekredit was a negligent over-valuation of a property, against which a bank was prepared to lend money. The borrower defaulted under the mortgage terms but the amount lent at all times had exceeded the true value of the property. There was a question as to when the cause of action arose, and whether it was at the time of the valuation, or subsequently when the bank obtained possession of the property, by which time the market value had fallen substantially. The House of Lords ruled that the cause of action had arisen at about the time of the loan transaction, being when the “relevant and measurable loss had first been revealed”. As the borrower had defaulted at once following the purchase, it was held that the valuer was liable for the adverse consequences that arose due to the deficiency in the valuation, but they were not liable for consequences which would have arisen even if the valuation had been correct. AUTHORITIES REFERRED TO, SUBMISSIONS UPON THEM & MY CONCLUSION ON THE PRINCIPLES TO BE TAKEN FROM THEM Khan v Falvey [2002] PNLR 28 (“Khan”)

[23]Both parties relied upon this Court of Appeal decision as the starting point in the line of authorities dealing with when a cause of action arises in tort, and particularly paragraphs 28-30 reproduced below at paragraph 26. The claim was brought against the claimant’s former solicitors whose alleged negligent delay in the conduct of the underlying claims resulted in them being struck out for want of prosecution.

[24]As the claim in negligence related to three separate pieces of work, I consider it helpful to set out the key dates/timings as follows: Contracts Actions Key dates Case 1 Trade debt C suffers trade debt of £7933.63 C instructs lawyers C said judgment should have been entered Struck out Professional negligence action started Court of Appeal holds loss suffered by C 1984 so time barred in 1990 1987 Dec 31st 1988 September 11th 1997 June 2nd 1999 (so damage should have occurred no later than June 1st 1993) 6 years from when the action could have been struck out, not from date of strike out so well before 1st June 1993 Case 3 Defence + counterclaim C instructs lawyers on a counterclaim worth £51,000+interest C pays lawyers £1,747.50 on account of costs C pays £11,200 to lawyers to meet a condition for C’s permission to defend claim C said judgment should have been entered Struck out Professional negligence action started Court of Appeal holds loss suffered by C March 1986 2nd August 1989 December 31st 1989 July 17th 1997 June 2nd 1999 (so damage should have occurred no later than June 1st 1993) 6 years from paying monies on account plus lost opportunity to recover £51,000 being suffered as pleaded, not from date of strike out so well before 1st June 1993 Case 4 C instructs lawyers on a variety of landlord + tenant matters including loss of opportunity to recover rent on a re-letting C said judgment for possession should have been entered C acting in person obtains possession Struck out Professional negligence action started Court of Appeal holds loss suffered by C 1989 January 1990 November 1992 March 1st 1999 2nd June 1999 In respect of the claim for loss of opportunity to recover rent on re-letting, by November 1992

[25]The Court of Appeal reached three decisions. First, that as some pleaded damage in each piece of litigation was “real damage” in terms of financial losses time started running for limitation purposes from the date of those losses, rather than awaiting the date of strike out.

[26]The Court went on to consider two further issues due to their importance, although not strictly necessary. They held that on the facts of the case the value of the claimant’s underlying claims had been diminished, and hence actionable loss suffered years before the cases were actually dismissed, because of the existence at that earlier stage of an “inevitability, or at least a very serious risk,” that they would in due course be dismissed. They went on to consider that if an application to strike out was made promptly, it might be difficult to conclude that there had been any earlier diminution in value. Sir Murray Stuart-Smith summarised the approach as follows (emphasis shown in underlining was added by the Defendant) : “28. A claim in tort is a chose in action and as such is assignable. But the value of the chose in action depends upon the prospects of success. If for whatever reason it is very likely or almost bound to fail, whether because it is liable to be struck out for want of prosecution, lack of merit or some other reason, it will have no value or no substantial value. In my judgment the Claimant in the present case could not have assigned his causes of action … for any real value for several years before they were actually struck out, because during that period there was an inevitability or at least a very serious risk that they would be struck out at any time. If this be right, as I believe it to be, it must follow that the claimant had already suffered damage by diminution in the value of his choses in action well before the actual striking out of the actions.29. In many cases the application to strike out for want of prosecution may be made at the earliest opportunity that it is likely to succeed. In such cases it may be difficult to say that the claimant’s chose in action has sustained any diminution in value until that time. In which case the cause of action will not arise earlier than the strike out, absent any prior damage of the sort claimed here. But often, when an action has gone to sleep for years, the actual application to strike is not made until years after it might successfully have been done. In such cases it seems to me that the damage is caused when there has been such inexcusable and inordinate delay or non-compliance with rules such that the Court would have struck out the action and pursuant to CPR Part 3.4, because the chose in action has so diminished in value to be of no real value.

30. It might be said that in theory the value of the chose in action will deteriorate over a period of time prior to the date when an application to strike out would have succeeded, and therefore once the decline starts, damage is sustained. But in the words of Lord Evershed in Cartledge v Jopling at p.774 there must be `real damage as distinct from purely minimal damage'. It seems to me that a claimant does not suffer real damage in the form of diminution of the value of his chose of action unless there is a serious risk that the original action could be dismissed for want of prosecution.

[27]Thus the Court was also keen to make clear that earlier Court of Appeal authority in Hopkins v MacKenzie [1995] PIQR P43 was no longer good law in respect of the need to await an actual strike out before time started running under the Limitation Act in a professional negligence claim where there had been a failure by previous solicitors to prosecute a claim diligently. If a strike out application was made promptly, there may be no real damage before the strike out. Chadwick LJ at [54] and [55], as referred to in the headnote, elaborated further, that before the advent of the Civil Procedure Rules (“CPR”) the Court was “all too familiar” with cases which were struck out for want of prosecution “as a consequence of inaction by the plaintiff or his solicitors over many months, if not years” where the Court might have to consider whether there was any residual value in a claim before the date it was eventually and belatedly struck out. In contrast he said with cases struck out under CPR 3.4(2) (c) “it is likely to be possible to identify, with some precision, the date at which the claim became liable to be struck out. The date will be that upon which there was a failure to comply with the relevant procedural requirement; and, as it seems to me, it will usually be on that date - and not on the date of actual strike out - that the opportunity to pursue the claim is lost.”

Submissions on Khan

[28]The Defendant contended that the focus of the Court’s attention was on the “diminution of value” of the claim, as measured by its prospects of success and that the approach was not restricted to negligent conduct leading to strike-outs for ‘want to prosecution’. They emphasised dicta from [28] that limitation can run from the time of very serious risk that the claim could be struck out, for a variety of other failures reported in subsequent authorities. They also referred me to phrases at [48] that time could run from when the claim “would be amenable” to being struck out and at [64] that “it is not a condition precedent for any claim against the solicitor that the underlying action be struck out”.

[29]The Claimant relied upon the factual context of the claim, namely that for all all three claims that had been struck out, the party seeking damages had suffered actual financial loss which had been pleaded and thus given rise to real loss more than six years before the professional negligence claim was issued. Furthermore, that in a dismissal for want of prosecution case there is no immediately identifiable date when damage occurs, and that the date of strike out has more to do with the defendant’s alacrity in issuing a strike out application than identifying the date of a material breach of duty. However, relying upon Chadwick LJ’s analysis at [55], that when it is possible with precision to identify a date by which a claim is liable to be struck out, due to failure to comply with a time limit in a court order, the Court will usually rely upon that date to determine when the claim is irreparably damaged and thus limitation barred, rather than await a strike out application by a defendant. Thus argued the Claimant, the Court does not hunt for even earlier dates than one already specified by the Court, to bring the limitation period forward as an end in itself.

My conclusions on the principles from Khan

[30]Having reviewed the authority reflectively after the hearing, and in its totality, one of the most striking features to me is that it was heard very shortly after the advent of the Woolf reforms which introduced the CPR, and the Court was keen to stress the sea change those reforms had introduced. It deals with extreme procedural delays and difficulties under the previous regime, and the decision emphasises that such delays were not expected to be a feature of cases run under the CPR’s modern case management rules. Indeed at [55-56] it was held that post CPR it was likely that the relevant date when actionable damage arises would be identifiable with greater precision, because of a failure to meet a relevant procedural time limit. I do not infer from this that the Court expected to be called upon to actively assess limitation dates in tort, where a date in a Court order specified the time limit; that does not appear to have been in the contemplation of the Lord Justices at all.

[31]I have real difficulty in applying the phrases from the judgment which were underlined by the Defendant (at paragraph 26 above) simply at their face value, by abstracting them from the factual context of the situation under examination by Sir Murray Stuart-Smith. The more important phraseology to my mind, giving effect to the overall context, is that which was not emphasised by the Defendant at [29] but to which I have added my own emphasis i.e. “when an application has gone to sleep for years, the actual application to strike is not made until years after it might successfully have been done. In such cases it seems to me that the damage is caused when there has been such inexcusable and inordinate delay or non-compliance with rules such that the Court would have struck out the action”.

[32]I agree with the Defendant that the case establishes that the Court does not need to await a strike-out to start limitation running.

[33]Another difference to the application before me is that in Khan the claimant had pleaded actual measurable financial loss occurring prior to a date 6 years before the professional negligence claim was issued at [21] and on that basis alone Sir Murray Stuart-Smith said he would have held the claim was statute barred. That is yet another reason why the important factual matrix underlying the decision should not be ignored when trying to draw out principles that bind me today. The Claimant in this application has pleaded breaches of duty prior to the expiry of the service deadline but has not pleaded that those acts or omissions caused loss occurring before then. Whilst the Defendant may be critical of this approach, and postulates that there was diminution in value before then, it is plain that all remarks of the Court of Appeal on that subject were obiter. (ii). Hatton v Chafes [2003] PNLR 24 (“Hatton”)

[34]This was another solicitor’s negligence case relied on by the parties where the original claim was issued in 1987, struck out in 1999 for want of prosecution and a professional negligence action commenced in 2000.

[35]The basic timeline was as follows: Activity Key dates Negligent accountancy services relied upon February-July 1983 D solicitors instructed 3rd May 1984 Writ issued January 1987 Failed strike out application November 1992 D Solicitor warns C claim may be struck out for want of prosecution October 1995 Strike out June 8th 1999 Professional negligence action issued October 13th 2000 but pleads “failing to take any steps to prosecute the claim between 1982 and 1992 and from 1993 onwards” No negligent acts or omissions pleaded after October 13th 1994 Professional negligence action struck out Finding that a strike-out application bound to succeed before 13th October 1994 on the facts

[36]It was in fact common ground between the parties in Hatton that the last event before October 13th 1994, was on July 9th 1993 at a court hearing to set the case down for trial. After that, notwithstanding the earlier strike out application, “nothing whatever was done” and Clarke LJ held at [39], “the delay since the hearing on July 9, 1993 was plainly both inordinate and inexcusable. The contrary would not have been arguable”. He said at [53] that at October 13th 1994 there would have been no arguable defence to a strike out application, such that the claim had no value by that date. He also noted that there was no allegation of negligence expressly relating to delay after October 13th 1994.

[37]Clarke LJ also held at [16], following Khan that “it is not a condition precedent for any claim against defendant solicitors that the underlying action should have been struck out. That is because the claimant may have suffered relevant damage before an order is made striking the action out. The question remains by what criteria to judge when that moment arises.” The Court did not consider they needed in this case to decide how to “judge when that moment arises” as on the particular facts they were able to determine that at the latest the date for limitation to start running would be when a strike out application would have been bound to succeed, such that the right of action became worthless.

[38]The three possibilities that were discussed on an obiter basis by the Court at [17] for the time at which damage was suffered were summarised as follows:

“The first is when the claimant has no arguable basis for avoiding the claim being struck out, the second is when it is more probable than not that the claim will be struck out and the third is when there is a real (as opposed to a minimal or fanciful) risk of the claim being struck out.”

[39]As I have set out at paragraph 36 above, it was not found necessary in the lead judgment to determine the degree of risk (i.e. the second and third propositions) which must be present before limitation started to run because, as in Khan, the facts showed the claimant to have “no arguable basis” for avoiding the claim being struck out at the relevant date such that the claim was “doomed to failure” [at 23].

[40]Sir Anthony Evans in a very short judgment, supporting the lead judgment of Clarke LJ went on to identify the relevant damage at [82] as “the loss of the right to proceed further with the original action” which in the circumstances of that case was “when the action is struck out in fact or when it becomes ‘amenable to striking out”. He added that in a professional negligence action it must be proven on the balance of probabilities that a striking out application would have succeeded at the date contended for. He emphasised how fact sensitive the cases are.

Submissions on Hatton

[41]The Defendant submitted that it was not necessary to adopt a “doomed to failure” threshold test for determining the application before me, as a lower one would suffice, although they were prepared to proceed on the basis of “doomed to fail” for present purposes. On any view the Defendant argued that the Claimant’s allegation in the Particulars of Claim that 10th December was the relevant point when the claim was doomed to fail could not be made out, as it was impossible for the Claimant to serve the claim through the Foreign Process Section (“FPS”) well before then. This was due to information given to the Claimant’s solicitor by court staff that it was likely to take more than 6 months to effect service, but they did not deliver complete paperwork to the FPS ready for service until 3rd October 2016, i.e. less than 2 months before the service deadline permitted by the Court. They also said November 16th 2016 was the last event in this case, akin to the last event described at [34] of the hearing on July 9th 1993 in Hatton and re-iterated that, on their view, all the pleaded elements of negligence had occurred well before 10th December 2016, similar to the last pleading in Hatton being before October 13th 1994. Thus as in [54] of the Hatton judgment they asserted the Claimant “cannot defeat the statute of limitations by claiming only in respect of damage which occurs in the limitation period if he had suffered damage from the same wrongful act outside that period”. They submitted that the Claimant’s allegation at 53 f) of her Particulars of Claim that “ The Defendant failed to serve the Claim Form on the Original Defendants by 10 December 2016” had no context and could not be properly made out as it was not open to the Claimant to serve the claim then; it was outside her control.

[42]The lack of any worth of the claimant’s case in Hatton before 13th October 1994, as discussed at [53] was also submitted to be analogous to the Claimant’s position before me, prior to 10th December 2016, due to the impossibility of service being effected in time through the FPS, according to the information that the Claimant had received from court staff.

[43]The Claimant drew my attention to the fact that this is another case based on striking out for want of prosecution pre-CPR and sought to distinguish it on that basis from the application before me. Furthermore, they highlighted what they considered to be an important qualification around the approach of simply looking for a reduction in the value of the underlying claim. In Hatton there had been two earlier attempts to strike the claim out, one being withdrawn in 1989 and the other dismissed in 1992, but the Court of Appeal did not find that the date of those applications started time running for limitation at [26] and [32].

[44]In addition the Claimant drew my attention to [82] where it was held that “The relevant kind of damage …is the loss of the right to proceed further with the original action. The measure of that loss, when it occurs, is the value of the chance of that action succeeding. But the loss is not suffered until the action is lost. That occurs when the action is struck out in fact or when it becomes “amenable to striking out”. They argued that there is a right to serve the claim until 10th December 2016 so the claim was not amenable to being struck out until after that date and there is nothing the Defendant can say to bring forward the date before then.

My conclusions on the principles from Hatton

[45]Once again I note that the claim relates to extremely dilatory events in the pre-CPR world. I agree with the Claimant’s interpretation that the context of the judgment is firmly set in the terms and language of the strike out regime.

[46]I do not find any parallel between the particularity of the pleaded losses arising in Hatton for breaches ending on an agreed basis over a year before the date that could have saved the professional negligence action, and the Claimant’s Particulars of Claim. There is not that level of consensus in this case. I will examine the various breaches of duty identified in the Claimant’s case in the period immediately before the expiry of the claim in due course.

[47]The three possibilities outlined by Clarke LJ , as referenced at paragraph 38 above were all obiter as he concluded at [64] “Since it is not (in my view) necessary to resolve these issues on the facts of this case I would prefer to leave their resolution to a case in which it is necessary to do so.” Importantly he also continued, “ It is to be hoped that it will never be necessary because the CPR are designed to eradicate applications to strike out for want of prosecution, which were unfortunately so common in the past”. That is far from compelling authority for me to reach a conclusion that the Claimant’s case was amenable to being struck out, within the period of validity of the Claim Form, and had lost value before 10th December 2016. I will consider the issues further more generally, but certainly do not consider the decision in Hatton dictates my decision. If anything the Court seems to have been anxious not to pin an early date for the claim being statute barred for the reasons advanced by the Claimant. (iii). Polley v Warner [2003] PNLR 40 (“Polley”)

[48]In Polley solicitors had issued a personal injury claim but were unable to serve it within the original period of validity of the claim form, which expired on September 24th 1993. They obtained, by an in time application, a four-month extension of time for service, not supported by any evidence, to January 24th 1994 which was later set aside on April 18th 1994. A professional negligence action was issued on April 14th 2000, relying on the set aside date to start limitation running. There was a trial of a preliminary issue on limitation. The Court considered whether any damage occurred more than 6 years before the professional negligence action was issued i.e. before 14th April 1994. It appears from [14] that no allegations of negligence were pleaded on or after 14th April 1994.

[49]Key dates can be summarised as follows: Activity Key dates Negligent legal services relied upon All aspects of negligence pleaded before 14th April 1994 D solicitors instructed By January 1993 Writ issued May 25th 1993 In time ex parte application to extend time for service of the claim Before September 24th 1993 Time expires for serving the claim under the original writ September 24th 1993 Extension of time order made September 29th 1993 Application to set aside the extension December 16th 1993 Set aside application successful April 18th 1994 C solicitors advised C his claim could not continue and he might have an action against them April 20th 1994 Professional negligence action issued April 14th 2000

[50]The Court of Appeal at [25] agreed with the District Judge that the relevant date for damage having occurred, sufficient to start time running for limitation, was when the mistake of not serving proceedings in time was made i.e. when they were not served within the original period of validity of the writ, not the later date when the original ex parte extension of time was set aside. This was based on a factual finding by the lower Court that in the particular circumstances there had been no good reason not to serve the proceedings according to the usual rules. The claimant’s lawyers had been awaiting an updated medical report in order to serve the claim but on a factual finding it was held that there were no substantial differences between a medical report that was available within the limitation period, and the subsequent report, apart from such dates which the District Judge had found could easily have been corrected later, if the original report had been relied upon at the time of service.

[51]Clarke LJ noted in passing at [25] that it was an essential step for the appellant’s case against the law firm that that their conduct fell below the standard of a competent solicitor such that no reasonable solicitor would have failed to serve the proceedings in time, thus an evidential burden for the defendant solicitor to satisfy, which “is a slightly different test from the doomed to failure test” which he had been considering. Clarke LJ’s conclusion accorded with that of the judge in the County Court such that the set aside application was held as “bound to succeed”.

[52]In reaching their decision the Court of Appeal had applied the principles in Khan and Hatton but Clarke LJ giving the principal judgment at [26] expressly stated he had not decided whether the “doomed to failure” test was correct, leaving it open, (as he had in Hatton) for a future case where it was necessary to determine it.

Submissions on Polley

[53]The Defendant submitted this case is not authority for any proposition that damage is only suffered when the date for service of the original claim form expires. They emphasised that while cases are fact specific, the principles remain the same. As the Polley claim required service within the jurisdiction they accepted the claim might only become doomed to fail, at or very shortly before, the time for service actually expired. Counsel for the Defendant provided an example that it would be possible for a solicitor to jump on a train and personally deliver a claim if necessary, and they had missed the post, right up to the final hour of validity of the writ. That of itself, they submitted distinguished the present application, where it became impossible for the Claimant’s solicitor to do anything to effect service quickly after depositing correct papers with the FPS. They drew my attention to the fact that it was in this case that the sixth guiding principle for assessing limitation in tort was added to the five principles set out in Hatton, namely that damage often occurs before it can be crystallised. Furthermore the claimant lost the argument in Polley that damage was not suffered until the extension order was set aside; relevant damage could occur before then.

[54]The Defendant acknowledged on the facts of Polley which were not in issue, it was already time barred on the last permissible date for service, and on the date of the extension (the order for which arrived only after limitation had expired, although the application had been submitted in time) and there was no issue raised by the defendant law firm about any earlier dates by which time service became impossible. Thus it was not an instance, as left open in Hatton and Polley, as to whether damage is suffered at an earlier point in time when either:(i) it was ‘more probable than not’; or

(ii) there was a ‘real risk’ that the underlying claim could not be served. This it was argued notwithstanding that, were either of those tests to be applied on the application before me, damage would have been suffered before 2 December 2016. Instead the Defendant sought to persuade me that the situation is equivalent to that in Khan, Hatton and Polley, in that the claim is on its facts “doomed to failure” and thus out of time.

[55]The Defendant also referred to a brief judgment issued by Auld LJ at [27] where he held that damage occurred when the “high vulnerability - certainty if the law and practice of the courts was to be properly applied - of the extension being set aside on application being made as it was, at the very least doomed the claim against the solicitors to failure, thus causing the actionable damage at that first hearing”.

[56]The Claimant relied on Polley as good authority for their proposition that damage is suffered when the time for service of the claim form expires i.e. on 10th December 2016 in the application before me. They took me to paragraph [7] of the judgment where the pleaded allegations were set out to support their submissions that this case illustrates how the Court deals with a single negligent event in that they look to when that event occurred to set time running under limitation: (1)“ Failed to serve the proceedings…within four months of the date of issue of the said proceedings (2) Failed promptly to apply, whether on notice or otherwise, for an order extending the period of time within the which the said proceedings could be served.”

[57]They drew my attention to [20] where the Court once again considered whether there would have been no arguable defence to an application to set aside the order extending time for service, which as they had set out in earlier submissions was seen as favourable to the Claimant in the application before me, as there could be no realistic prospect of an application to strike out a claim within the validity of the Claim Form. They accepted it was not a complete answer as there were remarks about a possible earlier date that are obiter. However, they maintained the decision was in accordance with authority and principle in all the other cases (Khan, Hatton, previously referred to, alongside two further cases considered below).

My conclusions on the principles from Polley

[58]The principle I take from the decision is that there is sound authority for a court not needing to enquire as to what sort of damage may or may not have been caused at various points before the expiry of an imminent court deadline. The expiry of that deadline is the appropriate one to start time running for limitation, if that is the pleaded date of the negligence.

[59]Although the Defendant sought to persuade me that there might well be no damage in reality before the time set by the CPR for service of a claim in a case being served within the jurisdiction (hence the lack of enquiry by the Court), because it is always possible to serve at the last minute, that reason is not explicit in the judgment. I do not find their example, or the distinction, helpful; law books are full of instances where service of a claim form has been left to the last minute and even experienced parties have come unstuck; mistakes get made in the pressure of the closing hours before expiry of a claim form and unforeseen complications can materialise. Rather this judgment focusses at [22] on the factual finding that the negligent solicitors misdirected themselves as to the suitability of medical evidence for service, which in fact was present some 6 months prior to the deadline in an acceptable format. I am specifically not asked in this application to make any factual findings. (iv). Cohen v Kingsley Napley [2006] PNLR 22 (“Cohen”)

[60]In Cohen, the Court of Appeal had to consider whether solicitors had been negligent in allowing a claim to be struck out. The law firm defending the action argued by the time they were instructed in 1995 the claim had no value or if it had any value, damage was suffered before November 1996 so it was out of time in professional negligence i.e. the counterclaim was doomed to failure in 1996.

[61]The key facts can be summarised as follows: Activity Key dates Negligent legal services relied upon Architect sues 3 parties for unpaid fees of £23,000 (not including C) February1992 A counterclaim served for £1.8M April 16th 1992 Action assigned to C by one party in 1991 allegedly and disclosed fact of assignment to claimant in 1994 1994 D solicitors instructed December 1995- date after November 21st 1996 Date 6 years before professional negligence claim issued November 21st 1996 Solicitors go on court record as legal aid certificate granted 1997 when previous solicitors disinstructed Notice of application to join C as Plaintiff in counterclaim June 1997 Strike out application issued February 1998 Strike out application for inexcusable delay in disclosing assignment in 1994 and not applying for summons for directions n 1994 July 1998 One other claimant assigns his benefit in the claim to C 1999 Professional negligence action issued for failing to warn of possible strike out if no summons for directions issued and /or failing to advise to issue protective writ for counterclaim November 21st 2002

[62]The Court of Appeal concluded at [15] that the Deputy High Court Judge’s finding that “since 1991 the applicant’s case had been carried out with a calculated disregard for the rules of court was a strong one and was justified on the evidence before him” That conduct pre-dated 1997 when the Court held that had a strike out application been made the result would have been no different to the one actually issued in 1998.

[63]The Court was pressed by the law firm to conclude that they should adopt an objective view, following Khan, as to when the case was amenable to strike out, so its value could be assessed as diminished to one of “no real value” without having to consider hypothetically what would have happened if a strike out application had been issued, which could be difficult to prove.

[64]The Court of Appeal stated at [18] that, “While, in many cases, it can readily be assumed that an application to strike out would have been made” in some circumstances, it was “certainly arguable that there will be cases in which a factual inquiry is appropriate”.

[65]Pill LJ held at [19] “Whether a cause of action has value at the material time will depend, first, on whether it would have been struck out had the application been made. …However, even if the answer to that question is in the affirmative, as it is in this case, the claim will continue to have value if, on a consideration of the facts, application to strike out might not have been made.”

[66]At [25] Pill LJ held that “on the material before the court, there are issues of fact which are fit for consideration at trial. This is not a case in which an assumption can properly be made that application to strike out would necessarily have followed immediately upon a notice of intention to proceed in November 1996”. Thus in this case the hypothetical question as to whether an application would have been made, did have to be confronted.

Submissions on Cohen

[67]The Defendant did not reference Cohen in their skeleton argument but orally referred me generally to the case law relating to the issues before me in Jackson & Powell on Professional Liability, ninth edition which was in the bundle and stated the law as at September 2021. At paragraph 5-057 Cohen is simply referenced as a decision of the Court of Appeal where it is left open as to “whether it would have sufficed if it was either more probable than not that the earlier action would have been struck out or whether there was a real (as opposed to a minimal or fanciful) risk that it would have been struck out more than six years before the issue of the later proceedings”.

[68]The Claimant relied upon this decision to support the view that there could be no damage to the Claimant’s chose in action until something had happened which might have given the defendants to the underlying claim the opportunity to bring the proceedings to an end. At 10th December 2016 the underlying claim was still within the period of validity of the first extension, the Claimant had the benefit of the second extension and the defendants had not applied to have the second extension set aside. There was therefore no prospect of the claim being struck out for a failure to serve proceedings before the deadline.

My conclusions on the principles from Cohen

[69]Although this is another pre-CPR case, for which there is already a long line of authority that absent active case management, unacceptable periods of delay should be censured with findings that strike out applications would have been successful, this case seems to put an additional hurdle in the way of a defendant trying to resist a professional negligence claim. This may be problematic at a summary judgment stage as it may be more appropriate to conduct a factual inquiry. This case does not appear to me to aid the Defendant whose evidential burden it is, in their pursuit of reverse summary judgment.

(v) Berney v Saul [2013] PNLR 26 (“Berney”)

[70]In Berney, relied upon by the Claimant, the Court of Appeal, reviewed decisions made on an earlier summary judgment/strike out application by defendant solicitors to a professional negligence claim. The Court held that relevant loss is suffered for the purposes of tortious liability in a professional negligence claim when the claimant is worse off as a result of the defendant’s breach of duty.

[71]The claim related to a liability accepted personal injury claim with proceedings being issued in April 2002. There was a failure to serve Particulars of Claim in accordance with the CPR but parties continued to negotiate. Thereafter the claim was settled with the assistance of new solicitors, but only after the defendants had indicated they would oppose any application to serve Particulars of Claim out of time. The subsequent professional negligence claim sought damages for loss caused by the under settlement of the claim, and relied upon the date of settlement as to the correct one to start limitation running.

[72]The key facts can be summarised as follows: Activity Key dates Negligent legal services relied upon All aspects of negligence pleaded before 1st November 2005 D solicitors instructed May 1999 Claim issued and reissued 12th April 2002 8th August 2002 Expiry of time for Particulars of claim to be served 11th August 2002 C told by counsel claim was vulnerable to strike out D alleges C had suffered damage by this date 2nd June 2004 Respondent letter to C sols that they would take no procedural points on delay 19th November 2004 D alleges claim statute barred well before this date which is 6years pre-professional negligence claim commenced 10th January 2005 Respondent assurances of 19th November 2004 withdrawn 25th January 2005 C instructs new solicitors due to delays 5th April 2005 Counsel advises that an application to extend time for service of Particulars had only 20% prospect of success due to delay 11th May 2005 C advised the application was unlikely to succeed as they were out of time 10th June 2005 C’s new solicitors try to agree time to serve Particulars of Claim and told by opponents it would be resisted 13th June 2005 Settlement of C’s claim at a low value 1st November 2005 Agreed between the parties any inactivity by C in this period was not relevant for limitation 30th May 2007-August 2010 Professional negligence action issued 10th January 2011

[73]The claimant had submitted the settlement date commenced time running for limitation purposes at [54] “ because, although the Respondent’s negligent non-compliance with the procedural requirements had occurred before that date, it was only on the settlement date itself that her loss materialised in financial terms and she actually suffered loss. Whilst, prior to that date, as she accepted, her claim had been subject to a litigation risk that it might be struck out for procedural non-compliance, or that it was possible that any application to obtain an extension of time for service might not succeed, it was only on the date of settlement itself that she suffered any actual loss: that loss was the loss of her ability to pursue her claim…in an amount in excess of the settlement sum”.

[74]The defendant accepted in submissions that the claimant’s application would have succeeded, but only in terms limiting the financial value of the claim, and with an adverse costs liability, such that damage had been suffered earlier than January 2005.

[75]In the lead judgment at [58] Gloster LJ held, “what is clear is that determination of the issue is critically dependent on the circumstances arising in any particular case. Thus, although there appears to be a tension between certain statements made in some cases, when compared to what is said in others, I am not persuaded that it is either necessary, or appropriate, for this court in this case to reconcile what may be differently nuanced approaches to what, at the end of the day, is essentially a factual question: namely, when did the claimant first suffer actual damage as a result of the professional negligence.” She also referenced Lord Hoffman in Nykredit at [61] who had “underlined the fact dependent nature of the inquiry”

[76]At [63] she noted, “in cases relating to the negligent conduct of litigation by a solicitor, however, attempts have been made in this Court (albeit obiter), and most strikingly in Khan, to lay down exhaustive predictive criteria to decide the precise moment in the course of negligently conducted litigation at which the defendant has suffered actual financial loss”.

[77]After reviewing prior authorities in great detail, Gloster LJ was at pains to point out at [70] that cases of this type are “notoriously fact sensitive”. At [70] she also held that there was no reason to comment on obiter statements in previous authorities “about the appropriate criteria to adopt to a determination of the limitation issue”. Instead she preferred to answer “the realistic and fact dependent question formulated by Lord Hoffman in Nykredit: when was Ms Berney financially worse off as a result of the Respondent’s breach of his duty of care than she would otherwise have been”. At [71] she considered “on an objective analysis of the facts, it is unreal to characterise Ms Berney’s claims as one for “diminution of the value of her chose in action”. Her claim is one for her loss as a result of having to settle her claim in November 2005. Although there was a possible litigation risk that she might not get permission to serve her Particulars of Claim out of time, in reality… that risk was, if not fanciful, at least extremely small.” She went on at [72] to consider “Personal injury claims where liability and damages are in serious dispute if left for an inordinate period of time without movement, may well lead a court to take the view that the reluctance to bring proceedings is due to a lack of confidence or enthusiasm for the case. In such circumstances, the result may well be that, prior to settlement or strike out, the claimant has suffered actual loss because the value of her claim has been rendered worthless”.

[78]Thus on the facts, Gloster LJ held that the claimant was not in serious danger of having her claim struck out before the settlement, and did not suffer actual financial loss prior to then, so the period for limitation did not start until that date. The defendant therefore failed in their bid to have the claim statute barred. She did not consider the interests of the administration of justice would be well served by imposing an earlier limitation date to deprive the claimant of access to the courts when she had a liability admitted claim which her solicitors had negligently allowed to proceed in a manner in breach of the CPR.

[79]Moses LJ agreed to allow the appeal but did not share all of Gloster LJ’s views. He referred at [86] to a “real risk” that had an application to court to extend time for service been made, her claim would have been limited in value (but not struck out) at that point, to the sum she had originally claimed, or a lesser sum based on the medical reports disclosed at the time. However this did not upset the result of the appeal because right up to 25th January 2005 there was no risk that time would not have been extended, or that the claim would have been restricted, thus meaning that the professional negligence action had been brought in time. He reasoned that his conclusion as to there being “no risk” was because to impute such risk would turn the defendant law firm’s assurances about not taking a point on delay at that time, on their head, and would be an unprincipled approach.

[80]Moses LJ would not have extended the time for limitation to start running to such a late date as Gloster LJ because he felt it was inconsistent with the conclusions reached in another case brought to the Court of Appeal (Price v Price [2003] 3 All E.R. 911, where the Court had been keen to stress the importance for the administration of justice of avoiding damage caused by delay and the need for a disciplinary framework).

Submissions on Berney

[81]The Defendant’s skeleton argument did not include any detailed consideration of Berney but orally they submitted the ratio was consistent with their argument before me in this application. They referred me to the fact that it was cited with approval in the final case I am about to review, Holt v Holley & Steer Solicitors

[2020] 1WLR 4638

, and upon which they had a number of submissions.

[82]The Claimant relied on paragraph [62] of the judgment for the principle that the Claimant needed to be financially worse off to have suffered relevant loss which could start time running in limitation.

[83]The Claimant also maintained that generally the authorities show that there is no need for the Court to embark on an analysis of when the claim was impaired if there is a discrete event, (such as non-compliance with a rule or order which precipitates failure of the claim), whilst acknowledging in Berney that the Court did conduct an analysis due to the increasing vulnerability to disaster over time.

My conclusions on the principles from Berney

[84]The Court made plain that assessment of damage to a right of action is highly fact sensitive, and that there are no exhaustive predictive criteria that can be applied. I find this helpful. Gloster LJ also seemed very keen to ensure that the interests of justice were not overlooked which would have been part of the Court’s (favourable) consideration if an application had been made to extend time, especially in a liability admitted case such as this one.

[85]The type of damage to the claim which the judgment of Moses LJ directed himself in closing was measured by financial limits that had been pleaded at specific times rather than more vague notions of “damage” which had been discussed following submissions by the defending law firm. Whilst he was keen at [90] to emphasise that any “diminution in value does not have to be quantified by a sale or settlement provided that it can be shown to be substantial”, quoting from Khan at [32], on the facts of the case he did not have to develop the point about what “substantial” might look like. In the case before me that does not assist the Defendant, to my mind, at this interlocutory stage.

[86]Both judges referred to the importance of maintaining court discipline through adherence to time limits for the proper administration of justice. The delay in this case was extreme, being over 2.5 years from issue of this post-CPR claim and 5.5 years from instruction of solicitors without Particulars of Claim being served, before time was judged to start running for limitation, even on the more cautious time estimate of Moses LJ. That of itself is far more serious than the case I am considering. (vi). Holt v Holley & Steer Solicitors

[2020] 1 WLR 4638

(“Holt)

[87]This was the most recent authority relied upon by the Defendant, where the Court of Appeal upheld a summary judgment finding that a party’s solicitors’ failure to obtain permission to admit expert evidence on the value of certain of their matrimonial assets prior to the final hearing at the latest (i.e. before judgment was subsequently handed down) started the limitation period in professional negligence; damage was suffered at [34] “when the chance of introducing further valuation evidence became in reality impossible”.

[88]The context was negligent conduct of divorce proceedings and at the first directions appointment the Court had ordered valuations of the family home, but no directions for the valuation of some investment properties held by the husband and wife. Further directions were made at a Financial Dispute Resolution meeting, but it was only subsequently that proper valuations were sought, very shortly before the final hearing of the financial relief proceedings. In the absence of any agreement to accept the new material, or any application to the Court to admit it, it was held, according to the headnote at H line 1, that the last opportunity to adduce that evidence could hardly have accrued later than the end of the final hearing, i.e., it could not have been as late as a subsequent event, such as the giving of judgment in the financial remedy proceedings two months later. The wife's professional negligence claim was brought more than six years after the conclusion of the final hearing, but less than six years after the giving of judgment and making the financial remedy order; this was ruled to be too late.

[89]The Court of Appeal found that the fact the subject matter of this dispute related to matrimonial proceedings rather than a general civil claim was immaterial to the findings on limitation at [51].

[90]The key facts can be summarised as follows: Activity Key dates Negligent legal services relied upon Financial relief proceedings initiated 15th February 2011 Directions appointment - expert valuation directions given 1st July 2011 Financial Dispute Resolution hearing -further orders made about evidence for the final hearing 11th October 2011 C solicitors obtain further non-directed evidence and produce it to D 4 days before the hearing 19th January 2012-10th February 2012 C solicitors aware that D would not consent to additional evidence being adduced but no application made to court 10th -16th February 2012 Final hearing 16th February 2012-16th March 2012 (on 4 days only) Draft Judgment circulated to the parties 10th April 2012 Professional negligence action commenced 5th April 2018

[91]At [34] McCombe LJ held “It seems clear to me that Mr Fowler was correct to assert, on the basis of this pleaded case, that there was no difficulty in measuring a loss at a time when the chance of introducing further valuation evidence became in reality impossible. At that stage, Ms Holt had lost the opportunity to invite the judge to assess her case based on what she asserted were the proper values of the properties and the jewellery. On that hypothesis, she had lost a chance of arguing her case for a better outcome on fuller evidence. “Loss of a chance” was one of the “illustrations of a kind of loss which is meant by ‘actual’ damage” described by Stephenson LJ in the passage of his judgment in Forster v Outred & Co which was approved by the House of Lords in Nykredit”.

[92]McCombe LJ considered whether the real risk to the claimant’s matrimonial settlement valuation was in any way contingent on the judgment being delivered before the damage could be properly quantified, such that actionable damage did not materialise until the draft judgment was circulated. At [44] McCombe held, “In my judgment, as I have already said, I consider that Ms Holt’s particulars of claim show that her loss was sufficiently well measurable, if not precisely quantifiable, when she lost the ability to adduce the evidence that she refers that she should have been able to produce before District Judge Daniel in the financial remedies proceedings….In the present case, it could hardly have been later than the end of the hearing on 16th of March 2012”.

[93]At [58] McCombe LJ chose to apply the standards of Berney to Holt, finding “there was a real risk (indeed perhaps a near certainty on the present facts)” from January 2012 at the latest, when the husband's solicitors made it clear they would object to new valuation evidence, but he recognised even if one postponed that inevitability to the 16th March 2012, being the end of the hearing, it made no difference to the outcome as the damage was still suffered more than six years before the commencement of the professional negligence action.

Submissions on Holt

[94]The Defendant was keen to press upon me a link between the “impossibility” criterion for fixing the damage caused in this case at [34], to the “ impossibility” of effecting service in time by the Defendant in not delivering papers to the FPS before 2nd December 2012. This was to support their argument that time ran when a mistake could no longer be corrected, but they stressed that I did not need to identify a precise date, as the Court in Holt had not done so either.

[95]They stressed the passages making it plain I should identify “the point at which the claimant had become financially worse off” from the headnote to the judgment.

[96]The Defendant was also keen to point out that the contingent nature of any damage had been unsuccessfully argued in this case, thus I should not find that the Claimant’s damage was not crystallised or suffered until the expiry of the limitation period on 10th December 2016;

[97]The Defendant also relied on a passage at [51] cited from Lord Nicholls in Nykredit, “within the bounds of sense and reasonableness the policy of the law should be to advance, rather than retard, the accrual of a cause of action”. That passage also recorded, and was relied upon, that where there are parallel causes of action in contract and tort, the time disparity between them for the causes of action to arise should be smaller not greater.

[98]The Claimant reminded me of the policy aims of the law of limitation cited in Holt at [51] that I should reflect on “the bounds of reasonableness”, which they argued tempers any notion of bringing forward a cause of action wherever possible.

[99]They also reminded me that the Court should not be conducting a factual investigation on this application, and that many of the cases relied on by the Defendant where the Court has reached a “bound to fail” threshold in terms of damage accruing, such as in Holt, had a factual matrix which made this possible without further enquiry.

[100]The Claimant also stressed the difference between Holt and the instant case before me, in that no judge conceivably would have allowed in more evidence after the end of the final hearing whereas in principle, the Claimant still had a right to fix her action and save it up until the expiry of the extension period on 10th December 2016; if in principle a claim is fixable it is not “doomed to fail”. What matters is whether the right still exists, not whether in fact the right will be exercised, which they submitted was a fallacy which Saville LJ had fallen into in Hopkins, which they submitted was distinguished “out of all existence” in Khan.

My conclusions on the principles from Holt

[101]My takeaway point from this case that is that once again, the Court was keen to uphold discipline and the administration of justice by reference to court ordered deadlines, which it did not seek to foreshorten. If anything, the Court was generous to not only consider “a real risk (indeed perhaps a near certainty on the present facts)” causing a diminution in value was in January 2012, but also concluding the date of “ inevitability” of damage to be the last day of the 4-day final hearing at [58].

[102]As to the identification of “real damage” the Particulars of Claim showed the claimant’s loss was “well measurable” and there was no need to consider any difficult question factually of what diminution to value could have affected its assignability, as that was not relevant. Whilst the Court has been keen to recognise that “diminution in value does not have to be quantified by a sale or settlement provided that it can be shown to be substantial” (see paragraph 85 above), this case again demonstrates that they are far more ready to find such loss, at least when there has been no factual enquiry, when the quantification is readily apparent from the facts of the case.

OTHER TEXTS RELIED UPON BY THE PARTIES

[103]Although the case itself was not within the authorities bundle, the claimant took me to an extract of The Law of Solicitors’ Liabilities 4th edition and in the section headed “Negligent conduct of litigation” at page 360 paragraph 7.46, asked me to note the following, “In Sephton, Lord Walker took Hatton to establish that a solicitor was liable if he carelessly allowed the client's claim to become either statute-barred or “doomed to failure” because a striking-out application would be bound to succeed”. Lord Mance’s formulation was that the cause of action accrued when the claim became time-barred “or Liable to be struck out for want of prosecution”. It seems likely that Lord Mance approved the results and reasoning in Hatton and Polley, since he cited them, apparently with approval.” This was relied upon to support one of the Claimant’s primary assertions that there is no precedent to strike out a claim within a valid time period set by a court for compliance; a defendant has to await expiry of the time limit before seeking a strike out.

OVERALL CONCLUSIONS ON THE SUMMARY JUDGMENT APPLICATION RELATING TO THE CAUSE OF ACTION IN TORT

[104]I remind myself that I need to be satisfied the Claimant has no real prospect of succeeding on the limitation issue and there is no other compelling reason why the claim should be disposed of at trial.

[105]I have indicated for each of the authorities studied, what headline points I have taken from them. That analysis has not led me to conclude that the Claimant has no realistic prospect of success on the limitation argument.

[106]Underlying much of the Defendant’s application has been the question of construction of the individual Particulars of Claim, and whether paragraphs relating to specific breaches before 10th December 2016 are fatal for the Claimant’s prospects of success, as has been the case in a number of the authorities to which I have been referred. I fully accept that the Claimant cannot only rely on later breaches causing loss, to avoid a limitation finding. However, it is plain to me from the structure of the Particulars of Claim, in terms of its headings, and as a matter of general interpretation that each separate breach is not an allegation of damage being caused to the claim at the time of breach; they are allegations of sub-standard professional conduct. Anyone who has worked in a solicitors’ office will be aware that standards may on occasion be breached, but the situation can be totally salvaged, such that no damage is caused. My interpretation of the Particulars is that it builds a picture of serial failures but the actual damage is pleaded as caused at the expiry of the extension deadline when the situation is no longer fixable and thus damage occurs.

[107]I have noted the Defendant’s particular focus on the allegation of late delivery of papers to the FPS as something which moved matters beyond the Claimant’s control earlier than 10th December 2016, at a time when court staff had indicated it would take some months to achieve service. They say that alone is enough to find damage was caused before 10th December 2016. There are three difficulties with that, to my mind. First, court staff are expressly not permitted to give “advice” which can be relied upon by litigants. They try to be helpful and provide information, but as this case has shown, it is not infrequently the case that matters develop in a different way. Their predictions as to service times in the UAE were not accurate as a matter of fact as can be seen in the subsequent chronology. Furthermore, we do not know what variables they had built into their estimates or how experienced they were in terms of numbers of proceedings recently served there. At the end of the day, to effect service in the UAE required postal delivery and processing by staff in London and the UAE. There is no explanation before the Court as to why it should be a greatly protracted affair, as it is accepted the paperwork was in good order by the time it was delivered for the final time to the FPS.

[108]The second difficulty with the Defendant’s proposition is that it ignores the fact that at the time of delivery to the FPS the Claimant had a valid second extension of time in any event. I have sympathy with the view that the claim was therefore not damaged at that point, but that will be a matter for a trial judge to determine who can undertake a full enquiry.

[109]Thirdly, there is the novelty of the Defendant’s argument that once matters are moved beyond the control of the Claimant they are not fixable by the Claimant. That also is not a short point of construction suitable for summary judgment, based on compelling previous authorities. If anything, despite a number of occasions when matters have been brought before the Court of Appeal it has shown a reticence to develop the law beyond the principles set out in Khan over 20 years ago. The 2013 case of Berney was widely seen as a further obstacle put in the way of defendants seeking to run limitation defences. I am bound to say that I cannot find there is no realistic prospect of the Claimant succeeding in their opposition to that novel argument. I also believe it needs further factual enquiry. The authorities which I have reviewed in detail emphasise how fact sensitive the cases on limitation are.

[110]In terms of more general observations, my reading of the totality of the authorities is that they place emphasis on finding against claimants who have been guilty of gross delay and wholesale disregard for court imposed time limits. In this case the final date for compliance with the deadline of 10th December 2016 has been reviewed and upheld by three courts including the Court of Appeal. Those courts were aware of the steps taken, and delays by Claimant’s solicitors preceding 10th December 2016, which in any event were not of the same magnitude as in the authorities (in Khan actionable loss was suffered for years, in Hatton there was delay and total inactivity for over a year, and in Cohen a delay of many years). In this case the courts reviewing matters could have set aside or varied the 10th December 2016 date, but chose not to.

[111]Another reason why I do not believe the Claimant has only fanciful prospects of success on limitation is because my interpretation of all the authorities is that they seek to uphold the overriding objective in their decisions by enforcing compliance with rules or orders and ensuring the good administration of justice. They have not sought to bring forward times for compliance with court ordered dates; to do so would add to the court’s workload by increasing satellite litigation. That is a point with potentially far-reaching consequences, and not one to be sidelined or held as having no real prospect of success, or indeed there being no compelling reason for it to be fully argued at trial.

[112]Although the Defendant has asked me to consider all facts as proven for the purposes of the application, that seems to me problematic, when not all acts or omissions may cause damage; they may evidence a general disregard for proper process but causation of damage or the final breach which makes the fixable become non-fixable, seems to me to be something requiring factual inquiry.

[113]Whilst I have been urged by the Defendant to “grasp the nettle” now on the limitation issue in order to save costs and time, not only are there the practical difficulties which I have indicated above but I also consider it should not pass unremarked that this demonstrates a rather selective approach to the CPR and Pre-Action Protocol which encourages parties to narrow the issues by making early admissions. The Defendant has steadfastly denied any allegation of negligence, despite the claim effectively dying on their watch; a cataclysmic event, and despite the Court of Appeal judgment in Al-Zahra (PVT) Hospital & Others v DDM

[2019] EWCA Civ 1103

when reviewing the two extension of time orders. To say I am to treat the allegations against them as made out for the purposes of the application alone rather ducks the issue to my mind, when limitation is such fact sensitive matter, and is not an approach encouraged by the rules or protocols.

THE LIMITATION PERIOD IN CONTRACT: Statutory definition and submissions

[114]The Limitation Act 1980 at section 5 defines the time limit in contract as six years from the date on which the cause of action accrues, being the date of the breach, even if at that time no actionable damage has been suffered.

[115]The Claimant's case is brought by reference to concurrent duties in contract and tort, with the same allegations of both breach and damage.

[116]The Claimant pleaded in her Reply at [3a] “ With regard to the claim for breach of contract, the Defendant was under a contractual obligation to serve the Claim Form in the Original Claim by 10th December 2016. That obligation was breached on 10th December 2016 and the Claimant had six years from that date in which to issue a claim for breach of contract.” The Claimant maintained in submissions that the most important breach of duty is that at 53 (f), namely failing to serve the claim form before it expired, and that the other allegations of breach were not strictly necessary as part of the pleading but simply facets of why the Defendant failed to serve the proceedings in time.

[117]Thus the Claimant contends that time in contract only started to run on 10th December 2016.

[118]The Defendant however took the view that, “any causative breach of contract for the purposes of Section 5 of the Limitation Act 1980 occurred well before 2nd December 2016 in circumstances where all except one of the claimant’s allegations of breach had taken place by October 2016”.

[119]The parties’ submissions on the claim in contract were far less extensive than those for the tortious action with the Defendant opening by saying that it was not clear if the Claimant would be relying upon a claim in contract even if unsuccessful in tort. As I have not found that I can enter reverse summary judgment on the action in tort it seems that the overlapping issues as to causative breach are best dealt with altogether before the trial judge, In any event, as the Claimant contended, whether the Defendant breached the contract in the manner they assert is not raised by this application, where I am asked to assume that all the breaches alleged are made out.

[120]I heard some argument on whether or not time could have started running on the contract claim earlier than 10th December 2016 as an anticipatory breach. I did not find this persuasive as my reading of the authorities matched the Claimant’s arguments that the principle comes into play when the innocent party treats the contract as discharged because of the other party’s unwillingness or inability to perform it.

CONCLUDING REMARKS

[121]The Defendant’s application was curious in that it requested a hearing in front of a High Court Judge, not a Master, having regard to the factors identified in paragraph 11.4 of the King’s Bench Guide 2024, particularly that it “raises issues of unusual difficulty or importance, including the existence of conflicting decisions or dicta which increase the likelihood of appeal”. That definition is hard to square with the applicability of the summary judgment procedure in CPR 24, which as I set out earlier, is designed for cases where there is no real prospect of success, there may well be short points of construction to determine and there is no compelling reason for the case to be disposed of at trial. By the time of the Defendant’s skeleton argument it was asserted that the limitation defence “turns on the application of settled law in circumstances where there is no dispute of fact between the parties”. I have not found there to be settled law that can be readily applied to the facts of this case, such that the Claimant has no realistic prospect of success or other compelling reason for the matter to proceed to trial but I am grateful to both counsel for their extensive and helpful submissions.