P & O Nedlloyd BV v Arab Metals Co & Ors

Under CPR 17.4(2), an amendment adding a new claim after expiry of limitation is permissible only where the new claim arises from the same or substantially the same facts as an existing claim. The test requires more than a common factual background where the new claim depends on substantial additional evidence or contractual analysis.

Claims founded on simple contract, including declaratory relief asserting contractual rights, are subject to the six-year period in section 5 of the Limitation Act 1980. A claim for specific performance may likewise be time-barred by analogy under section 36(1)(b) where it arises from the same contractual breach and merely seeks to prevent further loss.

The claimant shipowners sought permission to amend their particulars of claim concerning two containers of radioactive scrap carried from Alexandria. The existing claims alleged obligations under a bill of lading, including duties to take delivery and liability for dangerous goods.

The proposed amendments alleged that the bill of lading had been varied, or that an alternative contract of carriage to Hamilton had been made. The second and third defendants opposed the application, relying on limitation, CPR 17.4(2), delay and prejudice. The central issues were whether the new claims were time-barred and whether they arose from the same or substantially the same facts as the existing claims.

1. Limitation. The proposed claims for damages and an indemnity were founded on simple contract and were time-barred under section 5 of the Limitation Act 1980. The proposed declarations were also new claims founded on contractual rights and breaches. A declaration is not an equitable remedy; it was created by the Judicature Acts. It was therefore subject to the contractual limitation period.
2. Specific performance. Section 36(1)(b) excludes equitable claims from the statutory periods except where the period could have been applied by analogy before 1 July 1940. The relevant analogy depends not only on the remedy but also on the underlying facts. Where specific performance, damages and an indemnity all arise from the same contractual breach, and specific performance merely stops continuing loss, equity would have applied the six-year period by analogy. All the proposed claims were therefore time-barred.
3. Same facts. CPR 17.4(2) imposes a threshold concerned with whether the new claim requires investigation of materially additional facts. Applying the overriding objective, the rule was treated as having a co-extensive threshold with section 35(5) of the Limitation Act 1980. The existing claim required proof that the fax nominated a delivery place under the bill of lading. The proposed variation and alternative-contract claims required proof of agency, contractual authority and prior telephone discussions. Those matters went well beyond the fax and were not substantially the same facts.
4. The court therefore had no jurisdiction to permit the amendments, and the application was dismissed. In any event, the unexplained delay and the resulting risk of evidential prejudice would have led the court to refuse permission in its discretion. The possible defence of laches was left for trial.