Dewrace Ltd v Brown

Substitution of a claimant after limitation has expired is governed primarily by CPR 19.5. A mistake as to the identity of the proper claimant is distinct from a mistake as to the claimant’s name, and does not satisfy rule 19.5(3)(a). The overriding objective may provide an alternative route in an appropriate case, but substitution after limitation requires very cogent reasons. Potential limitation prejudice and uncertainty about the proper contracting parties may justify refusal. An amendment adding a new claim after limitation is permissible only where it arises from the same or substantially the same facts as the existing claim.

Dewrace Ltd claimed payment for architectural services against Charles Brown. The evidence indicated that the services may have been contracted for personally by David Frankling, Dewrace’s director, although Dewrace had issued the relevant invoice and commenced the proceedings.

Frankling sought substitution as claimant and permission to amend the particulars of claim. The proposed amendment also introduced a claim concerning property-management services at 14 Eldon House. The applications raised the interaction between party substitution, limitation, the overriding objective and amendments adding new claims after limitation.

1. Substitution refused. The application was not governed by CPR 19.2(4), because Dewrace’s interest or liability had not passed to Frankling. The mistake was as to the identity of the proper contracting party, rather than nomenclature. On the binding Court of Appeal approach summarised at paragraphs 55–56, rule 19.5(3)(a) requires a mistake in the name of the party, not a mistake as to identity. The substitution therefore could not be made under rule 19.5.
2. Overriding objective. Rule 19.2 had to be read in its procedural context and with the overriding objective. The court retained power under CPR r.3.1(2)(m) to make another order in an appropriate case. However, very cogent reasons were required to use that power to permit substitution outside rule 19.5. The claimant had not established that limitation remained current. Some claims might have become time-barred between issue and the hearing. Refusal allowed any fresh proceedings to test limitation without prejudicing the defendant.
3. Proposed amendment. Under CPR 17.4(2), a new claim could be added after limitation only if it arose from the same or substantially the same facts as the existing claim. The existing claims principally concerned architectural services, whereas the Eldon House claim concerned apparently distinct property-management and possible maintenance services. It did not arise from the same or substantially the same facts.
4. The court therefore refused substitution and indicated that, had it been necessary to decide the amendment application, leave to amend the specified paragraphs would also have been refused. The observations on amendment were expressly obiter.

First-instance decision in the High Court (Technology and Construction Court). No earlier appellate decision in the same proceedings is stated.