Rosgosstrakh Ltd v Yapi Kredi Finansal Kiralama AO & Anor

Under CPR 19.5, a party may be substituted after limitation has expired where proceedings were issued in the wrong name because of a genuine mistake, and the intended party can be identified by a description specific to the claim. The mistake may involve naming a different legal entity. It is not confined to a clerical misnomer.

Where solicitors were unaware that an insurer had ceased to exist through corporate reorganisation, naming the former entity may constitute a mistake as to name rather than a mistake as to legal rights. The court must then decide whether substitution is just. The loss of a limitation defence is not, without more, a decisive factor because the statutory scheme permits such amendments.

The claimant sought permission to substitute Rosgosstrakh Insurance Company (Public Joint Stock Company) for Rosgosstrakh Limited in proceedings concerning a marine insurance policy. Rosgosstrakh Limited had been absorbed into the proposed claimant before proceedings were issued, but the claimant’s solicitors were unaware of the reorganisation and issued the claim in the former company’s name.

The application was made after expiry of the limitation period. The court considered whether CPR 17.4(3) or CPR 19.5 applied, whether the mistake was one as to name or legal rights, and whether substitution would be just.

1. Application granted. The proposed substitution involved a different legal entity and therefore did not fall within CPR 17.4(3), which concerns a misnomer where the correct party has been sued or is suing. CPR 19.5 was the applicable provision.
2. Applying The Sardinia Sulcis test, the intended claimant was the insurer under the policy at the date proceedings were issued. The claim form and evidence identified that description, and only Rosgosstrakh Insurance Company (Public Joint Stock Company) fitted it at that date.
3. The solicitors had been wholly unaware of the reorganisation. Their mistake was therefore factual: they named the former entity because they did not know that it had ceased to exist. It was not a deliberate choice of the former entity, nor an error as to the legal rights of a party whose identity had been correctly selected. The reasoning in International Bulk Shipping and Services Ltd v Minerals and Metals Trading Corp of India was distinguishable.
4. The facts were materially indistinguishable from The Sardinia Sulcis, and the judge was bound to follow it. The generous interpretation of “mistake as to name” reflected in Adelson v Associated Newspapers Ltd, and the approach in Insight Group v Kingston Smith, supported that conclusion.
5. It was just to permit substitution. The claimant and its solicitors had been at fault, and the duty of full and frank disclosure on the application to serve out had been breached through inadvertence. However, the breach caused no relevant prejudice, the application was made before the defence, and the limitation bar was not a weighty factor because the rules expressly permit substitution after limitation has expired.

The court had jurisdiction under CPR 19.5 and ordered substitution with retrospective effect from issue of the claim form.