Breitenbach & Ors v Canaccord Genuity Financial Planning Ltd

When deciding whether to try a limitation preliminary issue across related claims, the court should balance the additional value of a determination against the extra cost and time. Relevant considerations include the material differences between the claims, the diversity of individual facts, the likely benefit of the decision, and the burden of preparing and conducting the additional trial. A decision in one representative claim may provide strong persuasive guidance in related claims even where it is not technically binding. A separate preliminary issue should not be directed where its incremental benefit is insufficient to justify the additional work and expense.

The claimants brought professional negligence claims concerning film finance schemes. Canaccord relied, among other matters, on limitation defences under sections 2 and 14A of the Limitation Act 1980.

The court had already directed sample Invicta 43 claims for trial. It was asked whether two Claremont claimants should effectively be added so that limitation issues in the Claremont claims could also be determined. The Eclipse claims had been stayed pending the Invicta 43 trial. The central issue was whether the additional persuasive value of deciding the Claremont limitation issues justified the additional cost and time.

1. The application to direct a trial of limitation preliminary issues in the Claremont claims was refused. The court considered the additional value of that trial insufficient to justify the significant extra preparation, cost and estimated two additional trial days.

2. The relevant case-management considerations were: (i) the difference between the material facts in the Claremont and Invicta 43 claims; (ii) the differences between individual Claremont claimants and the number of sample claimants required; (iii) the likely benefit of a Claremont decision; and (iv) the additional cost and time.

3. The material facts relevant to section 14A were substantially similar. They included claimants’ awareness of HMRC enquiries, tax tribunal decisions and communications from scheme promoters or intermediaries. However, findings on section 14A would remain dependent on each claimant’s individual knowledge, limiting the extent to which a decision involving two Claremont claimants could be read across.

4. The section 2 issue was expected to be a pure question of law and the Invicta 43 decision would inevitably be relevant to the Claremont claims. The decision on the knowledge required under section 14A was also likely to provide a strong legal precedent and practical guidance in the Claremont and Eclipse claims, despite not being technically binding.

5. On balance, the likely persuasive benefit did not outweigh the additional selection, pleading, disclosure, evidence and trial work. The Eclipse claims remained stayed pending the outcome of the Invicta 43 trial.