Canada Square Operations Ltd v Potter (Rev 2)

For limitation purposes, deliberate concealment under section 32(1)(b) of the Limitation Act 1980 ordinarily requires a legal duty to disclose where the concealment consists only of non-disclosure. Section 32(2), however, is wider. A deliberate act or omission which constitutes statutory legal wrongdoing and gives rise to the claimant’s statutory right of action may amount to a deliberate breach of duty, even though no independent common-law or contractual duty existed. The defendant need not foresee the precise legal consequences, but must deliberately commit the relevant conduct with sufficient awareness that it may constitute wrongdoing. An objective inference of deliberateness may be drawn where the defendant calls no evidence.

The claimant entered into a regulated loan and associated PPI policy. The defendant retained a substantial commission which was not disclosed. After receiving compensation that did not cover her full loss, the claimant brought proceedings under sections 140A–D of the Consumer Credit Act 1974. The claim was issued outside the ordinary six-year limitation period.

The Recorder found that the relationship was unfair because the commission had not been disclosed and held that section 32 of the Limitation Act 1980 postponed limitation. The defendant appealed on the questions whether there had been a relevant breach of duty and whether the non-disclosure had been deliberate.

1. Appeal dismissed. The claim under sections 140A–D of the Consumer Credit Act 1974 was not statute-barred.
2. Section 32(1)(b) and section 32(2) overlap but are not duplicative. Section 32(1)(b) principally addresses active concealment. Where the complaint is non-disclosure, the provision generally requires a legal duty to disclose arising under the general law. No autonomous “Limitation Act duty” is sufficient.
3. Section 32(2) is a deeming provision. “Breach of duty” includes legal wrongdoing of any kind which gives rise to a right of action. It therefore covers statutory wrongdoing under sections 140A–D, even though those provisions are not founded on an independent duty to disclose and the relationship is assessed by a broad statutory evaluation of unfairness.
4. The omission to disclose the commission was capable of constituting a deliberate breach of duty. The statutory unfairness and the defendant’s resulting responsibility arose under the Consumer Credit Act 1974 itself. Section 32(2) applies to omissions as well as acts.
5. The required mental element does not demand knowledge of the precise legal consequence. It requires a deliberate act or omission amounting to legal wrongdoing, together with awareness of the risk of wrongdoing or conduct properly characterised as unconscionable. In the circumstances, the defendant consciously decided not to disclose the commission and must be taken to have apprehended the risk that the non-disclosure was legally wrongful.
6. The defendant’s failure to call evidence permitted an objective inference that the decision was deliberate. The relevant period was principally April 2007 to March 2010, after the statutory provisions had come into force and while the loan relationship continued.

High Court (Queen’s Bench Division): The Recorder’s decision of 6 August 2019 was appealed with permission granted by Stewart J. The appeal was dismissed.