Bhattacharya & Anor v Oaksix Holdings Ltd

Claims for repayment under sections 26(2) and 28(7) of the Financial Services and Markets Act 2000 are claims to recover sums by virtue of an enactment. They therefore fall within the six-year limitation period in section 9 of the Limitation Act 1980. The cause of action accrues when all necessary facts exist. Where a borrower cannot obtain repayment until capital has been repaid and the statutory accounting exercise can be completed, accrual may occur on repayment of the capital rather than on each earlier payment of interest or fees. A declaration of unenforceability is a separate specialty claim subject to the longer period in section 8(1).

The appellants challenged a Deputy Master’s order striking out, and giving summary judgment on, claims for repayment of interest and fees paid under bridging-loan agreements said to be unenforceable under sections 26 and 28 of the Financial Services and Markets Act 2000.

The Deputy Master held that claims for repayment were subject to the six-year limitation period in section 9 of the Limitation Act 1980, running from the dates of payment. The appeal concerned the applicable limitation provisions, the date of accrual, whether summary determination was appropriate, and the effect of limitation on the declaratory claim.

1. Appeal allowed in part on the limitation issue. The Deputy Master had been wrong to conclude that the appellants had no real prospect of showing that the limitation defence was unavailable. The respondent’s application of 16 March 2020 was dismissed.
2. The repayment claim arose under sections 26(2) and 28(7) of the Financial Services and Markets Act 2000. The claim arose out of, and only out of, that statute. It was therefore an action to recover a sum recoverable by virtue of an enactment within section 9(1) of the Limitation Act 1980, rather than an action governed solely by the 12-year period in section 8(1).
3. The relevant distinction was between a claim for a declaration as to the sum payable and a claim for repayment. The former was a claim on a specialty and attracted section 8(1). The latter attracted section 9(1).
4. A cause of action accrues when all facts necessary to establish the claimant’s right to judgment have come into existence. The appellants could elect not to perform the agreements. Before repayment of the capital, they could not obtain an order requiring repayment of money because the statutory accounting exercise might instead require payment of a balance to the lender. The critical event for the repayment claim was repayment of the capital on 27 August 2013. The claim was therefore arguably brought within six years.
5. The analogy with Patel v Patel was rejected. The statutory scheme there required assessment of the whole credit relationship, whereas sections 26 and 28 did not require the claimant to plead matters arising throughout the relationship. Section 28(3) operated as a defence.
6. Permission to amend the particulars of claim to plead restitution for mistake was refused. The proposed claim was new, the respondent’s limitation defence was reasonably arguable, and the amendment did not arise from the same or substantially the same facts. Any such claim would need to be brought in fresh proceedings.
7. Grounds concerning the general appropriateness of summary determination and whether a declaration should survive a statute-barred money claim did not arise. Consequential orders were reserved.

• High Court (Chancery Division): Appeal from the Deputy Master’s order dated 15 May 2020. The appeal was allowed on the accrual issue and the respondent’s strike-out and summary-judgment application was dismissed.
• Deputy Master Linwood: Struck out and summarily dismissed claims for repayment of sums paid before 9 August 2013 and the related declaration concerning the first loan agreement.