Watford Control Instruments Limited v Colin Brown

Applications to add a party or introduce a new claim after expiry of limitation are governed by Limitation Act 1980 section 35 and the relevant Civil Procedure Rules. Even where jurisdiction to permit the amendment may exist, permission remains discretionary. The court should consider the overriding objective, including delay, cost and prejudice.

Where the proposed amendment would relate back to the issue of the original proceedings and would deprive the defendant of an arguable limitation defence, that prejudice is a powerful reason to refuse relief. The claimant may instead need to bring fresh proceedings, in which limitation can be determined at trial.

The claimant had brought proceedings concerning alleged misappropriation of company funds. It later obtained an assignment of the relevant cause of action and applied to join the assignor as a second claimant and amend the Particulars of Claim.

The proposed amendments substantially expanded the claims and extended them to transactions dating back to 2004. The defendant opposed the application, principally on the ground that it was barred by section 35(3) of the Limitation Act 1980, and alternatively that the court should refuse relief under CPR rules 19.5 and 17.4.

The central issue was whether the proposed joinder and amendments should be permitted where they might deprive the defendant of an accrued or arguable limitation defence.

1. Application refused. The claimant was refused permission to join YZMA as a second claimant and to amend its Particulars of Claim. Fresh proceedings remained available.
2. Section 35 of the Limitation Act 1980 and CPR rule 19.5 were engaged. The proposed amendments introduced claims which were new in substance, not merely amendments pleading the assignment. CPR rule 19.5 required consideration of whether the limitation period was current when proceedings began and whether joinder was necessary.
3. At the interlocutory stage, where the defendant had a prima facie limitation defence, the claimant had to show that the defence was not reasonably arguable before the court could deprive the defendant of it. The court could not resolve disputed questions of fraud or deliberate concealment summarily.
4. Even assuming that the court had jurisdiction to allow the joinder and amendments, CPR rule 19.5 conferred a discretion. That discretion had to be exercised in accordance with the overriding objective. Considerable delay, the substantial enlargement of the claims and the potential loss of a limitation defence were material considerations.
5. The proposed amendments would relate back to the commencement of the proceedings and would at least arguably deprive the defendant of a limitation defence. That prejudice was a strong pointer against granting relief. The appropriate course was to refuse the application and leave limitation to be determined, if necessary, in fresh proceedings at trial.
6. The court declined to determine definitively whether it had jurisdiction to join an equitable assignor after expiry of the primary limitation period. It observed that a very narrow approach might be difficult to reconcile with section 35 and the approaches in Parkinson Engineering Services Ltd v Swan and Finlan v Eyton Morris Winfield.