Mark William Taylor & Anor v Bank Of Scotland Plc

Applications for summary judgment and amendment should be determined by asking whether the challenged claim has a real prospect of success and whether there is any compelling reason for a trial. A claim under section 32 of the Limitation Act 1980 involves a fact-sensitive inquiry into what the actual claimant, having regard to its resources, could have discovered with reasonable diligence. Public availability of information does not itself establish discoverability. The claimant must be able to plead a viable and sufficiently particularised cause of action, but need not possess all later evidence. On a summary application, disputed factual issues about notice, investigation and the significance of documents should generally be left for trial.

The claimants, former shareholders of Taylor Hotels Limited, pursued assigned misrepresentation claims against the defendant bank concerning interest-rate hedging agreements. They sought permission to amend their particulars of claim. The bank sought summary judgment on the interest-rate rise representation claim as time-barred and on the hedging requirement representations claim for lack of merit and limitation. The central issues were whether the claims had a real prospect of success and whether the claimants could rely on section 32 of the Limitation Act 1980.

1. Applications test. The court applied CPR 24.2. The applicant had to show that the opposing party had no real prospect of success and that there was no other compelling reason for a trial. The same real-prospect test governed the proposed amendments.
2. Section 32. The burden lay on the claimant. The question was whether the actual claimant, objectively assessed by reference to its position and resources, could with reasonable diligence have discovered the fraud and the essential facts needed to plead a viable claim. The inquiry was fact-sensitive and involved both what put the claimant on notice of a need to investigate and what a reasonably diligent investigation would have revealed. A claimant need not discover every item of evidence, but must be able to plead the precise viable case ultimately alleged.
3. The fact that the Bank of England Reports were publicly available did not establish that the claimants could reasonably have discovered them. Their actual investigations, the absence of advice identifying dishonesty, and the FCA’s LIBOR findings could support a case that the possibility of dishonesty only arose later. The interest-rate rise representation claim therefore had a real prospect of defeating the limitation defence and was not summarily dismissed.
4. For section 32 purposes, the acts or omissions of a claimant’s agent were not attributed to the claimant. The evidence concerning the claimants’ solicitors could not therefore determine discoverability against them at summary judgment.
5. On the hedging representations, the first and third representations had a real prospect of being understood as statements that hedging was required by the credit sanction. Conditions proposed by the Treasury division and accepted by the credit sanctioning division were not materially different from conditions imposed by that division itself. The claimants had no real prospect of proving falsity on that basis. The second representation referred naturally to a requirement in the facility letter, not to a condition imposed by the credit sanctioning division, and the claimants had no real prospect of establishing the pleaded meaning or falsity. The hedging claim was therefore summarily dismissed. The alternative limitation issue did not need to be decided, but the claimants would have had a real prospect of showing that the relevant internal documents could not reasonably have been discovered earlier.