Office Properties PL Limited (in liquidation) & Ors v Adcamp LLP & Anor

For the purposes of Limitation Act 1980 section 35(6)(b) and CPR rule 19.6(3)(b), a new party may be substituted where the original claim cannot properly be maintained against the existing party and the claim pursued against the new party is, in substance, the same claim. Facts showing why the original party was thought liable do not necessarily form part of the claim itself. The court should construe the provisions neutrally and exercise its discretion to permit substitution unless there is a sufficient reason to refuse it, such as material prejudice.

The claim arose from allegedly negligent legal advice concerning a dividend and lease guarantee. Proceedings were issued against BDB Pitmans LLP, which was described as the successor practice to Pitmans LLP. After BDB denied responsibility for Pitmans’ acts, the claim form was amended to add Pitmans and later to remove BDB.

The primary limitation period had expired. Pitmans applied to disallow the amendment under CPR rule 17.2 and to strike out the claim as statute-barred. The central issue was whether the amended claim was the same claim as the original claim for the purposes of section 35(6)(b) of the Limitation Act 1980 and CPR rule 19.6(3)(b), and whether permission should be granted in the exercise of the court’s discretion.

1. Application dismissed. The addition of Pitmans as defendant fell within Ground (b), and the court permitted the amendment in its discretion.
2. Section 35(6)(b) and CPR rule 19.6(3)(b) substantially express the same test. The claim must be incapable of being properly maintained by or against the original party unless the new party is added or substituted, and the claim continued against the new party must be the same claim.
3. The phrase in CPR rule 19.6(3)(b) referring to a claim being carried on “by or against the original party” must be read so that it also accommodates substitution of the original party.
4. The relevant claim was the claim for loss caused by Pitmans’ negligence. The allegation that BDB had assumed responsibility for Pitmans’ liabilities was included only to explain why BDB was sued. It was not a necessary ingredient of the underlying claim and its removal did not create a new claim.
5. The court adopted the reasoning in Insight Group Ltd v Kingston Smith, while distinguishing the materially different claims in Roberts v Gill and Nemeti v Sabre Insurance Co Ltd. Parkinson Engineering Services plc v Swan and Irwin v Lynch supported substitution where the same cause of action was being pursued by the correct party.
6. The discretion should generally be exercised in favour of substitution where the statutory requirements are met and there is no material prejudice. The possibility of a claim against legal advisers for loss of a chance, and delay on the facts, did not justify refusal.