UNDUE HARDSHIP AND THE FOREIGN LIMITATION PERIODS ACT

The Foreign Limitation Periods Act 1984 is one of those matters that litigators must always have at the forefront of their mind when dealing with any matter that has a foreign connection.  The stringent nature of the Act is made clear in the judgment of Mr Justice Wilkie in KXL -v- Murphy [2016] EWHC 3102.  There is a useful distillation of the principles relating to Section 2 of the Act.

KEY POINTS

  • The fact that claimants whose actions for sexual abuse in Uganda were statute barred in Ugandan law did not suffer “undue hardship” as defined in Section 2 of the Act.
  • The existence of a three year limitation period with no Section 33 type discretion also did not represent “undue hardship”.

PRACTICE POINTS

  • It is important to note that a failure to issue because of a lawyer’s ignorance of the existence of a time period does not represent undue hardship ( This was not a factor that led to late issue in the current case, however there is reference to  (Harley v Smith 2010 EWCA Civ 78)

THE ACT: SECTION 1: FOREIGN LIMITATION PERIOD APPLIES 

The Act is clear:

“1 Application of foreign limitation law.
 (1) Subject to the following provisions of this Act, where in any action or proceedings in a court in England and Wales the law of any other country falls (in accordance with rules of private international law applicable by any such court) to be taken into account in the determination of any matter—
(a) The law of that other country relating to limitation shall apply in respect of that matter for the purposes of the action or proceedings; and
(b) Except where that matter falls within subsection (2) below, the law of England and Wales relating to limitation shall not so apply.”

SECTION 2: THE EXCEPTION AND UNDUE HARDSHIP

2 Exceptions to s. 1.
 (1) In any case in which the application of section 1 above would to any extent conflict (whether under subsection (2) below or otherwise) with public policy, that section shall not apply to the extent that its application would so conflict.
(2) The application of section 1 above in relation to any action or proceedings shall conflict with public policy to the extent that its application would cause undue hardship to a person who is, or might be made, a party to the action or proceedings.
(3) Where, under a law applicable by virtue of section 1(1)(a) above for the purposes of any action or roceedings, a limitation period is or may be extended or interrupted in respect of the absence of a party to the action or proceedings from any specified jurisdiction or country, so much of that law as provides for the extension or interruption shall be disregarded for those purposes.

THE CASE

The claimants brought an action alleging sexual abuse had taken place in Uganda between 1999 and 2004.   In each case the Limitation Period in Uganda had expired.

THE ISSUE BEFORE THE COURT

The only issue the judge was asked to consider was under Section 2. The preliminary issue being set out by Master Leslie as:-

“Whether, it being common ground that Ugandan law is the applicable governing law, the application of section 1 of the Foreign Limitation Periods Act 1984 would conflict with public policy and / or would cause undue hardship to the claimants within the meaning of section 2(1) and 2(2) of the Foreign Limitation Periods Act 1984?”

THE ARGUMENTS BEFORE THE COURT

The judge set out the facts and considered the legal arguments and relevant principles in detail.

“Conclusions
  1. There is a significant level of agreement on the principles to be identified as a result of the case law and other sources of authority.
Section 2(1) Public Policy
  1. I accept that the following principles are established from the relevant authorities.
i) It would be wrong to treat a foreign limitation period as contrary to English public policy simply because it is less generous than the comparable English provision in force at the time (Durham v T&N plc 1996 Court of Appeal unreported).

ii) Public policy should be invoked for the purposes of disapplying the foreign limitation period only in exceptional circumstances. Too ready a resort to public policy would frustrate our system of private international law which exists to fulfil foreign rights not destroy them.

iii) Foreign law should only be disapplied where it is contrary to a fundamental principle of justice.

iv) The fundamental principle of justice with which it is said foreign law conflicts must be clearly identifiable. The process of identification must not depend upon a Judge’s individual notion of expediency or fairness but upon the possibility of recognising, with clarity, a principle derived from our own law of limitation or some other clearly recognised principle of public policy. English courts should not invoke public policy save in cases where foreign law is manifestly incompatible with public policy. (City of Gotha v Sothebys, Transcript October 8 1998 p89)

v) The English law of limitation serves the purpose of providing protection for defendants from stale claims, encouraging claimants to institute proceedings without unreasonable delay, and conferring on a potential defendant confidence that after the lapse of a specific period of time he will not face a claim (Law Com report No 114 para 4.44) and

vi) The absence of any escape clause such as that contained in Section 33 of the 1980 Act cannot make the imposition of [the foreign limitation period] in any way contrary to English public policy (Connelly v RTZ Corp plc & anr 1999 CLC 533 at 548).

The Claimant’s Submissions on Section 2(1)
  1. The claimants contends that, where a defendant domiciled in England and Wales, in a position of trust, commits acts of the kind complained of in these claims, he should not be able to escape liability for those acts in the Courts of England and Wales merely by operation of a non-extendable foreign limitation period, such that, had the acts been committed in England and Wales they would have remained justiciable, albeit the application of Section 33 of the 1980 Act to extend time might be necessary in order to give the Court jurisdiction to hear the claims.
  2. The claimants contend that the position should be the equivalent of that which pertains in the criminal jurisdiction. Section 72 of the Sexual Offences Act 2003 provides that a UK national or a resident who does an act in a country outside the UK, which is an offence under the law in force in that country and is one in England and Wales, constitutes a sexual offence of which the UK national or resident is guilty in England and Wales, so that proceedings may be brought against such a person in England and Wales as if the person had done the act here. It is contended that, by parity of reasoning, it would be against public policy for the Courts not to provide a civil remedy on the same terms as if the conduct had occurred here.
  3. Reliance is placed on certain obiter statements in the House of Lords in A v Hoare 2008 1AC844, in particular, Baroness Hale, at paragraph 60, and Lord Brown, at paragraph 84 and following.
  4. In support of the claimants’ case, I have been invited to consider a Bill recently introduced into the Scottish Parliament which abolishes the time limit applicable to an action in damages in respect of personal injuries where the claimant was a child and the act or omission constitutes an abuse of that child whether sexual, physical or emotional, subject only to a prohibition upon an action proceeding where the defender satisfies the court that it is not possible for a fair hearing to take place, where the defender would be substantially prejudiced and where that prejudice is such, having regards to the claimant’s interests in the action proceeding that the action should not proceed. I am also invited to consider the Limitation Amendment Child Abuse Act 2016 No 5 of New South Wales which permits an action for damages in relation to child abuse to be brought at any time and similar legislation in Victoria in 2015 and a Bill introduced to like effect in 2016 in Queensland.
  5. Mr McDermott disarmingly accepts that there is no case in this jurisdiction in which it has been decided that, in the absence of legislation of the kind to which he has drawn my attention in other jurisdictions, the application of a foreign limitation period, which would have the effect of rendering time-barred a claim of this sort, where the lex causae is a foreign jurisdiction but where the defendant is domiciled or resident in this jurisdiction, would be in conflict with public policy – contrary to a clearly identifiable fundamental principle of justice.
  6. In the course of argument, I have been extensively informed of the variety of limitation provisions in numerous jurisdictions. Some are more restrictive than those which prevail in this jurisdiction, others less so. None of these differences, on their own, have been sufficient to require the foreign limitation period to be disapplied pursuant to Section 2(1).
  7. Mr McDermott has, in my judgment, helpfully identified what appears to be an emerging tendency in common law jurisdictions for legislation to be passed or considered which treats historic child abuse cases as special for the purposes of the limitation of civil claims based upon them. This is reflected in the introduction in a small number of jurisdictions of legislation amending existing limitation provisions so as to disapply those provisions in cases of historic child abuse. The obiter remarks in A v Hoare are, in my judgment, straws in the wind in the same direction.
Conclusions on s. 2(1)
  1. In my judgment, given the way in which the Courts, the Law Commission and leading academic writers have described the way in which the Courts have, or should, approach the question of disapplying foreign limitation periods on grounds of conflict with public policy as requiring: a conflict with fundamental principles of justice readily and clearly identifiable; and have warned against approaching the matter on the basis of the “idiosyncratic inferences” of a few judicial minds, it is a bold and, in my judgment, an erroneous submission to suggest that this Court should conclude that the application in this case of the Ugandan Limitation Act would conflict with public policy as described in the authorities. Mr McDermott has done no more than identify an emerging direction of travel in a few, contiguous or similar, jurisdictions. In my judgment, those interesting insights as to how policy may develop in this regard provides an insufficient basis upon which to require this Court to anticipate such a possible legislative development in this jurisdiction by identifying the application of the Ugandan Limitation Act as constituting a conflict with a fundamental principle of justice. In my judgment, therefore, the application of Section 1 of the Foreign Limitation Periods Act 1984, in these cases would not conflict with public policy within the meaning of Section 2(1) of the 1984 Act.
Undue Hardship
  1. Once again, there is no significant dispute about the legal principles which are to be derived from the authorities as follows
i) Undue hardship is an example of conflict with public policy (Jones v Trollope Colls Cementation Overseas Ltd The Times January 26 1990 (CA) at page 4).

ii) The Courts must be astute not to allow what are really Section 2(1) arguments to be re-introduced by way of 2(2) (Gotha City v Sotherby’s at page 99).

iii) “Undue” in this context means “excessive“. One has to see whether the plaintiff has suffered greater hardship in the particular circumstances by the application of Section 1(1) than would normally be the case (Jones ibid at page 4).

iv) Consideration of undue hardship does not require a balancing act between the interests of the claimant and the defendant (ibid at page 5)

v) where Section 2(2) is involved the focus is on the undue hardship caused to the claimant by the application of a foreign limitation period over and above that inevitably caused by the application of the foreign limitation period in question (ibid at page 5).

vi) If, within the foreign limitation period, the claimant acquires all the material required for bringing the action, it is not contrary to public policy to apply the foreign rule even if he is only a few days late in commencing the proceedings (Arab Monetary Fund v Hashim & ors 1993 1 Ll Rep543).

vii) The fact that a claimant did not issue in time on account of inaccurate legal advice as to the limitation period does not suffice as a hardship would not have been caused by the foreign limitation period (Harley v Smith 2010 EWCA Civ 78)

viii) It cannot be said that the 3 year period for claims of this sort is so short that the plaintiff suffered undue hardship merely by reason of the fact that it is imposed. There must be some additional factors which make the hardship excessive in this case (Arab Monetary Fund v Hashim & ors).

ix) The question can be framed in the following manner. Does the application of the foreign limitation period deprive the claimant of his claim in circumstances where he did not have a reasonable opportunity to pursue it timeously if acting with reasonable diligence and with knowledge of its potential application, where the claimant is deemed to have knowledge of the application of the relevant foreign limitation period (Naraji v Shelbourne 2011 EWHC 3298(QB) at paragraph 177, and, Bank of St. Petersburg v Arkhangelsky 2013 EWHC 3674 CH at paras 15 and 17).

x) Reasonable diligence can be considered by reference to, for example,

a) Any unusual difficulties in effecting the steps necessary to bring the claim

b) The reasonableness of any expectation of the claimant, though subsequently falsified, that a particular means of bringing the claim within the foreign limitation period will be effective

c) Any efforts in fact made, albeit without success, to bring the claim and the reasons for their failure

d) Any special factors which have made it unusually difficult for the claimant to bring the claim within the time prescribed by the foreign limitation period (Bank of St Petersburg, ibid para 17)

xi) The Court will not accept as justifying the disapplication of a foreign limitation law

a) Hardship caused not by lack of time but by a factor unconnected with the specific period prescribed such as wrong advice as to the application of the period.

b) The mere fact that the period specified by the foreign limitation law is less generous than the period allowed under English law, or

c) Hardship that, however regrettable, is no greater in the particular circumstances than would normally be the case (ibid para 18).

xii) The existence of an alternative route to redress can be significant and it is not necessary for the alternative route to provide equivalence to access to the Courts in England and Wales (OJSC Oil Company v Abramovich & ors 2008 EWHC 2613(QB) paras 318 – 324).

The Claimants’ Submissions
  1. The evidence of the claimants and of Dr O’Neill is that bringing the claim has involved them re-living painful experiences which they had reasonably tried to put behind them. They were minors for part of the period since the accrual of the cause of action and have been suffering from psychological difficulties. The prejudice, or hardship, in not allowing the claims to proceed would be significant. The claims in this jurisdiction would be totally extinguished. It is understandable that bringing such claims may give rise to some delay in the claimants steeling themselves to do so, particulary having regard to their poor mental state caused by the abuse, the position of authority of the alleged abuser, the attitudes in Uganda towards the church and attitudes within the community towards those making such claims. It is said that to deny them the ability to make these claims in this jurisdiction, would cause undue hardship, which itself is evidence of a conflict with public policy under Section 2(2).
The Defendants’ Submissions
  1. The defendants contend that the decided cases identify examples of where undue hardship has led to the disapplication of the lex causae limitation period. They include:
a) Where the defendant agreed an extension of time which turned out to be ineffective under that foreign law (The Komninos [1991] 1 Ll Rep 370 (CA))
b) Where, within a 12 month limitation period, the plaintiff spent time in hospital and had been led to believe her claim would be met (Jones)
c) Contrary to public policy to allow foreign limitation rule to be relied on by a thief or transferee of stolen property other than a purchaser in good faith (Gotha City)
d) Where the action has become time barred as a consequence of the defendant’s deliberate concealment of relevant facts (Gotha City)
e) Where there was a series of factors all of which gave rise to a significant and unfair hurdle put in the way of the defendant making a counter-claim within time (Bank of St Petersburg)
  1. The defendants contend that those examples identify that, in order for there to be undue hardship, there has to be something unusual about the difficulties facing the claimant preventing or disabling them from commencing proceedings in time, or oppressive or misleading conduct on the part of the defendant preventing the claimant from commencing the proceedings within time, or misleading the claimant into believing the limitation defence would not be advanced.
An Alternative Remedy – the Ugandan Human Rights Commission
  1. I have received extensive argument for and against the proposition that the UHRC exists and is prepared to accept a complaint made by the claimants.
  2. It is said that the essence of the conduct complained of would amount to a breach of human rights under Article 24 of the Ugandan Human Rights Code requiring respect for human dignity and protection from inhuman treatment. It is said that it falls under the rubric of: cruel, inhuman or degrading treatment or persecution where another person’s act or omission deliberately or unintentionally makes another feel fear, anguish and inferiority; that is humiliating and debasing; where intense physical and mental suffering are caused such as where a person is subjected to torture or cruel, inhuman or degrading treatment.
  3. I have received evidence on behalf of the second defendant in the form of undertakings by the second defendant and by witnesses, that the claimants may: have access to the UHRC Tribunal to have their complaints considered as breaches of human rights; that remedies, if their complaints are allowed, can take the form of compensation and/or other remedies including a public apology; that the second defendant will fund the claimants’ reasonable legal expenses in bringing and pursuing such claims before the UHRC; and that the second defendant will satisfy any compensatory remedies as are awarded.
  4. Mr McDermott contends that these undertakings are by no means watertight and that I should regard them as of doubtful effect. He also questions whether the UHRC would, in practice, be as willing to accept jurisdiction as Mr Kaggwa, the chair of the UHRC has, apparently, made clear in his evidence, and, Mr McDermott says, it is the claimants’ right to choose in what forum to bring these claims, provided they can do so legitimately.
My Conclusions on Undue Hardship
  1. In my judgment, the evidence of the claimants in explaining their difficulties in bringing themselves to commence these proceedings, whilst relatively brief, is clear and understandable. It reflects the common experience evident to the Courts in this jurisdiction of the difficulties which lie in the way of persons subject of abuse taking the initiative promptly to complain and/or commence proceedings and one understands fully and sympathises with their difficulties. These difficulties were recognised in the obiter statements to which I have been referred in A v Hoare and, I conclude, must have, to some extent, informed the legislative developments in some jurisdictions to which I have been referred.
  2. However, it cannot be said that they were unaware of the fact that the abuse had taken place from the outset, nor that it was wrong, nor that they possibly had redress in law nor, as is common ground, that they must be deemed to have been aware of the limitation periods.
  3. In my judgment, posing for myself the question identified in Naraji v Shelbourne, the answer I give is clearly “no”; the claimants’ hardship is neither more nor less than the consequence of the imposition of the time bar to which they were subject in making their claim. There is nothing in their circumstances which begins to bring these cases within the type of restricted categories of cases in which s.2(2) has operated to disapply s.1(1) of the 1984 Act.
  4. In any event, and a significant factor in my conclusion, I am satisfied on the evidence before me, that the UHRC does provide a sufficient alternative route to obtain redress both monetary and reputational. I have no reason to do other than accept, at face value, the undertakings given by the second defendant and by witnesses called by them as to: the availability of a complaint to the UHRC and its willingness to accept such complaint; and the second defendant’s willingness to support, financially and in other ways, the making and pursuing of such complaints and to discharge the liability to make recompense, in the event that the complaints were upheld.
  5. Accordingly, the answer to the second part of the preliminary issue is that the application of Section 1 of the Foreign Limitation Periods Act 1984 would not cause undue hardship to the claimants within the meaning of Section 2(2) of the Foreign Limitation Periods Act 1984.

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