ACTION WAS STATUTE BARRED AND AN ABUSE OF PROCESS: THE COURT WILL NOT SIMPLY REFEREE WHATEVER GAME A CLAIMANT WANTS TO PLAY

June 26, 2017 · by · in Abuse of Process, Applications, Limitation

In Schweppe -v- Closier [2017] EWHC 1486 (TCC) Mr Justice Coulson struck out an action on the grounds it was statute barred and represented an abuse of process.  The judgment is worth reading because it reviews the principles relating to “knowledge” in limitation and also on abuse of process when issues could have been (and were) raised in earlier litigation.

“It is therefore time for the court to step in and bring these matters to an end: the court should not simply sit back and referee whatever game the claimant wants to play”

THE LAW ON LIMITATION REVIEWED

The judge found on the fact that the facts the claimant both knew, and should have known, of the facts on which the alleged action was based. The action was statute barred.
3. LIMITATION
3.2 The Applicable Principles
    1. As noted above, the causes of action pleaded against the defendants, of fraudulent misrepresentation, unlawful act conspiracy and inducement to breach of contract, are tortious claims. It is common ground that the primary limitation period for such claims is six years from the accrual of the cause of action pursuant to section 2 of the Limitation Act 1980 (“the 1980 Act”). Because none of the relevant acts could have occurred after 1992, and these proceedings were not started until 29 November 2016, it is not disputed that the primary limitation period has expired. Therefore, the only way in which the claimant can keep these proceedings alive is to rely on section 32(1) of the 1980 Act.
    2. Section 32(1) provides as follows:
“32. Postponement of limitation period in case of fraud, concealment or mistake.
(1) Subject to subsections (3) and (4A) below, where in the case of any action for which a period of limitation is prescribed by this Act, either—

(a) the action is based upon the fraud of the defendant; or

(b) any fact relevant to the plaintiff’s right of action has been deliberately concealed from him by the defendant; or

(c) the action is for relief from the consequences of a mistake;

the period of limitation shall not begin to run until the plaintiff has discovered the fraud, concealment or mistake (as the case may be) or could with reasonable diligence have discovered it.
References in this subsection to the defendant include references to the defendant’s agent and to any person through whom the defendant claims and his agent.”
    1. There is no suggestion in the present case that any fact relevant to the claimant’s right of action has been deliberately concealed from him by either defendant. Thus s.32(1)(b) does not apply. Neither does s.32(1)(c): this is not an action for relief from the consequences of a mistake. The only applicable subsection is therefore s.32(1)(a). The defendants rightly accept that a claim for fraudulent misrepresentation is an action based on fraud for limitation purposes: see Regent Leisuretime v Natwest Finance Limited [2003] EWCA Civ 391.
    2. What matters is the claimant’s knowledge of the precise deceit which the claimant alleges had been perpetrated on him: see Barnstaple Boat Company Limited v Jones [2007] EWCA Civ 727 at paragraph 34. Knowledge of a fraud in a more general sense is not enough to start the limitation period running under s.32(1)(a): see Allison and Another v Horner [2014] EWCA Civ 117 at paragraph 14. In the same way, “facts which improve prospects of success are not facts relevant to his right of action”: see Rose LJ in Johnson v The Chief Constable of Surrey, Transcript 19 October 1992, cited at paragraph 22 of Waller LJ’s judgment in Barnstaple Boat.
    3. This has all been confirmed more recently by the Court of Appeal in Arcadia Group Brands Limited and Others Visa Inc and Others [2015] EWCA Civ 883 (in particular paragraphs 62-65 of the judgment of the then Chancellor of the High Court).
    4. The leading case on reasonable diligence remains Paragon Finance PLC v DB Thakerar [1999] 1 All ER 400 where Millett LJ said:
“The question is not whether the Plaintiffs should have discovered the fraud sooner; but whether they could with reasonable diligence have done so. The burden of proof is on them. They must establish that they could not have discovered the fraud without exceptional measures which they could not reasonably have been expected to take. In this context the length of the applicable period of limitation is irrelevant. In the course of argument May LJ observed that reasonable diligence must be measured against some standard, but that the six year limitation period did not provide the relevant standard. He suggested that the test was how a person carrying on a business of the relevant kind would act if he had adequate but not unlimited staff and resources and were motivated by a reasonable but not excessive sense of urgency. I respectfully agree.”

 

ABUSE OF PROCESS

The judge went on to consider the separate issue in relation to abuse of process. He held that the proceedings were an abuse of process given that the issues could have been (and were) raised in earlier proceedings.
4. ABUSE OF PROCESS
4.1 The Applicable Principles
    1. The leading case is Johnson v Gore Wood & Co (No. 1) [2002] 2 AC 1. That case decided that whether litigation of a decided issue was an abuse depended upon all the circumstances. It was wrong to hold that, simply because a matter could have been raised in earlier proceedings, it should have been raised, so as to render the raising of it in later proceedings necessarily abusive. What was required is a broad, merits-based judgment, taking account of all the public and private interests involved and all the facts of the case.
    2. Dexter Limited v Vlieland-Boddy [2003] EWCA Civ 14 is authority for the proposition that, where A has brought an action against B, a later action against B or C may be struck out where the second action is an abuse of process. The later action against B is much more likely to be held to be an abuse of process than a later action against C. The court will rarely find that the later action is an abuse of process unless it involves unjust harassment or oppression of B or C.
    3. Aldi Stores Limited v WSP Group Plc [2007] EWCA Civ 1260 is authority for the proposition that the fact that the defendants to the original action and the later action were different was a powerful factor in the application of the broad merits-based judgment, but it did not operate as a bar to an application of the principle.
4.2 Should The Allegations Have Been Made In The Earlier Proceedings?
    1. In my judgment, there can be no doubt that the allegations in the current proceedings should have been made in the 1992 or the 2014 proceedings. Indeed, many of them were.
    2. As to the 1992 proceedings themselves, the claimant sought to revive those in 2011. By then, of course, he had made all the detailed allegations in his letters of August and September 2010, and his statement of August 2011 repeated all those allegations again. He was expressly alleging duplicity regarding the true identity of the employer. He therefore could and should have joined the first defendant into those proceedings and made his own allegations against the second defendant (who was already a third party in the 1992 proceedings).
    3. The position in relation to the 2014 proceedings is even more stark. During the course of argument, I was taken to the Particulars of Claim in the 2014 proceedings. Yet again, that pleading (produced by the claimant) made precisely the same allegations as are now made in these proceedings. It would be unnecessarily wearisome to set them all out. But, by way of example only, paragraph 46 of the Particulars of Claim in the 2014 proceedings avers as follows:
“The claimant now asserts that the defendant and Ian Closier, colluded, together with the architect [the first defendant in these proceedings] to entice the claimant onto the site without the benefit of a signed contract, to cover up Herriard’s real role in the development. That is, as project manager and joint employer, with the architect retained as agent by Herriard, with responsibility for design and supervision of the claimant during the course of the contract. Now confirmed by the letter of 11 June 1991 from the architect to Ian Closier.”
    1. In other words, there was the so-called Counterparty Representation, and the allegation of collusion, involving the two defendants to the present proceedings. Plainly, they could and should have been joined in the 2014 proceedings. The claimant was unable to advance a coherent reason as to why that had not happened.
4.3 The Wider Merits
    1. There are a number of matters which need to be identified in respect of the wider merits because, in my judgment, those also support the conclusion that these proceedings are an abuse of process. The first is the observation that no proper trial of these allegations could ever now take place. The two principal players, Mr James Murray and Mr Carlo Marino, are both dead. The claimant was not involved at the time of the contract so can give no relevant evidence at all. Although the claimant referred to the possibility of material from Michael Murray, he also confirmed that Michael Murray had not wanted to be involved in the claim. There is no statement from him.
    2. In those circumstances, I conclude that no fair trial could ever possibly take place of these allegations of fraud. Indeed, I note that that was a point made by Mr Jason Marino in his statement in 2012. Five further years have past. It is simply too long ago for this matter to be fairly tried now.
    3. In addition, that explains why this is not a case where the court is likely to be in a much better position as to the facts at trial, rather than at this interlocutory stage. On the contrary, it is highly probable that there will be no further material from any source. The material before me is therefore as good as it is going to get for the claimant.
    4. There is also the question of oppression. The evidence is that the claimant has regularly harassed both defendants in respect of these allegations. On that issue, I consider that the letters of August and September 2010 speak for themselves. They have a menacing tone which goes way beyond any acceptable assertion of a civil claim. They are threatening and deeply unpleasant. They might be said to be typical of the claimant’s vendetta against these defendants which, 25 years on, has shown no sign of abating. It is therefore time for the court to step in and bring these matters to an end: the court should not simply sit back and referee whatever game the claimant wants to play (to use the phrase of Lord Phillips MR in Jameel v Dow Jones & Co Inc [2005] EWCA Civ 75).
4.4 Summary
  1. For the reasons set out above, applying the principles in the three Court of Appeal cases noted in paragraphs 68-70 above, I conclude that these proceedings are an abuse of process. The allegations should have been made in the 1992 proceedings and certainly in the 2014 proceedings. They are incapable of fair trial. They are part of what appears to be an unpleasant personal vendetta (and which, on the basis of the letters of August and September 2010, may have its roots in events which are nothing to do with the Hogwood Lane development). They only exist because the same claims against the employer named in the contract have been struck out twice already. That therefore gives rise to a separate reason why this claim should be struck out.