3. Additional Claims and Changing Parties

Question 1

Counterclaims by a defendant against a claimant

Answer 1

Counterclaims are a form of additional claim and these are dealt with in CPR 20.

There are a number of different types of additional claims. The only one that we are interested in here is the ‘classic’ counterclaim by a defendant against a claimant (CPR 20.4). Other types of claim under CPR 20 (also known as ‘additional claims’ or ‘other additional claims’) are detailed in a separate element, as are a number of procedural points relevant to additional claims.

A counterclaim is a separate claim to the main claim and is normally made at the same time as the defendant files its defence. If a counterclaim is made after the defence has been filed, permission of the court is needed (CPR 20.4(2)).

Counterclaims by a defendant against a claimant

At its simplest, a defendant’s counterclaim against the claimant is pursued in the same proceedings as the main claim and is, accordingly, dealt with under the same claim number as the main (substantive) claim by the claimant against the defendant.

The defendant could, of course, commence an entirely separate claim, but it is usually more convenient for the defendant to combine its counterclaim with the main claim. These types of counterclaim are very common.

Counterclaims by a defendant against a claimant

A counterclaim, like any other claim, needs to be based on case analysis which confirms that a viable cause of action exists. The defendant in their counterclaim will need to be able to establish duty, breach, causation and loss against the claimant.

A counterclaim may or may not have anything to do with the claimant’s substantive cause of action against the defendant. However, the parties must be suing/being sued in the same capacities as in the main claim.

If the court does not think the counterclaim should be heard with the main claim, it can order that the counterclaim be struck out or heard separately (CPR 3.1(2)(e)).

Question 2

Form of counterclaim

Answer 2

The counterclaim, if made at the same time as the defence, should form a single document with the defence (15 PD 3). It normally follows on directly from the defence (within the same document) and is clearly labelled as a counterclaim. This document is then entitled ‘Defence and Counterclaim’.

The counterclaim is essentially a particulars of claim by another name. It must therefore comply with the rules on particulars of claim. As mentioned above, it must contain the four necessary elements of a claim: duty; breach; causation; and loss. It should also comply with CPR 16.4 (and the corresponding provisions in 16 PD).

A court fee will be payable to the court on filing a counterclaim.

Question 3

Set off

Answer 3

The facts that give rise to a counterclaim may also amount to a defence in the main claim (ie the defence of set off).

The defence of set off may be a partial or complete defence to the main claim. It has the effect of ‘extinguishing’ any claim up to the same amount against the defendant. Please see the illustration below.

There are only certain circumstances where the defendant can actually ‘set off’ its judgment in the counterclaim against the claimant’s judgment in its substantive claim. The most important ones are as follows.

Mutual debts: If the claimant and defendant each owe the other money, one debt can be set off against the other debt. Note that this applies to debts, not damages.

S.53(1) Sale of Goods Act 1979: Where the seller sues for the price of goods sold and delivered, the buyer can set off a claim for breach of implied terms as to quality and fitness for purpose.

Defective services: Where a claim is made for the price of services, the defendant can set off a claim for damages for poor services.

Equitable set-off: This has been developed by the courts when it considers that there is such a close connection between the two transactions that it would be manifestly unjust to allow enforcement of one claim without taking into account the cross-claim.

Form of set off

The defence of set-off should be set out in the defence part of the Defence and Counterclaim, (as opposed to the counterclaim part) (CPR 16.6). It is usually pleaded as in the following example:

“Further or in the alternative, if the Defendant is held liable to the Claimant, the Defendant will seek to set off against the Claimant’s claim as much of the sum awarded by way of counterclaim in these proceedings as to reduce it or extinguish it altogether.”

The above paragraph will usually be the last paragraph of the defendant’s defence, before the start of the counterclaim.

Question 4

Defence to counterclaim

Answer 4

The claimant needs to respond to any counterclaim against them, just as any other claim against a party needs a response. A defendant’s counterclaim can be either admitted or defended by a claimant.

ØTime for serving defence to counterclaim

There is no requirement for a claimant to acknowledge service of the counterclaim using an acknowledgment of service (CPR 20.4(3)). A claimant’s defence to a counterclaim must, however, be filed and served in accordance with the usual rules for defences (CPR 15). This means, the defence to a counterclaim must be served within 14 days after service of the counterclaim.

If a claimant wishing to defend a counterclaim fails to serve a defence within the requisite time limit, a judgment in default might be entered by the defendant (CPR 12.3(2)(b)).

ØForm of defence to counterclaim

A defence to a counterclaim is very similar to a ‘normal’ defence. Its contents must therefore comply with the usual rules in relation to defences (CPR 16.5 and 16 PD).

Question 5

Reply

Answer 5

A reply is an optional statement of case served by the claimant if they wish to allege facts in answer to the defence which were not included in the claim (CPR 15.8).

ØWhen to file a reply

Replies are not filed in every case but, if there is one, it should be filed with the directions questionnaire. (The directions questionnaire is a case management document which the court directs should be filed after a claim is defended. Parties are given at least 14 days’ notice of the deadline for doing this).

This time limit is different in some specialist proceedings (eg Commercial Court claims) so it is necessary to check the relevant rules and court guides if dealing with a specialist claim.

A reply must be verified by a statement of truth (CPR 22.1(1)(a)).

As this statement of case is usually being prepared at the same time as the claimant is considering their response to any counterclaim that has been made, the ‘Reply and Defence to Counterclaim’ normally form one document with the defence to counterclaim following on from the reply (15 PD 3.2).

Question 6

Ø Last statement of case

Answer 6

The reply should be the last statement of case in a claim confirms that permission of the court is needed to file any statement of case after the reply (CPR 15.9).

Question 7

Amendments

Answer 7

This topic primarily focuses on new causes of action, parties and additional claims and how existing proceedings might be affected. However, it is important to remember that amendments relate to any type of amendments to statements of case, and not just amendments which relate to new causes of action, counterclaims and additional claims.

Changes in the parties’ knowledge of a case (eg upon disclosure or the exchange of witness statements) or even simple drafting errors sometimes necessitate the amendment of a statement of case.

For example, if a factual mistake has been made in the originally drafted and served particulars of claim, this can be corrected by the claimant serving an amended particulars of claim with the mistake corrected.

Adding parties and additional claims

In the ‘Counterclaims and other statements of case’ element within the topic of ‘Statements of case’, you were introduced to ‘classic’ counterclaims (CPR 20.4), which are one form of additional claim.

In this current topic we will additionally cover the other different types of counterclaims and additional claims (CPR 20), as well as how to add, substitute and remove parties to a claim (CPR 19).

Both CPR 19 and CPR Part 20 can deal with the possible addition of a party to a claim. You will see as you work through this topic that as a general rule of thumb, Part 20 is used when a defendant is adding a party to an existing claim. Part 19 is used when a claimant is adding a party to an existing claim.

Question 8

Description of the additional claim

Answer 8

Description of the additional claim

A counterclaim by a defendant against the claimant. (CPR 20.2(1)(a) and 20.4)

A counterclaim by a defendant against the claimant and some other person. (CPR 20.2(1)(a) and 20.5)

An additional claim by a defendant against any person (already a party to the proceedings) claiming a contribution or an indemnity. (CPR 20.2(1)(b) and 20.6)

An additional claim by a defendant against any person (already a party to the proceedings) claiming some remedy other than a contribution or an indemnity. (CPR 20.2(1)(b) and 20.7)

An additional claim by a defendant against any person (not already a party to the proceedings) claiming a contribution or an indemnity or some other remedy. (CPR 20.2(1)(b) and 20.7)

An additional claim being made by a party which has itself been joined to the main proceedings pursuant to CPR 20. (CPR 20.2(1)(b) and 20.7)

Question 9

Additional claims: an overview

Answer 9

Important note:

Ø A claim by the original claimant cannot fall into any of the categories summarised in the above table, even if the claimant is adding a further claim to its existing claim. Therefore, a claim by the original claimant is not an additional claim.

Ø It is also worth noting that the terms ‘contribution’ and ‘indemnity’ are also defined in the CPR, as follows:

Contribution ‘A right of someone to recover from a third person all or part of the amount which he himself is liable to pay.’

Indemnity ‘A right of someone to recover from a third person the whole amount which he himself is liable to pay.’

Question 10

Counterclaims against a person other than the claimant

Answer 10

Sometimes the defendant will have a counterclaim against both the claimant and another person at the same time. This type of counterclaim (CPR 20.5) is much more unusual in practice than the classic counterclaim previously mentioned (CPR 20.4).

A counterclaim against a person other than a claimant is a counterclaim by the defendant against:

The claimant AND Some other person

Counterclaims against a person other than a claimant

The defendant’s own cause of action, as particularised in the counterclaim, must be against the claimant and some other party who is, for example, jointly liable with the claimant to the defendant.

If this other party is not already a party to the ‘main’ court action between the claimant and the defendant, the other party will need to be joined into the main claim as a third party so that the defendant’s counterclaim can proceed.

Remember that if the claimant was not involved in the claim which the defendant is bringing, this would essentially be a claim by the defendant against some other party who is not involved in the current proceedings (ie the main claim between the claimant and the defendant). In those circumstances, it would not be a ‘counterclaim’ (because it would not be a claim by the defendant against the claimant) and it would have nothing to do with the main cause of action (since the claimant would not be involved).

Counterclaims against a person other than a claimant

For this type of counterclaim the defendant’s counterclaim must be against the claimant and the third party together.

There must be some connection between the claimant and third party in respect of the counterclaim. (If there was not, the defendant would simply issue an entirely separate action against the third party.)

As with other counterclaims, it is still the case that the defendant’s counterclaim might arise from a completely different set of facts from the main/substantive claim.

Question 11

Contribution or indemnity

Answer 11

The remaining types of additional claim relate to the defendant claiming a contribution or indemnity from someone else to cover any liability it might be ordered in the main claim that they, the defendant, owe to the claimant.

The words ‘contribution’ and ‘indemnity’ have differing meanings in different legal contexts and there is detailed case law in this regard (the specifics of which are beyond the scope of this module). For our purposes, the CPR glossary definitions as mentioned above will apply. For the purposes of the CPR an indemnity is equivalent to a 100% contribution.

A right to a contribution might arise in tort, contract or under the Civil Liability (Contribution) Act 1978 – for instance, in a road-traffic accident case, that Act might give a driver being sued by an injured pedestrian the right to seek a contribution from another driver who also contributed to the accident.

A right to an indemnity will often arise from a contract (with one party contracting to indemnify another) or some other statutory provision: for example, a defendant being sued for professional negligence might have a contractual right to claim an indemnity from his insurers.

Question 12

Claims for a contribution or indemnity from an existing party

Answer 12

A crucial hallmark of both claims for contribution and indemnity is that the party pursuing the claim for contribution / indemnity is seeking to recover something which it is itself obliged to pay to someone else.

A defendant who has acknowledged service of a claim or who has served a defence may make an additional claim for contribution or indemnity against an existing party (most likely a co-defendant) (CPR 20.6) by filing a contribution notice with the court and serving that notice on the other party.

There would need to be a legal basis on which the defendant could base this claim, so case analysis will again be essential, as when considering any other claim.

For this type of additional claim to arise, there must be other existing parties already involved in the action ie it must be more than a simple ‘one claimant against one defendant’ claim by this time.

These types of additional claims often involve the defendant pointing the finger of blame at a third party whom, for some reason, the claimant cannot or does not wish to sue directly, exposing the defendant to full blame.

Question 13

Claims for a contribution or indemnity from a third party

Answer 13

As mentioned above, one of the more common CPR 20.7 claims is a claim for a contribution or indemnity from someone not already an existing party, ie a third party. The same principles will apply as apply to a defendant claiming a contribution or indemnity from an existing party (pursuant to CPR 20.6). So again, there would need to be a legal basis on which the defendant could base this claim against the third party and case analysis will be essential as when considering any other claim.

Other additional claims

The issues in this type of additional claim are purely between the defendant and the third party (ie do not involve the claimant at all), but many of these issues will depend upon what happens in the main claim between the claimant and the defendant.

Question 14

Permission or no permission?

Answer 14

It is necessary to ascertain if the court’s permission is required for your client to pursue a counterclaim or an additional claim.

Classic counterclaim (CPR 20.4) No Permission? If filed at the same time as/with the defence. Permission? If filed at any other time.

Counterclaims against a person other than the claimant (CPR 20.5). Permission is always required.

Claimants for a contribution or indemnity from an existing part (CPR 20.6). No Permission? If filed and served at the same time as/with the defence (or – if the additional claim is made against a party added to the main/substantive claim at a later date – within 28 days after that party files its defence). Permission? If filed at any other time.

Other additional claims (CPR 20.7). No Permission? If the additional claim is issued before or at the same time as the defence is filed. Permission? If filed at any other time.

Permission is applied for using the ‘normal’ interim application procedure. The Application Notice will be accompanied by a draft order and evidence in support which will include details of the stage the main claim has reached, details of the additional claim, a summary of the relevant facts, explanation of any delay and the name and address of any proposed party (20 PD 2).

Question 15

Structure and form of additional claims

Answer 15

Classic counterclaims

A counterclaim by a defendant against the claimant (and not against anyone else) will usually take the form of a ‘particulars of counterclaim’ (CPR 20.4(1)). The defence and the counterclaim should normally form one single document, with the counterclaim following on from the defence (20 PD 6.1).

As the defence and counterclaim form one document, they are filed and served together (in accordance with the time limits specified in relation to defences).

Counterclaim against a person other than a claimant

A claim for a contribution or an indemnity from another party (ie someone who is already a party to the main / substantive proceedings) is made by serving the appropriate notice. There is no set form for making a CPR 20.6 claim (ie no equivalent to the N1 claim form), but an example format is provided on the Court Service website (see PF22).

If done in circumstances when the court’s permission is not required, the notice is filed and served with the defence.

If the court’s permission is required, the court will give directions as to when the notice should be served.

Other additional claims

Other claims are started by issuing an N211 claim form which is similar to the ‘normal’ claim form (ie the N1), other than it is buff coloured and contains more room for the details of all the parties to be inserted.

If such an additional claim is made without the court’s permission, the claim form should be served on the person against whom it is made within 14 days of it being issued (CPR 20.8).

If the court’s permission is required, the court will give directions as to when the notice should be served.

All additional claims

A party upon whom an additional claim is served becomes a party to the proceedings if he was not already a party (CPR 20.10). If an additional claim is served on someone who is not already a party to the proceedings, it must be accompanied by (CPR 20.12(1)):

• a response pack; and
• a copy of every statement of case and any other documents that the court directs.

A copy of the additional claim form must also be served on every existing party (CPR 20.12(2)).

Question 16

Case management

Answer 16

Where the defendant to an additional claim files a defence, other than to a counterclaim, the court will arrange a hearing to consider case management of the additional claim (20 PD 5.1 and CPR 20.13).

Notice of the hearing will be given to any party likely to be affected by any order made at it – in most cases this will be all of the parties. The court may treat the hearing as a summary judgment hearing, dismiss the additional claim or give directions on the way any claim or issue should be dealt with, including how the additional defendant will be dealt with at trial.

Question 17

Title of proceedings where there are additional claims

Answer 17

Matters can become confusing when there are a number of different parties involved in a set of proceedings in a variety of capacities.

Ø Names of Parties

Claimants and defendants in the original claim should always be referred to as such in the title to the proceedings, even if they subsequently acquire an additional procedural status (20 PD 7.3).

Additional parties should be referred to in the title to the proceedings in accordance with the order in which they are joined to the proceedings, for example ‘Third Party’ or ‘Fourth Party’ and so on, whatever their actual procedural status (20 PD 7.4).

Question 18

Default judgment and additional claims

Answer 18

As a preliminary point, note that an additional claim is, subject to a small number of exceptions, to be treated as a claim (CPR 20.3). This means, for example, that a party served with an additional claim must file a defence in accordance with the usual rules (CPR 15.2).

What happens if the person on the receiving end of an additional claim does not respond?

Ø If a party does not file a defence to a counterclaim then a defendant can apply for default judgment as usual (CPR 12.3(2)(b)).

Ø If an existing party does not reply to a notice of contribution or indemnity, it is not possible to apply for a default judgment.

Ø Where an additional claim form (N211) is served on a person not already a party, it should be accompanied by an acknowledgment of service and a response pack. If a party fails to reply to a Form N211 in the appropriate way/within the specified time limits then it will generally be deemed to admit the claim and will be bound by the judgment or decision given at trial of the main claim (to the extent that it is relevant to any matter arising in the additional claim) (CPR 20.11(2)). It is not possible to apply for default judgment in such claims, other than in exceptional circumstances (CPR 20.11(2)(b) and 20.11(3)).

Question 19

Amendments generally

Answer 19

A party might need to amend a statement of case as a knock on consequence of having added a party or claim, or this might have become necessary due to a change in their knowledge of a case (eg upon disclosure or the exchange of witness statements) or because of a simple drafting error.

Amendments to statements of case must be verified by a Statement of Truth (CPR 22) unless the court orders otherwise. The rules in this area are grouped as follows and apply together when the situation requires:

CPR 17 deals with general amendments

CPR 19 governs amendments which remove, add or substitute a party

The rules are particularly strict after the limitation period has expired.

The court will ensure that other parties are safeguarded in costs. A party applying for an amendment will usually be responsible for the costs of and arising from the amendment. Also, upon giving an order to substitute or add a party the court generally makes an order for costs against the party seeking the change.

Question 20

Amendment without permission or consent

Answer 20

A party may amend a statement of case at any time before it is served (CPR 17.1(1)).

Such amendments will largely be limited to amendments to the claim form in the period between issue and service and amendments to other statements of case (such as particulars of claim) prior to service.

Amendments before service can be as extensive as the re-writing of the entire text of the statement of case, even as far as changing the parties and the causes of action. Having said this, any amendment to the particulars of claim that alters the parties involved may require consent or permission if the claim form has been served, as such changes may require consequential amendment to the – already served - claim form.

Bear in mind, however, that the court retains the power to disallow such amendments under CPR 17.2.

Question 21

Amendment by consent

Answer 21

Any statement of case can be amended at any time with the written consent of all the other parties (CPR 17.1(2)(a)).

The general rule is that the party making the amendment will bear the costs of and arising from the amendment (PD 17).

When an amended statement of case is filed without the need for the permission of the court, as set out in 17 PD 2.1(2), it should be endorsed with the words:

‘Amended [particulars of claim/defence (or as may be)] under CPR [rule 17.1(1) or 17.1 (2)(a)] dated …’

Remember, however, that the court can still disallow such amendments (CPR 17.2).

Question 22

Amending with the court’s permission - procedure

Answer 22

When a statement of case has been served and the written consent of all the parties has not been given, a party will need to apply to the court for permission to make an amendment (CPR 17.1(2)(b)).

The party seeking the amendment should file an application notice with the court, together with a copy of the proposed amended statement of case (17 PD 1.2). The application can be dealt with at a hearing or, where all parties consent, without a hearing on written submissions.

If permission to amend is given, the court will usually give directions as to any consequential amendments and the service of any amended statements of case (CPR 17.3(1)). In any event, the amended statement of case should usually be filed by the applicant within 14 days of the date of the order granting amendment unless the court orders otherwise. A copy of the amended statement of case and the order should also be served on every party to the proceedings.

Where an amended statement of case is filed with the permission of the court, it should be endorsed as follows:

‘Amended [particulars of claim/defence (or as may be)] by order of [Mr Justice…] dated …’ (17 PD 2.1(1))

If the substance of the statement of case is changed by reason of the amendment, the statement of case should be re-verified by a statement of truth.

Question 23

When will the court give permission to amend?

Answer 23

Except in cases where the limitation period has expired (CPR 17.4), which are discussed later, there is no specific guidance on the principles upon which the court is to exercise its discretion to allow amendments to statements of case. Parties are expected to be cooperative in litigation so, once the necessity to amend has become apparent, a party should tell their opponents about the proposed amendment so as to enable them to consider whether to oppose or consent to it.

In practice, this is an area in which the facts of your case will need to be carefully compared with the authorities that exist in order to understand how a court is likely to approach the application to amend.

You will try to find authorities that are nearest or most analogous with your own case and use those to persuade the court that permission should be given.

Question 24

Will permission to amend be granted?

Answer 24

General principles

It is recognised that the general principle is that the court is required to give effect to the overriding objective of dealing with cases justly and at proportionate cost (CPR 1.1).

The decision will always involve the court seeking to find a balance between injustice to the applicant if the amendment is refused, and injustice to the opposing party and other litigants in general, if the amendment is permitted. There are a number of cases dealing with this area. Some general principles that have emerged from some of these cases are mentioned below.

Need to show some prospects of success

An application for permission to amend a defence will be refused if it is clear that the proposed amendment has no prospect of success.

The court may reject an amendment seeking to raise a version of the facts of the case which is inherently implausible, self-contradictory or is not supported by contemporaneous documentation. A party will also not be permitted to raise by amendment an allegation which is unsupported by any evidence and is therefore pure speculation or invention. The required statement of truth verifying such an amendment could not properly be given.

Late amendments

In accordance with the court seeking to further the overriding objective, a late amendment (ie an amendment sought close to the trial date) can potentially cause unfairness in that it might put the parties on an unequal footing or add an excessive burden to the respondent’s task of preparing for trial. The court will therefore be very mindful of this fact when considering permission in these circumstances.

A late amendment might even put the trial date at risk and cause a postponement of the trial, which is always something that the court will wish to avoid.

An applicant seeking permission in these circumstances will need to work very hard to convince the court that permission should be given, providing a good explanation as to why they did not apply earlier and must show the strength of the new case and why justice to them, their opponent and other court users requires them to be able to amend.

Swain-Mason and ors v Mills & Reeve [2011] EWCA Civ 14

In this case the Trial Judge had allowed the claimants in a professional negligence action to re-amend their particulars of claim on the first day of trial. The Court of Appeal said that the judge had misdirected himself and set out the following principles:

The court should be less ready than it used to be to allow a very late amendment, where the need for the amendment does not result from some late disclosure or new evidence.A heavy onus lies on the party seeking a late amendment to justify it, not only as regards its own position, but also in relation to other parties to the litigation and other cases before the court, and to give evidence as to why the application is made at such a late stage.The party seeking the late amendment must satisfy the full requirements of preparing a proper pleading.In other words, the party cannot say that deficiencies can be rectified by way of further information or evidence in due course.

Question 25

Amendments which add, remove or substitute parties (CPR 19)

Answer 25

As mentioned above, adding, removing and substituting parties is dealt with in CPR 19.

‘Any number of claimants or defendants may be joined to a claim’ (CPR 19.1).

Ø Except in cases where the limitation period has expired (CPR 19.5) which are discussed below, the main test to be satisfied when seeking to add, remove or substitute a party is that the amendment is ‘desirable’ (CPR 19.2)

In considering this test the court will have in mind the policy objective of enabling parties to be heard if their rights may be affected by a decision in the case, and the overriding objective.

Adding parties to a claim increases the complexity and case management decisions required, which will add to the cost and the time the particular matter might take so the court will have this in mind when exercising their discretion here.

Question 26

Additional claims and adding parties

Answer 26

When additional claims arise, the status in the main claim of the parties to the additional claim should be considered, as the allegations and basis of the additional claim might impact the issues in the main claim. This can have the effect of leaving a party exposed

Permission and / or consent needed

No one can be added as a claimant without his or her consent, with the consent being filed at court (CPR 19.4(4)). If someone refuses to be added as a claimant, they can instead be added as a defendant (CPR 19.3(2)). Finally, the court’s permission is always required to add, remove or substitute a party, unless the claim form has not yet been served (CPR 19.4(1)).

• The rule is designed to avoid the possibility of claims being defeated on the basis that one or another party should or should not have been joined.
• The decision to amend is, as with the amendments already referred to, made in accordance with the overriding objective.
• Permission is usually given to amend on the basis that the amending party must pay the costs of the amendment (plus those arising from it).

Question 27

Amendments after the limitation period has expired

Answer 27

There are special rules in relation to amendments in cases where the limitation period has expired.

An amendment to add a new cause of action or party to existing proceedings is deemed to be a separate action which is commenced on the same date as the original action.

The addition of a new party now takes effect on the date the amended claim form is served upon him, unless the court orders otherwise (CPR 19.4(9). By contrast, when one is considering new claims, the Limitation Act determines when a new claim is deemed to be commenced.

Question 28

Post limitation amendments provisions

Answer 28

There are a number of relevant provisions to consider.

The starting point is s 35 Limitation Act 1980 and the usual rule is that such amendments will not be allowed (s.35(3) Limitation Act 1980).

There are, however, exceptions to this general rule. These include when an original set off or counterclaim is raised by an amendment and where otherwise provided in the Limitation Act and by the rules of the court. The relevant provisions here are:

(s 33 Limitation Act) Amendments in relation to personal injury claims

(CPR 17.4) Amendments generally

(CPR 19.5) Amendments which add or substitute a party

Question 29

Adding causes of action post limitation

Answer 29

A new cause of action can be added to an existing statement of case after the end of the limitation period only in the following circumstances:

Ø When the court directs that the limitation period will not apply in a personal injury action (s.33 Limitation Act 1980). This provision gives the court a general discretion to disapply that time limit if satisfied that it is equitable to do so.

For example, the cause or significance of personal injuries or disease caused by someone’s negligence might not be apparent within the standard 3 year limitation period for personal injury claims and this could be a reason for the court to exercise its discretion under this provision in order to do justice. If an action on some other basis was already underway, it could be amended under this provision to add this new claim after the limitation period had expired.

Ø The new cause of action is an original set-off or counterclaim (s.35(3) Limitation Act 1980).

Ø The new cause of action arises out of the same facts or substantially the same facts as are already in issue in the original claim (s.35(5)(a) Limitation Act 1980.

The court may allow the amendment when the effect will be to substitute or add a new claim after the end of the limitation period, but only if the new claim arises out of the same facts (or substantially the same facts) as a claim in respect of which the party seeking permission to amend has already claimed a remedy (CPR 17.4(2). The onus is on the applicant to show that the proposed amendment falls within this criteria.

An amendment adding a new duty or obligation on the part of a defendant (or possibly even a claimant) will usually raise a new cause of action so this will be a new claim.

An amendment adding additional facts or particulars which clarify a duty or obligation which has already been alleged, will not normally be interpreted as raising a new cause of action.

Ø The court will therefore examine the alleged duty, breach, causation and loss very carefully in order to decide which of the above two categories the proposed amendment comes into. If there is a new distinct allegation, it will be a new cause of action and will need to be justified within the criteria mentioned above as this amendment will add a new claim after the limitation period has expired.

Ø If the only change is the addition of a further instance of the alleged breach or a new remedy, there will be no additional cause of action.

Question 30

Adding parties post limitation

Answer 30

There can also be amendments which change the parties to an action.

There is an interplay between the general provisions for amendments and those which specifically deal with adding or substituting parties substantively. This is because any change in the parties will also necessitate and amendment to the statements of case. There are three main situations that can arise:

· Relates to correcting a mistake as to the name of a party (CPR 17.4(3))

· Relates to changing the capacity of a party (CPR 17.4(4))

· Relates to changing the identity of a defendant (CPR 19.5)

There are a limited number of situations where new parties can be added or substituted despite the limitation period’s expiration (CPR 19.5) – these are addressed in detail on the next slide. If the case does not fall into one of these categories the proposed amendment will not be allowed.

The onus is on the applicant to show that the proposed amendment falls within the applicable criteria.

Question 31

Requirements for adding/substituting parties post limitation

Answer 31

Parties may only be added or substituted after the end of the relevant limitation period if:

• the limitation period was current when the proceedings were actually started; and
• the addition or substitution is ‘necessary’.

The addition or substitution is deemed to be ‘necessary’ only if the court is satisfied that (CPR 19.5(3)):

the new party is to be substituted for one that was named in the claim form in mistake for the new party; or

the claim cannot properly be carried on/by/against the original party unless the new party is added or substituted; or

the original party has died or had a bankruptcy order made against him and his interest or liability has passed to the new party.

Question 32

Change in name only, or a different person?

Answer 32

The court will distinguish between mistakes in name only, and those which actually result in an entirely different person or entity becoming a party ie mistakes as to identity.

Ø For example, the intended party might have been named in the claim form but there was a genuine mistake such as causes no reasonable doubt as to the identity of the party in question. The claim form will have been served on this defendant despite their name being wrong. An amendment to this party’s name might be allowed (CPR 17.4(3)).

Ø Sometimes the mistake is more fundamental and the situation can only be made right by the new party being substituted (CPR 19.5(3)(a)). So here, a new person will be joining the action, however their identity will have been known already.

For example, a claimant might know the attributes of the proposed defendant (eg their employer or a seller of an item) but has no personal knowledge of their name. The claimant might have been incorrectly informed of the name, resulting in proceedings against the wrong defendant.

Many of the cases in this area involve corporate or quasi corporate entities changing business structure but effectively being the same going concern.

In summary, amendments post limitation in relation to the name of the party might be allowed but those relating to someone with an entirely new identity will not be allowed.

The Sardinia Sulcis [1991] 1 Lloyd’s Rep. 201

This case sets out the correct approach for the court when deciding such issues. The test is as follows:

Has the intended defendant been identified in the statements of case ‘by reference to a description more or less specific to the particular case’?

If yes, it is a mistake of the type covered by CPR 19.5(3)(a) and the amendment may be permitted by the court. If not, then the court cannot permit the amendment.

This test might allow the substitution of a new defendant, unconnected with the original defendant and unaware of the claim until after the expiry of a relevant limitation period. Any potential injustice in these circumstances can be avoided by the exercise of the court’s discretion – the court may allow the amendment, but is not obliged to allow it if it would be unjust.

Question 33

Obtaining further information: CPR 18

Answer 33

A party can obtain further information from the other party to clarify or give additional information in relation to any matter which is in dispute in the proceedings. In most instances whether or not a matter is “in dispute” will be apparent only from a reading of the statements of case and, therefore, the disputed matter will be often be contained or referred to in a statement of case. However, the court’s power is not limited to matters contained or referred to in a statement of case. Requests should be confined to matters which are reasonably necessary and proportionate to enable the party seeking clarification or information to prepare its own case or to understand the case it has to meet.

Examples of why a party wishes to request further information include:

To obtain admissions (although this is rare)

To obtain information which may reveal weaknesses in the other party’s case

To obtain information about facts which the other party needs to prove to make good their case

To acquire advance details of what a witness may say before exchange of witness statements.

To obtain clarification of the other party’s case (a common and useful function as it limits the other party’s ability to depart from it later)

To narrow the issues between the parties to save time and costs

In multi-track claims, directions setting out the time period for serving requests for further information and responses to them will usually be included in the directions at the first case management conference.

Question 34

Making a request for further information

Answer 34

A party is expected to seek information from the other party on a voluntary basis first and should only make an application to the court if the request cannot be resolved (18 PD 1).

The party seeking information serves a written request on the other party stating a date for a response (allowing the other party a reasonable amount of time to respond).

The request should be concise and confined to matters which are reasonably necessary and proportionate to enable the requesting party to prepare its own case / understand the opponent’s case.

The CPR contain instructions as to the format and layout of the request.

Question 35

Responding to a request

Answer 35

The response must be written, dated and signed by the party or its legal representative and include a statement of truth (18 PD 2).

The response must be sent to the other party and filed at court.

If a party objects to providing a request, it must inform the party who made the request giving reasons for the objection and object within the timeframe set out in the request (18 PD 4). If the request can only be complied with at disproportionate expense, the reasons why must be explained, for example, the request is about matters that are irrelevant, disproportionate, not reasonably necessary or privileged.

Request to the court for further information

The court can order a party to clarify any matter which is in dispute in the proceedings or give additional information in relation to any such matter where or not the matter is contained or referred to in a statement of case (CPR 18.1)..

An application to the court would be appropriate where the other party has not responded or has responded with an objection to provide the information (18 PD 1.1).

The application should be made as an interim application (CPR 23 and18 PD 5). If, the other party has not responded after 14 days have passed, the application can be made without notice to the opponent and the court can deal with the application without a hearing.

If a court makes an order for further information, the party against whom the order made must file its response and serve its response on the other parties within the time specified by the court. The response must be verified by a statement of truth.

Restriction on the use of further information

The court can direct that further information given by a party to another party either voluntarily or pursuant to an order is not be to used for any purpose other than the current proceedings (CPR 18.2).