Resolving a dispute through a civil claim Flashcards
Limitation Act 1980 (LA 1980)
The Limitation Act 1980 sets strict time limits within which a claimant must commence legal proceedings.
If these time limits are missed, the claim is likely to be “statute barred,” meaning the court will not allow the case to proceed unless there are exceptional circumstances.
The purpose of these deadlines is to protect defendants from being under perpetual threat of litigation for events that occurred years earlier and to account for the degradation of evidence and witness reliability over time.
Effect of Limitation Period Expiration
If a claim is filed after the limitation period has expired, the defendant can raise a technical defense that the claim is “statute barred.”
If the court agrees, the claimant will be unable to succeed in their litigation.
This defense is critical in protecting the legal certainty of the defendant. Lawyers must be diligent in monitoring limitation deadlines to avoid negligence claims from their clients for missed deadlines.
Limitation Periods for Different Types of Claims
- Contractual claims: Six years from the date the breach of contract occurs (Section 5 of LA 1980).
- Tort claims: Six years from when the tort is committed or when damage occurs due to negligence (Section 2 of LA 1980).
- Personal injury claims: Three years from the cause of action or the claimant’s knowledge of the injury. For children, this period begins on their 18th birthday.
- Negligence with latent damage: The limitation period is six years from the cause of action or three years from when the damage was discovered, whichever is later, but no later than 15 years after the negligent act or omission (Section 14A of LA 1980).
Exceptional Circumstances for Extending Limitation Period
While limitation periods are strictly enforced, in exceptional circumstances, the court may allow claims commenced outside the limitation period to proceed.
However, this is rare, and a defendant raising the limitation issue as a defense usually leads to the claim being dismissed. It’s essential for claimants to act within the statutory time limits unless they can demonstrate a justifiable exception.
Parties to a Claim
Claimant: The party initiating the lawsuit.
Defendant: The party against whom the lawsuit is brought.
It is crucial to ensure the correct identification and spelling of the names of all parties involved to avoid procedural errors.
In cases involving torts by employees, both the employee and employer (due to vicarious liability) may be defendants. Additionally, in cases involving defective products, both the retailer and manufacturer may be liable.
Suing the Correct Defendant
A defendant must be correctly identified and sued in the proper legal capacity. They could be:
- An individual
- A sole trader
- A partnership
- A limited liability partnership (LLP)
- A limited company
Suing the wrong legal entity could result in procedural delays and additional costs.
Checking the Financial Viability of the Defendant
Before pursuing a claim, it’s essential to assess whether the defendant is financially capable of satisfying a judgment. This can be done through:
- A search at Companies House (for companies)
- Bankruptcy searches (for individuals)
- Using inquiry agents or online research
Suing a defendant on the brink of bankruptcy or liquidation is often futile, as they may be unable to pay any judgment awarded.
Types of Claims: Specified vs. Unspecified Claims
Specified claims: Claims for a fixed amount of money, such as debts or contractual amounts. The amount owed is known and easily calculable (e.g., unpaid invoices).
Unspecified claims: Claims where the court must investigate and determine the amount payable, often involving damages where the exact amount is unknown at the outset.
How does taking full instructions at the first interview help a lawyer act in the client’s best interests?
A lawyer must act in the best interests of their client by ensuring that the client does not pursue a hopeless case or one with limited prospects of success.
It is crucial to take full instructions from the client at the first interview to understand their problem and begin evaluating potential legal solutions.
This process helps the lawyer offer preliminary advice on key issues such as liability and quantum (the amount of damages that could be awarded).
What is a cause of action, and how does a solicitor assess whether a client has one?
A cause of action is the legal foundation upon which a claim is built, such as breach of contract or negligence, the cause of action forms the legal basis for drafting statements of case, which outline the positions of both parties.
To determine whether a client has a viable cause of action, the solicitor must carefully analyze all available evidence—whether that evidence is provided orally by the client and witnesses, or found in written documentation.
Key Elements of a Breach of Contract Claim
In a breach of contract case, several key elements must be addressed:
Existence of a contract: The first step is to establish that a contract existed, though this is rarely disputed.
- Terms of the contract: The solicitor must determine the express and/or implied terms of the contract. Written agreements help clarify express terms, while oral contracts may require assessing the evidence from both parties. Implied terms, especially in business contracts, may be imposed by statute.
- Breach of contract: The solicitor must assess whether the other party’s actions (or inaction) amount to a breach of the contract.
- Consequences: The factual consequences of the breach must be identified.
What must a solicitor consider when a breach of contract is proven, and what is the primary aim of damages in contractual disputes?
When a breach of contract is proven, the solicitor must consider the damage or loss suffered by the claimant. Each claimed item of loss must be supported with evidence. The aim in contractual disputes is often to compensate the claimant for losses resulting directly from the breach, restoring them to the position they would have been in had the breach not occurred.
Tort of Nuisance
The tort of nuisance occurs when a landowner unreasonably interferes with another landowner’s use or enjoyment of their land. Common examples include:
- Excessive noise from a neighbor.
- Tree roots causing damage to adjacent property.
- Water flooding from one property to another.
The purpose of damages in a nuisance claim is to restore the claimant to the position they would have been in if the nuisance had not taken place.
Misrepresentation
Misrepresentation occurs when one party (Party A) makes an untrue or misleading statement of fact that induces another party (Party B) to enter into a contract, causing Party B to suffer loss.
For example, if a car salesman falsely claims a vehicle has never been in an accident and the customer buys the car based on that claim, this could be a case of misrepresentation. The aim of damages in a misrepresentation claim is to return the claimant to the position they were in before entering the contract.
What must be established first in a breach of contract claim, and what challenges can arise when the contract is oral?
To succeed in a breach of contract claim, the existence of the contract must first be established. This is rarely disputed, but proving the contract terms can be more complex, especially if the contract was made orally.
In such cases, the available evidence may consist of conflicting accounts from the parties involved. For business contracts, implied terms imposed by statute may also play a role, even in the absence of a written agreement.
Evaluating Evidence in Contract Disputes
A key part of a solicitor’s role in a contract dispute is to evaluate evidence proving a breach. This includes reviewing the client’s account and assessing documents, witness statements, or physical proof to show that the breach occurred and caused recoverable loss.
What is Pre-Action Procedure and when is it followed
Before issuing court proceedings, parties are required to follow specific pre-action protocols annexed to the Civil Procedure Rules (CPR).
These protocols encourage early communication between parties to promote settlement before litigation becomes necessary.
Examples of protocols cover areas such as debt claims, personal injury, and professional negligence. If no specific protocol applies, the Practice Direction on Pre-Action Conduct and Protocols (PDPAC) provides general guidelines to ensure consistency across all civil claims.
Purpose of Pre-Action Protocols
The main objectives of the pre-action protocols and the PDPAC are to encourage early and constructive communication between parties, promote the exchange of information, and explore the potential for settlement without the need for litigation. If litigation is necessary, the protocols ensure that the process is efficient and aligned with the court’s timetable. These aims reflect the overriding objective of the CPR, which prioritizes the fair and proportionate resolution of disputes.
Principles of Pre-Action Protocols
The key principles of pre-action protocols include:
- Litigation should be a last resort, with alternative dispute resolution (ADR) considered before issuing proceedings.
- Parties should exchange sufficient information to understand each other’s position, make informed decisions, and attempt settlement.
- Steps should include a concise claim letter, a timely response, and the disclosure of relevant documents.
- Parties should take only reasonable and proportionate steps to resolve the dispute.
- If litigation is necessary, the court will expect the parties to have complied with these steps, and failure to do so may result in sanctions.
Consequences of Non-Compliance with Pre-Action Protocols
Failure to follow the pre-action protocols or the PDPAC can lead to court-imposed penalties. These may include:
- The party at fault being ordered to pay the other party’s costs.
- A claimant being deprived of interest on any damages awarded.
- A defendant being required to pay interest on damages at a higher rate (up to 10% above the base rate).
Additionally, making false statements during the pre-action process can lead to contempt of court proceedings.
Pre-Action Protocol for Debt Claims
The Pre-Action Protocol for Debt Claims applies to claims by businesses, including sole traders, against individuals or sole traders for unpaid debts.
It does not apply to business-to-business debts unless the debtor is a sole trader.
The protocol requires detailed information on the debt, including an up-to-date statement of account and any interest or charges. The debtor has 30 days to respond before court proceedings can be issued, with additional time allowed for seeking legal advice or repayment.
Pre-Action Protocol for Professional Negligence
The Pre-Action Protocol for Professional Negligence applies when a claim is brought against a professional for alleged negligence. The process begins with a Preliminary Notice to the professional, providing basic information about the claim.
A Letter of Claim is then sent, detailing the claim and attaching relevant documents. The professional must respond within 21 days, and thereafter, they have three months to investigate and reply. The aim is to encourage negotiation and settlement before litigation.
Pre-Action Protocol for Professional Negligence (Process Flow)
Explanation:
The pre-action process for professional negligence involves the following steps:
- Claimant gives Preliminary Notice: The claimant notifies the professional of the potential claim.
- Claimant sends Letter of Claim: A detailed letter outlining the claim is sent to the defendant.
- Defendant acknowledges: The defendant acknowledges the receipt of the Letter of Claim.
- Defendant investigates the claim: The defendant has three months to investigate the claim.
- Defendant sends a Letter of Response and/or Letter of Settlement: The defendant responds by either denying the claim or offering a settlement.
- If Claim denied and no settlement offered: A stocktake occurs, and the claimant may proceed with court action.
- If Claim admitted in whole or part and/or settlement offered: The parties may engage in negotiations or alternative dispute resolution (ADR) procedures to reach a settlement.
Steps in the Practice Direction on Pre-Action Conduct
- Claimant sends a letter before claim, which should include:
- Concise details of the claim.
- A summary of the facts.
- What the claimant (C) wants from the defendant (D), and how this amount is calculated.
- Key documents relevant to the claim.
- Defendant responds within a reaonable time by sending a letter of response, which must:
- Confirm if the claim is accepted or explain reasons for not accepting it.
*Indicate if there is a counterclaim.
- Include key documents relevant to the issues in dispute.
- Claimant replies, and both parties then consider:
- Negotiation.
- Alternative Dispute Resolution (ADR).
- Appointment of expert(s), if necessary.
- Stocktake: Before issuing proceedings, both parties should:
- Review their positions.
- Consider whether court proceedings can be avoided.
- If not, narrow the issues in dispute.
- Sanctions for non-compliance:
* The party at fault may be required to pay some or all of the opponent’s costs.
* The claimant may lose some or all interest on damages.
* The defendant may be required to pay a higher rate of interest on damages.
Importance of Alternative Dispute Resolution (ADR)
ADR is a central focus of the PDPAC, encouraging parties to consider alternatives to litigation. ADR methods, such as mediation or negotiation, should be actively explored before commencing court proceedings. Courts expect parties to demonstrate that they have reflected upon ADR, and failing to do so can lead to cost sanctions. Litigation is viewed as a last resort, and premature court action may result in penalties.
