Malik Javid Khan v R M Falvey
| Jurisdiction | England & Wales |
| Judge | Sir Murray Stuart-Smith,Lord Justice Chadwick,Lord Justice Schiemann |
| Judgment Date | 22 March 2002 |
| Neutral Citation | [2002] EWCA Civ 400 |
| Docket Number | Case No: A2/2001/1054 |
| Court | Court of Appeal (Civil Division) |
| Date | 22 March 2002 |
[2002] EWCA Civ 400
Lord Justice Schiemann
Lord Justice Chadwick and
Sir Murray Stuart-Smith
Case No: A2/2001/1054
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN'S BENCH DIVISION
MCKINNON, J.
A.R. NICOL (instructed by Pinsent Curtis Biddle for the Appellant)
A. RIZA Q.C. and B. ANGAMMANA (instructed by Singh & Co.for the Respondent)
Introduction.
This is an appeal from the decision of McKinnon, J. h and ed down on 27 th April 2001 on a preliminary issue in which the learned judge held that the claimant's causes of action were not statute-barred pursuant to Section 2 of the Limitation Act 1980.
In this action the Claimant sought to recover damages for alleged professional negligence from his former solicitor. The Defendant was one of a number of solicitors instructed to act by the Claimant from time to time over a lengthy period in respect of several different disputes. In particular, from time to time the Claimant instructed the Defendant to act on his behalf;
(a) In a High Court Action (1985 K No. 196) against a Mr Kanuga ("Case 1");
(b) In a High Court Action (1986) M No. 1674) against Maurice Lay Distribution Ltd. ("Case 3")
and
(c) In a High Court Action (1989 K No. 1445) against a Ms Begum and Mr Hussain ("Case 4");
The Claimant's retainer of the Defendant was not an entire contract because on occasion the Claimant would either act on his own behalf or instruct alternative solicitors to so act. The Claim Form in this action was issued on 2 nd June 1999.
All the actions set out above were dismissed for want of prosecution; Case 1 on 11 th September 1997, Case 3 on 17 th July 1997 and Case 4 on 1 st March 1999.
The Claimant's pleaded case in respect of Case 1 is as follows:—
The Defendant's retainer commenced in early 1987 when the Defendant was asked to act for the Claimant to recover a trade debt which had allegedly arisen in 1984. The Claimant alleges that he has suffered loss and damage by reason of the Defendant's defaults and specifically asserts that had the Defendant acted competently Judgment in Case 1 would have been entered in his favour by 31 st. December 1988. In this action the Claimant claims to recover the amount claimed in the earlier action £7,933.00 (plus interest thereon) and the total amounts paid to the Defendant and another firm of solicitors by way of costs and expenses.
The Claimant's pleaded case in respect of Case 3 is as follows:—
The Defendant's retainer commenced in March 1986 when the Defendant was asked by the Claimant to resist a claim made against the Claimant in respect of a commercial debt and to make a counterclaim. It is alleged that a payment on account of the Defendant's fees was made in the sum of £1,747.50 and this total sum is claimed as damages in the current action. It is also alleged that the Claimant put the Defendant in funds to make a payment to his opponent's solicitors of £11,200 on 2 nd August 1989 as a condition of being granted permission to defend, that this sum was so paid and this sum is claimed as damages in the current action. The Claimant also claims to recover as damages in this action the loss of the opportunity to recover in respect of his counterclaim in the earlier action damages in the sum of £51,000 plus interest thereon and asserts that judgment in the earlier action should have been entered in his favour by 31 st December 1989 had the Defendant acted competently.
The Claimant's pleaded case in respect of Case 4 is somewhat complicated and unclear, but it appears to be as follows:—
The Defendant's retainer commenced in 1989. The Claimant instructed the Defendant to act for him in an attempt to recover alleged arrears of rent which he claimed had arisen in respect of a property which he alleged he owned in Hounslow, Middlesex. The Claimant claims that the Defendant acted in breach of his duty by failing to recover possession of the premises on his behalf and asserts that possession should have been obtained by January 1990. Accordingly in this action the Claimant seeks to recover damages for the rent that he alleges he would have received for the property between January 1990 and November 1992 (when the property was repossessed) plus interest thereon but which he did not receive as a result of the alleged negligence of the Defendant. The Claimant also seeks to recover the total amounts paid to the Defendant in the sum of £1,800. It appears that the Defendant's retainer was terminated sometime in 1992 but he was reinstructed in January 1993. During the period that the Claimant acted in person he obtained a judgment against the tenants for £22,344. But the judgment was subsequently set aside and the action, which included a claim for £16,500 for damage allegedly caused by the tenants, was transferred to the County Court. The arrears of rent and the damages were not recovered before the action was struck out on 1 st March 1999.
The total claim against the Defendant is in the sum of £409,563, and is clearly calculated on the basis that the Claimant has been owed certain moneys by the Defendant's since 1988, 1989, 1990 and 1992.
The allegations of negligence against this Defendant are in substantially the same form mutatis mut and is in each Case, though those in respect of Case 4 are more elaborate. Thus in Case 1 the particulars of negligence allege:
"(1) Failing to take procedural steps, in particular discovery of documents, preparation of proofs and /or witness statements, taking out a summons for direction and setting the claim down for trial, in Case 1 after 18 th March 1988 and /or 30 th September 1994.
(2) Failing to warn the Claimant's expressly that if such steps were not taken his claim in Case 1 would be amenable, as it was, to be struck out for want of prosecution at any time after 1990."
In each case, in addition to the specific items of loss claimed, the Claimant claims the loss of opportunity to recover the sums claimed in the original action. Thus in Case 1 particulars of loss and damage include:
(2) Loss of opportunity to recover £7,933.00 and interest thereon from the date of issue of the writ until an expected date of judgment, which ought to have been by 31 st December 1988.
The Judge's decision.
The Judge held that none of the claims under Case 1 and Case 3 were statute barred. He also held that in Case 4 the claims to recover the Claimant's own costs of £1,800 paid to the Defendant and the opportunity to recover the arrears of rent in the sum of £22,244.39 were not statute barred. In relation to the other claims under Case 4, he held that there was insufficient material upon which he could reach a decision as to when the cause of action arose. The judge held that he was bound by the decision in Hopkins v Mackenzie [1995] PIQR 43 (CA) to hold that the causes of action did not arise until the actions in each case were struck out for want of prosecution. Since all the actions were struck out within the six year limitation period before the issue of the claim, none was statue barred.
The Defendants Submissions
Mr Nicol on behalf of the Defendants/Appellants submits that the Judge was in error. He makes three submissions:
That each of the three cases are distinguishable from Hopkins v Mackenzie, because on the Claimant's own pleaded case he sustained loss and damage due to the same alleged acts of negligence before 1st June 1993 (the limitation date). Whereas in Hopkins v Mackenzie the only claim appears to have been for the loss of the opportunity to obtain damages for personal injury by reason of the strike out of the original action.
Alternatively that the ratio decendi of Hopkins v Mackenzie should be narrowly confined on the basis that the only pleaded case advanced was the loss of the chance to recover in the original action and that loss was sustained when the action was struck out and not before..
That Hopkins v Mackenzie was wrongly decided and cannot st and in the light of the subsequent House of Lords decision in Nykredit Mortgage Bank PLC v Edward Erdman Group Ltd (No. 2) [1997] 1 WLR 1627.
The first submission. The law.
It is trite law that a cause of action in negligence does not arise until the claimant suffers damage as a result from negligent act of the defendant. But once real damage – as distinct from purely minimal damage is sustained—the cause of action arises, even though greater loss may later eventuate from the negligence. In Cartledge v E. Jopling and sons Ltd [1963] AC 758 Lord Reid said at p. 771:
"It is now too late for the courts to question or modify the rules that a cause of action accrues as soon as a wrongful act has caused personal injury beyond what can be regarded as negligible, even when that injury is unknown to and cannot be discovered by the sufferer, and that further injury arising from the same act at a later date does not give rise to a further cause of action."
The harshness of the rule has been mitigated by subsequent legislation. But the Claimant does not seek to rely on any of the provisions of such legislation.
In Forster v Outred and Co. [1982] 1 WLR 86 at p. 94 Stephenson LJ accepted counsel's submission as to what was meant by actual damage which is a necessary ingredient in the cause of action for negligence:
"….. it is any detriment, liability or loss capable of assessment in money terms and it includes liabilities which may arise on a contingency, particularly a contingency over which the plaintiff has no control; things like loss of earning capacity, loss of a...
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