The Chief Constable of Hampshire Constabulary v Southampton City Council
| Jurisdiction | England & Wales |
| Judge | Lord Justice Jackson,Lord Justice Patten,Lord Justice Lewison |
| Judgment Date | 01 December 2014 |
| Neutral Citation | [2014] EWCA Civ 1541 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: B3/2013/3097 |
| Date | 01 December 2014 |
[2014] EWCA Civ 1541
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM SOUTHAMPTON COUNTY COURT
DISTRICT JUDGE POWELL
2YN64361
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Jackson
Lord Justice Patten
and
Lord Justice Lewison
Case No: B3/2013/3097
Mr Martin Porter QC (instructed by Berrymans Lace Mawer LLP) for the Appellant
Mr Glyn Edwards (instructed by Wansborough Solicitors) for the Respondent
Hearing date: Thursday 30 th October 2014
This judgment is in seven parts, namely:
| Part 1. Introduction | Paragraphs 2 to 8 |
| Part 2. The facts | Paragraphs 9 to 15 |
| Part 3. The contribution proceedings | Paragraphs 16 to 20 |
| Part 4. The appeal to the Court of Appeal | Paragraphs 21 to 23 |
| Part 5. Does this case fall within section 10 (3) or section 10 (4) of the Limitation Act 1980? | Paragraphs 24 to 34 |
| Part 6. The construction of section 10 (4) of the Limitation Act 1980 | Paragraphs 35 to 47 |
| Part 7. Executive summary | Paragraphs 48 to 51 |
This is an appeal by the Hampshire Constabulary ("HC") against a decision that its claim against Southampton City Council ("the Council") under section 1 of the Civil Liability (Contribution) Act 1978 is statute barred. The issue in this appeal is when time starts to run in a contribution claim, where the original claim is settled by acceptance of a Part 36 offer, but there are subsequent consent orders embodying the settlement agreement and quantifying costs.
In this judgment I shall refer to the Compensation Recovery Unit as "CRU". I shall refer to the original claimant, Robert Chegwidden, as "Mr Chegwidden". I shall refer to Simpson Millar LLP, who were Mr Chegwidden's solicitors, as "Simpson Millar". I shall refer to Berrymans Lace Mawer, who were and are HC's solicitors, as "Berrymans". I shall refer to Zurich Insurance who are the Council's insurers, as "Zurich".
I shall refer to the Civil Liability (Contribution) Act 1978 as "the 1978 Act". Section 1 (1) of the 1978 Act provides:
"Subject to the following provisions of this section, any person liable in respect of any damage suffered by another person may recover contribution from any other person liable in respect of the same damage (whether jointly with him or otherwise)."
Section 2 (1) of the 1978 Act provides:
"Subject to sub-section (3) below, in any proceedings for contribution under section 1 above the amount of the contribution recoverable from any person shall be such as may be found by the court to be just and equitable having regard to the extent of that person's responsibility for the damage in question."
I shall refer to the Limitation Act 1980 as "the 1980 Act". Section 10 of the 1980 Act provides:
"(1) Where under section 1 of the Civil Liability (Contribution) Act 1978 any person becomes entitled to a right to recover contribution in respect of any damage from any other person, no action to recover contribution by virtue of that right shall be brought after the expiration of two years from the date on which that right accrued."
(2) For the purposes of this section the date on which a right to recover contribution in respect of any damage accrues to any person (referred to below in this section as "the relevant date") shall be ascertained as provided in sub-sections (3) and (4) below.
(3) If the person in question is held liable in respect of that damage —
(a) by a judgment given in any civil proceedings; or
(b) by an award made on any arbitration;
the relevant date shall be the date on which the judgment is given, or the date of the award (as the case may be).
For the purposes of this sub-section no account shall be taken of any judgment or award given or made on appeal in so far as it varies the amount of damages awarded against the person in question.
(4) If, in any case not within sub-section (3) above, the person in question makes or agrees to make any payment to one or more persons in compensation for that damage (whether he admits any liability in respect of the damage or not), the relevant date shall be the earliest date on which the amount to be paid by him is agreed between him (or his representative) and the person (or each of the persons, as the case may be) to whom the payment is to be made."
I shall refer to the Civil Procedure Rules 1998, as amended, "CPR". CPR 36.11 provides:
" The effect of acceptance of a Part 36 offer
(1) If a Part 36 offer is accepted, the claim will be stayed.
….
(5) Any stay arising under this rule will not affect the power of the court –
(a) to enforce the terms of a Part 36 offer;
(b) to deal with any question of costs (including interest on costs) relating to the proceedings."
After these introductory remarks, I must now turn to the facts.
Mr Chegwidden, now unfortunately deceased, was a police officer in the HC throughout his working life. For many years he was based at the Southampton Central Police Station ("the police station"). The police station was located in the north and west wings of the Southampton Civic Centre. The Council owned that building and let the north and west wings to HC under a tenancy at will.
After retirement Mr Chegwidden developed mesothelioma as a result of exposure to asbestos. On 15 th April 2010 he issued proceedings in the Queen's Bench Division of the High Court against HC alleging that negligently and in breach of statutory duty they had exposed him to asbestos. In due course HC, using the CPR Part 36 procedure, settled Mr Chegwidden's claim for £76,351.20 plus costs. Of that sum £35,000 was payable to Mr Chegwidden and £36,351.20 was payable to the CRU.
HC's settlement offer under CPR Part 36 was contained in Berrymans' letter to Simpson Millar dated 8 th October 2010. Mr Chegwidden's acceptance of that offer was contained in Simpson Millar's letter to Berrymans dated 4 th November 2010.
At the request of the parties the court subsequently made a consent order, which embodied the settlement previously agreed as well as other matters. I shall refer to this as "the consent order". The consent order was dated 15 th December 2010 and read as follows:
"UPON AGREEMENT having been reached between the parties for the settlement of the Claimant's claim in this action and by consent IT IS ORDERED:-
1. All proceedings in this action be stayed except for the purposes of implementing the agreed terms set out in the Schedule hereto with liberty to apply for such purpose.
2. The Defendant to pay the Claimant's costs of this action such costs to be agreed if possible and if not, to be subject to a detailed assessment by the court.
1. The Claimant do accept the sum of £71,351.20 (seventy one thousand three hundred and fifty one pounds and twenty pence) in full and final settlement of his claim arising from these proceedings.
2. The Defendant do pay to the Claimant's solicitors the sum of £35,000 (thirty five thousand pounds) within 14 days of the date of this Order.
3. The Defendant do pay to the Compensation Recovery Unit the sum of £36,351.20 (thirty six thousand pounds three hundred and fifty one pounds and twenty pence) within 14 days of this order.
4. The Claimant do return to the Defendant the original Police notebooks and any CID day books/notes and any material relating to criminal matters retained by him upon his retirement within 90 days of the date of this Order.
5. Upon payment of the foresaid sums and costs the Defendant be discharged from all further liabilities arising out of or in any way connected with the claim the subject matter of these proceedings."
As foreshadowed in paragraph 2 of the consent order, the solicitors in due course reached agreement on the amount of Mr Chegwidden's reasonable costs. On the 15 th September 2011 Master Campbell, a costs judge in the Senior Courts Costs Office, made an order giving effect to that agreement. I shall refer to Master Campbell's order as "the costs order". The costs order provided:
" AND UPON the parties agreeing terms that namely that the
1. The Claimant's cost of this action payable by the Defendant are agreed in the sum of £140,000 (inclusive of vat and interest, credit to be given for the sum of £75,000 paid on account)
2. The costs of the detailed assessment are agreed in the sum of £11,500 (inclusive of vat and interest)
IT IS ORDERED THAT
1. The balance of £76,500 be paid by the Defendant to the Claimant on or before 29 September 2011
2. Liberty to apply."
HC took the view that the Council bore some responsibility for Mr Chegwidden's injuries. On 6 th January 2012 Berrymans wrote to Zurich, asserting that the Council had negligently allowed asbestos lagging to be present in the police station, thus exposing police officers to the risks associated with asbestos dust and fibres. Accordingly Berrymans notified Zurich that HC claimed against the Council a contribution to (a) the damages and costs paid to Mr Chegwidden and (b) HC's costs incurred in defending Mr Chegwidden's claim.
Zurich rejected the claim notified by Berrymans. In those circumstances HC commenced contribution proceedings.
HC commenced contribution proceedings against the Council by a claim form issued in Northampton County Court on 3 rd December 2012. In the accompanying particulars of claim HC asserted that the Council had been negligent in failing either to remove or properly encapsulate the asbestos lagging in the police station. Accordingly HC claimed a contribution to the damages and costs paid to Mr Chegwidden and a...
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