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Scottish Court of Session Decisions
You are here: BAILII >> Databases >> Scottish Court of Session Decisions >> Morrice v. Martin Retail Group Ltd [2002] ScotCS 298 (22 November 2002)
URL: http://www.bailii.org/scot/cases/ScotCS/2002/298.html
Cite as: 2003 SCLR 289, [2002] ScotCS 298

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Morrice v. Martin Retail Group Ltd [2002] ScotCS 298 (22 November 2002)

OUTER HOUSE, COURT OF SESSION

A3234/00

 

 

 

 

 

 

 

 

 

 

OPINION OF LORD CLARKE

in the cause

LORNA MORRICE

Pursuer;

against

MARTIN RETAIL GROUP LIMITED

Defenders:

 

________________

 

Pursuer: McDonald; Russell, Jones & Walker

Defenders: McGregor; Simpson & Marwick, W.S.

22 November 2002

Introduction

  • This is an action of reparation in which the pursuer seeks damages from the defenders for injuries she alleges she sustained on or about 16 April 1997, when she was engaged, in the course of her employment, as a shop assistant with the defenders. She claims that she sustained certain injuries to herself as a result of having to manhandle a metal roller shutter at the defenders' premises. Her case is based on statutory fault on the part of the defenders. The summons was not served on the defenders until 21 November 2000.

  • The matter came before me for debate on the defenders' first plea-in-law which is to the effect "The action being barred by the passage of time under and in terms of Section 17(2) of the Prescription and Limitation (Scotland) Act 1973, should be dismissed." Section 17(1) of the 1973 Act provides as follows:

    • "This section applies to an action of damages where the damages claimed consist of or include damages in respect of personal injuries, being an action ...... brought by the person who sustained the injuries or any other person".

    Section 17(2) then provides:

    "Subject to sub-section (3) below and Section 19A of this Act, no action to which this section applies shall be brought unless it is commenced within a period of three years after -

    (a) the date on which the injuries were sustained or, where the act or omission to which the injuries were attributable was a continuing one, that date or the date on which the act or omission ceased, whichever is the later;"

    It is not contended, on behalf of the pursuer, that the action was raised within the triennium. It is accepted that the action should have been raised within three years of the date on which the injuries were sustained, namely 16 April 1997. It is, however, averred, on the pursuer's behalf, that, in the circumstances, it would be equitable to allow her to bring her action, notwithstanding the expiry of the triennium, relying on the provisions of Section 19A of the 1973 Act. Section 19A(1) is to the following effect:

    "Where a person would be entitled, but for any of the provisions of Section 17 ... of this Act, to bring an action, the court may, if it seems to it equitable to do so, allow him to bring the action notwithstanding that provision."

    Defenders' Submissions

  • Counsel for the defenders' submission was that there were wholly insufficient averments put forward by the pursuer to justify the Court in exercising the discretion conferred by Section 19A. It was essential, he contended, before the Court could decide whether or not it would be equitable to allow the pursuer to bring an action, that she provide sufficient averments to show that the equities lay with her and why they lay with her. In her pleadings the pursuer makes averments as to how it came about that the action was not raised within the triennium. The relevant averments, in this respect, are as follows. In Article 5 of Condescendence, pages 12 to 13 of the Closed Record, it is averred: "It is explained and averred that in or about the middle of August 1999 the pursuer consulted a company of claims handlers to represent her in pre-litigation negotiations with the defenders and their insurers" (it is clear from the other averments and material placed before me that the reference to August 1999 should in fact read August 1998). The averments then continue:

    • "That company was Quantum Claims Compensation Specialists Limited of 70 Carden Place, Aberdeen. They intimated a claim on her behalf in a letter to the defenders dated 19 August 1998. That letter was passed by the defenders to their insurers, CGU Insurance, who replied on behalf of the defenders in a letter dated 6 October 1998."

    The pursuer's averments then proceed to refer to various correspondence passing between the insurers of the defenders and the pursuer's representatives. Reference was made to a letter dated 14 September 1999 from the insurers to the pursuer's representatives in which it was inter alia stated: "For the purposes of negotiation we are prepared to consider your client's claim further and await sight of medical evidence together with full quantification of your claim in due course." There then follow averments about the pursuer's representatives instructing a medical examination and report on the pursuer's condition. The averments at page 14D to E then take up matters as follows:

    "The said claims handlers have a system which is meant to ensure that an action is raised within the limitation period. When a client, such as the pursuer, first consults them, they open a new file. They place the date of the incident on the front of the file. They copy this onto an index card. These index cards are used to make diary entries, so that the papers will be placed before a claims handler four months before the end of the triennium. When the file in respect of this accident was opened, the secretary who did so wrote the wrong date on it. She wrote "16 April 1998" on the cover of the file. This was copied onto the index card. Accordingly the said time warning system was not triggered. It would not have triggered until December 2000."

    It is then explained, in the pursuer's pleadings, that on 27 October 2000 the pursuer was asked to comment on the content of the medical report which had been obtained regarding her condition. The averments continue at page 15C to D as follows:

    "The claims handler who was dealing with the pursuer's claim then prepared a full quantification thereof. This was sent to the said insurers in a letter dated 27 October 2000. Whilst so doing he realised that it was already more than three years since the said accident."

    Thereafter the pursuer's averments explain that the matter was referred to solicitors for them to raise an action and that, in due course, after various communings between the solicitors instructed and the claims handlers, counsel who had been instructed, produced a summons which was signetted on 20 November 2000.

  • Counsel for the defenders drew my attention to a series of letters, emanating from the claims handlers, and addressed to the defenders' insurers which are dated 11 November 1998, 9 December 1998, 30 June 1999, 6 August 1999, 14 September 1999, 20 September 1999, 27 October 2000 and 23 November 2000. These letters are referred to in Answer 5. Copies thereof form 7/1 of process. While their terms are not incorporated into the pleadings, the pursuer in her averments refers to them for their terms and it was not suggested by counsel for the pursuer that I could not have regard to them for the purpose of the debate. In each and every one of those letters the words "accident 16 April 1997" appear within the letter heading. Counsel for the defenders contended that, standing that fact, an explanation was required as to why the mistaken entry on the file cover and index card were not picked up or, indeed, why the mistaken entry on the file cover and the index card had caused the claims handler to overlook the fact that the triennium would expire on 16 April 2000. Moreover the problem for the pursuer was compounded by the averments at page 15D to the effect that the claims handler, in quantifying the claim on 27 October 2000, realised that it was already some three years since the accident. It was not explained what made him realise this at that point in time, which was some time before the index card system would have resulted in the triggering of the warning system. Counsel referred me to the case of Carson v Howard Doris Limited 1981 S.L.T. 273. In that case Lord Ross, at page 275, in discussing the power conferred on the Court by Section 19A, said this:

    • "In deciding whether or not to exercise this power, I am of opinion that the Court should consider inter alia; (1) the conduct of the pursuer since the accident and up to the time of his seeking the Court's authority to bring the action out of time, including any explanation for his not having brought the action timeously; (2) any likely prejudice to the pursuer if authority to bring the action out of time were not granted; and (3) any likely prejudice to the other party from granting authority to bring the action out of time. Of course, each case depends on its own facts and there may well be other factors to be considered also in any particular case."

    Counsel emphasised the requirement, set out in that dictum, of an explanation for the delay. There was, he contended, a completely insufficient explanation given by the pursuer, in the present case, for the delay. The approach adopted by Lord Ross in the last mentioned case in requiring an adequate explanation for the delay in raising the action was endorsed by Lord Cowie in the case of Whyte v Walker 1983 S.L.T. 441 at page 442. In Curran v Toffolo Jackson & Co Limited 1998 S.L.T. 1000 Lord Nimmo Smith had made it clear, in relation to the question as to whether it would be equitable to allow an action to proceed by an exercise of the Section 19A power, that the pursuer had to aver more than the consequences of it not proceeding. As his Lordship put it at page 1003K, it is necessary for the pursuer "to provide the Court with a basis upon which the Court's discretion could properly be exercised in the pursuer's favour."

  • Counsel for the defenders submitted that, having regard to those authorities, there simply was no basis provided by the pursuer to justify the exercise by the Court of the Section 19A discretion.

    • Pursuer's Reply

  • In reply, counsel for the pursuer, moved me, in the first place, to repel the defenders' first plea-in-law and to sustain the pursuer's third plea-in-law which is to the following effect:

    • "It being equitable that the pursuer be allowed to bring this action, as condescended upon, notwithstanding that it was not raised timeously, the Court should so order in terms of a Prescription and Limitation (Scotland) Act 1973, Section 19A."

    Alternatively, counsel submitted that a preliminary proof should be allowed regarding the question as to whether the Section 19A power should be exercised. In relation to that alternative submission, counsel referred me to the case of Stephen v North of Scotland Water Authority 1999 S.L.T. 342. In that case the circumstances were that the pursuer had not instructed solicitors until about three months before the expiry of the triennium. An action was raised on his behalf, within the triennium, but against the wrong defenders. Immediate steps were then taken by the solicitors, acting on his behalf, on discovering the mistake, to sue the correct defenders and the summons was served on the correct defenders only eight days after the expiry of the triennium. It was contended, on behalf of the pursuer, that the mistake with regard to who were the proper defenders arose out of the complexity of the particular legislative provisions with which the case was concerned. At page 345 Lord Philip said, under reference to the provisions of Section 19A:

    "The onus is on the pursuer to persuade the Court that its discretion should be exercised in his favour. The discretion conferred by the Section is unfettered. The Court has to balance the interests and conduct of the parties and their advisers, and the degree of prejudice which either party may suffer in the event of a discretion being exercised one way or the other. As in all such cases, the exercise of discretion in the pursuer's favour will inevitably prejudice the defenders in respect that they will lose the statutory protection conferred by Section 17. As to the availability of any alternative remedy open to the pursuer it must, in my view, be taken into account, even although no reference is made to such remedy in the pleadings. It is of such obvious importance in the balancing exercise that it would be wholly unrealistic and inequitable to ignore it, when it can hardly be argued that, without notice on record, the parties, both of whom are legally advised, are not conscious of its significance. Having regard to the nature of the error made by the pursuer's solicitors, there seems to be to be a reasonable chance that an action at the instance of the pursuer against them would succeed. I was not told, nor are there any averments, as to how such an action would be funded. In that situation I am not persuaded to assume that the pursuer would require to fund it himself. On the face of it, if the present action were to be dismissed, the pursuer would be likely to be found liable in expenses to the defenders. I do not know who would actually meet these expenses. In any event, as Lord Sutherland noted in Elliot v J & C Finney, if the present action were to be dismissed, the pursuer would be likely to be delayed for some considerable time in receiving any compensation. Counsel for the defenders criticised the paucity of the pursuer's pleadings on matters germane to the question of the equities. It could equally be said that they are disarmingly succinct. The pursuer's agents made a mistake and there is little more to be said. They were able to bring an action within the triennium despite only being instructed in March 1996. The lateness of the pursuer's instructions to them would not therefore appear to be the cause of the failure to serve the summons within the triennium and for that reason that factor may not weigh heavily in the balance against the pursuer. The error of the pursuer's solicitor did not take the form of culpable inaction, but appears rather to have been a case of insufficient care being given to the consideration of fairly detailed statutory provisions. The fact that the defenders stand to benefit from the misconstruction of detailed statutory provisions governing their liabilities may not weigh heavily in the balance in their favour. The delay was only one of eight days, and the pleadings do not indicate that the defenders have suffered any prejudice other than the admitted loss of their statutory defence. In these circumstances I am unable to conclude that the pursuer cannot possibly succeed in invoking Section 19A. I shall therefore accede to the pursuer's motion and allow a proof before answer of his averments in relation to that Section on which his third plea-in-law is based."
  • Counsel for the pursuer frankly accepted that the only explanation he was able to proffer, in the present case, for the failure to raise the action, was a mistake made by the claims handler, acting on behalf of the pursuer, and dealing with her case, but he contended that, in that respect, the position was no different from that which obtained in the case of Stephen. Recognising, however, that some further explanation was really required as to why, notwithstanding the fact that the person handling the case for the pursuer headed all his correspondence dealing with the claim, with the correct date of her accident, he failed to see to it that the action was raised within three years of that date, counsel for the pursuer sought leave to amend. He also recognised that insufficient explanation had been given as to how it came about that the claims handler wakened up to his mistake. The pursuer's motion for leave to amend was formally opposed by counsel for the defenders. I allowed counsel for the pursuer to amend at the Bar. Among the averments added by way of amendment was the following: "Explained and averred that the heading for letters sent out by the claims handler are generated automatically by the word processing system used by his secretary". As to how the claims handler came to realise his mistake, the pursuer amended to explain that the claims handler realised his mistake on 27 October 2000, when he was preparing the quantification of the pursuer's claim and referred to the medical report which he had instructed, which gave the correct date of the accident. Counsel for the pursuer turned to address the question of prejudice to the defenders if the action were to be allowed to proceed outwith the triennium. He submitted that there was no real prejudice to the defenders, save for the obvious fact that they would lose an otherwise cast iron defence to the claim. He referred me to the averments of the pursuer at Article 5 of Condescendence, page 13 which are to the following effect: "Following sundry correspondence, the said insurers wrote to the pursuer's said representatives in a letter dated 14 September, 1999. Inter alia the said letter stated:

    • "For the purposes of negotiation we are prepared to consider your client's claim further and await sight of medical evidence together with full quantification of your claim in due course. The said letter does not admit liability. However, it is an indication that the said insurers were prepared to pay out in respect of the said claim. It is the type of letter which insurers send out when they wish to pay a claim without making a formal admission of liability. The said claims handlers took the said letter as an indication that liability was not going to be in dispute."

    The terms of the said letter are admitted by the defenders. A copy of it is number 6/3 of process. Counsel for the pursuer contended that the terms of that letter indicated that the defenders and their insurers had had a full opportunity to consider the pursuer's claim within the triennium and to investigate it. The accident was a relatively straightforward one and, in any event, would not require any detailed investigation by the defenders. As far as prejudice to the pursuer was concerned, if the action were not to be allowed to proceed, counsel for the pursuer, once again with commendable frankness, accepted that, in the event of the present action not proceeding, because it had been raised outwith the triennium, there would be no identifiable material prejudice to the pursuer since, as he put it, she would have a completely clear case against the claims handlers for their neglect in processing her claim timeously. What is more he advised the Court that the claims handlers had made it clear to the pursuer they would settle her claim without dispute and that she would not be financially prejudiced as a result. Counsel for the pursuer's position, in effect, came to be that the equities lay in not permitting the defenders to obtain "a windfall", by being able to avoid a claim which they had an opportunity to investigate within the triennium and in respect of which they had been prepared to pay compensation.

    Defenders' Reply

  • In reply, counsel for the defenders submitted that it was a misconception to approach the question as to the exercise of the Section 19A power, by the Court, by suggesting that, if the action were not to proceed, the defenders would obtain a windfall. The previous authorities had all recognised that there was real prejudice to defenders in such a case in being deprived of an otherwise cast iron statutory defence to the claim. The proper approach, in a case like the present, was to look to see, to what extent the pursuer would suffer prejudice, if the action were not allowed to proceed and to weigh that along with all the other relevant factors. In the present case counsel for the pursuer had conceded that there would be no real prejudice to the pursuer if the action were not to proceed. The position was that, even after amendment, the pursuer did not aver any adequate basis for saying that the equities lay with her being allowed to proceed with her action. It was simply a case of culpable carelessness by the person handling her case in overlooking the date of the expiry of the triennium. The letter from the defenders' insurers, 6/3 of process, was simply to be seen as having been sent for the purpose of negotiation. It did not include any admission of liability. It did not mean that the claim had been fully investigated by the defenders at the stage at which it was written. In any event, the fact that the defenders' insurers had applied their mind, to some extent, no doubt from a purely commercial point of view, to the claim within the triennium, provided no excuse or justification for the claim handler's negligence, which was particularly extreme when the true date of the accident was information clearly available to him from the time he was instructed by the pursuer. Counsel for the defenders drew my attention to the pursuer's averments, at page 14 of the Closed Record which are to the effect that the surgeon who was instructed by the claims handler to report on the pursuer's condition wrote to the pursuer on 20 April 2000 offering her an appointment on 30 May 2000. A copy of the letter in question is pursuer's production 6/15 of process. It refers correctly to the date of accident as being 16 April 1997. A copy of that letter was sent by the surgeon to the claims handler. Nevertheless it, apparently, took the claims handler until October 2000 to realise that the triennium had expired on 16 April 2000. Counsel renewed his submission that I should dismiss the action.

    • Decision

  • I have no hesitation in reaching the conclusion that this is not a case where the exercise of the power contained in Section 19A is appropriate. It appears to me that, in a case like the present, where there is an admitted culpable act of negligence by the pursuer's representatives in not raising the action timeously, it is simply insufficient to aver the fact of that negligent act. Frequently where the power conferred by Section 19A is prayed in aid by a pursuer, there has been an oversight or omission by those acting for him to raise the action timeously. The Court's discretionary power, conferred by Section 19A, is to be exercised when it seems to the Court that it is equitable to do so. Before the pursuer can succeed in persuading the Court to exercise the power he must, in my judgement, set out appropriate facts and circumstances which point to it being equitable, notwithstanding the oversight or omission by those acting on his behalf, that the action should be allowed to proceed. Those facts and circumstances will include, no doubt among other things, the reason for the oversight or omission, how excusable the oversight or omission was, and the prejudice to the pursuer (including the extent of any such prejudice) if the action were not to proceed. It is clear from the authorities, cited by counsel for the defenders, that these factors have to be averred with some degree of specification (and if necessary proved). The section 19A power cannot, in my judgment, be regarded as simply providing an automatic release from the consequences of a pursuer's representative's negligence. In the present case, even after amendment, the pursuer's pleadings, in my opinion, provide no basis which would justify the Court being persuaded that, not withstanding the oversight or omission in this case, it would be equitable for the pursuer to be allowed to bring her action. This is particularly so where it is accepted, as it was, that a refusal to exercise the Section 19A power would involve no real prejudice to the pursuer. For the foregoing reasons I shall accede to the defenders' motion, sustain the defenders' first plea-in-law, repel the pursuer's third plea-in-law and dismiss the action.

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