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29 October 2013
The High Court recently considered the extent to which pleadings can be amended to introduce new claims out of time.(1) The decision is a useful insight into the process that the court must undertake in considering whether it is appropriate to allow the introduction of a new cause of action after expiration of the limitation period.
A large number of cruise ship passengers claimed damages for illness during a holiday aboard a cruise ship operated by defendant Tui UK Limited. The claims, brought within the relevant two-year limitation period,(2) alleged that the problem was an outbreak of bacterial gastroenteritis.
Subsequently, outside the limitation period, the claimants applied to amend their pleadings to allege, in the alternative, that the infections were caused (at least in some cases) by a virus rather than a bacterial infection. The claimants' application to amend was allowed at first instance. The defendant appealed.
The court's jurisdiction to allow new claims is derived from Section 35 of the Limitation Act 1980 and implemented by Civil Procedure Rule (CPR) 17.4, which together provide as follows:
To ensure compatibility with Article 6 of the European Convention on Human Rights, the Court of Appeal has ruled that the above test must be read as follows:
"The court may allow an amendment whose effect will be to add… a new claim, but only if the new claim arises out of the same facts or substantially the same facts as are already in issue on a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings."(3)
The court is therefore required to follow a three-stage analytical process. First, would the effect of allowing the amendment be to add or substitute a new claim? If no, the amendment falls outside the scope of CPR 17.4. If yes, the court must proceed to the next stage.
Second, does the new claim arise out of the same facts or substantially the same facts as are already in issue on a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings? If no, the application must fail. If yes, the court must proceed to the next stage.
Third, applying the overriding objective, should the court exercise its discretion to allow the proposed amendment? If yes, the application succeeds. If no, the application must fail.
On the facts, the court found that the amendment had introduced a new cause of action. The judge reviewed the authorities, which considered the concepts of 'new claims' and 'causes of action'. He held that there was a genuine and substantive difference between the means of communication of bacteria and norovirus and also between the necessary steps to be taken to mitigate the risk of infection, and that the amendment therefore introduced a new cause of action.
The court also held that the new cause of action did arise out of substantially the same facts as already pleaded in the particulars of claim and defence taken as a whole. Of particular significance was the fact that the defendant itself had specifically alleged that the infected claimants had contracted norovirus. The defence also explicitly alleged that the defendant had complied with outbreak procedures, guidelines and industry standards.
Finally, the court found that allowing the amendment was a proper exercise of the court's discretion. The court noted, among other points, that:
The judgment, although in the personal injury sphere, is an instructive example of the analytical and balancing exercise that the court must undertake when faced with out-of-time pleading amendments which introduce new causes of action.
For further information on this topic please contact Geraldine Elliott or Matthew Dando at RPC by telephone (+44 20 3060 6000), fax (+44 20 3060 7000) or email (email@example.com or firstname.lastname@example.org).
(1) Nolan v Tui UK Limited  EWHC 3099.
(2) Article 3 of the Athens Convention 1974.
(3) Goode v Martin  1 WLR 1828.
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