Introduction
It was always assumed that the Courts would not allow limitation to be circumvented by permitting claimants to add or substitute new parties after the expiry of primary limitation save in very narrowly circumscribed cases: being misdescription or standing issues.
The working assumption was that the Courts would ordinarily apply limitation and refuse permission to add or substitute; however, there was little first instance consideration and no decided appeal authority on the point.
The relevant provisions, being sub-section 35(6)(b) of the Limitation Act 1980 and CPR r.19.6(3)(b) are mercurial.
A little reported upon first instance decision in the High Court, Office Properties PL Ltd (in liquidation) v Adcamp LLP [2025] EWHC 170 (Ch) ("Adcamp") has taken a more expansive approach to the discretion and if the decision is affirmed (permission is pending for an appeal to the Court of Appeal), it could widen the scope for adding or substituting parties where primary limitation has expired.
The most obvious relevance of the expansion in the professional negligence cases involving firms and other advisers where there has been a chain of successor firms and a succession of responsibility for the underlying liability for the specific claim.
The facts of Adcamp
The underlying claim arose out of allegedly negligent advice given by solicitors, Pitmans LLP in respect of an unlawful dividend declared by the claimant company, Office Properties PL Ltd (the "Company") and a lease guarantee entered into by the Company. The advice was given and effect on 20 January 2017 and thus, the primary limitation period in respect of the claim expired in January 2023.
The solicitors later changed their name to Adcamp but for the purposes of this note (and in the Judgment) are referred to as "Pitmans".
In 2018, Pitmans was taken over by Bircham Dyson Bell LLP, which changed its name to BDB Pitmans LLP ("BDB"). Although BDB was apparently the "successor practice" for the purpose of professional indemnity insurance (meaning that BDB's insurer was liable to indemnify Pitmans against claims), there was no novation of liabilities as between Pitmans, BDB and the Company. In 2021, Pitmans was dissolved but in 2023 it was restored to the register.
In 2022, the Company brought a claim mistakenly brought a claim against BDB.
Time for service of the claim was extended by agreement a number of times, however, on 15 September 2023, solicitors for BDB, wrote appending a draft defence by which BDB admitted that it was the successor practice to Pitmans for the purpose of indemnity insurance but denied that this constituted any assumption of responsibility by BDB for the acts or omissions of Pitmans.
This caused solicitors for the Company to realise that the Claim Form had failed to name the correct party. On 10 October 2023, the Claim Form was amended without permission to add Pitmans as First Defendant, renumbering BDB as Second Defendant.
It will be recalled that CPR r 17.1 permits such an amendment to be made without permission because the Claim Form had not yet been served. A second amendment was made to delete BDB as the Second Defendant.
Pitmans applied pursuant to CPR r 17.2 for the Court to consider the amendment as if permission were required.
The question for the Court was whether amendments which amounted to a full substitution of one party for another can be made after the expiry of primary limitation and, if so, what considerations govern whether the Court has a discretion to allow such amendments.
The relevant law
Section 35 of the Limitation Act 1980 deals with new claims and sub-section 35(1) states (so far as relevant) that a new claim is deemed to have been made on the date of the original action: this is what is referred to in the case law as the doctrine of relation-back.
The principles appear to apply equally whether the amendment seeks to add or substitute a claimant or a defendant. The doctrine of relation-back means that if the application is allowed the claim is deemed to have been brought in relation to any new party at the same time it was brought against the original defendant.
However, subsection 35(3) (so far as relevant) prevents a new claim from being made outside the limitation period unless permitted by rules of court. The rationale is to ensure that a defendant is not artificially deprived of a viable limitation defence arising between the service of the original claim form and the amendment application as was explained by the Court of Appeal in Welsh Development Agency v Redpath Dorman Long [1994] 1 WLR 1409 at 1425.
The balance that is engaged where a claimant might lose a viable claim as against a defendant who might face an otherwise statute barred stale claim is set out in Haward v Fawcetts [2006] 1 WLR 682 at [32] by Lord Scott in these terms:
"... limitation defences are creatures of statute. The expression "statute-barred" makes the point. And, in prescribing the conditions for the barring of an action on account of the lapse of time before its commencement, Parliament has had to strike a balance between the interests of claimants and the interests of defendants. It is a hardship, and in a sense an injustice, to a claimant with a good cause of action for damages to which, let it be assumed, there is no defence on the merits to be barred from prosecuting the cause of action on account simply of the lapse of time since the occurrence of the injury for which redress is sought. But it is also a hardship to a defendant to have a cause of action hanging over him, like the sword of Damocles, for an indefinite period. Lapse of time may lead to the loss of vital evidence; it is very likely to lead to a blurring of the memories of witnesses and to the litigation becoming even more of a lottery than would anyway be the case; and uncertainty as to whether an action will or will not be prosecuted may make a sensible and rational arrangement by the defendant of his affairs very difficult and sometimes impossible. Each of the various statutes of limitation that over the years Parliament has enacted ... represents Parliament's attempt to strike a balance between these irreconcilable interests, both legitimate. It is the task of the judiciary to identify from the statutory language and the purpose of each amending enactment the balance that that enactment has endeavoured to strike and to apply the enactment accordingly. It is emphatically not the function of the judges to try to strike their own balance, whether as a response to the apparent merits of a particular case or otherwise." (emphasis added)
So, the question becomes: when do rules of Court allow for the circumvention of limitation?
Sub-section 35(4) states that rules of court may permit new claims, but only if the conditions in sub-section 35(5) are satisfied. In the case of a claim involving a new party, sub-section 35(5)(b) states that the condition is: "if the addition or substitution of the new party is necessary for the determination of the original action".
The critical provision is contained in sub-section 35(6) in these terms:
"The addition or substitution of a new party shall not be regarded for the purposes of subsection (5)(b) above as necessary for the determination of the original action unless either—
(a) the new party is substituted for a party whose name was given in any claim made in the original action in mistake for the new party's name; or
(b) any claim already made in the original action cannot be maintained by or against an existing party unless the new party is joined or substituted as plaintiff or defendant in that action." (emphasis added)
It is also convenient to note where these provisions of the limitation statutes appear in the CPR r 19.6 which provides so far as relevant:
"(1) This rule applies to a change of parties after the end of a period of limitation under—
(a) the Limitation Act 1980 ....
(2) The court may add or substitute a party only if—
(a) the relevant limitation period was current when the proceedings were started; and
(b) the addition or substitution is necessary.
(3) The addition or substitution of a party is necessary only if the court is satisfied that—
(a) the new party is to be substituted for a party who was named in the claim form in mistake for the new party;
(b) the claim cannot properly be carried on by or against the original party unless the new party is added or substituted as claimant or defendant; or
(c) the original party has died or had a bankruptcy order made against them and their interest or liability has passed to the new party." (emphasis added)
Subsection 35(6)(a) is only apt to cure misnaming (incorrect name applied) of a party not mistaking one existing party for another entirely separate entity (issue as to standing); and so, the focus is on the mercurial provision in sub-section 35(6)(b). On one analysis, it is broad enough to encompass any and every substitute or addition – after all any claim needs a viable defendant.
So far as subsection 35(6)(a) was concerned on current facts, Counsel for the Claimants accepted they could not rely on the "mistake" exception in sub-section 35(6)(a) and CPR r.19.6(3)(a), for the reason given in Insight Group Ltd v Kingston Smith [2014] 1 WLR 1448 ("Insight"). That case concerned a partnership that had become an LLP, where the Judge found as a matter fact the claimant mistakenly believed the LLP had provided the advice. In those limited factual circumstances, sub-section 35(6)(a) and CPR r.19.6(3)(a) provided a gateway to correct the true name of the party.
Strictly speaking the Judge's findings in Insight also bypassed the need to consider the opaque effect of subsection 35(6)(b) and CPR r.19.6(3)(b). The Judge however did state (obiter) that subsection 35(6)(b) and CPR r.19.6(3)(b) should be apt to include amendments that go beyond standing; noting as well that if subsection 35(6)(b) and CPR r.19.6(3)(b) were limited to standing why was there a need for a separate category of mistake under sub-section 35(6)(a) and CPR r.19.6(3)(a)?
In Adcamp, the content of the pre-action correspondence prevented any such argument for the Claimants grounded under the mistaken provisions of subsection 35(6)(a) and CPR r.19.6(3)(a); the mistake was squarely in relation to the transfer of liability; it was not about the identity of the firm.
As the Judge noted, the only decided cases of successful substitution pursuant to sub-section 35(6)(b) and CPR r.19.6(3)(b) involved mere locus or standing issues predominately of claimants – they related to administrators of insolvent companies – where the underlying claim and facts remained constant: see Parkinson Engineering Services plc v Swan [2009] EWCA Civ 1366; Irwin v Lynch [2011] 1 WLR 1364, CA.
Further, in a case of party substitution (personal representative should have been sued) where the claim pursued against the new party was clearly different, substitution, the Supreme Court decided was correctly denied: see Roberts v Gill [2010] UKSC 22.
On any wider application of sub-section 35(6)(b) and CPR r.19.6(3)(b) to issues beyond standing where the underlying claim is identical or similar, there are competing inconsistent first instance decisions.
The first is Nemeti v Sabre Insurance Co Ltd [2012] EWHC 3355 (QB) ("Nemeti"), which was upheld in the Court of Appeal (see [2013] EWCA Civ 1555) but arguably without resolving the current dispute.
In Nemeti, the substitution was broader than simply standing and was found at first instance and on appeal to introduce a new cause of action where limitation had expired. On the facts, refusal of substitution was the obvious outcome.
The second is Insight (discussed above) and the obiter dicta of the Judge that sub-section 35(6)(b) and CPR r.19.6(3)(b) were apt to include broader issues than mere mistakes as to standing.
Perhaps regrettably, although the Court of Appeal in Nemeti[2013] EWCA Civ 1555 upheld the first instance Judge, they only mentioned Insight in passing and did not clearly pronounce on the wider interpretation of sub-section 35(6)(b) and CPR r.19.6(3)(b).
As the Judge noted there was no decided authority to resolve the precise scope of sub-section 35(6)(b) and CPR r.19.6(3)(b).
The decision in Adcamp
The Judge characterised the dispute between the parties in these terms:
"19. The court has jurisdiction to permit the amendment under Ground (b) only where the claim sought to be made by or against the new party is the same claim as was made by or against the original party. The narrow, but important, point which divides the parties is whether the claim as amended is the same claim." (emphasis added)
The Judge then noted the relevant authority on the meaning of "claim" in these terms:
"44. The classic definition of a claim is " simply a factual situation the existence of which entitles one person to obtain from the court a remedy against another person ": Letang v Cooper [1965] 1 QB 232 at 242-3 per Diplock LJ."
The question of whether the claim is new, or part and parcel of an existing claim is somewhat circular. Certainly, in the case of substitution, the claim in at least a narrow sense will always be a new claim because it is between different parties to the original claim. It must be at least arguable that the point is that a new claim against a new defendant should not proceed because it otherwise defeats the public policy of finality in litigation and the overall scheme of the limitation provisions.
Similarly, the language of necessity is somewhat opaque because presumably the substitution or addition will always be necessary for a determination of the claim otherwise what is the utility of the amendment at all?
One working assumption about the necessity requirement under sub-section 35(6)(b) and CPR r.19.6(3)(b) was that the amending party was under an obligation to show that but for the amendment they would lose the ability to a litigate a case against an existing defendant who was properly joined prior to expiry of limitation. The idea being the injustice to a new defendant of facing a stale claim was overcome by the need to allow the claimant to pursue its full claim against pre-existing defendants. However, that would suggest that the provision would only apply to addition and not substitution.
The Judge went on to consider whether a narrow or broader view of the scope of sub-section 35(6)(b) and CPR r.19.6(3)(b) should be adopted, preferring (on the facts) the decision in Insight and distinguishing Nemeti.
The Judge noted the lack of any real guidance about the exercise of the discretion once the gateway provisions in sub-section 35(6)(b) and CPR r.19.6(3)(b). In any event, permission was not strictly required for the amendment, but the Judge found that had permission been required it would have been given.
Permission is pending to appeal to the Court of Appeal; so perhaps watch this space.
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