0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

Forgotten your password?

Cain v Francis; McKay v Hamlani (1) & Direct Line Insurance Plc (2), Court of Appeal, 2 February 2009

2 February 2009
The issues

Section 33 Limitation Act 1980 – exercise of the discretion – the extent to which loss of the limitation Defence could be considered as prejudice for the purposes of Section 33.

The facts

The two appeals were conjoined. Both concerned claims for personal injuries sustained in road traffic accidents. In each case the Claimant intimated a claim to the Defendant’s insurers very promptly and in each case the insurer accepted liability, recognising that early settlement would not be possible because of the uncertain medical prognoses. Voluntary interim payments were made in both cases. Both claims became time barred under Section 11 of the Limitation Act and when proceedings were begun the Claimants had to seek a direction under Section 33. In the case of McKay the delay was just under a year. In that case the Judge exercised his discretion in favour of the Claimant. In the decision in Cain, the delay was only 1 day and the Judge refused to extend time and the claim was dismissed. In McKay, the insurer / Defendant appealed. In Cain, the Claimant appealed.

The decision

It was a fundamental precept of the common law that a tort feasor should compensate the victim of the tort. It was a fundamental precept that any person who was sued in respect of a tort should have a fair opportunity to defend himself. As early as 1623 a limitation period was introduced for all actions, the rationale being to protect Defendants from stale claims. The limit remained at 6 years in respect of personal injury actions until the Limitation Act of 1954 when it was reduced to 3. Any limitation bar was arbitrary. Significant prejudices and unfairnesses might arise even within the 3 year period but the Rule was that the Claimant could proceed notwithstanding that unfairness. On the other hand the expiry of the 3 year term did not automatically create unfairness. The 3 year limit was Parliament’s best guess as to whether prejudice can be expected to have arisen. The imposition of an arbitrary limit could only ever hope to do rough justice. In 1975, in response to the Law Commission’s recommendations, Parliament introduced knowledge provisions and discretion provisions. Parliament cannot have intended that the financial prejudice suffered by a Defendant who has restored to him the obligation to pay damages that could not otherwise be paid because of the operation of Section 11 of the Limitation Act should be taken into account. That was because in fairness and justice the Defendant ought to pay the damages if, having had a fair opportunity to defend himself, he was found liable. If having to pay the damages was not a relevant prejudice under Section 33(1) it could not be relevant either as one of the circumstances of the case.

The basic question to be asked was whether it was fair and just in all the circumstances to expect the Defendant to meet the claim on the merits, notwithstanding the delay in commencement. The length of the delay would be important, not in itself but as to the effect it has had. For example, to what extent had the Defendant been disadvantaged in his investigation of the claim and / or the assembly of evidence, in respect of the issues of both liability and quantum.

It would also be important to consider the reasons for the delay. The delay may have arisen for so excusable a reason that looking at the matter in the round on balance it was fair and just that the action should proceed. On the other hand the balance might go in the opposite direction, partly because the delay had caused procedural disadvantage and unfairness to the Defendant and partly because the reasons for the delay (or its length) were not good ones.

It would always be relevant to consider when the Defendant knew that a claim was to be made against him and also the opportunities that he had to investigate the claim and collect evidence.

The Appeal in Cain v Francis would be allowed.
The Appeal in McKay v Hamlani (1) & Direct Line Insurance Plc (2) would be dismissed.

Focus on...

Legal updates

Gosden and another v Halliwell Landau and another [2021] EWHC 159 (Comm)

This claim addressed the question, of when the date for assessment of damages in cases of negligence should be determined and shows that when appropriate the Courts will depart from the default position.


Legal updates

Assessing the scope of employers liability – Chell v Tarmac

These were the opening remarks of Mr Justice Martin Spencer when handing down his Judgment in the recent case of Andrew Chell v Tarmac Cement and Lime Limited [2020] EWHC 2613, the latest in a series of appeals dealing with the scope of vicarious liability.


Legal updates

Non-payment of insurance premiums during the Coronavirus pandemic

The forced closure of many businesses as a result of the Coronavirus pandemic has had a huge impact on the nation’s Gross Domestic Product (GDP). Recent reports from the Office for National Statistics state that the economy was 25% smaller in April than it was in February this year.


Legal updates

Reinstatement for property damage losses – when does it apply?

The Court of Appeal has recently considered the correct test for measuring the indemnity for property damage losses and has provided useful guidance on whether an insured needs to intend to reinstate the property to its pre-loss condition.


The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

Mailing list sign up

Select which mailings you would like to receive from us.

Sign up