PRESCRIPTION AND LIMITATION – CLAIMS FOR AND AGAINST PENSION TRUSTEES Nigel A. Burroughs 14 November 2017

Article 1 of Loi Relative aux Prescriptions, 1899 Toutes demandes mobilières et actions personelles qui se prescrivent maintenant par le laps de dix ans, seront à l’avenir prescrites par le laps de dix ans Section 5 of the Limitation Act 1980   An action founded on simple contract shall not be brought after the expiration of six years from the date on which the cause of action accrued.   

Section 4 of the Law Reform (Tort)(Guernsey) Law, 1979 Notwithstanding the provisions of any enactment or any rule of law, an action founded on tort shall not be brought after the expiration of six years from the date on which the cause of action accrued Section 2 of the Limitation Act 1980 An action founded on tort shall not be brought after the expiration of six years from the date on which the cause of action accrued.

… when [empêchement d’agir] applies it operates to suspend the prescription period in favour of the plaintiff suffering from an impediment that made it practically impossible for him to discover the facst needed to support the cause of action, or the existence of the cause of action itself. Time begins to run only when the impediment is lifted. per Bailiff Collas in Jefcoate and Jefcoate v Spread Trustee Company Limited (Judgment 11/2013)

I am satisfied that the law regards ignorance as reasonable as a matter of legal policy where there was no means by which the particular plaintiff could reasonably have been expected to discover the facts on which her cause of action was based. I do not accept that policy requires us to apply the same principle in a case where the plaintiff is ignorant not of facts upon which her cause of action is based, but of the existence of a legal remedy against the defendant arising out of those facts. There seems to me to be an important distinction to be made between those two cases and nothing that has been decided today bears upon the latter one. per Sumption JA in Boyd v Pickersgill 1991 JLR 284

For my part, I consider that in an age in which the prudent man is encouraged to place his affairs, be they legal, medical, financial or otherwise, in the hands of professional consultants, the client should be entitled to rely on such advice or services being rendered to him with competence and with care. It is not for the client in such circumstances, where he does not have any expertise of his own, to be continuously auditing or obtaining secondary advice on what is being done for him by those experts. I venture to suggest that it may be inequitable for that consultant, when the client claims there has been a failure on the part of the consultant giving grounds for action against him in contract or in tort, to be able to use prescription as a shield. It should not be open to him to allege that the client should have been aware of the failings claimed to give rise to the cause of action, at a time when the client was relying and was still entitled to be relying on the consultant to discharge the duties for which he had been retained. In such circumstances, I further cannot see that it is necessary to allege fraud or deliberate misrepresentation by the retained consultant. per Carey JA in Yaddehige v Credit Suisse Trust Limited (GLR 2007-08 GLR 282)

The knowledge required for bringing an action for damages is: Knowledge of the material facts about the damage in respect of which the damages are claimed (s 14A (6)); That the damage was attributable in whole or in part to the act or omission which is alleged to constitute negligence (s 14A (8)(a)); and The identity of the defendant (s 14A (8)(b)).

The statutory provisions do not require merely knowledge of the acts or omissions alleged to constitute negligence. They require knowledge that the damage was ‘attributable’ in whole or in part to those acts or omissions. Consistently with the underlying statutory purpose, ‘attributable’ has been interpreted by the courts to mean a real possibility, and not a fanciful one, a possible cause of the damage as opposed to a probable one: see Nash v Eli Lily & Co [1993] 1 WLR 782, 797-798. Thus paraphrasing, time does not begin to run against a claimant until he knows there is a real possibility his damage was caused by the act or omission in question. per Lord Nicholls in Haward v Fawcetts [2006] 1 WLR 682, 686 C-D

The 1st Defendant Sedgwick Financial Services Limited 1 July 1990 Sedgwick Financial Services Limited 1 September 1992 Sedgwick Consulting Group Limited 22 December 1993 Sedgwick Noble Lowndes Financial Consultants Limited 31 December 1993 Sedgwick Financial Services Limited The 2nd Defendant Sedgwick Noble Lowndes Limited

For the purposes of this section, the starting date for reckoning the period of limitation…is the earliest date on which the plaintiff or any person in whom the cause of action was vested before him first had both the knowledge required for bringing an action for damages in respect of the relevant damage and a right to bring such an action. Section 14(5) of the Limitation Act 1980

For the purposes of this section a person’s knowledge includes knowledge which he might reasonably have been expected to acquire- from facts observable or ascertainable by him; or from facts ascertainable by him with the help of appropriate expert advice which it is reasonable for him to seek; but a person shall not be taken by virtue of this subsection to have knowledge of a fact ascertainable only with the help of expert advice so long as he has taken all reasonable steps to obtain (and where appropriate act on) that advice. Section 14(10) of the Limitation Act 1980

There is clear authority that … if facts are reasonably ascertainable by a solicitor acting with reasonable diligence and the solicitor acts in a dilatory manner in obtaining that information, knowledge of that information will be imputed to the claimant, and he will not be entitled to the protection of the proviso at the end of s 14(3) unless perhaps it can be shown that in obtaining the particular facts, the solicitor could be said to be providing expert advice. per Colman J in Goode v Martin [2001] 3 All ER 562, 572

An action for damages for negligence … shall not be brought after the expiration of fifteen years from the date (or, if more than one, from the last of the dates) on which there occurred any act or omission – which is alleged to constitute negligence; and to which the damage in respect of which damages are claimed is alleged to be attributable (in whole or in part). Section 14B of the Limitation Act 1980

Subject to the preceding provisions of this section, an action by a beneficiary to recover trust property or in respect of any breach of trust, not being an action for which a period of limitation is prescribed by any other provision of this Act, shall not be brought after the expiration of six years from the date on which the right of action accrued. For the purposes of this subsection, the right of action shall not be treated as having accrued to any beneficiary entitled to a future interest in the trust property until the interest fell into possession. Section 21(3) of the Limitation Act 1980

The second question is whether Paula had a present interest while she was under age 25 or whether she had only a future interest which fell into possession when she attained that age. The judge held that she had merely a future interest. In my judgment, he was right. Until Paula attained 25 the trustees held the trust fund upon trust to accumulate the income with power instead to pay it to Paula or to apply it for her benefit. She had no present right to capital or income but only the right to require the trustees to consider from time to time whether to accumulate the income or to exercise their power to pay or apply it for here benefit. That, in my judgment, is not an interest in possession. The respondents submit that the policy to which section 21(3) of the Act of 1980 gives effect is that it would be unfair to bar a plaintiff from bringing a claim unless and until he is of full age and entitled to see the trust documents and so has the means of discovering the injury to his beneficial interest. The difficulty with this argument, in my judgment, is that it proves too much. Every beneficiary is entitled to see the trust accounts, whether his interest is in possession or not. The rationale of section 21(3) appears to me to be different. It is not that a beneficiary with a future interest has not the means of discovery, but that he should not be compelled to litigate (at considerable personal expense) in respect of an injury to an interest which he may never live to enjoy. Similar reasoning would apply to exclude a person who is merely the object of a discretionary trust or power which may be exercised in his favour.’ per Millett LJ in Armitage v Nurse [1998] Ch 241, 261 A and F