Most legal systems impose some form of time limit to restrict the right to bring a civil claim. At first blush, the approach to this time limit in Scotland and England & Wales appears fairly similar, but on closer inspection, this is far from the truth. The devil, as is so often the case, is lurking in the detail.
This article highlights some of the main time-related pitfalls that can befall the unwary should they assume the two legal systems operate in a similar manner when pursuing a professional negligence claim. This is an area which can, and regularly does, trip up those who deal with cross border litigation without seeking specialist advice from experts with knowledge of both jurisdictions. That attention to detail has never been more important than in the context of the current COVID-19 pandemic, during which the usual deadlines for claims continue to apply pending any emergency legislation which might relax the rules temporarily, as has already started to happen overseas.
Prescription vs Limitation: More than semantics
The first point to note is that Scotland, with certain notable exceptions such as personal injury claims, imposes time limits through 'prescription' compared to the English 'limitation' of actions. While it may be easy to dismiss this as two words for the same thing, the distinction is more than mere semantics. As the name suggests, limitation limits the right of a party to pursue a claim in the courts, while prescription extinguishes the legal cause of action altogether, as if it had never existed.
For practical purposes, the most important effect of this is that parties can agree to extend a limitation period, something which is commonly done south of the border through signing up to a 'standstill agreement'. The same arrangement cannot work for a right which no longer exists, so in Scotland, the prescriptive time limit cannot currently be extended by agreement, although new legislation is expected to introduce some limited opportunity for doing so.
Important practical differences
In England, the basic time period to bring a civil claim, including one for professional negligence, is six years. In Scotland, it is five years. The apparent simplicity of that difference belies a whole world of subtle but fundamental disparities between the two systems.
In England, a limitation period is interrupted when the court receives a claim form, notwithstanding that the claim may then not be served on the defendant for another four months. By contrast, in Scotland, service of the writ/summons on the defender will generally be required to interrupt prescription.
In both jurisdictions, the time limit for bringing contribution proceedings against a party with joint liability is two years. However, in England, such an action can be brought following settlement of a claim, whereas in Scotland a court judgment is needed in that scenario. Therefore, if a Scottish claim is to be settled, thought must be given to whether additional steps are needed to preserve any claim against a joint wrongdoer for a contribution.
Latent Damage: Could your claim be gone before you even knew it existed?
The most important task is to identify the date from which the relevant time limit will run. Where there is obvious physical damage, the time period will normally be triggered whenever that damage occurs, but where the loss, damage or its cause is less obvious, as with economic loss cases, it can get much harder to identify the relevant start date.
In England, the six-year limitation period will begin to run when the cause of action arises, irrespective of what the claimant knew about it. However, for the purposes of a claim in negligence (but not breach of contract or other types of civil liability claim) a secondary three year period runs from the date when certain specific facts become (or should reasonably have become) known to the claimant. Broadly speaking, those facts are: 1) that the damage suffered is sufficiently serious to justify bringing a claim; 2) the identity of the defendant; and 3) that the damage was caused by the act or omission alleged to constitute the negligence.
In Scotland, the commencement of the five-year prescription period is postponed if the pursuer is unaware, and could not reasonably have become aware of having suffered loss, injury or damage. Following a series of cases starting with the Supreme Court judgment in David T Morrison & Co Limited v ICL Plastics Limited & Ors in July 2014 and including the Court of Session (Outer House) decision in Midlothian Council v Blyth & Blyth & Ors in March 2019, the courts have clarified that there is no need for a claimant in Scotland to have knowledge of having suffered a wrong, or the identity of the wrongdoer, in order for the time period to run. The relevant date of loss continues to be judicially scrutinised (see the recent decision of Kirkcaldy Sheriff Court in January 2020 in Ian Ford v The Firm of W & A S Bruce [2020] SCKIR 9); as will the date upon which a claimant could reasonably have been aware that loss had been sustained.
Thus, the Scottish five-year period can commence whenever a claimant incurs an expense which only later turns out to be wasted due to a breach of duty: knowledge that some harm has been suffered is not required. The effect is that some claims in Scotland may have prescribed before the claimant knew that their right to pursue a claim had even existed.
The general feeling that this may be somewhat harsh (as recognised by the Supreme Court in Gordon's Trustees v Campbell Riddell Breeze Paterson LLP in November 2017) has been addressed by the Prescription (Scotland) Act 2018 which will, when it finally comes into force, bring the Scots position on knowledge of latent damage closer to the English position with the introduction of a three part test for the discoverability of a claim. But the wording of the Act is not the same as the English version, so it will remain important to recognise the potential for the time limits to be applied differently.
It is also worth noting that both systems impose a longstop date to prevent claims for latent damage being pursued after too long a delay, regardless of whether the relevant facts remain hidden. In England, this longstop kicks in at 15 years from the date of the negligence; whilst in Scotland, the period is 20 years, currently running from the date that breach of duty and loss coincide.
Lawyers practising in both jurisdictions are keeping a keen eye on whether emergency legislation will be introduced to relax the rules on time limits during the COVID-19 pandemic while courts have had to prioritise urgent business. Although the current procedural rules and guidance do still tend to allow proceedings to be raised where a time limit is imminent, the arrangements for doing so have changed and it is always preferable to avoid delaying until the last moment. In particular in Scotland where service of documents is the crucial step; one that has been more challenging to achieve in the current situation.
Conclusion: Local experts are crucial
As things stand, in England a claimant might have a better chance of bringing a claim 'out of time', for example, if they have missed the six-year limitation date on account of a lack of knowledge of their rights to bring a claim, but only if the claim is for negligence and only for a further three years from the date of knowledge/constructive knowledge.
Meanwhile in Scotland, a claimant may have five years from date of knowledge compared to the English three for causes of action beyond negligence. However, under the current law, the perceived wrongdoer may well argue that a claim against them is out of time because the claimant was fixed with sufficient knowledge to make the clock start ticking at a point more than five years ago; which might be before they knew they had suffered a wrong.
This is important when considering pursuing a claim in either jurisdiction; and particularly where there may be a choice about where to raise proceedings. Whilst this article highlights some of the more common differences encountered, it just scratches the surface. The precise operation of time limits in either jurisdiction is complex and fact-specific whilst in Scotland, the law continues to evolve with legislative reform underway and the possible added complication of temporary relief from the time limits worldwide. The application of the relevant rules requires careful thought and, whether parties are pursuing or facing a claim for damages, early advice from lawyers with knowledge of the intricacies of the relevant system(s) is an absolute must. As Benjamin Franklin sagely observed, 'You may delay, but time will not'.
DISCLAIMER: Specialist legal advice should always be sought on the specific circumstances of a claim and whilst this article is representative of the law as at April 2020, it does not constitute such advice.
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