The fact that a defendant was insured was not by itself a reason for concluding, in terms of section 33 of the Limitation Act 1980, that he would suffer less prejudice, if the limitation provisions barring the plaintiff's case were disapplied, than if he were not insured. In considering such prejudice, defendant and insurer were to be treated as a composite unit.
The Court of Appeal allowed an appeal by the executors of the estate of Dr Christopher Bastible, who died in 1970, against a decision of Mr Justice Wright on 17 November 1994 to allow a claim by the plaintiff, Dean John Kelly, for damages for medical negligence at the time of his birth in 1965, to proceed out of time. In allowing the case to proceed, the judge took into account that the doctor was insured by the Medical Defence Union.
Piers Ashworth QC and Fiona Sinclair (Hempson, Covent Garden) for the defendants; Nigel Baker QC and Simon King (Cooke & Son, Luton) for the plaintiff.
Lord Justice Waller said that in relation to any claim now being brought against the doctor's estate, the impact of the Limitation Act was of prime importance. By section 11 the time limit for personal injuries was three years from the date on which the cause of action arose, or the date of knowledge (if later) of the person injured. Knowledge was dealt with by section 14.
By virtue of section 28(1) and (6) the limitation period in the case of someone under a disability [in the sense of being unable to sue, eg because he was a minor: see section 38(4)] was extended to three years from the date when he ceased to be under such disability.
The plaintiff ceased to be under a disability at the age of 18. By that age or soon after, the judge found, he must have had the requisite knowledge to bring proceedings. But he only consulted solicitors in 1987, and the writ was not issued until 1990, when he was 25.
The defendants applied to strike out the claim. But the judge, exercising his discretion under section 33 of the 1980 Act, permitted it to proceed.
Section 33 empowered the court to disapply the limitation provisions if it would be equitable to allow the action to proceed, having regard to the degree to which the limitation provisions prejudiced the plaintiff and to which their disapplication would prejudice the defendant.
The judge concluded that he would have exercised his discretion against allowing the action to proceed, but for the fact that the defendants were insured. He held that he was compelled to take this into account without considering any prejudice to the insurers, and concluded that the defendants were not prejudiced.
In so concluding, he relied on an observation of Parker LJ in Hartley v Birmingham City Council  1 WLR 968, that:
if it is . . . legitimate to take into account when considering prejudice to the plaintiff that he will have a claim against his solicitors, it must in my judgment [be] legitimate to take into account that the defendant is insured.
In his Lordship's judgment, that observation did not preclude insurers being entitled through the defendant to rely on any point there might be to demonstrate prejudice. The correct approach when considering prejudice to the defendant under section 33 was to treat the defendant and his insurer as a composite unit.
It was always right in weighing prejudice to one side against that to another for the judge to recognise that the plaintiff had no alternative remedy against his solicitor, and he would also as a matter of reality be aware that the defendant was insured.
However if, treating the defendant and insurer as a composite unit, the judge concluded that delay had seriously prejudiced their ability to defend, and if he would not allow the action to proceed if the defendant were not insured, then, taking into account at that stage that the plaintiff would have no claim against his solicitor, the weight to be given to the mere fact that the defendant was insured ought to be nil.Reuse content