DANNY MAMAN (T/A FINE WATCHES & JEWELLERY) v CERTAIN LLOYD’S UNDERWRITERS (2016)

The defendant underwriters applied to set aside an order permitting the claimant to amend and re-issue his claim form so as to strike out the first and second defendants and re-name the third defendants.

 

The claimant, a jeweller, claimed to have lost valuable items in a theft which occurred on 17 February 2009 and a robbery which took place on 15 March 2009. He made a claim under his insurance policy, but that claim was rejected on various grounds. His solicitors issued a claim form on 16 February 2015, naming the insurance brokers and the brokers’ agent as the first and second defendants. The third defendant was named as “Lloyd Syndicate Members”. The claimant’s solicitors accepted that the defendants had not been properly named. On a without-notice application, the master permitted the claimant to amend and re-issue his claim form so that the only defendants named were “Certain Lloyd’s Underwriters subscribing to policy number DCAL/08230”. The defendants’ application to set aside that order raised issues as to the applicability of CPR r.17.4 and r.19.5. Rule 17.4 was stated to apply where a party applied to amend his statement of case after a limitation period had expired. It provided that the court might allow an amendment to correct a mistake as to the name of a party, but only where the mistake was genuine and not one which would cause reasonable doubt as to the identity of the party in question. Rule 19.5 was stated to apply to a change of parties after the expiry of a limitation period. It provided that the court could add or substitute a party if the relevant limitation period was current when the proceedings were started and the addition or substitution was necessary. The addition or substitution of a party was stated to be necessary only if the court was satisfied that the new party was to be substituted for a party who was named in the claim form in mistake for a new party.

 

The issues were (1) whether the limitation period had expired in June 2015, when the master made his order (the claimant had argued that it had not and that time only ran from the date of the defendants’ failure to pay out under the policy); (2) whether the case fell within either or both of r.17.4 and r.19.5; (3) if it did, whether the court should exercise its discretion in the claimant’s favour.

 

HELD: (1) The general and well-established rule was that the cause of action in a claim against insurers would arise at the time when the loss against which the insured was to be indemnified actually occurred. The limitation period therefore expired in February/March 2015 (see paras 29-30 of judgment).

 

(2) Both r.17.4 and r.19.5 could apply in a case of this kind, Adelson v Associated Newspapers Ltd [2007] EWCA Civ 701, [2008] 1 W.L.R. 585 applied. However, r.19.5 did not add anything to the application. As to r.17.4, this was a case where the defendants had been described rather than named. However, r.17(4) could be used to correct the description of a party, even though it referred only to correcting the name of a party. If it was acceptable to commence proceedings against a party who was described rather than named, and it was, there ought to be a means by which the description was capable of being corrected in the same way there clearly was where an incorrect name was used (paras 42, 45, 47, 55).

 

(3) It was appropriate for the court to exercise its discretion under r.17.4 in the claimant’s favour. Although the defendants were misdescribed in the claim form, that was a genuine mistake, albeit one arising from the ineptitude of the claimant’s solicitors. Moreover, there could have been no reasonable doubt as to the identity of the party to be sued. The claim form as a whole made it clear that the parties to be sued were the syndicate members who had accepted a premium from the claimant. The exercise of discretion involved weighing all the circumstances and balancing the prejudice to each party, American Leisure Group Ltd v Olswang LLP [2015] EWHC 629 (Ch), [2015] P.N.L.R. 21 applied. Although there had been an obvious failure by the claimant to prosecute his claim with proper diligence, that was not quite enough to warrant refusing the application to amend the claim form. Among other things, the defendants had been aware of the claim throughout. It would be appropriate to refuse their application. However, the claimant would be required to make a payment into court (in an amount to be decided following further argument) by way of security for the defendants’ costs (paras 51-52, 58-61).

 

Application refused

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