Charities and internal investigations
The case of Blakemores LDP v Scott & Anor  EWCA Civ 999 concerned villagers from Ireby (“the Appellants”) who instructed a firm of solicitors, Blakemores LDP (“Blakemores”) to assist with matters surrounding two Land Registry titles relating to the Lordship of the Manor of Ireby (“the Lordship title”) and 360 acres of moorland overlooking the village (“the Ireby Fell title”).
On 9 May 2007, the Appellants applied to alter the register relating to the land, so as to correct a mistake under the Land Registration Act 2002. In April 2009, the Appellants were informed by Blakemores that they had negligently failed to notify them that the deadline for submitting an objection to the registration of the titles was April 2005. It was stated by the Appellants that when they ran out of money to fund the case, Blakemores consequently agreed to enter into a conditional fee agreement (“CFA”) and indicated that recovery of the fees from the other side was anticipated.
If there was any shortfall, the Appellants said Blakemores agreed to cover this, in consideration of their earlier negligence. The Appellants were successful in correcting the issue with the Lordship title, but not in relation to the Ireby Fell title.
Blakemores issued a claim for their legal fees under the CFA, amounting to £635,530.78. In their defence and counterclaim, the Appellants pleaded that Blakemores had been negligent in failing to advise them about a deadline for filing an objection. They did not expressly claim damages for negligence, but did plead that the firm was estopped by the events which had occurred from claiming its fees.
The Appellants argued that while they had been informed about the failure to put in the objections to the registration of title in 2009, they were not aware that the failure to do so would lead to any loss, or make any difference to the overall outcome.
In the first instance, the Judge had found that the claim for negligence was statute barred as on the face of their own pleadings the Appellants had been told about the negligence in April 2009 and that damage had been suffered because the objections had not been registered in April 2005.
The central issue before the Court of Appeal was whether the Judge was correct to grant summary judgment striking down the negligence claims against Blakemores, on the grounds that they were issued more than three years after they acquired “the knowledge required for bringing an action for damages in respect of the relevant damage” within the meaning of sections 14A(5) and (6) of the Limitation Act 1980.
Section 14A(5) of the Limitation Act 1980 states that the start date is the earliest date on which the claimant 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 14A(6)(a) says that "the knowledge required for bringing an action for damages in respect of the relevant damage" includes knowledge of "the material facts about the damage in respect of which damages are claimed".
Section 14A(7) provides that "the material facts about the damage" are such facts about the damage as would lead a reasonable person who had suffered such damage to consider it sufficiently serious to justify his instituting proceedings for damages against a defendant who did not dispute liability and was able to satisfy a judgment.
Lord Justice Vos found that there were two reasons why the material fact about the damage in this case could not just be the negligent advice, or the failure to file the objection before the deadline. First, he was of the view that the Appellants were not experts in land registration or manorial law and could not be taken to have known the obscure consequences of a failure to file an objection in time, without being told what they were.
Second, the relevant material facts about the damage have to be such as would lead a reasonable person to consider it sufficiently serious to justify his instituting proceedings for damages against a solvent firm, not disputing liability.
Based on the evidence, Lord Justice Vos found it highly arguable that the Appellants did not know anything that would lead a reasonable person to sue. They had no reason to think they would be worse off. They understood that the costs were to be covered by the firm and not reclaimed from them, the case was going to be successful, and most crucially they appear to have had no inkling that the firm's negligence had turned a clear right to have the Ireby Fell title closed into a matter for the discretion of the adjudicator.
It was found that the Judge was wrong to determine as a matter of law that the starting date for limitation purposes had to be April 2009.
It is important to consider the expertise of a claimant, in order to assess whether they understood the implications of the negligence at the time they became aware of it.
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