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Neutral Citation Number: [2021] EWHC 2671 (QB) CLAIM NO.: QB- 2019 - 001430 IN THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION MEDIA AND COMMUNICATIONS LIST Royal Courts of Justice Strand, London, WC2A 2LL Date: 08/10/ Before : MR JUSTICE JULIAN KNOWLES
**Between :
DR CRAIG WRIGHT Claimant
- and - PETER MCCORMACK Defendant**
Adam Wolanski QC, Greg Callus and Lily Walker-Parr (instructed by ONTIER LLP ) for the Claimant Catrin Evans QC and Ben Silverstone (instructed by RPC) for the Defendant Hearing dates: 16 and 18 February 2021
Approved Judgment
Mr Justice Julian Knowles: Introduction
- This is a claim for libel. The words complained of by the Claimant are contained in fourteen tweets (Publications 1-10 and 12-15) and a YouTube video (Publication 16). The Defendant admits publication. For reasons I will come to, Publication 11 is no longer relied on by the Claimant. The case has a complicated and protracted procedural history. The papers before me on this PTR run to several thousand pages. There are several sets of written submissions from both sides and a number of different versions of the pleadings upon which I was being asked to adjudicate, some which were served shortly before, and even during, the hearing. I also received further submissions and substantial further documentation after the hearing.
- The PTR was ordered by Nicol J on 4 February 2021. He was keen to emphasise that the PTR should bring finality to the pleaded cases, and the evidence which would be admitted to prove those cases. Once the ambit of the Defence is ascertained (in whatever amended form), a reliable trial estimate can be given and a trial listing obtained.
- Nicol J’s order provided for the determination of a number of applications, but in the event the only ones I am required to decide are as follows: a. The Claimant’s First Amendment Application, dated 14 July 2020: (i) The first part of this is an application by the Claimant to add Publications 1 2 to 16 to the Claim Form. In their original form, the Particulars of Claim (POC) referred to Publications 1 – 10. These were served in May 2019. After that, the Defendant published Publications 12 – 16. In late 2019 the Claimant circulated draft Amended POC (APOC) containing Publications 11 - 16. The Defendant consented to these amendments in December 2019. For reasons I will explain, no application was made by the Claimant at that time to amend the Claim Form to match the APOC. The part of the First Amendment Application therefore seeks to achieve consistency between the APOC and the Claim Form so that the same publications are set out in each. (ii) The second part is an application dated 8 February 2021 to amend the First Amendment Application (if necessary) to add an argument based on s 32A of the Limitation Act 1980 (LA 1980). b. The Claimant’s Third Amendment Application, dated 23 November 2020: (i) This seeks to remedy discrepancies in the time stamps of Publications 1 – 10 , as between the times pleaded in the APOC when the tweets were said to have been sent, and the times given for these tweets on the Claim Form. c. An application by the Claimant to strike-out: (i) parts of the draft Re-Amended Defence. The version of this pleading I have worked from was supplied to me in an electronic file called ‘UPDATED 170221 Appendix C Claimant’s colour coded revised draft ReAmDef with
in the cryptocurrency community. In this judgment I will refer to this person or group as ‘Satoshi’.
- In summary, the Claimant says that the Defendant’s publications accused him of having fraudulently claimed to be Satoshi, and that they caused him serious harm as a consequence, both to his reputation generally and also in specific ways (eg, that they resulted in him being disinvited from conferences).
- I will not set out all of the publications in issue, but just give a few examples to give the flavour of the Claimant’s case. In the following paragraphs the times of publication are as given in the APOC.
- On 29 March 2019 at 8:17pm the Defendant published a tweet (Publication 1 , APOC [4] et seq). This began with a re-tweet by the Defendant of a tweet by someone called Calvin Ayre: “Craig [Wright, ie, the Claimant] has started filing lawsuit against those falsely denying he is Satoshi .... they can all have a day in court to try to prove their fake case but the judge will rule that Craig invented Bitcoin because he did and he can prove it.”
- Below this was another tweet by Calvin Ayre which the Defendant included in his tweet: “Calvin Ayre @CalvinAyre yup ... Dr Craig Wright is Satoshi Nakamoto ... and #BSV is the only real #Bitcoin. All others are attacking Craig to sell their dysfunctional snake oil crypto products. Craig has proven this to me directly in a number of ways."
- The Defendant then wrote: “Replying to @Calvin Ayre Can I go first? Craig Wright is not Satoshi Craig Wright is not Satoshi …”
- The phrase ‘Craig Wright is not Satoshi’ was then repeated a number of times by the Defendant in the tweet.
- In [5] of his APOC the Claimant alleges that by way of innuendo these words meant and were understood to mean that he had fraudulently claimed to be Satoshi.
- The following Particulars of Innuendo are then pleaded: “5.1 The individual, or group of individuals behind the pseudonym Satoshi Nakamoto (‘Satoshi’) is/are generally
accepted within the Bitcoin and cryptocurrency community as the original creator, or one of the originals creators, of the cryptocurrency Bitcoin. 5.2. This would have been known to a substantial but unquantifiable number of unidentifiable readers of the First Publication, and these readers would have understood the words complained of herein to bear the meaning set out above.”
- On 10 April 2019 at 1:47pm the Defendant published a tweet (Publication 2, APOC [6] et seq): “[retweet of a tweet by @CalvinAyre]: Calvin Ayre @CalvinAyre Apr 10 [photograph of the Claimant in a group] Craig and I polishing our muskets at today's Troll Hunting meeting in London. #Craigis-Satoshi. … [tweet by the Defendant]: Replying to @CalvinAyre ‘Craig Wright is not Satohis! [sic] When do I get sued ?’”
- Paragraph 7 essentially repeats [5]. The following Particulars of Innuendo are then given. Paragraph 7.1 repeats [5.1]. Paragraphs 7. 2 and 7. 3 aver: “ 7 .2. On and prior to 10 April Calvin Ayre had made it publicly known that the Claimant was intending to bring proceedings for libel against individuals who had alleged on Twitter that the Claimant had fraudulently claimed to be Satoshi. 7.3. The photograph which featured in the Second Publication was of the Claimant, Calvin Ayre and a group of lawyers. The reference to ‘Troll Hunting’ in the Second Publication was a reference to the pursuit by means of libel proceedings of those who had ‘trolled’ the Claimant on Twitter by accusing him of falsely claiming to be Satoshi Nakamoto.”
- Publication 12 (APOC, [24C] et seq) is pleaded as follows: “24C. On 22 August 2019 at 4:54 am the Defendant first published a tweet (‘The Twelfth Publication’). The Twelfth Publication remains online and is accessible via the following url … In the Twelfth Publication the Defendant published or caused
- Publication 16 (APOC [24K] et seq) consists of words spoken by the Defendant during a video discussion on 18 October 2019 hosted by someone calling himself ‘Hotep Jesus’. The video is available on YouTube. The words complained are as follows: “The reality is, is Bitcoin is king. Like, you can do what the fuck you want with BSV; it's dead, it's already dead. The market's voted, it's dead. If you're going to put your time at it, it's dead. The price is going to die; it's -- the only thing keeping it afloat, is Calvin's money; that's literally it. Add to that, you are supporting a bunch of people who are liars, frauds and morons. Craig Wright is a fucking liar, and he's a fraud; and he's a moron; he is not Satoshi. He can come at me in the fucking UK, he can take me to Court; he can come with his -- his fucking billions of dollars; I don't give a shit, come at me. Sue me, I don't give a fuck; you're still a liar, you're still a fraud, and you're still a moron.”
- In [24N] the Claimant avers by way of innuendo the said words meant and were understood to mean that the Claimant had fraudulently claimed to be Satoshi Nakamoto. Particulars of Innuendo are then given which are the same (mutatis mutandis) as those given for Publication 1.
- In summary, therefore, the Claimant’s case is that the publications complained of alleged that he is a liar who has made fraudulent claims to be Satoshi and they have caused him serious harm.
- The Claimant’s case on serious harm ( per s 1 of the Defamation Act 2013 (DA 2013)), damages, and remedies is pleaded at [25] et seq of the APOC. He alleges that it is a matter of obvious inference that the words complained of have caused or were likely to cause serious harm to his reputation.
- At [25.1] the following is pleaded: “25. 1 The imputations complained of are inherently serious in terms of their propensity to cause harm to the reputation of the Claimant, and the probability is that publication of such imputations in relation to the Claimant would have this result. They go to the heart of his personal reputation for honesty and ethical conduct and, given his involvement within the cryptocurrency industry, to the heart of his professional reputation. No retraction or apology has been published, and so readers of the tweets complained of continue to believe that the Claimant is guilty of the conduct alleged.”
- Without prejudice to the generality of this averment, the Claimant alleges that: a. the imputations complained of are inherently serious in terms of their propensity to cause harm to his reputation, because they go to the heart of his personal reputation for honesty and ethical conduct and, given his involvement within the cryptocurrency industry, to the heart of his professional reputation.
b. the publications complained of were widely published to any internet user, without subscription or registration. The Claimant therefore invites the inference that a very substantial number of readers viewed the publications.
- At [25.9] the Claimant alleges that his reputation within the academic community and the computer science, cryptocurrency and financial technology industries has been seriously harmed by the publications complained of. He also says he has suffered specific harm, for example, the withdrawal of invitations to speak at numerous academic conferences in the period immediately following publication. Details of these conferences are given at [25.9.1] et seq.
- He goes on to allege at [25.9.4] that as a result of his exclusion from conferences, he has been unable to present or publish his academic work, which has led to considerable difficulties for him in pursuing academic opportunities. He wishes to develop an academic career in England but needs to demonstrate the recent publication of academic papers to obtain such positions. At [25.9.5] he also alleges that his inability to publish academic papers has had a detrimental impact upon the value of the patents which he has filed.
- Further, at [25.10] the Claimant alleges that the publication of the words complained of has made it more difficult for him to achieve his ambition of becoming a magistrate in Surrey. He avers that any application he made for such a position would be severely compromised by the existence in the public domain of the words complained of, given that they allege serious dishonesty on his part. After publication began, the Claimant therefore abandoned the application he had started making for the position of magistrate, assuming that the application was now hopeless.
- At [26] he alleges that in addition to the serious harm caused to his reputation by the publication and republication of the publications complained of, the Claimant has suffered considerable distress and embarrassment. The Defendant’s case in outline
- For reasons which will become clear, it is important to emphasise that in his Amended Defence dated 18 March 2020 the Defendant pleaded to all 16 publications then relied on by the Claimant in his APOC, even though, at that stage, the Claim Form only listed Publications 1 - 10. The Defence was amended by consent pursuant to CPR r 17.1(2)(a). I will use the past tense to describe this pleading because, as I shall explain, large parts of it have subsequently been abandoned by the Defendant.
- At [3] the Defendant pleaded that the Claimant is supported in these proceedings by Calvin Ayre, a Canadian businessman domiciled in Antigua. Mr Ayre carries on in business in online gambling. In November 2018 the Claimant and Mr Ayre established a new cryptocurrency called ‘Bitcoin SV’/‘BSV’ (standing for ‘Bitcoin Satoshi Vision’), which had Mr Ayre’s financial backing. The Defendant alleged that Mr Ayre has been the public face of the Claimant’s threats to bring legal proceedings against the Defendant and others in this jurisdiction. Paragraph 3A alleges that these proceedings are being controlled by Mr Ayre/a company associated with him called EITC/or other third parties and the Claimant is merely a nominal claimant.
- At [20] et seq the Defendant also alleged that the claim was an abuse of process. At [20.1] he alleged that the claim was not a genuine claim by the Claimant for vindication of his reputation, but was being run by third parties (and in particular Mr Ayre) for commercial gain. At [20.1] it was alleged that the claim was being brought with the purpose of bankrupting the Defendant. At [20.3] it was said to be capable of reasonable inference that the Claimant, and Mr Ayre and/or other third parties, were seeking to use these and other proceedings in this jurisdiction as a means of stoking global publicity in relation to the Claimant’s claim to be Satoshi.
- At [21] the Defendant relied on the defence of truth in s 2 of the DA 2013. He averred that the words complained of, if and in so far as, in their proper context, they respectively bore or were understood to bear the following imputation by way of innuendo, those statements were substantially true: “… that the Claimant’s claim to be Satoshi Nakamoto (the pseudonymous person or one of the group of people who created Bitcoin) was fraudulent, in that it was a lie, as demonstrated by his own failed promises to provide cryptographic proof of that claim.”
- At [22] it was pleaded in the alternative, if and in so far as the words complained of respectively bore or were understood to bear the imputation pleaded by the Claimant in [5] of his APOC, namely, that the Claimant had fraudulently claimed to be Satoshi, that is to say the person, or one of the group of people, who developed Bitcoin, they were substantially true. Further, if and in so far as the statement complained of in paragraph 24C bore or was understood to bear the imputation pleaded by the Claimant in [24D], that the Claimant had fraudulently claimed to have written the Bitcoin White Paper (ie, Bitcoin: A Peer-to-Peer Electronic Cash System , a paper published by Satoshi in October 2008), that meaning was substantially true. Extensive particulars were then pleaded.
- At [23] the Defendant pleaded, further or alternatively, that the statements complained of were or formed part of statements on a matter of public interest and the Defendant reasonably believed that publishing the statements complained of was in the public interest pursuant to s 4 of the DA 2013.
- At [37] the Defendant denied that the Claimant has suffered distress or embarrassment as a consequence of the Defendant’s publications, and in [39] he set out matters to be relied upon in mitigation of damages.
- In summary, therefore, the Defendant relied on the following defences in his Amended Defence: a. No serious harm, and therefore the publications were not defamatory ([18]-[19]); b. Abuse of process ([20]); c. Truth ([21]-[22]); d. Public interest ([23]-[36]);
e. Absence of any distress or embarrassment ([37]).
- I will set out the events which occurred following the service of the Amended Defence in the next section. Discussion (i) Third Amendment Application (the timestamp issue)
- It is convenient to begin with the Claimant’s Third Amendment Application, which is not opposed by the Defendant. It is made pursuant to CPR r 17.2(1)(b). The evidence in support is set out in the Eighth Witness Statement of the Claimant’s solicitor, Mr Cohen, dated 23 November 2020.
- At the hearing on 23 November 2020 Nicol J noted differences in the times of the first ten tweeted publications as between the Claim Form and the APOC. For example: a. Publication 1 is pleaded in the APOC as having been sent at 8.17pm on 29 March 2019 ; on the Claim Form (and on the tweet itself), the time is given as 1.17pm, ie, seven hours earlier. b. Publication 2 is pleaded in the APOC as having been sent at 1.47pm on 10 April 2019; on the Claim Form (and on the tweet), the time is given as 5.47am, ie, eight hours earlier.
- In fact, each of Publications 2 to 10 has an eight-hour time discrepancy with the time on the Claim Form being eight hours earlier than the time pleaded in the APOC.
- To put this application into context, the following information is relevant: a. Twitter is headquartered in California in the United States. b. California operates Pacific Standard Time (PST) and Pacific Daylight Time (PDT). PDT is daylight savings time and is one hour ahead of PST. The change from PST to PDT takes place in the spring. They are respectively analogous to Greenwich Mean Time (GMT) and British Summer Time (BST) in the UK. c. PST is eight hours behind GMT. PDT (ie, PST+1) is seven hours behind GMT. PDT is eight hours behind BST (ie, GMT+1). d. In 20 1 9, California moved from PST to PDT at 2:00 PST on 10 March 2019. e. The UK moved from GMT to BST at 1 : 00 GMT on 31 March 2019, some three weeks later than California’s move to PDT. f. Thus, between 10 :00 GMT on 10 March 2019 and 1:00 GMT on 31 March 2019, California time (which by then was on PDT) was seven hours behind the UK (which was still on GMT).
- Mr Cohen attempted to unravel the discrepancy, and [9] of his Eighth Witness Statement explains that what appears to have happened is as follows:
- I am concerned with two aspects of the First Amendment Application (there are other parts I am not concerned with): a. Firstly, his application to amend the Claim Form to add Publications 12 to 16. b. Second, his application of 8 February 2021 to amend the application notice of 14 July 2020 (if necessary) for an order that the one-year limitation period in s 4A of the LA 1980 be disapplied pursuant to s 32A in relation to Publications 12 to 16.
- The evidence in support is contained in Mr Cohen’s Second, Eighth and Eleventh Witness Statements. Background
- The first ten publications were published between 29 March 2019 and 16 April 2019. The Claim Form was served on 17 April 2019 listing those ten publications and claiming damages for libel and other relief. The POC containing Publications 1 – 10 were served on 2 May 2019.
- Publication 11 took place on 19 June 2019. On 8 August 20 19 the Defendant served his Defence. Publications 12 to 15 then took place between 22 August and 29 September 20 19. The Claimant’s Reply was served on 11 October 20 19. Publication 16 took place on 18 October 2 019.
- Draft APOC were circulated by the Claimant’s solicitors on 19 November 2019 to add Publications 11 to 16. The Defendant consented to those amendments on 19 December 2019, and the APOC were filed and served the same day pursuant to CPR r 17 .1(2)(a).
- In March 2020 there was a CCMC before Master Davison and extensive directions were given. On 18 March 2020 the Defendant served his Amended Defence, which as I have said was done with consent, in which he pleaded to Publications 11 – 16.
- In his Eleventh Witness Statement Mr Cohen explains that when the draft APOC were circulated by his firm in late 2019, through an ‘administrative oversight’, his firm did not also prepare or circulate a draft amended Claim Form to include Publications 11 to 16. This error was not spotted by the Claimant’s legal team, including during preparations for the March 2020 CCMC, or by the Defendant when he was preparing his draft Defence in respect of all 16 publications.
- Hence, by early 2020 the position was that there was an APOC, an Amended Defence and an Amended Reply (dated 22 April 2020) dealing with all 16 publications, each of which had been consented to by the other party, but a Claim Form which only contained Publications 1 – 10.
- According to Mr Cohen, this oversight was first spotted by the Claimant’s team in about May 2020 when the addition of a data protection claim was being considered, but it was not at that stage specifically drawn to the Defendant’s attention.
- The application to amend the Claim Form was issued on 14 July 2020. Further confusion was added when the Claimant’s solicitors erroneously enclosed in draft a ‘Re-Amended Claim Form’, containing proposed amendments in red and green, when
it should just have been a draft ‘Amended Claim Form’, containing one set of proposed amendments in red. (This application also sought other amendments, eg, to add the data protection claim, however I am not concerned with those).
- Mr Cohen’s Eleventh Witness Statement explains what happened after the Claimant had served the 14 July 2020 application notice. By that stage the CCMC had been restored for hearing before Master Dagnall on 30 July 2020 to deal with disclosure issues. On 15 July 2020 the Defendant’s solicitors wrote to the Claimant’s solicitors indicating that they did not consent to the First Amendment Application and that they would be applying to strike out the claim.
- I need not go into all the details, but the upshot of exchanges between the parties and the hearings before Master Davison and Master Dagnall in July 2 020 was that the disclosure issues were put off and it was agreed that the First Amendment Application and the Defendant’s strike-out application would be listed for hearing together before a judge of the Media and Communications List. It was agreed two days would be necessary and that the hearing would not take place before November at the earliest. In the event, the hearing was listed for 23 - 24 November 2020 before Nicol J. The Defendant’s solicitors consented to the hearing going off until then.
- The delay in the hearing of the First Amendment Application until November 2020 had the consequence that the limitation period of one year for claims in defamation (see s 4A, LA 1980) expired in relation to Publications 1 2 – 16 in the period from 22 August 2020 onwards. The limitation period for Publication 11 had already expired by the time the First Amendment Application was made on 14 July 2020. I will return to this later.
- On 23 October 2020, the Defendant’s solicitors wrote to the Claimant’s solicitors to inform them that the Defendant was: (a) withdrawing his strike out application; and (b) abandoning his entire Defence and would no longer be defending the claim.
- In response, the Claimant’s solicitors wrote to the Defendant’s solicitors asking a number of things including whether he would: (a) consent to judgment being entered against him with damages to be assessed; and (b) consent to the First Amendment Application.
- The Defendant’s solicitors replied on 6 November 2020 saying ( inter alia ) that the Defendant would not consent to judgment being entered, but he did not (now) object to the First Amendment Application.
- On 10 November 2020, the Claimant applied for summary judgment and requested that the hearing of that application be listed for the November hearing, in place of the Defendant’s strike-out application and the Claimant’s First and Second Amendment Applications. (I am not concerned with the Second Amendment Application.) That request was granted.
- The Defendant did not attend, nor was he represented at, the November hearing before Nicol J. As I explained earlier, it was at that hearing that Nicol J drew attention to the timestamp issue. Accordingly, on 23 November 2020 the Claimant made the Third Amendment Application. Also, given the Defendant’s decision not to
- In support of his application to amend the Claim Form to include Publications 12-16, Mr Wolanski on behalf of the Claimant submits as follows.
- The expiry of the limitation period for Publications 12 - 16 brings into play the principles which apply where a court is asked to allow an amendment to a statement of case which has the effect of adding to an existing action a new claim in respect of which the limitation period has expired.
- The starting point is the LA 1980, s 35(1) of which provides: “ 35 New claims in pending actions: rules of court. (1) For the purposes of this Act, any new claim made in the course of any action shall be deemed to be a separate action and to have been commenced - (a) in the case of a new claim made in or by way of third party proceedings, on the date on which those proceedings were commenced; and (b) in the case of any other new claim, on the same date as the original action.”
- Section 35(2) provides: “(2) In this section a new claim means any claim by way of set-off or counterclaim, and any claim involving either - (a) the addition or substitution of a new cause of action; …”
- In HM Commissioners of Revenue and Customs v Begum [2010] EWHC 1799 (Ch), [29]-[30], David Richards J said: “Section 35 and CPR 17.4 refer to ‘a new claim’ and to a ‘claim already made’, and s 35 refers also to ‘a claim involving a new cause of action’. For present purposes, a claim is a new claim only if it involves ‘the addition or substitution of a new cause of action: s 35(2)(a). The authorities establish that ‘cause of action’ carries the meaning given by Diplock LJ in Letang v Cooper [1965] 1 QB 232 , 242 - 3: “… simply a factual situation the existence of which entitles one party to obtain from the court a remedy against another person … [as distinct from] a form of action ... used as a convenient and succinct description of a particular category of factual situation”. So, an amendment to include a claim for damages in negligence for personal injuries on facts already pleaded where the claim in respect of the injuries had been pleaded as a claim for damages in trespass to the person would not involve a new cause of action.
In Lloyds Bank plc v Rogers [(No.2) [1999] 3 EGLR 83] Auld LJ noted that what makes a new claim as defined in s 35(2) is ‘not the newness of the claim according to the type or quantum of remedy sought, but the newness of the cause of action which it involves.’ After referring to Diplock LJ's dictum in Letang v Cooper, Auld LJ continued: ‘… It makes plain that a claim and a cause of action are not the same thing. It follows, as Mr Croally argued, that an originally pleaded 'factual situation' may disclose more than one cause of action, although one of them may not be individually categorised as such or the subject of a claim for a separate remedy. However, as Mr Browne-Wilkinson submitted, it does not follow that a claim so categorising it and/or seeking a remedy for it made for the first time by amendment is the addition of a new cause of action so as to render it a new claim. That the draftsmen of section 35 and Ord 20 r 5 had the distinction in mind is underlined by their respective provision for new claims by reference to substituted new causes of action, as well as additional new causes of action. The remedy claimed – 'any claim' – may or may not be the same; what makes the claim 'a new claim' is the newness of the substituted cause of action. Thus, a claim for damages is a new claim, even if the same amount as originally claimed, if the claimant seeks, by amendment, to justify it on a different factual basis from that originally pleaded. But it is not, even if made for the first time, if it does not involve the addition or substitution of an allegation of new facts constituting such a new cause of action.’ Lloyds Bank v Rogers was a decision of a two-judge constitution of the Court of Appeal (Auld and Evans LJJ) and, while they differed on the issue as to whether the amendment introduced a claim involving a new cause of action, there was I think no disagreement on Auld LJ's statement of the underlying principles. In any event, the statement was cited with approval by the Court of Appeal in Aldi Stores Ltd v Holmes Buildings plc [2003] EWCA Civ 1882.
- Thus, ‘claim’ in the phrase ‘any claim involving … a new cause of action’ refers to the remedy sought, while ‘cause of action’ refers to the factual basis for the claim. Whilst the distinction is clear, it might be thought to lead to some tautology when applying the test in s 35(5)(a) as to whether ‘the new cause of action arises out of the same facts or substantially the same facts as are already in issue on any claim previously made in the original action’. The answer lies in treating ‘cause of action’ as those facts relied on in the statement of case as giving rise to a
The exercise to be undertaken in deciding whether there is ‘a new claim’ as defined in s 35(2) is therefore to compare the essential factual elements in a cause of action already pleaded with the essential factual elements in the case of action as proposed. If they are the same, there is no new cause of action and therefore no new claim.”
- Thus, in the phrase ‘any claim involving … a new cause of action’ in s 35(2)(a), ‘claim’ refers to the remedy sought, and ‘cause of action’ refers to the factual basis for the claim: see, generally, White Book 2021, Vol 2, [8-110].
- Section 35(3), (4) and (5) provides: “(3) Except as provided by section 33 of this Act or by rules of court, neither the High Court nor the county court shall allow a new claim within subsection (1)(b) above, other than an original set-off or counterclaim, to be made in the course of any action after the expiry of any time limit under this Act which would affect a new action to enforce that claim. (4) Rules of court may provide for allowing a new claim to which subsection (3) above applies to be made as there mentioned, but only if the conditions specified in subsection (5) below are satisfied, and subject to any further restrictions the rules may impose. (5) The conditions referred to in subsection (4) above are the following - (a) in the case of a claim involving a new cause of action, if the new cause of action arises out of the same facts or substantially the same facts as are already in issue on any claim previously made in the original action; …”
- The court has a general power to amend under CPR r 17.(2)(b), but this is subject to CPR r 17.4, which is the rule of court referred to in s 35( 4 ). It provides: “ Amendments to statements of case after the end of a relevant limitation period
(1) This rule applies where – (a) a party applies to amend his statement of case in one of the ways mentioned in this rule; and (b) a period of limitation has expired under –
(i) the Limitation Act 1980; … (2) The court may allow an amendment whose effect will be to add or substitute a new claim, but only if the new claim arises out of the same facts or substantially the same facts as a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings.”
- This wording differs from that of s 35(5)(a), as it is narrower, a result contemplated in s 35(4) (‘… subject to any further restrictions the rules may impose.’) CPR r 17.4(2) requires the new claim to arise out of the cause of action relied on by the applicant for the amendment, ie, the facts already pleaded and relied on by the party seeking to amend , whereas s 35(5)(a) does not contain this restriction. However, in Goode v Martin [2002] 1 WLR 1828 the Court of Appeal held that the principle of construction in s 3(1) of the Human Rights Act 1998 applies, so that CPR r 17.4 must be interpreted and applied as if it reads as follows, which is similar to the wording of s 35(5)(a): “… only if the new claim arises out of the same facts or substantially the same facts as are already in issue on a claim in respect of which the party applying for permission has already claimed a remedy in the proceedings.” (Emphasis added)
- Ms Goode had sustained serious head injuries in a yachting accident which had left her with no memory of it. There were no witnesses on whom she could rely. She had pleaded a case in negligence against the yacht’s captain. He pleaded a defence containing a different set of facts. The claimant sought to amend her pleadings after the expiry of the limitation period to add a claim for negligence based on the defendant’s version of events. The master and judge on appeal struck out her claim. Allowing her appeal, the Court of Appeal restored her claim. Reading the rule in the way indicated by Brooke LJ enabled her to plead by way of post-limitation amendments such that, even if the defendant succeeded in establishing his version of events, she was entitled to damages because, upon such facts, he was negligent as an experienced yacht master in failing to take proper care of her as a novice sailor. He had put the facts in issue for the purposes of the rule as so read when he served his Defence, and thus her new claim arose out of those facts and so fell within the rule.
- In Charles Church Developments Ltd v Stent Foundations Ltd [2007] 1 WLR 1203 Jackson J read the rule (as interpreted in Goode ) as enabling a claimant to advance a new claim against the First Defendant on the basis of facts that had been pleaded by the Second Defendant. At [33]-[34], he said: “ 33 Thus, it can be seen that in Goode v Martin [2002] 1 WLR 1828 , the Court of Appeal reached its decision on the basis of an expanded version of CPR r 17.4(2). I shall refer to the expanded version of the rule as set out in para 46 of Brooke LJ's judgment as ‘the expanded rule’.
