Lloyds Bank Plc v Rogers, Court of Appeal - Civil Division, July 16, 1999, [1999] EWCA Civ 1874

Issuing Organization:Civil Division
Actores:Lloyds Bank Plc v Rogers
Resolution Date:July 16, 1999




(His Honour Judge Anthony Thompson QC)

Royal Courts of Justice

The Strand

London WC2

Friday 16th July, 1999

B e f o r e:



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(Handed down Transcript of Smith Bernal Reporting Ltd

180 Fleet Street, London EC4A 2HG

Tel: 0171 421 4040

Official Shorthand Writers to the Court)

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MR M CROALLY (Instructed by Messrs Alison Trent & Co., London EC4A 2BU) appeared on behalf of the Appellant

MR S BROWN-WILKINSON QC and MR J CHAPMAN (Instructed by Messrs Foot & Bowden, Plymouth, Devon PL1 2SW) appeared on behalf of the Respondent

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(As approved by the Court)

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LORD JUSTICE AULD: This is an appeal by the first defendant, Mr Derek Rogers, from an amended order of His Hon. Judge Anthony Thompson, Q.C., on 8th September 1998 in the Bodmin County Court, upholding the decision of Deputy District Judge Rutherford allowing the plaintiff, Lloyds Bank PLC, to amend its particulars of claim for possession of mortgaged property to add claims for principal and interest due under an associated guarantee and an overdraft, and to re-amend its amended reply and counterclaim.

The Bank's claim against Mr and Mrs Rogers is for possession of their property pursuant to the terms of a legal charge over it of 12th October 1990 and a written guarantee by them of 25th May 1991 in respect of the borrowings by their family company from the Bank.

On 27th April 1992, by which time the Rogers' indebtedness under the guarantee was £931,704.59, the Bank, by a summons and particulars of claim issued in the Launceston County Court, claimed possession of the mortgaged property. Although the pleading contained no money claim, it did, as required by CCR Order 6, Rule 5(1), set out the essential particulars that would have justified such a claim as well as the claim for possession. It recited the material terms of the charge and of the guarantee, the making, on 9th August 1991, of a formal demand on the Rogers under the guarantee in respect of their indebtedness under it in the sum of £820,165.72, their indebtedness under the guarantee at the date of claim of £931,704.59 and the continuing accrual of interest at specified rates.

The Rogers, by their amended defence and counterclaim, admitted the charge and the guarantee but put the Bank to strict proof of their effect. They also admitted the making of the formal demand in the amount specified, though putting the Bank to "strict proof" of their alleged indebtedness. Although there was no claim for money, only the pleaded factual basis for it, they pleaded a defence of set-off and, by their defence and counterclaim, they sought damages for breach of contract and/for misrepresentation. Their case was that the Bank, in making the formal demand and the claim for possession, was in breach of a collateral oral agreement, or had falsely or negligently represented to them when they entered into the guarantee, that it would not enforce it and would continue to support their company for at least two years. They also relied on further alternatives of equitable estoppel and repudiatory breach of the guarantee or collateral contract.

On 6th May 1998 Deputy District Judge Rutherford, on the application of the Bank, allowed it to amend its particulars of claim by adding a claim for a money judgment. It sought to update the claimed indebtedness under the guarantee and under the overdraft arising from the accrual of further interest. It also added the date of demand for interest in respect of the overdraft. Finally, it sought to add claims for repayment of the total sum then outstanding under the guarantee and overdraft of about £1,500,000 (after making deductions for interest accrued from the dates of demand outside the limitation periods) and of continuing accrual of interest at specified rates.

Mr Rogers challenges the Judge's upholding of that order on three grounds: 1) the proposed amendment by addition of a money claim was in whole or a non-severable part a new claim that was statute-barred under Section 35(3) of the Limitation Act 1980 Act; 2) it did not qualify for allowance under Section 35(5) and RSC Order 20, Rule 5 (5) as applied to the County Court by CCR Order 20, Rule 1, because it did not arise out of the same or substantially the same facts in issue in respect of which relief had already been claimed; and 3) in any event, the Court should, in the exercise of its discretion, refuse to allow the amendment. Mr Miles Croally, on behalf of Mr Rogers, submitted that, at the very worst, the Judge could have allowed the amendment, save as to such part of it which, on examination, proved to be statute-barred.

The Bank's case was that the proposed amendment did not add a new cause of action and that it should be allowed in the exercise of the Court's discretion to enable all the matters in issue to be resolved together. It maintained alternatively that, if it did involve a new cause of action, it arose out of the same or substantially the same facts as the cause of action already pleaded and in issue and the Court should in its discretion allow it.

Mr Rogers' main concern in opposing the amendment was as to the interest claimed. The limitation period applicable to interest on a sum secured by mortgage is 6 years from the date on which it becomes due (1980 Act, section 20(5)), whereas that in respect of the recovery of mortgaged land and of principal secured by the mortgage is in each case 12 years from the accrual of the right of action (1980 Act, sections 15 and 20(1)(a)). Mr Rogers maintains that the sought amendment still contains, in both the sums of principal and interest claimed, a substantial element of statute-barred interest.

Section 35 provides, so far as material:

"(1) ... any new claim made in the course of any action shall be deemed to be a separate action and to have been commenced-

... (b) ... on the same date as the original action.

(2) ... a new claim means ... any claim involving ... (a) the addition or substitution of a new cause of action ...

(3) Except as provided by Section 33 ... or by rules of court, neither the High Court nor any county court shall allow a new claim within subsection (1)(b) ... to be made in the course of any action after the expiry of any time limit ... which would affect a new action to enforce that claim.


(4) Rules of court may provide for allowing a new claim ... to be made ..., 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 ... are ..

(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;..."

RSC Order 20, Rule s 5 provides, so far as material:

"(1) Subject to ... the following provisions of this rule, the Court may at any stage of the proceedings allow the plaintiff to amend his writ, or any party to amend his pleading, on such terms ... as may be just and...

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