Phillips & Co (a firm) v Bath Housing Co-Operative Ltd, England and Wales Court of Appeal (Civil Division), Judgment, Law, casemine.com

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Attorney(S)

Grant Crawford (instructed by Humphreys & Co) for the Appellant
Jeremy Burns (instructed by Phillips & Co) for the Respondents

Judges

LORD JUSTICE LLOYD
LORD JUSTICE MCFARLANE
LORD JUSTICE LONGMORE

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Phillips & Co (a firm) v. Bath Housing Co-Operative Ltd

Smart Summary

Factual and Procedural Background

The appellant, Company A, sought possession of a flat from one of its tenants and retained the respondent, Company B, to act on its behalf. The work was completed by the end of 2003. The solicitors' fees were not agreed upon, entitling them to claim a reasonable amount via a bill, subject to court assessment if disputed. The solicitors notified Company A of their claimed fees in September 2004, to which Company A responded disputing the amount. No further relevant action occurred until the solicitors issued proceedings for payment in September 2010, beyond the six-year limitation period under the Limitation Act 1980. Company A relied on the limitation defence, while the solicitors argued Company A's 2004 letter constituted an acknowledgment restarting the limitation period. The District Judge initially dismissed the claim, but on appeal, Judge [Last Name] held the letter was an acknowledgment under section 29(5) of the Limitation Act 1980, allowing the claim to proceed. Permission to appeal was granted on two points.

Legal Issues Presented

Whether a solicitors' claim for costs, billed but not yet fixed by assessment or agreement, falls within the terms of section 29(5) of the Limitation Act 1980.
If so, whether the letter from Company A dated 20 September 2004 constituted an acknowledgment of the claim for the purposes of section 29(5).

Arguments of the Parties

Appellant's Arguments

The solicitors' claim was not for a liquidated debt or sum, as it required judicial assessment to determine the amount.
The 2004 letter acknowledged receipt of the solicitors' claim and retainer but did not acknowledge any specific sum or a general liability to pay costs.
Reliance on authorities such as Proudman J in Truex v Toll and Evans LJ in Turner & Co v O. Palomo S.A. to support the position that the claim was not liquidated.
The judicial assessment process required to quantify the claim meant it could not be considered a liquidated pecuniary claim under section 29(5).

Respondent's Arguments

The solicitors' claim fell within the scope of section 29(5) as a "debt or other liquidated pecuniary claim".
Reliance on the Court of Appeal decision in Lagos v Grunwaldt and High Court decisions by Judge [Last Name] and Judge [Last Name] supporting that a quantum meruit claim is a liquidated pecuniary claim for these purposes.
The 2004 letter from Company A amounted to an acknowledgment of the claim, sufficient to restart the limitation period.
Cited Lord Brown of Eaton-under-Heywood's statement in Bradford & Bingley plc v Rashid that acknowledgments need not be confined to debts indisputable as to quantum.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Spencer v Hemmerde [1922] 1 AC 507	Historical approach to acknowledgments as promises to pay reviving limitation periods.	Illustrated the historic judicial mitigation of strict limitation rules by construing acknowledgments as promises to pay.
Lagos v Grunwaldt [1910] 1 KB 41	Quantum meruit claims as liquidated demands under old Rules of the Supreme Court.	Supported the interpretation that solicitor's claims for fees fall within "debt or liquidated demand" for limitation purposes.
Turner & Co v O. Palomo S.A. [2000] 1 WLR 37	A solicitor's claim requiring judicial assessment is not a liquidated sum.	Distinguished but held not directly applicable to Limitation Act interpretation.
Thomas Watts & Co v Smith [1998] 2 Costs LR 59	Solicitor's claim for fees requiring judicial assessment analogous to claims for damages to be assessed.	Supported the view that such claims are not liquidated sums but are claims for a reasonable sum to be determined by the court.
Truex v Toll [2009] 1 WLR 2121	Solicitor’s unassessed fees claim not a debt for liquidated sum for bankruptcy petition purposes.	Relied upon by appellant to argue claim was not liquidated under Limitation Act.
Dwr Cymru v Carmarthenshire County Council [2004] EWHC 2991	Claims for damages in tort not liquidated pecuniary claims under section 29(5).	Clarified scope of "liquidated claim" as requiring a sum readily ascertainable.
Amantilla Ltd v Telefusion plc (1987) 9 Con LR 139	Quantum meruit claims are liquidated pecuniary claims for limitation purposes.	High Court decision followed by the court to support that solicitor’s unassessed fees claim falls within section 29(5).
Bradford & Bingley plc v Rashid [2006] UKHL 37	Acknowledgments not confined to debts indisputable as to quantum.	Supported respondent’s argument on the nature of acknowledgment.
Dungate v Dungate [1965] 1 WLR 1477	Definition and scope of acknowledgment of debt.	Held that acknowledgment need not specify amount; letter sufficient to acknowledge debt.

Court's Reasoning and Analysis

The court first considered whether the solicitors' claim fell within the phrase "debt or other liquidated pecuniary claim" in section 29(5) of the Limitation Act 1980. It analyzed the nature of solicitor’s claims for fees not fixed by agreement or assessment, concluding that such claims are claims in debt of a quantum meruit nature but not for an ascertained sum until judicial assessment or agreement. Despite requiring judicial quantification, the court found that historically and procedurally, such claims have been treated as liquidated pecuniary claims for limitation purposes, referencing the legislative history, including the Limitation Act 1939 and relevant case law such as Amantilla Ltd v Telefusion plc and Lagos v Grunwaldt.

The court rejected the appellant’s argument that the claim was not liquidated due to the need for judicial assessment, noting that the term "liquidated" in this statutory context did not require an already ascertained sum but included claims where the amount could be ascertained by judicial process. The court emphasized that the Limitation Act provisions are technical and their interpretation must be informed by their original legislative context rather than modern notions of "common sense".

Next, the court examined whether the 2004 letter from Company A constituted an acknowledgment of the claim under section 29(5). The letter expressed concern about the amount claimed but did not dispute the existence of a liability to pay costs. The court found that the letter acknowledged the claim sufficiently to restart the limitation period, consistent with precedents such as Dungate v Dungate, which held that an acknowledgment need not specify the amount but must indicate an acknowledgment of liability.

Holding and Implications

The court DISMISSED THE APPEAL, upholding the decision that the solicitors’ claim falls within section 29(5) of the Limitation Act 1980 and that the 2004 letter from Company A constituted an acknowledgment restarting the limitation period.

The direct effect is that the solicitors’ claim is not barred by the limitation period and may proceed on other grounds. No new precedent was set beyond affirming the established interpretation of section 29(5) as applying to solicitor’s claims for fees not yet fixed by assessment or agreement and clarifying the nature of acknowledgment under the statute.