Butters & Anor v Hayes

Factual and Procedural Background

The appeal concerns longstanding litigation between the parties following a divorce after a twenty-year marriage. The dispute arises from a harassment claim brought approximately 15 years prior by the Plaintiff against the Defendants. In November 2005, the Plaintiff initiated an action alleging multiple acts of harassment. In June 2011, the court granted the Plaintiff leave to file an amended statement of case alleging additional acts of harassment. The Plaintiff did so in July 2011, followed by a schedule of loss filed in 2012 claiming significant damages.

The Defendants contended that the Plaintiff should have paid an additional court fee due to the increased value of the claim from the amendment and schedule of loss, which the Plaintiff disputed. The trial on liability took place in early 2019, during which the Defendants applied to strike out the amended particulars on limitation grounds related to non-payment of the additional fee. The trial judge rejected this strike-out application, finding no intention to increase the claim value at the time of amendment and thus no additional fee was required.

The Defendants were granted permission to appeal on the limitation and fee payment issue. The appeal court below upheld the trial judge’s decision, holding that the amended claim was properly brought within the limitation period and that non-payment of the additional fee did not continue the limitation period or invalidate the claim. The Defendants sought further appeal, challenging the interpretation of section 35 of the Limitation Act 1980 and the applicability of precedent concerning fee payment and limitation.

Legal Issues Presented

1. Whether the non-payment of a court fee in respect of a new claim made by amendment within existing proceedings means that time continues to run for limitation purposes under section 35 of the Limitation Act 1980.
2. Whether a new claim made by amendment is "made" for limitation purposes on the date of the court order allowing the amendment or on the date the amended particulars are filed or served.
3. The extent to which the payment of the correct court fee affects the bringing or making of an action or new claim within the limitation period.
4. The legal consequences of underpayment or non-payment of court fees on limitation periods and the validity of claims or amendments.

Arguments of the Parties

Appellant's Arguments

• The court order of 15 June 2011 allowing the amendment was void or provisional because it was granted without the court having seen the proposed amendments, contrary to CPR PD17 1.2, and thus could not properly allow new claims that might be time-barred.
• Relation-back under section 35 applies only when a new claim is "made," not when it is merely "allowed" by the court order; the date of making is the date the amendment is filed or served.
• Non-payment of the appropriate additional court fee when amending the particulars means the limitation period continues to run, and therefore the amended claims are statute-barred.
• The Defendants have the right to strike out the amended particulars on limitation grounds at any time, regardless of whether the amendment was abusive.
• There is no reason in principle to treat new claims under section 35 differently from the bringing of new actions under Part I of the Limitation Act.

Respondent's Arguments

• The court order of 15 June 2011 effectively allowed the new claims to be made within the limitation period, and the failure to pay an additional fee did not invalidate the amendment or extend limitation time.
• The amended claim was made within the limitation period in accordance with the court order and CPR rules.
• Non-payment or underpayment of fees does not prevent a new claim from being "made" for the purposes of section 35 of the Limitation Act.
• It would be unjust and absurd to invalidate a new claim due to an innocent miscalculation of a court fee, especially given available procedural sanctions for abuse.
• The claim for an injunction remains unaffected by any fee payment issue.

Table of Precedents Cited

Court's Reasoning and Analysis

The court began by interpreting section 35 of the Limitation Act 1980, which provides that new claims made in pending actions are deemed commenced on the date of the original action, subject to rules of court. The court distinguished between "rules of court" and "fees orders," concluding that fees orders prescribing court fees are not "rules of court" regulating practice and procedure and thus do not affect the limitation period under section 35.

The court analyzed the Civil Procedure Rules (CPR) governing amendments and noted that failure to pay court fees does not invalidate a claim or amendment, nor do CPR rules impose limitation consequences for non-payment. The court held that a new claim is "made" when the amended document is filed or served, not when permission to amend is granted.

The court reviewed relevant case law concerning the timing of bringing claims and the effect of non-payment or underpayment of fees. It identified conflicting first-instance authorities but emphasized that none indicated that non-payment of fees prevents a new claim from being "made" under section 35. The court also rejected the strict approach that would bar claims due to innocent miscalculations of fees and highlighted procedural alternatives to control abuse.

Applying these principles to the facts, the court found that the amendment was made within the limitation period, in accordance with the court order and CPR. The failure to pay an additional fee did not invalidate the new claims or extend the limitation period. The court rejected the appellant's arguments that the order was void or that relation-back did not apply.

The court emphasized the difference between bringing a new action (which requires issue and payment of fees) and making a new claim by amendment within existing proceedings (which is governed by section 35 and CPR). It concluded that the appellant’s interpretation was legally unsound and that the appeal should be dismissed.

Holding and Implications

The appeal is dismissed.

The court held that non-payment of a court fee does not prevent the making of a new claim by amendment within existing proceedings for the purposes of limitation under section 35 of the Limitation Act 1980. The new claims contained in the amended particulars of claim were properly brought within the limitation period despite any failure to pay an additional fee. The attempt to strike out the claims on limitation grounds was without merit.

The decision clarifies that fees orders are distinct from rules of court and do not regulate the limitation period for new claims by amendment. It confirms that the limitation period does not continue to run due to non-payment of fees in this context, and that procedural mechanisms exist to address fee non-payment or abuse without resorting to limitation bars.

No new precedent was established beyond the clarification of existing statutory interpretation and case law. The ruling underscores a balanced approach favoring substantive justice over technical fee-related limitation bars, particularly in cases of innocent miscalculation or non-abusive conduct.