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In this post, Max Eshraghi, an associate working within the insurance team at CMS, comments on the decision handed down by the UK Supreme Court in the matter of  Matthew and others v Sedman and others [2021] UKSC 19, which concerns the application of limitation timebar.  

On 21 May 2021, the UK Supreme Court dismissed the appeal of Matthew & ors v Sedman & ors [2021] UKSC 19 in which it was argued that a cause of action that accrues on the very first moment of a day (a ‘midnight deadline’) should result in the expulsion of that day for the purposes of calculating the limitation period. As the High Court and the Court of Appeal held previously, in a ‘midnight deadline’ case where the cause of action accrues at the very start of the day following midnight, that day is a complete undivided day and should be counted for the purposes of calculating the limitation period. This provides some much needed clarity to litigators in all practice areas.

Background

For the full background, including summaries of the High Court and Court of Appeal judgments, see our earlier blog post.

By way of brief recap, on 27 November 2017, the High Court at first instance decided that the appellants’ cause of action accrued at the first moment of Friday 3 June 2011 and that consequently the limitation period began on 3 June 2011. The reason for this was as set out in para 31 of the judgment: “At any moment during that day the [appellants] can bring a claim; and to exclude that day from the calculation for Limitation Act purposes would have the effect of giving [them] an extra day over and above the statutory limitation period for bringing the claim.”

However, the judge gave the appellants permission to appeal on the issue of “whether the date when the cause of action accrued in (their claim) (being 3 June 2011) is or is not included in the calculation of when the limitation period expired.”

The appellants argued that there is a longstanding proposition that the day on which an action accrues is not counted for limitation. Even in a case such as this – a midnight deadline case – the claim does not accrue until after midnight and therefore (however shortly) accrues into the day following midnight (i.e. 3 June 2011) such day which should not be counted for limitation.

The respondents argued that a midnight deadline case is different from other cases and the first instance judge was right to make such distinction. Where there is a midnight deadline, the potential claimant has the entire accrual day to bring a claim and so this day should not be excluded from the calculation of limitation.

In a judgment handed down on 20 March 2019, the Court of Appeal agreed with the respondents and dismissed the appeal finding that, as at first instance, in midnight deadline cases there is a “categorical indication that the action accrued by that point in time, rather than accruing on the day following midnight.”  The cause of action therefore accrued at the first moment of Friday 3 June 2011 and that was the first day for the purposes of calculating limitation.

The matter was then appealed to the Supreme Court.

UK Supreme Court judgment

The appellants, arguing that the cause of action accrued on 3 June 2011, primarily relied on four authorities to establish what they submitted was a long-standing rule that the day of accrual of the cause of action should be excluded from the reckoning of time. This, they argued, extended to cases in which the cause of action had accrued part way through the day or in the first millisecond of a day (‘midnight deadline’ cases).

The Appellants also argued that both the Judge at first instance and the Court of Appeal had failed to pay proper heed to the wording of sections 2, 3 and 21(3) of the Limitation Act 1980 (“LA 1980”). They placed reliance upon the key words “from”, “date” and “accrued” to make the following arguments:

  • It was important to identify the “date” upon which cause of action accrued. In reliance upon Dodds v Walker [1981] 1 WLR 1027 (which had informed the decision of Irwin LJ in the Court of Appeal), it was argued that there was no metaphysical point where it was neither 2 June 2011 nor 3 June 2011. Therefore, as the cause of action can only have accrued after midnight on 2 June 2011, it must have accrued on 3 June 2011. It was further suggested that (contrary to the respondents’ case), the expiry of 2 June 2011 and the Appellants’ loss could not have occurred simultaneously as the two events were incapable of co-existence.
  • The word “from” indicated a period subsequent to the date upon which the cause of action accrued, thereby justifying the exclusion of the day upon which the cause of action accrues from the reckoning of time in all cases to which the LA 1980 applies.
  • The statutory use of the word “accrue” indicated that the focus of the LA 1980 was not on the time of day at which the cause of action accrued, but the day itself. As a day is an indivisible unit of time, the whole day should be excluded from the reckoning of time for limitation purposes in all cases.

Despite this purported reliance on authorities, the UK Supreme Court held that none of the cases cited established a general rule applicable to a midnight deadline case. The only midnight deadline case advanced was Gelmini v Moriggia [1913] 2 KB 549, in which the day on which the cause of action was complete was included in the calculation of the limitation period. In referring to this case, the appellants submitted that it had been wrongly decided because it was inconsistent with Radcliffe v Bartholomew [1892] 1 QB 161 and was disapproved in both Marren v Dawson Bentley & Co Ltd [1961] 2 QB135  and Pritam Kaur v S Russell and Sons [1973] QB 336.

As they had in the Court of Appeal, the Respondents argued that in ‘midnight deadline’ cases, there is no fraction of a day. As per the principles considered by Channell J in Gelmini, where a cause of action accrues part way through a day, then that whole day falls to be excluded from the calculation for limitation purposes. However, “midnight deadline” cases are distinguishable and are not subject to the same rule because no fraction of a day arises. The Appellants had the entirety of 3 June 2011 to commence proceedings. The outcome was therefore the same whether the cause of action arose at the end of the 2 June 2011 (as the Court of Appeal had concluded) or the very start of 3 June 2011 (as Channell J in Gelmini had concluded).

The Respondents disagreed with the Appellants’ submission that Gelmini had been decided wrongly. This was because the judgment of Channell J in Gelmini had not been considered in a subsequent “midnight deadline” case prior to the current case. To the extent that Gelmini had been the subject of judicial commentary (for example in Radcliffe, Marren or Kaur), it was in the context of cases in which the cause of action had accrued part way through a day. That analysis was therefore distinguishable from the analysis applicable in the current case.

Essentially the Respondents’ point can be summarised by saying that by excluding the day immediately after a missed midnight deadline, as argued by the Appellants, this would extend the relevant limitation period to six years and a day, which was contrary to the express language of the Limitation Act 1980.

In Lord Stephens’ leading judgment, the Respondents’ position was affirmed. It was concluded that in ‘midnight deadline’ cases, the cause of action arose at, and not after, midnight (in line with the approach of Underhill LJ in Gelmini).

Significance

It is unsurprising that the UK Supreme Court dismissed the appeal. Their reasoning was based upon practicalities and common sense and was not framed in metaphysical terms which, as Lord Stephens pointed out, the common law eschews. If a cause of action accrues from the very first moment of a day, in practical terms, the claimants still have the entirety of that day to bring a claim. On that analysis, it can be said to be misconceived for a party to seek to argue that the accrual of a cause of action ‘a nanosecond’ into a particular day should mean that that entire day be discounted for the purposes of limitation.

The UK Supreme Court reasoning was largely in line with that of the High Court and Court of Appeal. It has been affirmed then that in ‘midnight deadline’ cases, one does include the date the cause of action arises on (that being at 00:00 of that particular day). The distinction is made from instances where the cause of action accrues during part of the day, as the law rejects a fraction of a day and in such cases the limitation period is calculated from the following day.