Edward Sparrow on judges' discretion in limitation issues

With Mark Elvy, Edward Sparrow led the Ashurst Morris Crisp team acting for Imperial Tobacco.

Mr Justice Michael Wright recently refused to allow eight lead plaintiffs in the group action brought by a number of smokers and former smokers against Imperial Tobacco and Gallaher to proceed with their claims against tobacco companies.

The litigation was conducted as a group action with nine of the 52 plaintiffs acting as lead plaintiffs: 36 of them (including eight of the lead plaintiffs) had been diagnosed as having lung cancer more than three years before they began proceedings and were statute-barred under the Limitation Act 1980.

Trial was fixed for January 2000 but the judge it was in the plaintiffs' and the public interest that the limitation issues in the eight statute-barred lead cases should be determined at a preliminary trial in December 1998.

The trial addressed exclusively whether the judge should exercise his discretion under s.33 of the Act to let the eight cases continue despite being statute-barred.

The judgment begins with findings common to all the plaintiffs. The judge formed a very broad overall view of their chances of success, which he described as "by no means self-evident".

He contrasted the modest damages that a successful plaintiff might expect to recover with the "formidable" potential cost liability of an unsuccessful plaintiff. He highlighted the heavy onus on plaintiffs who seek to bring claims outside the statutory period and the potential risk to a fair trial of witnesses' loss of recollection caused by substantial delay.

He rejected the plaintiffs' argument that the defendants would suffer no real economic prejudice by having to fight statute-barred claims because they, in any event, faced 16 non-statute-barred claims. He concluded that the stimulus for the litigation was the availability of lawyers willing to act on conditional fee agreements but held that this did not justify allowing stale claims to proceed.

The judge found that seven of the plaintiffs had not acted promptly or reasonably to pursue their claims after they were diagnosed with lung cancer.

The judgment provides a paradigm for the court's approach to its exercise of discretion under s.33 of the Limitation Act and a reminder of the importance of the facts of individual cases even in group actions.