Concealment, the limitation clock and cladding

Background 

The Property

In 2015, the Claimant (RG Securities (No.2) Ltd) acquired the freehold to a residential tower block in Ipswich (the “Property”). The Property consists of 16 storeys with 116 flats and a café on the ground floor. Between 2006 and 2009, the Property was substantially refurbished, with those works being carried out by the third defendant, R Maskell Ltd (“Maskell”). The works included the installation of a Trespa cladding system, largely using Polyisocyanurate (PIR) insulation, alongside Aluminium Composite Material (ACM) cladding panels in certain areas.

The claim 

In the ongoing litigation, the Claimant asserts that: (i) the above cladding system is more flammable than that installed on Grenfell Tower; and (ii) no reasonably competent developer would have used such cladding on the Property. The Claimant is therefore seeking to recover damages of c.£3.6mil, equating to the estimated cost of proposed remedial works, in order to ensure that the Property is fit for habitation. The Claim Form itself was issued on 10 December 2019.

The application (for summary judgment)

By way of a limitation defence, Maskell argued that the claim was statute barred under the Limitation Act 1980. Maskell applied for summary judgement on the basis that:

• The refurbishment works at the Property concluded in 2009;
• Consequently, primary limitation expired six years later in 2015; and
• The claim was therefore already statute barred when the Claimant issued proceedings in December 2019.

In response to Maskill’s application, the Claimant asserted that when they acquired the Property in 2015: (a) the refurbishment works did not have the requisite Building Regulations approval; and (b) Maskills deliberately concealed that information, such that primary limitation should be extended accordingly.

The decision 

The Technology and Construction Court dismissed the Defendant’s application, allowing the claim to proceed towards trial.

The relevant question addressed was not whether there had been deliberate concealment. Rather, the question was whether Maskell (in the context of their application for summary judgment) had successfully demonstrated that the concealment case had no realistic prospect of success.

Against that backdrop, Fraser J found for the Claimant with the resultant effect that time did not start running for limitation purposes until the Claimant had discovered the concealment in May 2018. The primary limitation period did not therefore expire until 2024.

Analysis 

It is apparent from the judgment that the Courts remain cautious when dealing with an application for summary judgment, particularly one made by a Defendant (as opposed to the more usual Claimant led application). In this instance, the Court followed the approach summarised by Lewison J (as he was then) in the case of Weatherspoon v Van de Berg & co [2007] EWHC 1044 (Ch). They remind us that there is a need to … "remain cautious about making a summary determination where reasonable grounds exist for believing that a fuller investigation in to the facts of the case would add or alter the evidence available to a trial judge and so affect the outcome of the case”.

In considering the postponement of time running and the application of s.32 (1)(b) of the Limitation Act 1980 (where arguments of deliberate concealment are made), reliance was placed upon the earlier 1996 House of Lords decision of Sheldon v RHM Outhwaite (Underwriting Agencies) Ltd and in particular the comments of Lord Browne-Wilkinson. That case supports the proposition that if there has been deliberate concealment such that s.32 (1)(b) applies “...time does not start to run if there has been concealment, until  [our underlining] the concealment is discovered”. It follows therefore that in the present case the date upon which the works were actually finished was irrelevant.