Amendments to group claims permitted following appeal (Viegas and others v Cutrale and another and Sanches and others v Cutrale and another)

Dispute Resolution analysis: The Court of Appeal has considered complex questions arising on an appeal of a decision dismissing a challenge to amendments to group litigation cartel proceedings, where a viable limitation defence was raised. This conclusion, however, depended upon an undertaking given by the Claimants not to rely upon the doctrine of relation back.

Viegas and others v Cutrale and another and Sanches and others v Cutrale and another [2024] EWCA Civ 1122

What are the practical implications of this case?

This is a significant appellate decision in relation to the circumstances in which parties may be added to claims prior to service where the Defendant has an arguable defence based on limitation. It is significant to note that the Court of Appeal adopted a somewhat contrasting approach to the issues compared with the lower court. It confirms the following propositions of general importance. (1) The 14-day period for bringing a challenge under CPR 17.2 applies even where a jurisdiction challenge has been brought. That deadline, however, is not subject to any express or implied sanction. The decision also confirms that the mere existence of an arguable limitation defence will not preclude an amendment. The Defendant must be able to identify prejudice caused, for example by reason of the application of the relation back doctrine.

What was the background?

This appeal concerns cartel claims brought by orange farmers domiciled in Brazil. The Defendants, the estate of Mr Cutrale snr and Mr Cutrale jnr were, during the relevant period, directors and shareholders of the Brazilian undertaking, Sucocitrico, a producer of orange juice. One set of proceedings, the “Viegas Claim” was originally issued on behalf of 170 Claimants. It was then amended prior to service to add further Claimants, bringing the total Claimants to 1,495 individuals, 21 companies and one foundation. Another, the “Sanches Claim” was issued on behalf of 30 individuals and one company. It has never been amended. The Defendants challenged the jurisdiction of the High Court in respect of these claims. Upon the failure of that challenge, they applied, pursuant to CPR r.3.4(2) to strike out these amendments and to disallow the amendments under r.17.2. The applications were based on a number of grounds, including that the claims (both the original claims and those sought to be added by amendment) were time barred and had been since 2009, that the amendments sought to add claims by persons who were deceased when the claims were issued, that claims were purportedly brought by the representatives of deceased persons who had failed to obtain English grants and that claims had been brought without the informed consent of the relevant Claimant. The applications came before Dame Clare Moulder DBE (sitting as a Deputy High Court Judge) and a reserved judgment was given on 24 July 2023. Both the Claimants and Defendants appealed that judgment on multiple grounds. The judgment of the Court of Appeal addressed the grounds of appeal in the order set out below.

What did the court decide?

The Defendants appealed the Learned Judge’s decision not to disallow the amendments on limitation grounds. This aspect of the appeal raised five questions for the Court. (1) Is the addition of a new claimant barred whenever there is an arguable limitation defence to the claim or only where relation back might operate to a defendant’s prejudice? The Court of Appeal agreed with the Learned Judge that an amendment should be disallowed or refused where there is a prospect of the relation back doctrine under section 35 of the Limitation Act 1980 prejudicing a defendant. The mere fact that there may be an arguable limitation defence will not preclude an amendment. The defendant’s position for limitation purposes must be made worse as a result of the application of the relation back doctrine. (2) If prejudice is required, is there a sufficient prospect of it here? The Court of Appeal did not think the possibility of the defendants being prejudiced by relation back could be discounted and that was sufficient on the facts of this case to justify the amendments being rejected. (3) Is the 14-day period for which CPR 17.2(2) provides applicable even where an application challenging jurisdiction has yet to be resolved? The Court of Appeal concluded that it was. It held that the language of CPR 17.7(2) was perfectly clear, providing for an application to be made “within 14 days of service of a copy of the amended statement of case”. There was no scope for reading into that the contention that the jurisdiction challenge raised impliedly extended the time for making an application under r.17.2 from the usual 14 day period. (4) Does an implied sanction attach to CPR 17.2(2)? The Court of Appeal confirmed that neither an implied nor an express sanction applies to CPR 17.2. (5) If not, should this Court itself grant the defendants an extension allowing them to apply under CPR 17.2(2)? The Court of Appeal would have been minded to permit the Defendants to pursue their strike out application, however, during the course of the hearing, the Claimants indicted that they were will to give an undertaking not to rely on the doctrine of relation back. That meant there was no danger of relation back depriving the Defendants of any limitation defence. Permission to apply under CPR 17.2 was consequently refused. The Court of Appeal reversed the Learned Judge’s finding that where an original claimant was deceased when the claim was issued, they could not be substituted under Part 17, CPR. The amendments could be approached as matters of addition of parties and not substitution.

Case details

Court: Court of Appeal, Civil Division

Judges: Lord Justice Newey, Lord Justice Lewis and Lord Justice Nugee

Date of judgment: 2 October 2024

Article by Phillip Patterson, originally published by LexisNexis here.