You (don’t) pays your money and you (still) takes your choice

Impecuniosity and s. 14A of the Limitation Act 1980

In the recent decision of Kay v Martineau Johnson (a firm) [2026] EWCA Civ 224, the Court of Appeal considered whether a claimant’s lack of financial resources to pay for legal advice was relevant to whether they had sufficient knowledge to start time running under the secondary limitation period provided for by s. 14A of the Limitation Act 1980. The question arose in the context of a professional negligence claim relating to advice given by solicitors in matrimonial proceedings.

Background

Ms Kay alleged that her former solicitors, Martineau Johnson, had negligently advised her in relation to a financial settlement reached during divorce proceedings in April 2008. Amongst other allegations, she said she had been advised to accept a ‘clean break’ settlement and not been advised on the possibility of obtaining a nominal spousal maintenance order which could have preserved the ability to revisit the financial settlement in the future.

The settlement turned out badly for Ms Kay and she did not receive as much as she was expecting, due mainly to external forces including the global financial crisis and a third party’s insolvency. Over time, she became aware of conspicuous indications of wealth by her former husband, leading her to believe he had not fully disclosed his assets at the time of settlement.

Ms Kay initially enquired with the firm between October 2008 and May 2009 as to whether she could set aside the settlement but was told she could not. She revisited the issue some ten years later and obtained her files from the firm between May 2018 and July 2019. However, she did not seek counsel’s advice about the possibility of reopening the divorce settlement until May 2020 as, she said, she could not afford to fund the advice until that point.  Counsel at that point separately advised that she might have a claim against Martineau Johnson.

Ms Kay eventually issued proceedings in professional negligence in March 2023, alleging that the original advice had caused losses of approximately £1.274m. Although the primary 6-year limitation period had expired long before issue of the proceedings, she argued that she only became aware of a potential negligence claim in May 2020 when she received counsel’s advice, and thus her claim was brought within the three-year secondary limitation period under s. 14A Limitation Act 1980.

s. 14A of the Limitation Act 1980

Section 14A of the Limitation Act 1980 provides a special alternative time limit for negligence claims where the facts relevant to the cause of action were not known at the date of accrual.

The effect of s. 14A(4)-(8) is that time runs for 3 years from the date on which the claimant acquires knowledge:

• of the material facts about the damage in respect of which damages are claimed; and
• that the damage was attributable in whole or in part to the act or omission which is alleged to constitute negligence; and
• of the identity of the defendant; and
• if it is alleged that the act or omission was that of a person other than the defendant, of the identity of that person and the additional facts supporting the bringing of an action against the defendant.

That knowledge can be actual or constructive. S. 14A(10) expands on the constructive knowledge element:

(10) For the purposes of this section a person’s knowledge includes knowledge which he might reasonably have been expected to acquire—

(a) from facts observable or ascertainable by him; or

(b) from facts ascertainable by him with the help of appropriate expert advice which it is reasonable for him to seek;

but a person shall not be taken by virtue of this subsection to have knowledge of a fact ascertainable only with the help of expert advice so long as he has taken all reasonable steps to obtain (and, where appropriate, to act on) that advice.

[emphasis added]

One of the questions for the Court of Appeal was whether during 2018-19 Ms Kay had taken “all reasonable steps to obtain” the advice that she later obtained so as to preclude her from obtaining constructive knowledge at that time in circumstances where, she said, she was unable to afford the necessary legal fees until 2020. Ms Kay said that the (absence of) steps she took to obtain expert advice were reasonable in her straitened financial circumstances.

The High Court’s decision

HHJ Russen at first instance held that Ms Kay had “actual trigger knowledge” (under s. 14A(6)-(8)) by no later than the end of 2009 by which time the firm had told her the settlement could not be reopened. He found that it must have been obvious by then that something had gone wrong in her ancillary relief claim. She therefore knew enough to investigate the possibility that the lack of recourse may be attributable to a fault on the part of the firm.

He found that in the alternative she had “constructive trigger knowledge” (under s. 14A(10)) by the end of 2009 or, if that was wrong, by the end of 2018. With respect to the last of those conclusions, he held that there was no reason why the counsel’s advice sought in March 2020 could not have been obtained during 2018. The Judge held that “the personal reasons” Ms Kay relied on for not obtaining counsel’s advice sooner, including her lack of resources, were as a matter of law irrelevant.

The Court of Appeal’s decision

Ms Kay, represented by our colleague, James Hall, appealed both findings. The Court of Appeal (Newey, Males and Lewis LJJ) overturned the finding that Ms Kay had actual knowledge in 2008-9, but held that Ms Kay did have constructive knowledge in the period 2018-2019 and therefore the claim was out of time. The majority of the Court of Appeal, Males and Lewis LJJ, would also have held that the trial judge was entitled to find constructive knowledge in 2009. The Court’s findings as to actual knowledge and constructive knowledge in 2009 turn on the facts of the case and establish no new principles. The Court’s consideration of the potential effect of Ms Kay’s impecuniosity during the period 2018 to 2020 is of more general interest.

Impecuniosity

Ms Kay’s key submission was to the effect that, for the purposes of s. 14A(10), it was reasonable for her not to have obtained counsel’s advice before 2020 because she could not afford to do so. Hence, it was reasonable for her not to have acquired knowledge that she obtained from counsel’s advice until 2020, less than three years before issue.

A difficulty facing that submission is that previous cases have held that the approach to be taken to whether there was sufficient constructive knowledge to start time running in s. 14(3) and 14A(1) of the 1980 Act is a “mainly objective” one. See Adams v Bracknell Forest Borough Council [2004] UKHL 29, [2005] 1 AC 76 and Gravgaard v Aldridge & Brownlee [2004] EWCA Civ 1529.

In Kay, Newey LJ held that the correct approach to s. 14A(10) is indeed “mainly objective”, so that characteristics of the claimant which are peculiar to him or her are “at least generally, irrelevant” to the question of what knowledge the claimant might reasonably have been expected to acquire. He observed that, “the ‘mainly objective’ approach applicable to section 14A(10) of the 1980 Act tends to suggest that the resources available to a claimant, which are ‘peculiar’ to him, should rarely, if ever, be of significance.”

However, Newey LJ did not rule out altogether taking into account a claimant’s lack of resources. He held (at [64]) that:

• it is questionable whether a claimant’s impecuniosity can ever matter for the purposes of s. 14A(10);
• even if there can be circumstances in which impecuniosity is relevant, they will be rare; and
• it must be incumbent on a claimant who wishes to rely on impecuniosity to provide detailed evidence as to his financial circumstances and they prevented him from obtaining appropriate advice.

Newey LJ considered that the evidence of Ms Kay’s impecuniosity at trial was insufficient to establish that the instant case was a rare one in which impecuniosity might justify a claimant’s failure to obtain advice earlier. Ultimately, Newey LJ accepted the Defendant’s contention that the delay was caused by a “lack of prioritisation, not lack of funds” (paragraph 34).

The other two members of the Court agreed with Newey LJ on the impecuniosity issues.

Evidencing impecuniosity

Since the Court of Appeal left open the possibility of impecuniosity being relevant to the assessment of constructive knowledge under s. 14A in rare cases, the question of what evidence of impecuniosity might suffice arises. In light of the Court’s remarks, it will be incumbent on a claimant to provide detailed evidence as to how their financial circumstances prevented them from obtaining appropriate advice.

The judgment gives some helpful indications on the level of granularity that might be expected to prove impecuniosity which may include:

1. The money available to the claimant
2. Their financial commitments
3. Their earning capacity
4. What other ways they had investigated to obtain relevant advice, for example by exploring whether a lawyer would have been prepared to act pro bono or on a conditional fee basis.

Whether a claimant armed with such evidence might be able to pass through the small gap left open by the Court of Appeal in this case remains to be seen.

Article by Daniel Gatty and Alice Whyte