A key consideration when contemplating any court claim is whether the deadline for bringing the action (referred to as the ‘limitation period’) has expired.
If a claim is brought outside of the limitation period the defendant has a complete defence to the claim, however strong the case is (other than in certain very specific circumstances). The length of the limitation period varies with different types of claim.
Claimants could be forgiven for assuming that in the midst of the COVID-19 pandemic they might see some relief from the usual limitation periods. It seems that in virtually every area of life normality has gone out of the window. We have seen extensions for the filing of accounts at Companies House, re-payment holidays and help from the government in paying employee’s wages.
Most courts are now practically off limits to the general public. Despite this, the Courts and Tribunal service has been pro-actively ensuring that courts operate as close to normally as possible. Courts are utilising modern technology, with papers being filed electronically and hearings being held via phone or video link. However, in respect of limitation periods, it is business as normal and the usual rules still apply.
Given the unprecedented nature of the current situation it remains to be seen if we will see a moratorium on limitation periods. Both Spain and Italy, two of the worst hit nations, have implemented relief on time bars in certain actions. Similarly, the German constitution provides that time bars will be automatically paused where the administration of justice is suspended.
In England and Wales, the Limitation Act provides only very limited circumstances in which limitation time bars will be extended. In light of the above, and as the courts continue to operate with close to normal capacity, potential claimants should continue to take steps to ensure that their actions are brought within the relevant limitation period.
Alternatively, where parties to litigation would prefer to suspend proceedings until a return to normality they may enter into a ‘standstill agreement’ before the limitation period has elapsed. This has the effect of stopping time from running for limitation purposes. It is crucial, however, not to assume that claims brought out of time will be excused due to the COVID-19 pandemic.
