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Northern Ireland (Limitation Amendment)

Volume 19: debated on Monday 1 March 1982

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11.30 pm

I beg to move,

That the draft Limitation Amendment (Northern Ireland) Order 1982, which was laid before this House on 4th February, be approved.

Limitation of actions is a technical branch of our law. Nevertheless, it is of importance not only to practising lawyers but to all who might at any time have business that takes them into the civil courts. Any citizen of Northern Ireland could have recourse to civil action.

The prime object of the law in this area is to prevent the bringing of stale actions and to encourage plaintiffs who want to bring actions to start those actions as soon as possible or to decide not to do so. Another object is to relieve potential defendants from the burden of defending claims on which the dust can be said to have settled.. The law aims to hold a balance between the differing interests of the parties who might be involved.

The order implements all but two of the recommendations contained in the Law Reform Committee's final report—the 1977 report—on the law of limitation and corresponds to the Limitation Amendment Act 1980, which introduced similar provisions for England and Wales in all but two minor respects.

I do not propose to describe each article in detail. I hope that hon. Members will find that they have been adequately described in the explanatory document that has been circulated. However, I must in passing refer to articles 4, 5, 7, 9 and 14, which call for some elaboration over the detail that has been given in the explanatory document.

Article 4 deals with the difficulty that has arisen in the law relating to loans—typically loans between members of a family or friends. The present law is that the lender's cause of action accrues at the time when the loan is made. The operation of this rule means that the lender will lose his right to recover the loan six years later. If, for example, an aunt lends money to her nephew and leaves the loan outstanding for six years, her right to recover it will have vanished completely after that time. The effect of article 4 is that time would not begin to run against the aunt until she had made a written demand to her nephew asking for repayment. That solution, following the final report of the Law Reform Committee, is more appropriate to relatively informal arrangements of the sort that prevail in family circumstances.

Article 5 implements the Law Reform Committee s recommendation that, where property is stolen, the owner's rights against the thief should never be barred by lapse of time. The present law is that an owner of goods loses his rights of recovery against a thief six years after his property is stolen. That is an absurd position. There is surely no justification in law in principle for giving a thief good title to property as against the owner at any time during the life of that thief. Article 5 remedies that injustice so that a thief can no longer set up what is called a defence of limitation, but it protects a subsequent purchaser for value who has acted in good faith. Article 5 removes an absurdity in the law that I hope will be welcomed.

Article 7 will have an important effect on that branch of land law known as adverse possession, a complicated topic. In future, when determining whether occupation of land is adverse to the owner's rights, thereby leading to the extinguishment of his title to that land, the courts will be obliged to look at the actual facts of the case before holding that an implied licence had been granted by the owner to occupy that land. This article has been found necessary in order to clear up any misunderstandings there might have been due to recently decided cases. There was a considerable area open to doubt and debate.

Article 9 provides that no acknowledgement or part payment made in respect of a claim after the expiry of the relevant limitation period shall operate to revive a remedy that has already become statute-barred. That will reverse the existing rule.

I turn now to article 14 which does not appear in the order as it was published as a proposal. Its inclusion arises as a result of representations made by members of the Northern Ireland judiciary and legal profession after the consultation period for the order had ended. I hope that right hon. and hon. Members, particularly from Northern Ireland constituencies, will accept that the Government have been flexible and reasonable in taking into account serious and soundly based representations from the legal profession which were made after the final date for consultation had passed.

It was represented—and we have acted on these representations—that the limitation rule in respect of claims against the land registry insurance fund, a fund designed to compensate persons who suffer loss as a result of mistakes in the Land Registry, was such as was clearly liable to cause injustice to those people, weighting matters against the individual and in favour of the State. That needed to be remedied.

The present rule is that claims must be brought within six years of the date of erroneous registration in the Land Registry. That could indeed lead to cases of injustice such as this. It could easily arise that a mistake in the registry might not come to light until after the expiry of the present limitation period due to the length of time that had elapsed between the transactions in one piece of property.

Article 14 lays down a new principle which is much more generous to claimants than that which it replaces. If the order is passed time will not begin to run against the claimant until the date when he or she discovers the mistake, or could, with reasonable diligence, have discovered it. I hope that hon. Members will agree that this is a much fairer rule which substitutes the date of discovery of the mistake for the date of the making of the mistake. This is in the interests of the individual: interests that it is important to protect against inadvertent mistakes in Government Departments.

Because of the need to consider the representations to which I have referred and then to settle on the appropriate reformulation of this complicated legislation, there has been some delay in the order coming before the House. I consider the delay not to have been time wasted, however. Rather, it has been time used to enable the Government to reflect on the opinions of those who are concerned with the day-to-day workings of the rules that the House makes, and to get it right rather than to get it wrong and have to correct it subsequently.

The order is a complex but important piece of law reform legislation which commands, to the best of my knowledge, the support of the legal profession in Northern Ireland. As such I commend it to the House.

11.39 pm

It could hardly be an enviable task for the hon. Member for Oxford (Mr. Patten) to have to present to the House an order dealing with a subject of the intense complexity of this one. There was a moment earlier in today's procedures when the appearance of the "sly shade" of the Solicitor-General at the far end of the Treasury Bench suggested to observers from this distance that perhaps he might be undertaking this liturgy rather than the hon. Gentleman. But the hon. Gentleman seems to be increasingly cast by the Northern Ireland Office in the role of a maid of all work, and it turns out that this was his work, too.

Those of us on this Bench in particular have often criticised the procedure by Order in Council for legislation in Northern Ireland. Nevertheless, in connection with this order there are at any rate two incidental advantages of the procedure that might be noted.

This is not the first legislation amending earlier limitations legislation. One notes—I believe that I am correct in this—that the improvement in the law of limitations in Great Britain, which was brought about by an Act of 1939, was not reproduced in the law of Northern Ireland until 1958—a gap of 19 years, although, admittedly, six or seven of those years were occupied largely by other kind of business. In this case we are, after an interval of less than two years, albeit apologised for by the hon. Gentleman on the ground of its length, extending to Northern Ireland the improvements of the law that were made for Great Britain by the 1980 Act. That is a considerable improvement in narrowing the gap between the law in Northern Ireland and that in the rest of the United Kingdom.

Secondly, although the procedure of proposal and draft order does not allow for the full range of amendment that Committee procedure permits, nevertheless, we have yet another example in the case of this order where representations made on the basis of the proposals have actually resulted in the draft order being better when presented to the House than it was in its original form. That difference—the addition of paragraph 14—is a point on which my hon. Friend the Member for Londonderry (Mr. Ross), who has made some study of the matter, may be addressing you, Mr. Deputy Speaker.

I wish to address only two questions to the Minister for clarification. The first is regarding article 5. I take it that the law whereby the purchaser for value acting in good faith acquires title to the stolen property after six years is not itself an innovation produced by the order, but that the innovation is the maintenance of the right of suit against the thief or a person culpably handling the stolen goods.

It still remains, in one sense, unsatisfactory that after six years the good title to goods that have been stolen should pass from the true owner even to a person who acquired them eventually in good faith. I believe that in that respect the limitation is less severe in this country than on the Continent, although no doubt the European Court of Human Rights will presently discover that there is a human right which requires us to amend our law so as to make the limitation in this country as short as it is on the Continent.

I am probably not the only hon. Member who recalls with irritation the episode of the Burghfield effigy, which, having been stolen from a church in Berkshire, and having been purchased by an antiquary in Belgium, had to be repurchased for several thousands of pounds, I believe, by a not wealthy church, albeit with assistance from other sources of finance. Though I agree that there must be some limitation, it is a pity that we have the six-year period still applying as between the original owner and the purchaser for value acting in good faith. Perhaps the hon. Gentleman will be good enough to verify that in that respect there has been no change in the law and that the change is related only to the situation as between the original owner and the thief or a culpable handler.

My only other question relates to article 11, which extends the provisions to the Admiralty Division of the High Court. Is it really the case that these limitations have not applied hitherto to Admiralty jurisdiction, and how came it that Admiralty jurisdiction enjoyed this peculiar privilege until this late stage of our history? Perhaps there is some misunderstanding, but, on the face of it, it is a curious point which perhaps the Minister—he will be assisted in this by what my hon. Friend the Member for Londonderry has to say—may be able to explain.

11.45 pm

When the limitation which has now been corrected by the insertion of article 14 was first brought to my notice about a year ago, I was soon made aware that the judiciary and the solicitors in Northern Ireland were taking up the matter with the Northern Ireland Office, as I did subsequently.

I thought at first that it was the result of sloppy drafting that the six years ran from the date of the original purchase. Later, in the course of my investigations, I discovered that this was not so, but that the law in Northern Ireland derived from the original law for all of Ireland prior to 1920 and that the original draft of this order used the practice and language which was used in the Dublin Act of 1964 which was to overhaul the law in the Republic.

It is an interesting reflection on the history of the British Isles that the separate body of law in Ireland operated in this fashion so many years after the separation of the Republic from the rest of the United Kingdom.

In those circumstances, it was with great pleasure that I received a letter from the Minister of State on 15 December telling me that article 14 had been inserted in the draft order and that it would meet the problem which had originally been brought to my attention. One of my constituents had suffered considerable financial loss because of the existing law, which has now been corrected. I am very pleased that the matter has been brought to this satisfactory conclusion and that in future other cases, a great many of which possibly have not yet come to light, will not result in any financial loss following the change which has been made.

I wish to put one or two questions to the Minister. The first refers to article 14(3). It appears that the heir of an owner can be caught, whereas the person who buys the property in question can start running the six years from the date of purchase. Is my understanding correct? Someone who inherits property is caught by the sin of omission of his father, whereas someone who buys the property has a second bite at the cherry. Is that just? Should each individual owner, whether an heir or a buyer, not stand on the same footing? That may be a further effect which will cause problems in the future. I should be grateful if the Minister would look at that matter.

At one time I was also moved to wonder whether, by paragraph 3 of schedule 9 of the 1970 Act, people in Northern Ireland were being treated less generously than those in Great Britain. I should be obliged if the Minister would investigate that and write to me to let me know whether my fears are well founded. I should not like to tell the people of Ulster that they are on an equal footing with the folk in the rest of the Kingdom, only to discover in a year or two that in some respects they might be rather worse off.

I feel a very real satisfaction at the happy outcome of my representations, which I know were backed by the judiciary and by the solicitors. I am grateful to the Minister and his right hon. and hon. Friends for the care with which they investigated the complaints that were made, which they brought to such a happy conclusion. The most relieved person of all is my constituent, who now finds that he will be able to recover the sums that he lost because the legislation is retrospective. I am exceedingly grateful for that.

11.53 pm

I am pleased to take the opportunity to reply to this short and probing debate on a highly technical part of the law.

The right hon. Member for Down, South (Mr. Powell) correctly referred to the fact that we have made rather more satisfactory progress this time in amending legislation in the Province than we did in the 19-year gap between the 1939 and 1958 legislation.

The right hon. Gentleman mentioned two points on articles 5 and 11. I say clearly and unequivocally in connection with his question on article 5 that his supposition is correct. Those buying goods in good faith are protected, but—and it is an important rider—after six years the good title goes to the bona fide purchaser. The true owner can still thereafter sue the thief. I hope that that short explanation will be adequate for the right hon. Gentleman.

The right hon. Gentleman also raised an extremely interesting—although to me slightly obscure—point on article 11 about Admiralty jurisdiction. It is correct that Admiralty jurisdiction was not covered by the 1958 Act. By the provisions of the order, if accepted by the House, that will now be reversed. I hope that that satisfies the right hon. Gentleman on the point of substance. I should like to write to the right hon. Gentleman at a later stage in order to give him all the background and the legal reasons for the exemption of the Admiralty in the 1958 legislation.

The right hon. Gentleman also referred to article 14. However, I must reply to his hon. Friend the Member for Londonderry (Mr. Ross) on that matter, as he has taken such a great interest in the clear injustice that was done to one of his constituents. If it is not egregious to do so, I should like to pay tribute to the hon. Gentleman for the vigorous way in which he has pursued the point to a successful conclusion, I hope, from his point of view and also that of any individuals in the Province who might, had it not been for his vigilance, have been faced with exactly the same kind of problem.

It is true that the detailed points that the hon. Gentleman raised on subsequent matters would be better dealt with in a letter. He has invited me to write to him and give those details. Following our consideration of these matters, I am only too pleased to undertake to do so as quickly as possible. I assure the hon. Gentleman that his interpretation of paragraph 3 of article 14 is correct in this context.

I am happy to commend the order to the House.

Question put and agreed to.


That the draft Limitation Amendment (Northern Ireland) Order 1982, which was laid before this House on 4th February, be approved.

Fire Service College Board (Abolition) Bill Lords

Order for Second Reading read.

Motion made, and Question put forthwith pursuant to Standing Order No. 66 (Second Reading Committees),

That the Bill be now read a Second time.

Question agreed to.

Bill accordingly read a Second time.

Bill committed to a Standing Committee pursuant to Standing Order No. 40 (Committal of Bills).