Supreme Court Clarifies Deliberate Concealment Gateway For Postponing Limitation

• Published date: 21 December 2023
• Subject Matter: Litigation, Mediation & Arbitration, Trials & Appeals & Compensation
• Law Firm: Herbert Smith Freehills
• Author: Mr Jeremy Garson and Jonah Oliver

In a significant and much-anticipated judgment, the Supreme Court has clarified the elements that a claimant must establish in order to rely on the "deliberate concealment" gateway in section 32(1)(b) of the Limitation Act 1980 (the Act) and postpone the start of the limitation period: Canada Square Operations Ltd v Potter [2023] UKSC 41.

Section 32(1)(b) of the Act provides that, where any fact relevant to a claimant's right of action has been deliberately concealed by the defendant, limitation does not begin to run until the claimant has discovered the concealment (or could with reasonable diligence have discovered it).

The Supreme Court unanimously upheld the Court of Appeal's ruling that the claimant could rely on s.32(1)(b) to avoid her claim for recovery of sums paid under a PPI policy being time-barred (see our blog post on the Court of Appeal decision here). However, the judgment given by the president of the Supreme Court, Lord Reed (with whom the remainder of the panel unanimously agreed), departed significantly from the Court of Appeal's reasoning. In particular, he emphasised the importance of giving the phrases "deliberate concealment" in s.32(1)(b) and "deliberate commission of a breach of duty" in s.32(2) their ordinary meaning.

The Supreme Court summarised the necessary elements for s.32(1)(b) of the Act to be engaged as follows:

• a fact relevant to the claimant's right of action (being a fact without which the cause of action is incomplete);
• the concealment of that fact from her by the defendant, either by a positive act of concealment or by a withholding of the relevant information; and
• an intention on the part of the defendant to conceal the fact or facts in questions.

Importantly, the Supreme Court rejected the suggestion that a fact will not be "concealed" for the purpose of s.32(1)(b) of the Act unless the defendant had a legal duty to disclose the relevant fact (although it noted that the existence of such a duty may be relevant to the question of whether any concealment was deliberate). It also stated expressly that the provision will not be engaged if the defendant's concealment is merely reckless and not deliberate, highlighting that, as a matter of the ordinary use of language, the adjectives "deliberate" and "reckless" have different meanings.

In addition to providing helpful clarification of an important feature of the law on limitation, the Supreme Court's judgment will be of particular interest given the status of Canada...