HT-2023-000254 - [2024] EWHC 2063 (TCC)

NHBC’s summary application is brought by Application Notice dated 18 January 2024, supported by the witness statement of Ms Alabi of the same date.

Ms Alabi is a solicitor employed by NHBC as Senior Litigation Counsel, and she took over day to day conduct of the matter in late May/early June 2023 following the departure on maternity leave of the previous in-house solicitor dealing with the claim.

Having reviewed the matter, Ms Alabi considered that the claim had become statute-barred under section 5 on 29 June 2022, by virtue of six years having passed since Vantage went into administration on 29 June 2016. She took this point on behalf of NHBC by a letter to Peabody’s solicitors on 3 July 2023, which asserted that the cause of action ‘based on the insolvency of Vantage’ would in principle have accrued on the date of insolvency.

It is worth emphasising that NHBC’s position in its letter of 3 July 2023 was based solely on a contention that time had started to run from, i.e. the cause of action in contract accrued on, the administration of Vantage on 29 June 2016. I will call this the Insolvency Point.

No limitation defence had been suggested by NHBC prior to 3 July 2023. To the contrary, the letter of claim under the pre-action protocol was sent on 17 November 2022. NHBC’s response dated 13 January 2023 rejected the claim on the basis that there were no extra costs over and above the original contract sum payable to Vantage which are covered by Option 1; but it indicated a willingness to review its position upon the receipt of further information and its further assessment as to whether there were any extra costs covered under Option 1. No limitation defence was taken, but on what is now NHBC’s case, any claim to such extra costs became time-barred in June 2022.

As I have mentioned, Peabody issued its Claim Form on 24 July 2023, which included two anticipatory pleas concerning limitation. First, a denial of the Insolvency Point that time started to run on the date of insolvency; and second, a contention that the cause of action accrued on the date on which Catalyst had to pay more for the relevant units to be completed. In a letter dated 7 August 2023, Peabody’s solicitors stated that this date “was significantly later [than the date of insolvency], and within six years of today’s date. For example, our client’s total expenditure on the affordable housing at the site exceeded the original Contract Sum under the original contract in June 2020”.

Secondly, Peabody contended in the Claim Form that NHBC had agreed not to take any defence to liability and/or was estopped from doing so or taking any limitation defence. However, I need not say anything more about that aspect, since Peabody does not pursue those arguments on this Application, nor does it suggest that the failure to take a limitation point prior to 3 July 2023 (although the subject of criticism in correspondence) prevents any good point being taken now.

Consistent with the letter of 3 July 2023, and further correspondence from NHBC e.g. dated 31 August 2023 and 3 October 2023, the Application was brought on the sole ground of the Insolvency Point. It did not seek summary disposal of the claim on any alternative basis, for example on the basis that (if it was wrong on the Insolvency Point) the time at which Peabody had ‘to pay more to complete’ occurred more than six years before the Claim Form. NHBC did not therefore seek to counter the anticipatory plea by Peabody in that Claim Form and the subsequent correspondence to which I have referred.

Peabody’s evidence in response to the Application correctly acknowledged that the Insolvency Point was the only basis of the Application (see Mr London’s witness statement dated 20 May 2024, para. 7).

This hearing was listed for half a day, which was NHBC’s estimate given in the Application Notice. That was a demanding but not unreasonable time estimate for the resolution of the Insolvency Point, which is essentially a discrete point of law and construction. It was not however an adequate time estimate to deal with any alternative case for summary disposal, as I will explain, and the time taken to discuss the alternative case meant that many of the submissions on the Insolvency Point were rushed too.