Embargo: MIDNIGHT TUESDAY 20th DECEMBER 2011
LAW REFORM COMMISSION PUBLISHES REPORT ON TIME LIMITS FOR BRINGING CIVIL CLAIMS IN THE COURTS (THE STATUTE OF LIMITATIONS)
REPORT RECOMMENDS SIMPLIFIED SYSTEM ON TIME LIMITS TO REPLACE COMPLEX LAW BASED ON ARCHAIC CONCEPTS
Wednesday 21st December 2011: The Law Reform Commission has published its Report on Limitation of Actions (Statute of Limitations). The Report forms part of the Commission’s Third Programme of Law Reform 2008-2014, and examines the rules on time limits for bringing civil claims in the courts, many of which are contained in the Statute of Limitations 1957, as amended. The Report makes 26 recommendations for reform of the law and also includes a draft Limitations Bill 2011 to implement them.
The meaning and purpose of the Statute of Limitations
The Statute of Limitations sets down specific time limits available to a person to initiate a civil claim against another person (the Statute of Limitations has nothing to do with criminal cases: there is, for example, no actual time limit within which a murder charge must be brought). It allows the person a specific amount of time within which to bring the claim: for example, 6 years from a breach of contract, such as failing to make a repayment on a loan. If the person fails to begin proceedings within the time allowed, the defendant has a full defence that the case is out of time (“statute-barred”).
Complexity of, and archaic rules in, the Statute of Limitations
The 80 sections that make up the Statute of Limitations 1957 involve a complex series of rules that determine: what the relevant limitation period is, when it starts running, and the possibility of an extension of the time limit for some reason, such as the potential litigant being under age at the time of an incident. The Commission notes that this has actually resulted in costly litigation on what time limit applies in a specific case. This is, therefore, a major cost for litigants, including businesses and the State, and a modern Limitations Act should prevent these inefficiencies in the future.
The Statute of Limitations 1957 contains 7 different limitation periods (1, 2, 3, 6, 12, 30 and 60 years) that apply to a wide range of civil actions. These are divided into a number of general headings, including what are called common law actions. This includes the main, high-volume, civil actions in the courts, such as claims concerning contracts (including debt-related claims) and torts (including personal injury actions).
As well as the complexity of the rules in the 1957 Statute, the reasons for which a specific limitation applies to a particular action can often be traced back to 17th Century legislation. For example, the current 6 year limitation period for contract cases was first set out in the Limitation Act 1623. While a 6 year time limit may have made sense in an era of slow communications, this cannot be justified in a time of virtually instantaneous communication.
Key recommendation: a simplified “core limitations” law
The Law Reform Commission’s Report reviewed limitation laws in many other States, and notes that a trend has emerged of more simplified and streamlined limitations laws. These are usually called “core limitations” laws. The key features of core limitations regimes in other States are: (1) an across-the-board (uniform) basic limitation period that applies to virtually all civil actions; (2) a uniform commencement date; and (3) a uniform ultimate limitation period (“long-stop”). The Commission recommends that a core limitations law should be introduced in Ireland for the high-volume civil claims, including contract claims and personal injuries claims.
Some of the detailed recommendations in the Report are that:
- there should be a basic limitation period of 2 years for contract claims (for example, debt-related claims) and tort claims (for example, personal injuries claims);
- the basic limitation period should run from the date of knowledge of the plaintiff (what the plaintiff knew or ought reasonably to have known);
- there should be an ultimate limitation period (“long stop”) of 15 years (most claims would, therefore, be statute-barred after 15 years);
- there should be a judicial discretion to extend the 15 year time limit in exceptional cases. These would include: (a) where an injury was symptomless for a very long time (for example, arising from exposure to asbestos fibres); (b) where the person’s ability to decide whether to sue was impaired (for example, due to sexual or physical abuse); and (c) where there was fraud or concealment by the defendant (for example, in a case involving financial loss).