IN THE REPUBLIC OF TRINIDAD AND TOBAGO CV2010-00448/HCA S-2360 of 2004 IN THE HIGH COURT OF JUSTICE BETWEEN TRINIDAD AND TOBAGO MORTGAGE FINANCE COMPANY LIMITED Claimant AND STEPHEN ROBERTS ELIZABETH ROBERTS ***************************************** Defendants Before: Master Alexander Appearances: For the claimant: Mr Bronock Reid, Instructed by Ms Geeta Maharaj For the defendants: Mr Terence Martin Milne DECISION 1. At the Case Management Conference ( CMC ) on 7 June, 2011 the court was asked to exercise its discretion under Part 26 of the Rules of the Supreme Court, 1998 as amended (hereinafter the CPR, 1998) to dismiss the claim against the defendants on the grounds that it was statute barred. This application was opposed by the claimant and submissions were ordered to be filed. 2. Before examining the applicable law on this application, I will attempt to provide a brief recital of the history of this matter in order to place the issues in the proper context. This action was commenced by writ of summons indorsed with a statement of claim filed on 22 December, 2004. The claimants sought therein to recover the sum of $16,861.31 plus interest at the rate of 8.5% per annum from 19 October, 2004 to the date of judgment or payment. The monies sought to be recovered were allegedly due on a contract dated 14 June, 1991 and made between the claimant and the defendants (hereinafter the said contract ). Page 1 of 7
3. It is not in dispute between the parties that the last payment made by the defendants under the said contract was on 7 July, 1995. The questions of an acknowledgment of the debt or of a part payment subsequent to that date also do not arise. It is also not in dispute that the instant action was filed outside of the period of limitation for bringing such claims. 4. It is instructive to recite clauses 2 5 of the said contract which are as follows: Clause 2 the sum of $148,704.36 remains due and owing to the Mortgagee under the security of the Deed of Mortgage. Clause 3 the Mortgagors are desirous of selling the said leasehold premises and under the provisions of the Deed of Mortgage they have sought the Mortgagee s consent to such sale. The Mortgagors have also requested the Mortgagee to release and re-assign the said leasehold premises to them freed and discharged from the Deed of Mortgage. Clause 4 the proceeds of sale of the said leasehold premises are insufficient to liquidate the amount now due and owing to the Mortgagee under the security of the Deed of Mortgage. Clause 5 the Mortgagee has agreed to consent to the sale of the said leasehold premises and to release and reconvey the same to the Mortgagors upon the following terms and conditions: a. the Mortgagors shall pay to the Mortgagee on or before the execution hereof the sum of $123,500.00 to be applied towards the amount now due and owing by the mortgagors to the mortgagee upon the security of the Deed of Mortgage. b. the Mortgagors shall pay the balance or sum of $25,204.36 together with interest at the rate of 8.5% per annum by 84 equal monthly installments of $410.33 each, commencing on the 31 st day of May 1991 and thereafter payable on the last day of each and every month. c. the Mortgagors shall pay to the Mortgagors default in the payment of any installment as aforesaid, the entire amount payable hereunder at the time of such default shall immediately become due and payable and may be recoverable by the Mortgagee by suit or otherwise. 5. The matter was filed on 22 December, 2004 under the Rules of the Supreme Court, 1975 as amended (hereinafter the RSC, 1975 ). It was converted from the RSC, 1975 to the CPR, 1998 by notice dated 1 April, 2010. 6. Several issues arise for determination on this application as follows: i. What are the applicable rules/law governing this matter? ii. What is the effect of a statute of limitation? Page 2 of 7
iii. What is the effect of a failure to plead the statute of limitation (under the RSC and CPR)? 7. Submissions of the Claimant Counsel for the claimant submitted as follows i. The law applicable to this matter is the Limitation of Certain Actions Act Chapter 7:09, Act 36 of 1997 and in particular Sub-Section 3(1)(a). ii. The defendants have denied the debt on the basis that the claimant s cause of action is barred by virtue of section 5(1) (a) of the Limitation Act No 22 of 1981 but this Act was never passed so the defendants must be held accountable for the debt. iii. In an action for a debt, a statute of limitation operates, generally, to bar the remedy and not the cause of action. 1 Thus, the cause of action is not extinguished but is rendered unenforceable in a court of law. This means that where a debt is due, a creditor cannot recover that sum in a court of law unless he takes action within the limitation period prescribed by legislation. 2 iv. For a debtor to rely on a statute of limitation, he must plead the statute. 3 He cannot rely simply on the fact that on the face of the claim, the recovery of the debt is statute barred. 4 If he fails to plead the statute of limitation that he relies on to oust the claimant s claim, the creditor is entitled to pursue his action in a court of law since the statute bars the remedy, not the cause of action. v. In the instant case, the defendant s failure to plead the statute of limitation means the defence ought to be struck out since without that plea it is a bare defence and cannot withstand scrutiny as a general statement of non-admission is not a sufficient traverse to the statement of claim. 1 Halsbury s Laws of England 4 th edition paragraph 646 @ p. 290 2 A creditor may, however, recover the debt by any other lawful means that remains open to him. For example, if a sum of money is paid to him by the debtor, he may apply those proceeds to the statute barred debt. 3 Halsbury s Laws of England 4 th edition paragraph 647 @ p. 291. See also The Supreme Court Practice 1997 Volume 1 paragraph 18/8/10 @ p. 302. 4 Halsbury s Laws of England 4 th edition paragraph 647 @ p. 291. Page 3 of 7
8. The Defendants Submissions Counsel for the defendants submitted as follows i. As a result of the conversion of this matter to the CPR, the applicable rules are the CPR, 1998 and not the RSC, 1975. ii. The law applicable to this matter is the Limitation of Certain Actions Act Chapter 7:09, and in particular Sub-Section 3(1)(a). iii. In its bid to oust the claimant s claim, the defendants did in fact raise the defence that the cause of action did not accrue within four years of the action and so is barred. However, it was erroneously stated that the applicable law was section 5(1) of the Limitation Act No 22 of 1981, which is not in existence. iv. In any event, the laws of England and the RSC, 1975 are not applicable to the instant matter so there is no need to plead the statute. v. The applicable law (i.e. the Limitation of Certain Actions Act Chapter 7:09) is clear that the claimant is barred from bringing any action four years after the date on which the cause of action arose. The action is not merely unenforceable but the law prohibits the bringing of the action in the first place. vi. Further, the defendants have pleaded in their defence that the cause of action did not accrue within four years of the commencement of the action i.e. within four years of the last payment under the contract on 7 July 1995. The defendants have also pleaded that because of this fact the action could not be brought by the claimant since the claimant was barred or prohibited from bringing the action. Thus, the erroneous mention of the specific law does not affect the fact that the prohibition was pleaded. vii. There is now no need to make a specific plea of limitation in this jurisdiction. Thus, although the plea of limitation was made by the defendants in the instant case, there really was no necessity to plead it. Page 4 of 7
viii. The court should exercise its discretion under Part 26, CPR 1998 and dismiss this action with costs as the Act prohibits the bringing of the action and it is clearly an abuse of process. 9. The Applicable Rules/Law of Limitation i. Both parties agree that the statute applicable to this matter is the Limitation of Certain Actions Act Chapter 7:09, and in particular Sub-Section 3(1)(a) which states: 3. (1) The following actions shall not be brought after the expiry of four years from the date on which the cause of action accrued, that is to say: (a) actions founded on contract (other than a contract made by deed) on quasi-contract or in tort; ii. In contention, however, is whether the matter falls under the RSC, 1975 or the CPR, 1998? In the view of this court, this matter was converted from the RSC, 1975 to the CPR, 1998 on 1 April, 2010 and consequent on its conversion, the applicable rules are the CPR, 1998 and not the RSC. 10. Application and effect of a Statute of Limitation Can the failure of the defendants to plead the correct Statute of Limitation operate to defeat the current application? Under the RSC, 1975 it is clear that for a debtor to rely on a statute of limitation, he must plead the statute. 5 debt is statute barred. 6 He cannot rely simply on the fact that on the face of the claim, the recovery of the In the instant case, the debtor has pleaded the limitation point but sought erroneously to rely on a non-existent statute of limitation. 7 The claimant has submitted that this faulty pleading is insufficient to oust the claimant s claim, and, as the creditor, it is entitled to pursue its action in a court of law since the statute bars the remedy, not the cause of 5 Halsbury s Laws of England 4 th edition paragraph 647 @ p. 291. See also The Supreme Court Practice 1997 Volume 1 paragraph 18/8/10 @ p. 302. 6 Halsbury s Laws of England 4 th edition paragraph 647 @ p. 291. 7 Section 5(1) (a) of the Limitation Act No 22 of 1981. Page 5 of 7
action. Given the defendant s failure to plead the statute of limitation, the defence ought to be struck out, as a bare defence, since a general statement of non-admission is not a sufficient traverse to the statement of claim. It must be noted that it is not in issue that the claimant s action was filed outside of the limitation period. In contention on the part of the claimant is the failure of the defendant to plead the statute. 11. The defendants attorneys have submitted that, as a result of its conversion to the CPR, the applicable rules are the CPR, 1998 and not the RSC, 1975 and under the CPR, 1998 there is no need to plead the Statute of Limitation. 12. In the view of this court, on conversion the instant matter would be governed by the rules of the CPR, 1998. The CPR, 1998 is silent with respect to any requirement for the Statute of Limitation to be pleaded by a debtor who wishes to oust the claimant s claim on the basis that it is statute barred. Authority for this position is found in the judgment of Gobin J in Wendell Beckles v The Attorney General of Trinidad and Tobago 8 who held that a defendant is entitled to raise the issue of limitation at the hearing of an assessment of damages since the CPR clearly gives the jurisdiction to allow a defendant to be heard on a matter which was not raised in a defence but imposes certain strictures in relation to matters which must be pleaded. She expressed the current position thus: I am not of the view that Limitation is a matter which must be pleaded. There is now no CPR rule requiring this as there was under the previous Order 18 of the Rules of the Supreme Court. In England, the former requirement for an express pleading of limitation has been retained by way of a practice direction. It is not surprising then that the learning in Blackstone s Civil Practice (2005) suggests (Page 99) that limitation is a procedural defence and that it will not be taken by the Court on its own motion. That is the position as it applies under the English practice. 8 Wendell Beckles v The Attorney General of Trinidad and Tobago, John Rougier & the Commissioner of Prisons, CV2009-03303 @ paragraphs 11 & 12. Page 6 of 7
There has been a deliberate departure from this position in our jurisdiction. I consider the difference in our current rule from our former rule under the RSC and the present English rule to result in a widened jurisdiction in the Court to allow a party to raise limitation even in the absence of a formal defence and I would go so far to say that a Court effectively managing a case may raise it on its own to prevent the waste of precious Court time and resources on stale claims but subject to a requirement that notice be given to the parties. 13. The above position was re-affirmed by Pemberton J recently in Nigel Aparball and ors v The Attorney General of Trinidad and Tobago CV2007-04365 who associating herself with the Gobin dicta stated, [I]t is open to a Defendant to raise the issue of limitation after a Defence is filed. There is no need for a specific plea in the pleadings. 14. In the instant case, the limitation was pleaded by the defendants albeit in reliance on a nonexistent statute. In the case of Harnett v Fisher [1927] AC 573 a defendant was allowed to amend his pleading so as to plead a subsisting statute of limitation instead of one which had been repealed. Based on the Gobin dicta, however, there was no necessity to plead the limitation in the defence under the new dispensation of the CPR. 15. CONCLUSION I find that on the facts as pleaded in the statement of claim, the claimant s case is statute barred. I also find that the instant matter is governed by the CPR and that it was open to the defendants to raise the issue of limitation. In the circumstances, I dismiss this action and order the claimant to pay the costs of the defendants to be assessed, if not agreed. Dated 27 th January, 2012 Martha Alexander Master of the High Court Judicial Research Assistant: Kimberly Romany Page 7 of 7