All in a Name

Forked road
What happens if a party is wrongly named in a claim form in English court proceedings? Can the correct party be substituted, even if the limitation period has subsequently expired? This was an issue which arose for consideration in the recent decision of Mr Andrew Henshaw QC in
Rosgosstrakh Limited v Yapi Kredi Finansal Kiralama A.O. 

The claimant P&I insurers paid out US$1.55m to the defendant named assureds following the loss of the insured vessel on 1 September 2010. It subsequently emerged that there were grounds to avoid the policy and a defence of unseaworthiness available under s.39(5) of the Marine Insurance Act 1906.  Attempts to settle the dispute were unsuccessful and so, with the applicable six year limitation period fast approaching expiry, the claimant’s solicitors issued a claim form on 26 August 2016 to recover sums paid and to obtain a declaration of non-liability. That claim form identified the claimant as “Rossgosstrakh Limited”. Apart from the misspelling, it subsequently emerged that Rosgosstrakh Limited had been adjoined with PSJC Rosgosstrakh from 31 December 2015, and had then changed its name to Rosgosstrakh Insurance Company (Public Joint Stock Company) from 14 April 2016. The claimant’s solicitors, at the date of issuing the claim form, were unaware of these changes, only being advised on 13 September 2016. They maintained that if they had known of the changes they would have named Rosgosstrakh Insurance Company (Public Joint Stock Company). They made an application to amend the claim form accordingly. The defendants objected.

It was accepted that as the proposed substitution would involve the substitution of a new entity as claimant, this was not a case within Civil Procedure Rule (CPR) 17.4 which is concerned with “mere misnomers”. Rather, this was a case falling within CPR 19.5 which addresses cases where it is necessary to substitute or add one party for another. The judge held that the identity of the person whom the solicitors intended should sue was the insurer under the policy, i.e. the entity which as at the date of the issue of the claim form was the insurer under the policy detailed in the claim form. The claims in the claim form were incompatible with the suggestion that the intended claimant was, or at least was confined to, the entity that originally issued the policy. Rather, the relevant description of the intended claimant was, or at least included, the insurer under the policy as at the date of the claim form. As at that date there was only one possible entity fitting that description: Rosgosstrakh Insurance Company (Public Joint Stock Company).

The judge was of the view that where proceedings are intended to be brought by or against an entity identifiable by description, such as employer, landlord, shipowner or insurer, but the person preparing the proceedings is unaware that the entity has meanwhile been subsumed into another corporate body and ceased to exist in its original form, then that person has misnamed the entity and the case falls within CPR rule 19.5. It was held that it would be “highly artificial” to classify such a case as involving no mistake as to the party’s name but only as to its rights: the mistake could readily be seen to be an incorrect naming of an entity identifiable by description. It was not a case of either (a) a deliberate selection of one entity over another or (b) a mistake as to legal rights, in which case substitution would not be permitted.

The decision serves as salutary reminder of the need to ensure the correct party is identified, named, and described when proceedings are issued. While there is some flexibility on the part of the court, and in this case the substitution was allowed, the issues which arise are often not clear cut: better to get it right first time round.

Christian Dwyer
Richard Hugg