LEGAL CASEWORK | PROPERTY

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n 30 July, the UK’s Supreme handed down its judgment in the case of David T Morrison & Co. Ltd t/a Gael Home Interiors v ICL Plastics Limited and others. BLM represented the successful appellants, ICL. DTO Morrison’s premises in Glasgow sustained substantial damage following an explosion at the ICL factory on 11 May 2004. Morrison served proceedings in August 2009, more than five years after the explosion. ICL admitted liability but argued any obligation to make reparation had prescribed. DT Morrison argued the prescriptive period commenced only once it could, in the exercise of reasonable , have discovered it had suffered loss as a result of the act, neglect or default of ICL. The issue in the case was how to apply the statutory test in Section 11(3) of the and Limitation () Act 1973. Is an action available immediately, more than five years following the explosion the date of the explosion. or only once a claimant has undertaken did not mean that it was out of time. The The allowed the appeal. investigations into the cause of the loss? pursuers were entitled to have evidence led Lord Reed gave the leading opinion. On a on the question of whether their claim had natural reading of Section 11(3), it did not Case history prescribed. require awareness of the cause of the loss, The of the ICL’s primary argument before the Supreme injury or damage before the prescriptive dismissed the action at first instance, holding Court was that the correct interpretation of the period would commence. It only required prescription was not deferred until the Prescription & Limitation (Scotland) Act 1973 awareness of the occurrence of loss. Lords prospects of success were ascertained. is that awareness of the fact of loss/damage is Neuberger and Sumption agreed with Lord The Scottish Appeal Court (the sufficient for the prescriptive period to begin. Reed. of the Court of Session) disagreed with the Alternatively, DT Morrison must have been The result was the claim was held to have Outer House and held that the mere fact aware it had sustained loss/damage as a result prescribed and ICL was absolved from any an action had been raised by the pursuers of an action, neglect or default of someone on responsibility for the claim of around £1.4m plus interest. Lords Hodge and Toulson were of the opinion the appeal should be dismissed. However, recognising his view as being in the minority in the case, Lord Hodge urged that recommendations on statutory amendments produced in 1989 be given fresh consideration in order When does a to clarify the law, the majority decision in this case having “changed the law as it was previously understood”. The lesson to be taken away from this decision is that in cases involving property loss become damage the prescriptive period can commence when loss has occurred, whether or not it is possible to say, at that time, the loss was caused by an “act, neglect or default” (injuria) on the part of some other a loss? party. The critical date is now clearly that on which the party that has suffered loss first The Supreme Court has clarified the law of prescription knows, or with reasonable diligence ought to in Scottish property damage claims. Tony Murray have known, it has suffered loss. GETTY explains what it means for you… Tony Murray is a partner at BLM IMAGE: 25 OCTOBER/NOVEMBER 2014 THE JOURNAL www.cii.co.uk