A v XY Ltd - Proceed…with Extreme Prejudice

Since the enactment of the Limitation (Childhood Abuse) (Scotland) Act 2017 (2017 Act), which removed the three year limitation period for historic child abuse claims, both pursuers and defenders in Scotland have waited in anticipation for the Court of Session to render a decision in relation to the “safeguards” under section 17D. This provision provides that a civil claim for damages in a historic child abuse claim cannot proceed if the Court finds that to do so would mean that a fair trial would not be possible and/or the defender would be met with “substantial prejudice”. The wait is now half over.

In the case of A v XY Ltd, Lord Woolman considered whether the “substantial prejudice” safeguard under s.17D(3) applied to the Pursuer’s case after hearing a debate on the point.

In short, the Pursuer alleges that when she was 13 years old, she was raped by a young male teacher during a school camping trip in 1987. She sued the school’s owners who employed him.

The Defenders were seeking to prevent the Pursuer’s case from proceeding further on the basis that they would face substantial prejudice given that: a) they were now, in light of changes to the law in this area over the past 20 years, potentially liable to pay a large sum of damages; b) they will face difficulties in investigating the claim; and c) evidence, such as documents and witnesses, may no longer be available.

The Pursuer, in contrast, argued that: a) the 2017 Act was intended to remove the limitation period for historic child abuse claims; b) the defender was vicariously liable; c) it had insurance cover; and d) there was sufficient evidence to prove the case. It was also contended that even if the Defender did face substantial prejudice, the Pursuer’s interest to see the case progress should prevail.

Lord Woolman agreed that the Defenders faced substantial prejudice, but ultimately held that the Pursuer’s interest in having the case proceed decisively outweighed this. He considered that there was sufficient evidence to make out the claim, including a comprehensive portfolio of documents and key witnesses. He noted that any gaps in evidence were not so fundamental as to lead the Defenders to claim that there could not be a “fair hearing”. He was also not persuaded that the Defenders arranged its affairs and was wound up on the basis that it had no liability as there was insurance cover at the time of the alleged incident.

Furthermore, he saw no reason for the Pursuer to bring a claim against the teacher, himself, given that he, too, could plead substantial prejudice and would also likely be unable to pay any damages awarded against him. In any event, Lord Woolman considered that the Pursuer had a clear financial interest for the case to proceed and a “vital interest” in securing justice given that she was, by her account, the victim of a “detestable crime”.

Comment

The decision in A v XY Ltd is not the grand statement of how the s.17D “safeguards” are to be interpreted and applied by Scottish Courts that many practitioners are keen to see, especially in light of the interpretation unusually provided by the English High Court of Justice in JXJ v Christian Bros.

While each case, as Lord Woolman stated, must be decided on its individual circumstances, his decision is, nonetheless, helpful in that it provides an idea of what factors will be considered when the courts balance the interests of both parties where the question of substantial prejudice arises.