§ 11.27 a.m.
§ Report received.
§ Clause 2 [Exceptions to Section 1]:
§ The Lord Chancellor moved the following amendment:
§ Page 2, line 19, leave out from ("would") to end of line 23 and insert ("to any extent conflict (whether under subsection (1A) below or otherwise) with public policy, that section shall not apply to the extent that its application would so conflict.
§ (1A) The application of section 1 above in relation to any action or proceedings shall conflict with public policy to the extent that its application would cause undue hardship to a person who is, or might he made, a party to the action or proceedings.")
§ The noble and learned Lord said: My Lords, I beg to move the amendment standing in my name on the Order Paper. In speaking to an amendment moved by the noble Lord, Lord Mishcon, in Committee, I acknowledged the problem which he raised but cast doubts on the noble Lord's proposed solution. The problem was that unduly long foreign limitation periods might not necessarily, by virtue of their length alone, justify the application of the public policy proviso in the Bill. I undertook to the Committee to give the matter further consideration, and this has resulted in the amendment which is now tabled in my name.
§ After consultation I have concluded that it is possible to adopt Lord Mishcon's formula, for which I thank him. There is, however, one significant difference in my own amendment. In contrast to his amendment, in which undue hardship was an alternative to public policy as ground for avoiding the application of a foreign limitation period, in the present amendment undue hardship is presented as an element of public policy. Underlying this difference is Article 16 of the European Community Convention on the Law Applicable to Contractual Obligations. Once ratified by the United Kingdom, the only available ground on which our courts may decline to apply a relevant foreign limitation period will be that of manifest incompatibility with what is called ordre public of the forum, which I translate as "public policy". To be consistent with our Community obligations it is necessary to draw the present amendment as a statement of our public policy.
731§ Lord Mishcon's amendment was also confined to defendants. My amendment caters not only for periods of limitation prejudicial to the defendant because of their excessive length, but also for periods being unduly short and prejudicial to the plaintiff. I am advised that in some foreign jurisdictions such periods exist, particularly in the sensitive field of personal injuries. Thus in the very few cases in which litigation in an English court involves the law of another country and in which, as a consequence of the Bill, the law relating to the limitation of that country will also apply, these few cases remain subject to public policy exception provided for in the Bill as originally drafted. But by this amendment is expressly incorporated into that conception an additional element—that is Lord Mishcon's formula of undue hardship. I beg to move.
§ Lord MishconMy Lords, I propose to follow the artistry of the noble and learned Lord in short and pithy replies which he illustrated so well at Question time. Therefore I merely thank him for the consideration that he kindly gave to my amendment and readily admit that his formula is a great improvement on mine. The Bill has now been improved as a result of our joint efforts, mine being the minor part.
§ The Lord ChancellorMy Lords, I am grateful to the noble Lord, Lord Mishcon, but I do not think there would have been an amendment down if it had not been for him so I am not sure that his amendment was the minor part.
§ On Question, amendment agreed to.