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In this financial climate, people are looking long and hard at how to maximise cash flow. In particular, we are seeing more attempts to revisit former projects to look for any previously disregarded claims that could be used to generate cash.

This includes assessing whether an existing claim could be improved by adding other potential causes of action. Where that is the case, the first step is to check the limitation periods. A missed deadline can prove fatal for an action and destroy the recovery of an otherwise valid claim.

Advising on new matters that are at the edge of limitation periods is challenging. For example, we recently saw a latent damages claim that was brought despite being within weeks of the 15-year stop date contained within the Limitation Act 1980, and various actions that have been revived long after the matter was regarded as settled.

There is a trend for reassessing the causes of actions during a claim: that is, considering if any further claims arise against a defendant during the course of proceedings. It is a natural tendency to be most aware of limitation before a claim is brought, but what if, during proceedings, a claimant wants to add or substitute a cause of action after the original limitation period has come to an end?

A claim form and the particulars would have been served (perhaps in time) but this does not stop the limitation clock from running on any other causes of action. A case in July of this year revisits the scenario of amending an existing claim after the expiry of a limitation period and the test that needs to be passed in order to ensure that the amended claim can stand (Revenue and Customs Commissioners vs Begum).

In this case, a claim was issued in 2002 to avoid potential limitation difficulties and a further claim was issued in 2007. The claimant then proposed further amendments and the issue arose as to whether those amendments amounted to a new cause of action that would fall outside the limitation period and therefore be time-barred.

Clause 35 of the Limitation Act allows the addition or substitution of a new cause of action if it arises out of the same facts, or substantially the same facts, as are already in issue on any claim made in the original action.

The court therefore carried out a comparison of the factual elements in the existing action with those of the proposed new cause of action.In the present case the amendments did not give rise to any new claims. The court found that 鈥渟uch claims arose out of the same or substantially the same facts as those relied on to found the original and existing claims鈥�.

If you delay and sit on your claims, you may lose the right to be paid even if you have a good case

This is not a watertight get-out-of-jail card. As part of his judgment, Mr Justice Richards referred to the Court of Appeal鈥檚 decision in the 1991 case of Hancock Shipping vs Kawasaki Heavy Industries (The Casper Trader) and acknowledged that even if it were demonstrated that the causes of action arose out of substantially the same facts, if there were prejudice to the defendant鈥檚 ability to meet the case, this could provide a sufficient ground for refusing the amendments.

Remember limitation when considering legacy claims and before incurring legal and expert costs. It should be at the forefront of a claimant鈥檚 mind and it is important to remain aware of its risks throughout the action, particularly if amendments are made to a statement of case.

Amendments will generally be permitted if the new cause of action arises out of substantially the same facts as the original causes of action and such amendment does not, in the court鈥檚 opinion, prejudice the defendant鈥檚 opportunity to consider and respond to the new cause of action. In practice, an amendment early in the proceedings is less likely to be prejudicial to the defendant.

The lesson is that it pays to keep on top of claims during the life of and after a project. The issue of limitation means that if you delay and sit on your claims, you may lose the right to be paid even if you have a good case.

And there is always the risk that when trying to put your claim together at the last minute, errors could be made and you could make your case on the wrong basis, leading to amendments that may be time-barred.