Limitation of Actions Consultation - Law Commission

(3) Acknowledgements and Part Payments by Co-Debtors and Other
Third Parties
8.44 The question whether an acknowledgement or part payment by one person will
bind other persons, in the sense of re-starting the running of time against them, is
governed by section 31 of the 1980 Act. It has been noted that in general the effect
on third parties of a part payment is likely to be greater than that of an
acknowledgement. 111
8.45 In the case of debts and other liquidated pecuniary claims, a part payment will
bind all persons liable, 112
but an acknowledgement will bind only the person who
made it. 113
8.46 An acknowledgement or a part payment by one personal representative will be
sufficient to bind the estate of the deceased. A part payment by a beneficiary may
be sufficient to restart the running of time against the estate. 114
8.47 An acknowledgement of title to land 115
by a person in possession will bind all other
persons who are in possession during the limitation period that follows the
acknowledgement. 116
The position in relation to mortgaged property is more
complex. Time is re-started by a payment made by either the person in possession
of the land, or by the person who is liable for the debt. 117
If the land has been
occupied by a squatter, the mortgagor can prevent time running in favour of the
squatter as against the mortgagee by making a payment on the mortgage to the
mortgagee. This will not stop time running in favour of the squatter as against the
mortgagor who is no longer in possession of the property. 118
The payment will bind
all other persons in possession of the mortgaged property during the ensuing
period of limitation, so far as the mortgagee’s right to foreclose or otherwise
recover the possession of the property is concerned. 119
8.48 Where two or more mortgagees are in possession of the mortgaged land, and only
one gives an acknowledgement, the acknowledgement will only bind that
mortgagee and its successors. 120
The limitation period 121
will continue to run in
favour of the other mortgagee. If the mortgagee giving the acknowledgement is
entitled to part of the mortgaged land, but not to an ascertained part of the
111 A McGee, Limitation Periods (2nd ed 1994), p 301.
112 Section 31(7).
113 Section 31(6).
114 See, eg, Re Hollingshead (1888) 37 Ch D 651; Re Lacey [1907] 1 Ch 330.
115 Or to a benefice or mortgaged personalty.
116 Section 31(1).
117 Section 29(3). See para 8.30 above.
118 See A McGee, Limitation Periods (2nd ed 1994), p 298.
119 Section 31(2).
120 Section 31(3).
121 Calculated from the moment the mortgagees went into possession of the mortgaged land: s
16, and see para 6.46 above.
159