Limitation of Actions Consultation - Law Commission

If consultees do not agree with these provisional views, we ask them to say
why not.
(3) Acknowledgement and Part Payment
12.155 Under the present law, a fresh right of action is considered to have accrued in
certain cases where an acknowledgement or part payment has been made. 237
This
applies to actions in respect of a liquidated pecuniary claim, or a claim to the
personal estate of the deceased; and to actions to recover land and actions in
respect of mortgages (whether of personal or real property).
12.156 The notion that acknowledgements and part payments restart the running of the
limitation period has been a long-standing feature of English law, first at common
law and then, after the Real Property Limitation Act 1833, in statute, 238
although
there has been a subtle shift over time in the theoretical basis underpinning it. 239
We take the view that it remains a useful and fair rule, and becomes all the more
necessary if, as we provisionally recommend in this paper, a core limitation regime
were adopted which would have the effect of reducing the initial limitation period
for the recovery of debts and for many other types of action. If a debtor
acknowledges the existence of a debt, either by saying as much in writing, or by
paying part of the debt, the creditor ought to be entitled to rely on the
acknowledgement, in the sense that he or she should not be prejudiced if he or she
refrains from enforcing the debt during the normal limitation period. 240
If creditors
were allowed to be prejudiced in this way, it would lead inevitably to their
commencing proceedings when there was no reason to do so, other than to protect
themselves from becoming statute-barred. 241
The same comments apply, mutatis
mutandis, to parties in land-related actions. We therefore provisionally
recommend that acknowledgement or part payment should continue to
restart a limitation period in relation to, at least, the same actions for
which this is presently the law. (And by limitation period, we mean to
refer to both an initial limitation period and a long-stop). We ask
consultees if they agree.
12.157 The New Zealand Law Commission, however, whilst recommending the widening
of the scope of the acknowledgement rule to all claims, 242
also recommended that
in order for the limitation period to recommence after an acknowledgement or
part payment, it should be necessary for the plaintiff to show that he or she relied
on the acknowledgement or part payment. 243
We take the view that this additional
237 See paras 8.27 - 8.48 above.
238 See para 8.27, n 66, above.
239 That is, away from the doctrine of an implied promise to pay: ibid.
240 See, eg, the New Zealand Law Commission, Report No 6, Limitation Defences in Civil
Proceedings, NZLC R6 (1988), para 272.
241 Ibid, para 273.
242 See para 12.167 below, where we make a similar provisional recommendation.
243 “that, but for the acknowledgement / part payment the [plaintiff] would have taken steps to
avoid the situation where a defendant becomes (otherwise) entitled to rely on a limitation
defence.” New Zealand Law Commission, Report No 6, Limitation Defences in Civil
Proceedings, NZLC R6 (1988), para 273.
307