Knowledge

To most observers, the legal concepts applied in Guernsey often appear similar to, if not much the same as, those encountered in England and Wales - often a case of the same concept referred to by two different names, and, in Guernsey's case, often a French one.  However, when it comes to the question of "prescription" there are some fundamental differences even if the outcome is much the same.

Prescription is the Guernsey equivalent of the English concept of limitation, being rooted in Guernsey's customary law with Norman French origins. Prescription is essentially different from its English cousin in that it extinguishes the right to bring a claim after a certain period of time. In contrast, the English concept of limitation provides a defence to a claim which arises after the passage of time. This distinction was highlighted by Deputy Bailiff Day when he held, in Holdright Insurance Company Limited v Willis Corroon Management (Guernsey) Limited, 25 August 2000, that "Prescription both establishes and extinguishes rights, in distinction merely to precluding remedies".

The time period after which prescription extinguishes a cause of action differs depending on the type of claim and is set out by way or statute or in Guernsey's customary law. The main types of claim, and the associated time periods, are, by way of outline only:

• contract: six years from the date of breach;
• tort: six years from the date of the cause of action;
• personal Injury: three years from the date of the cause of action; and
• breach of trust: three years from the date of knowledge.

It should be noted that prescription does not operate against minors or individuals deemed to be under legal incapacity.

The Guernsey customary law concept of empêchement d'agir (literally "impediment to action") may interrupt the operation of prescription (by way of extension or suspension) in one of two ways:

• empêchement de fait: the loss of right due to practical impossibilities; or
• empêchement de droit: the loss of right due to a legal disability, for example incapacity. 

In Guernsey, as in England and Wales, parties often enter into standstill agreements in order to prevent a claim being time barred (and often to facilitate negotiations). Prescription can be suspended or even extended upon agreement between the parties. The effectiveness and validity of these "standstill agreements" has been questioned historically by some legal practitioners in Guernsey and the concept has yet to receive any judicial scrutiny in the Bailiwick. An alternative route is to commence proceedings which stops the prescription "clock" running. In practical terms, this happens when a summons is handed to His Majesty's Sergeant for service on a defendant. After that, the parties can agree to "sign over" the proceedings without the need to actually present the matter before the court until a particular date – this has the same effect as a standstill agreement.

It is crucial to seek Guernsey legal advice early to properly understand the effect of prescription. Please get in touch with a member of our team who can advise on the applicable time limits and any empêchement that might affect a potential claim.