In a new ruling, the Supreme Court states that a request from the National Board of Industrial Injuries concerning a so-called section 10 statement may preliminarily suspend the time-barring period.

Dispute concerning claim for damages

The defendant had recognised liability in damages in connection with a traffic accident in 2001. The question was whether the claim was time-barred when raised in January 2007. The plaintiff claimed that the defendant's request to the Board concerning a section 10 statement on 16 August 2004 had suspended the time-barring period.

Time-barring

The question was to be heard based on the previous Statute of Limitation Act from 1908 according to which claims of this type are time-barred after five years. As it appears from the applicable act, the time-barring period may in a number of situations be preliminarily suspended with the effect that the time-barring date is postponed compared to the original time-barring date.

One of these situations justifying a preliminary suspension is if the parties start negotiations concerning the claim. The previous act did not contain any rules on postponement of the time-barring date in connection with the parties' negotiations.  However, in some situations, a postponement of this kind was acceptable according to case law. The reason was that there was an implicit acceptance from the debtor to temporarily suspend the time-barring period as long as negotiations were pending and for some time afterwards.

This practice became a statutory rule in section 21 (5) of the Statute of Limitation Act applicable at that time, according to which the time-barring period takes effect no earlier than one year after the date when the negotiations are considered concluded.

The assessment as to when the negotiation situation will imply that the time-barring period should be temporarily suspended is assumed to be the same according to the current rules as according to the previous act from 1908. The Supreme Court ruling is therefore also relevant in relation to the current act.

The district court and the high court agreed: Not a suspension of the time-barring period

The courts found that the fact that the defendant was responsible for representing the matter to the Board and for obtaining a specialist statement did not in itself give the plaintiff a justified expectation that the defendant would not object to time-barring.

Both courts found that the plaintiff's claim for damages was time-barred.

The Supreme Court: The request is compared to implicit acceptance

The case was appealed against to the Supreme Court, which delivered its ruling on 10 April 2015.

In general, the Supreme Court noted that if the tortfeasor has given the injured party an expectation in connection with the negotiations that a objection against time-barring will not be made during the negotiations, this will in practice be considered an implicit acceptance of a temporary suspension of the time-barring period.

In the Supreme Court's opinion, such justified expectation could exist if the tortfeasor (or the injured party in agreement with the tortfeasor) requests a statement from the Board.   The Supreme Court justifies this opinion by the fact that, in this situation, the injured party may expect that, based on the Board's statement, the parties may reach a settlement without bringing legal action.

The Supreme Court therefore attaches importance to the fact that the parties were in a situation where the negotiations were almost concluded and the loss was to be calculated based on the Board's statement.

The Supreme Court therefore found that the defendant had implicitly accepted a suspension of the time-barring period by requesting a statement from the Board.

The time-barring period was therefore suspended in due time - after the parties' negotiations could be considered concluded. Consequently, the Supreme Court sets aside the district court's and the high court's rulings determining that the plaintiff's claim was not time-barred.

Comments

It still depends on a specific assessment of the parties' indications and actions to determine whether the necessary willingness exists between the parties to temporarily suspend the time-barring period.

However, a request to the Board after the delivery of a Supreme Court ruling will in many cases be a sufficient indication that the necessary willingness to negotiate is present.

The content of this Newsletter is not, and should not replace, legal advice.

contacts

Finn Schwarz

Managing Partner

Maria Schmiegelow

Attorney