The decision is relevant in civil litigation generally, but is particularly relevant in professional negligence claims where issues concerning the correct defendant frequently arise. It serves as an important reminder that if a claimant mistakenly assumes that a subsequent corporate vehicle has assumed the liabilities of the original entity, when it has not, the court’s power to add or substitute parties is limited once limitation has expired.
Such is the importance of the decision that on 24th February 2026 the Supreme Court granted permission to appeal the decision “as of right”.
Background
The two appeals were heard together and both involved claimants (Office Properties and Lee) who had mistakenly sued BDB Pitmans LLP ("BDB ") instead of Pitmans LLP ("Pitmans") (later known as Adcamp LLP) for allegations of professional negligence. In both cases, the claimant had issued proceedings against BDB Pitmans despite alleging negligence against Pitmans. Proceedings were issued against BDB Pitmans after it acquired Pitmans' partnership business and, the claimants wrongly assumed, Pitmans' liabilities.
In both cases, the claimants sought to substitute Pitmans as the defendant after the limitation period had expired.
A High Court deputy judge in each case gave permission for both claimants to substitute and the defendants appealed. In giving permission, the High Court judges followed the obiter dicta of Leggatt J in Insight Group Ltd v Kingston Smith (“Insight Group”), which suggested that a claimant who sued the wrong entity mistakenly thinking it to be the successor of a negligent party could substitute the defendant if the same claim was advanced.
Issues
The substitution of a party after the expiry of the limitation period is governed by section 35 of the Limitation Act 1980 and CPR 19. The effect is that substitution of a defendant may only take place if necessary for the determination of the original claim and either:
- The replacement party is being substituted for a party who was named by mistake (described as the "first gateway"); or
- The claim cannot be maintained against the original defendant unless the replacement party is substituted (described as the "second gateway").
It was accepted by the parties that the first gateway did not apply in this case because the mistake related to the identity, and not the name, of the defendant.
It was the application of the second gateway that the Court of Appeal had to consider, and whether the claims could continue unless the substitutions were made. It was accepted by the parties that to fall within the second gateway the original and the new claim must be the same.
In making their decision to allow substitution, the decisions of the High Court deputy judges had followed the obiter dicta of Leggatt J in Insight Group as regards the meaning of 'same claim’ which, as discussed above, suggested that a claimant who sued the wrong entity mistakenly thinking it to be the successor of a negligent party would be able to substitute the defendant under the second gateway if the ‘same claim’ was advanced. The Insight Group case had been decided under the first gateway – mistake as to name, rather than the second gateway which was characterised as mistake as to identity.
The claimants asserted that their claims were the 'same claim' because the facts which give rise to the claim for damages were the same and that the additional facts necessary to demonstrate that BDB had assumed liability for the claim were part of the same claim. In opposition, the defendants argued that the claims were not the 'same claim' because two different defendants (BDB and Pitmans) were being sued on two different bases - BDB for liability and Pitmans' for negligence.
Decision
The Court of Appeal rejected the claimants' submissions and found in the defendant’s favour so that the appeal succeeded. The Court of Appeal concluded that the decision in Insight Group addressed the substitution of claimants where the cause of action remained vested in the same person or company and the change was therefore procedural, as opposed to a substantive change. It held that in these cases substituting Pitmans in place of BDB would replace an essential element of the original claim. The proposed substitution would therefore not maintain the original action but would be a different claim against a different party.
The Court of Appeal therefore disagreed with the High Court and held that the second gateway requires the original and new claims to be the same in substance, and that where substitution would change the identity of the defendant in a way that changes the core facts necessary to establish liability against the defendant, the second gateway is not satisfied.
The court acknowledged that the effect of this decision might well be that there could never be substitution of a defendant under the second gateway. Giving the Leading Judgment of the Court of Appeal, Zacaroli LJ said:
“Mistake is specifically catered for in the first gateway but, according to authority binding on this court [Adelson v Associated Newspapers] , the drafter of the 1980 Act deliberately limited the circumstances in which a mistake can be relied on to where it is a mistake as to name not identity. If that is correct, then it is difficult to construe the second gateway in such a way that it covers the type of mistake which is deliberately excluded from the first gateway.”
“The parties are agreed, however, that we are precluded by ‘Adelson’ from interfering with the interpretation of the first gateway. If it needs putting right, it is for the Supreme Court to do so.”
Comment
The Court of Appeal emphasised that determination of these issues involved a strict and principled approach to the interpretation of s.35 of the Limitation Act 1980 and CPR 19.6, placing emphasis on the substance of the claim rather than procedural flexibility, and a balancing act between fairness to claimants not to be deprived of a remedy, and to defendants who should be entitled to certainty.
In coming to this decision, the Court of Appeal has effectively closed off the second gateway for the substitution of defendants, making it significantly harder for a claimant to correct an error in a claim form where the wrong defendant has been named post expiry of the limitation period, unless the mistake is merely one of name.
For claimants, the decision substantially increases the risk associated with issuing proceedings against the wrong legal entity, and places emphasis on careful pre-action investigation of corporate structures, successions, and liability assumptions, particularly in professional negligence claims involving mergers or business transfers.
From a defendant’s perspective, the judgment provides greater certainty and protection. The court’s insistence that substitution after expiry of the limitation period must not alter the essential elements of the claim strengthens defendants’ ability to rely on limitation where proceedings have been misdirected.
It will be interesting to see whether the Supreme Court considers both gateways in the forthcoming appeal which will be anticipated with interest.
Adcamp LLP v Office Properties ("Office Properties") and BDB Pitmans v Lee ("Lee") [2026] EWCA Civ 50
Authors: Alastair Dabinett & Malcolm Rogers
