Dixons v Mastercard [2020] EWCA Civ 671: A photo of the English Court of Appeal. (Photo credits: Arbitration Malaysia Forum)


Section 29 Limitation Act deals with the scenario where the plaintiff’s right of action is based on (among others) fraud and that right of action was concealed by the defendant. The section provides that in that scenario, the period of limitation shall not begin to run until the plaintiff has discovered the fraud or could with reasonable diligence have discovered it. This article examines the italicised words: what exactly is involved in the process of ascertaining if the plaintiff could with reasonable diligence have discovered the fraud?

The above issue arose for decision in Dixons v Mastercard [2020] EWCA Civ 671 (“Dixons“) where the English Court of Appeal had to grapple with the meaning of those words as they appear in its English equivalent of s 29, namely s 32 (1) (b) UK Limitation Act. For the purpose of this article, we need not concern ourselves with the facts of that case. The specific issue raised was this: 

  • Does one proceed on the assumption that the plaintiff is on notice of the need to investigate such that the only issue then to decide is whether the plaintiff did in fact exercise reasonable diligence? or
  • Must it first be proved (that is, not assumed) that there were facts giving rise to the need for the plaintiff to investigate? In other words, must there first be shown a “trigger point” which should have put the plaintiff on notice to investigate? 


The English Court of Appeal decided that the latter is the correct position. In doing so, it first referred to its decision in Gresport Finance Ltd v Battaglia [2018] EWCA Civ 540 (“Gresport Finance”), where Henderson LJ referred to the judgment of Neuberger LJ (as he then was) in Law Society v Sephton [2005] QB 1013:

“it is inherent in section 32 (1) of the 1980 Act… that there mustbe an assumption that the claimant desires to discoverwhether or not there has been a fraud……Further, the concept of “reasonable diligence” carries withit, as the judge said, the notion of a desire to know, and,indeed, to investigate.”

The Court of Appeal then agreed with the reasoning of Foxton J. in Granville Technology Group Limited (in liquidation) v. Infineon Technologies AG, 25 February 2020, [2020] EWHC 415 (Comm) (“Granville”) on why such an assumption cannot be made: 

“45. If s.32(1) did involve a statutory assumption that the claimant was on notice of something meriting investigation, it would make it very difficult for many claimants to satisfy the s.32(1) test. Further, the application of s.32(1) in a number of the authorities has involved an enquiry into whether the claimant was on notice of something which merited investigation, with the courts holding that in the absence of such a “trigger”, the claimant could not be said to have failed to exercise reasonable diligence in its investigations. Thus in Allison v Horner [2014] EWCA Civ 117, Aikens LJ at [35] held that “on the assumption that it was not self-evident that the statements … were false …, it would only have been reasonable for Mr Horner to take action to investigate the truth (or otherwise) of those statements if he needed to do so”. Aikens LJ framed the issue for the court at [42] as whether Mr Horner was “put on enquiry that Ms Allison might have made such fraudulent representations so that he ought to have followed the matter up”. Similarly, Henderson LJ in [Gresport Finance] at [52] rejected the contention that reasonable diligence had not been made out in that case because the matters relied upon would not have “triggered an obligation to investigate” or put the claimant “on enquiry as to Mr Battaglia’s honesty”. In these circumstances, I believe that Henderson LJ in Gresport Finance at [46] was stating that the drafters of s.32(1) were assuming that there would in fact be something which (objectively) had put the claimant on notice as to the need to investigate, to which the statutory reasonable diligence requirement would then attach (and which involved an assumption that the claimant desired to investigate the matter as to which it was or ought to have been put on enquiry).”

Thus, the decision makes clear that the first step in answering the question whether the plaintiff could with reasonable diligence have discovered the fraud is to establish the facts which ought to have put him on enquiry. This is to be approached on an objective basis.

In this regard, the test is that adumbrated by Millett LJ in Paragon Finance v. Thakerar [1999] 1 All ER 400:

“how a person carrying on business of the relevant kind would act if he had adequate but not unlimited staff and resources and were motivated by a reasonable but not excessive sense of urgency”.


Determining when the plaintiff could with reasonable diligence have discovered the defendant’s fraud is vital as it marks the commencement date of the cause of action. As such, the decision is welcome for it illuminates the issue. 

To read the full judgment, click here.