Background
The applicants were former clients of Silver Law LLP, which acted in 2019 on their purchases of long leasehold interests in a Liverpool development. They paid deposits, but the developer later entered administration and the development was sold. The applicants alleged that Silver Law had negligently failed to advise them and take steps that would have protected their deposits.
Silver Law ceased trading in 2021 and was struck off in August 2024 before being dissolved on 3 September 2024. The applicants instructed solicitors in April 2025. Although Silver Law was restored to the register by a County Court order in June 2025, the applicants did not learn of that order until 17 July 2025. They sought a direction under section 1032(3) of the Companies Act 2006 that the period from strike-off to the restoration order’s receipt by Companies House should not count for limitation purposes.
The Court’s Holding
Master Clark dismissed the application. A section 1032(3) limitation direction may be made only where dissolution was the real cause of the claimant’s inability to bring the claim in time, and only to put the parties as nearly as possible in the position they would have occupied had the company not been dissolved.
The court held that the applicants would, had the LLP existed, have pursued a standstill agreement or protective proceedings when their solicitors sent letters before claim in June 2025. But, at most, a direction could cover the period from April 2025, when the solicitors were instructed, to restoration—a maximum of 64 days. It could not extend beyond the period of dissolution or relate back to the application date. Even with that maximum extension, every claim was out of time before the application was issued in February 2026.
Key Takeaways
- A restoration direction cannot give a claimant a better limitation position than if the company had never been dissolved.
- The relevant causal question is whether dissolution actually prevented timely proceedings or a standstill agreement.
- A court will not use section 1032(3) to revive claims after even the maximum justified extension has already expired.
Why It Matters
The decision illustrates the narrow remedial function of section 1032(3). Claimants affected by a defendant company’s dissolution must act promptly once they have advice and, especially, once restoration becomes known.
It also confirms that the court may assess the practical period during which dissolution truly impeded the claim, rather than automatically excluding the entire period of dissolution.