Professional negligence solicitor Emma Slade ponders the foreseeability of the economic downturn and its legal implications

A recent decision from the Court of Appeal could have serious implications for those who put themselves in a position of advisor prior to the double dip recession that has engulfed the UK economy.

Until the decision in Rubenstein –v- HSBC, it had long been accepted that a Claimant would not be reimbursed for their losses arising out of a recession or a falling market. However, the Rubenstein decision appears to have turned this on its head, with far reaching implications for people making a professional negligence claim.

To review the law as it appeared before the Rubenstein case, we need to consider South Australia Asset Management Corporation –v- York Montague Ltd 1997 AC 191, better known as the SAAMCO case. In fact, SAAMCO was three separate cases involving different parties but, as they all raised similar issues, they were heard together.

In each case, a valuation had been made of premises and on the strength of that valuation, the claimant (a lender) had made a loan. The valuations though were negligent over-valuations. This became apparent when the borrower defaulted and the lender had to recover the property, subsequently selling it at a loss. In each case though, the loss was made greater because of the fall in the property market in the last recession.

In effect, there were two losses: the difference between the over-valuation and the correct valuation and then the further loss arising from the fall in the value of the property. The lenders wished to recover both losses.

Ultimately, the Court of Appeal concluded that whilst the lenders could recover the first loss, they could not recover the second loss as that simply had not been foreseeable at the time the valuation had been undertaken. The court felt that whilst a surveyor could expect a small fluctuation in the market, the recession itself had not been foreseeable.

There was also another distinction made: whether the valuation was considered to be “information” to allow another person to decide upon a course of action; or whether it was “advice” encouraging another person as to what course of action they should take. In SAAMCO, the Court of Appeal considered that a valuation was merely information for the lender to make a decision about what to do; it was not advice about the nature of the property market.

The outcome of Rubenstein –v- HSBC has therefore come as quite a surprise.

In this case, Mr & Mrs Rubenstein had sold their property and wished to invest the proceeds of sale (£1.25m) in a risk free investment. Mr Rubenstein contacted an IFA at HSBC to discuss his options and was provided with a brochure for the AIG Premier Access Bond. In August 2005, Mr Rubenstein emailed the IFA saying:

We can’t afford to accept any risk in the investment of the principal sum. Can you confirm what – if any – risk is associated with this product

The reply came back:

We view this investment …as the same as cash deposited in one of our accounts…[T]he risk of default…is similar to the risk of default of Northern Rock.

A singularly prophetic response given the demise of Northern Rock two years later!

Mr Rubenstein invested his money in the AIG fund where it remained for three years until the crash of Lehman Brothers, swiftly followed by problems at AIG. Like others, Mr Rubenstein tried to extract his money from the ailing company but lost approximately £180,000 from his investment. He brought a claim for compensation for professional negligence.

At first instance, the trial judge concluded HSBC had indeed given negligent advice, that the fund had been totally inappropriate for Mr Rubenstein and that Mr Rubenstein had relied on that advice. However, applying the SAAMCO principles, the Court found that the loss was entirely unforeseen and too remote. The Judge concluded that the loss had not been caused by the bank’s negligence but by the “extraordinary and unprecedented financial turmoil which surrounded the collapse of Lehman Brothers”.

On Appeal, HSBC conceded that, in accordance with SAAMCO, they had provided Mr Rubenstein with “advice” upon which he relied. They also tried three lines of argument to try and show that the loss was not foreseeable.

Firstly, they claimed that the collapse of Lehman Brothers had caused unexpected and unprecedented financial turmoil which could not have been foreseen. The Courts response was that Mr Rubenstein hadn’t invested in Lehman Brothers! Rather, the loss resulted from HSBC advising Mr Rubenstein to invest in a fund that was subject to a market risk, something which he did not want.

Secondly, HSBC pointed out that at the time of the investment, the AIG fund would have been regarded as being risk-free. The Court considered this as irrelevant as the bank had a duty to protect Mr Rubenstein from market risk.

Finally, HSBC argued that the investment had only intended to be for a short period of time but instead, the fund was held open for an additional two years which would have been outside the remit of their original instructions and thus could not have been foreseen. The Court felt that this was a powerful argument but ultimately concluded that the time the monies were to be held in the fund had not been defined in terms of months but rather that it was to be there until Mr Rubenstein purchased a new property.

Mr Rubenstein’s professional negligence claim was successful and HSBC were ordered to pay £113,000 in compensation plus legal costs.

The outcome of this case is quite extraordinary, particularly in light of the cases that arose out of the previous recession. It is not clear whether this will set a new precedent for all professional negligence cases for losses that arise out of a recession or credit crunch, or whether this case is to be distinguished on its own particular facts. If it is to be distinguished, there are good grounds for doing so: in this particular instance HSBC accepted they were giving Mr Rubenstein “advice” rather than merely information. Importantly, Mr Rubenstein had made it unequivocally clear that he did not wish to experience any risk, yet HSBC had misrepresented the nature of the investment to him. On that basis, it would appear that the SAAMCO defence might still be available in a pro neg case if the advice was not part of the express terms of the instructions provided by the client.

Anyone seeking to bring a claim for compensation for professional negligence against a bank, IFA, financial adviser or any other professional person is welcome to use our FREE Professional negligence legal helpline. Call 0333 888 0403.

We deal with professional negligence claims on a no win, no fee basis and offer an out of office hours advice service by email in the evening and at weekends.

Litigation lawyers will know what a Hearsay Notice is, when one needs to be served and why. However, a recent decision by the Court of Appeal seems to have made it easier for hearsay evidence to be relied upon in court proceedings and this may result in a flood of professional negligence claims against unwary solicitors.

Hearsay is information gathered by one person from another – the first person having no first hand experience of the information. For example, you buy a packet of sweets from a shop for 52p and tell A what you have done. A then relays that information to B. When A passes that information to B it will be considered hearsay evidence as A has no personal knowledge of the fact that you bought the sweets for 52p.

Hearsay evidence can be used in court trials but in order to do so, the party who wishes to rely on it must comply with s2(1) of the Civil Evidence Act 1995, serving a notice on the other side stating an intention to adduce hearsay evidence “for the purpose of enabling [the other party] to deal with matters arising from its being hearsay.” Failure to serve such a notice means that the hearsay evidence cannot be used.

However, the Court of Appeal in Charnock –v- Rowan (2012) EWCA Civ 2 appears to have allowed an alternative method to be used.

The facts of the case are interesting. A car struck a stationary bus which carried 14 passengers. The damage to the bus was slight – it cost less than £500 to repair – but each of the 14 passengers made a personal injury claim, although only 10 accident claims proceeded to trial. The Defendants were highly sceptical. The bus had been stationary and the car had only been travelling at 15 mph. They seemed to be suggesting that 10 PI claimants were colluding in insurance fraud. As the trial judge said to the Defendant’s trial Counsel, Paul Higgins, “Either I have got ten liars or frankly, I have got none.” “That,” replied Mr Higgins, “is our position”.

The main argument put forward by the Defendants was to be found in their medical evidence; a series of medical reports prepared by a Mr Shah. Although his reports did not make any suggestions of disbelief in the claimant’s version of events, he did record some of the claimant’s stories as relayed to him and, in some cases, pointed to some discrepancies in the narrative. Technically, this is hearsay evidence and if the Defendants wished to rely on those aspects of Mr Shah’s report, they should have served a hearsay notice. However, they failed to do so.

What they relied upon was the fact that the Claimants had agreed that the report should be in the trial bundle without making any objection to Mr Shah’s comments. CPR PD 32 r 27.2 states that “all documents contained in bundles which have been agreed for use at a hearing shall be admissible at that hearing as evidence of their contents….” The Defendants argued therefore that by reason of this, no hearsay notice was required as the agreement of the bundle was the requisite notice.

The original trial judge, HHJ Gore QC, was not happy with this approach. What the Defendants were alleging was tantamount to insurance fraud and he felt that such claims must be based on “proper and admissible evidence…managed and presented in accordance with the substantive and procedural laws and rules of this jurisdiction.” If a formal hearsay notice had been served, the Claimants would have called Mr Shah to be cross examined but, following the Defendants argument, the Claimants lost this opportunity. His Honour felt that this drove a coach and horses through natural justice and long established statutory duty.

The judge found in favour of the personal injury Claimants saying that whilst there may be inconsistencies in their stories, none were sufficient to cause him alarm and quite frankly, he found it “implausible that so many people went to the trouble and inconvenience of going to hospitals or doctors or clinics, sometimes more than once, if… there was nothing wrong with them.” Interestingly, despite having spent a large proportion of his judgment dealing with the issue of the hearsay evidence, ultimately, it did not affect his finding for the Claimants – he relied purely on the facts as presented to him.

The Defendants appealed the decision, the basis of the appeal being whether or not they could rely on Mr Shah’s hearsay evidence. Ultimately, the Appeal was dismissed as the Court of Appeal felt that the Defendant’s case was “somewhat thin” but what the judgment did do was appear to endorse the Defendant’s argument that, despite it appearing to be a “trial by ambush”, documents that are included in an agreed bundle which contain hearsay evidence will be allowed without the necessity of serving a hearsay notice.

As I have said above, this judgment drives a coach and horses through the long established scheme of dealing with hearsay. To my view, the modern day scheme of litigation is for parties to try and work together without trying to trip each other up; no more “Perry Mason” style litigation of appearing at the last minute of the trial with the crucial piece of evidence or cross-examination. The hearsay notice was valuable in this respect as it could alert the opposing party to issues that they may not have considered as being live and to try to deal with is sensibly without it being “an invitation to almost limitless and costly wrangling both before and at trial” which the Court of Appeal thought their decision in this case was likely to avoid.

Whilst it may have avoided “costly wrangling” in the current case, if a solicitor misses the hearsay evidence in an agreed bundle and ultimately loses a claim as a result, this will only invite another claim, this time for professional negligence.

Professional Negligence solicitor, Emma Slade, comments on press reports about the rise in court action against lawyers for undersettled personal injury claims.

A recent article in the Law Society Gazette affirms what we, as professional negligence solicitors have long suspected: that claims against personal injury lawyers for professional negligence are on the increase because they are routinely under-settling accident claims.

There appears to be two main reasons for this: under-qualified staff and costs timetables.

A large proportion of injury claims are now dealt with by very junior ‘claims handlers’, many of whom have little or no formal legal training. Personal injury law has been de-professionalised to a significant degree, with companies spending vast sums on TV advertising campaigns to attract a high volume of accident claims that can be dealt with by an army of paralegals, working under the supervision of a single solicitor.

These injury paralegals are reliant on computer systems that enable them to process bulk claims in a routine, almost mechanical fashion. In many cases this is fine. However, because many of them are not legally qualified, mistakes can occur. They do not always understand why a particular course of action is being followed and do not always have the experience to know when a case calls for more specialist legal input.

Unqualified claims handlers can have particular difficulty understanding the significance of medical evidence. They are often unable to analyse or question the medical opinions expressed in the reports or identify where further medical evidence may be required, for instance from another medical expert in a different discipline. I am currently dealing with one professional negligence claim in which the personal injury lawyer did not appreciate the extent of the Client’s injury so failed to obtain an appropriate medical report. We reckon the client’s compensation claim was actually worth 10 times more than the figure she was advised to accept.

Some claims management companies also seem to be more concerned with how quickly and cost effectively a claim can be ‘turned around’, without necessarily striving for the best settlement for the claimant. Not all claims management companies are like this, but certainly those cases which we have dealt with suggest that undue speed in bringing a personal injury claim to a conclusion has led to the true value of the claim being missed and the case under-settled. Claims are being settled before the full extent of the injury is fully known and as the value of an accident claim is largely based on the severity of the injuries this inevitably leads to mistakes occurring and insufficient compensation being recovered.

Personal injury work is almost exclusively funded using conditional fee agreements (“no win, no fee”). This means the firm does not receive an income during the life of the claim and this can lead to some firms looking for a quick turnaround. The sooner the case is settled the sooner the costs can be recovered. Again, a quick settlement may suit many claimants but if claims handlers are too eager to settle the PI claim important legal points can be missed that will lead to the clients missing out on thousands of pounds..

We specialise in undersettled personal injury claims and will be more than happy to discuss it with you and advise you about bringing a professional negligence claim on a no win – no fee basis to recover the compensation that you have lost out on. Give us a call or send an email.

Solicitor, James McNally, looks at recent developments in mediation in professional negligence cases and civil litigation.

Lord Neuberger, the Master of the Rolls, has announced his support for a new pilot scheme within the Court of Appeal Mediation Service. The new scheme sees the automatic referral of appeals to mediation for claims worth less than £100,000, with judges open to recommend mediation for claims of any value where they feel it would be productive.

Mediation is now something that must be seriously considered by all parties engaged (or about to become engaged) in litigation: a view that was confirmed in the recent decision of Ghaith v Indesit [2012] EWCA Civ 642.

Mr Ghaith sued his employers for an accident at work. The value of his PI case was assessed at around £60,000. Indesit successfully defended the claim at trial but Mr Ghaith was given permission to appeal. Lord Justice Toulson recommended that both parties use mediation.

Although Mr Ghaith himself was keen to mediate, Indesit refused. They took the view that the legal costs were already more then the amount in dispute.

The appeal was successful. The Court of Appeal made it clear that Indesit were at fault for refusing to mediate and criticised their reasons for not doing so.

Lord Justice Longmore commented:

“This is an inadequate response to the Court’s encouragement of mediation, since a full day in this Court would inevitably result in a substantial increase in costs…Indesit’s reaction is all too frequent.”

Lord Justice Ward was also critical, making reference to Halsey v Milton Keynes General NHS Trust, one of the leading cases in relation to mediation.

In the Halsey case, Lord Justice Dyson had said:

“[the] factors which may be relevant to the question whether a party has unreasonably refused ADR (Alternative Dispute Resolution) will include (but are not limited to the following:

1. the nature of the dispute;
2. the merits of the case;
3. the extent to which other settlement methods have been attempted;
4. whether the costs of the ADR would be disproportionately high;
5. whether any delay in setting up and attending the ADR would have been prejudicial; and
6. whether the ADR had a reasonable prospect of success.”

LJ Ward added::

“It is not enough, as [counsel for Indesit] suggested, that there had been some attempt in the correspondence between solicitors to settle the case. The opening bids in a mediation are likely to remain as belligerently far apart as they were in correspondence but no-one should under-estimate the new dynamic that an experienced mediator brings to the round table. He has a canny knack of transforming the intractable into the possible. That is the art of good mediation and that is why mediation should not be spurned when it is offered.”

Refusing to mediate can result in a hefty cost penalty at the end of the case – see for instance PGF II SA v OMFS Company & Anor [2012] (where the offer to mediate was ignored) and Rolf v De Guerin [2011] (where the offer of round table discussions was repeatedly rejected with no reason being given.)

Mediation is not just restricted to the Court of Appeal. Local County Courts frequently make what is known as an “Ungley Order.” An Ungley Order will normally include the following wording:

“The parties shall consider whether the case is capable of resolution by ADR. If any party considers that the case is unsuitable for resolution by ADR, that party shall be prepared to justify that decision at the conclusion of the trial, should the judge consider that such means of resolution were appropriate, when he is considering the appropriate costs order to make.

The party considering the case unsuitable for ADR shall, not less than 28 days before the commencement of the trial, file with the court a witness statement without prejudice save as to costs, giving reasons upon which they rely for saying that the case was unsuitable.”

Costs sanctions are not currently automatic, but we are clearly heading that way. Over time, as the Courts become more stretched and funding becomes critical, the importance placed on mediation will grow.

Accordingly, an offer of mediation should be considered very carefully by all parties involved in a professional negligence dispute. If an offer of mediation is made then the potential costs consequences of unreasonable refusal should be spelled out. The refusing party should also be asked for the reasoning behind their decision.

Whilst there may still be uncertainty at the moment this is an area of law that is likely to rapidly develop. Any party considering entering into litigation (or already involved in it) should make sure that an offer to mediate – or take part in other suitable forms of ADR – is put forward at an early stage. If the invitation is rejected then the opponent’s decision to reject should be brought to the attention of the trial judge so that costs sanctions can be imposed, whatever the outcome.

Read more about this topic in our article on mediation in professional negligence cases and ADR.

Professional Negligence Solicitor, Lee Dawkins, reports on the Vibration White Finger Claims.

It is estimated that up to 60,000 coal miners in Britain are entitled to receive White Finger compensation for under settlement of injury claims involving the medical condition known as Vibration White Finger, or VWF.

Over ½ million miners have received Vibration White Finger compensation from British Coal Board and subsequent private mine owners under a special coal health compensation scheme.

The coal health compensation scheme was designed to compensate mine workers who contracted hand injuries as a result of using vibrating tools and vibrating work equipment.

However, it has been discovered that tens of thousands of those Vibration White Finger claims have been undersettled, resulting in professional negligence claims being brought by the miners against the solicitors who dealt with the VWF cases.

The negligent solicitors are being accused of failing to claim full compensation for “services” that the miners will require in the future as a result of suffering VWF.  These services include gardening and do-it-yourself (DIY).  The value of these services can be substantial, with the yearly loss mounting up over time.  Lawyers who represented coal miners in the original VWF cases estimate that the value of the future services claims can average up to £50,000.

Any miner or coal worker who feels that a claim for services was not pursued in their VWF case (or thinks that their Vibration White Finger claim was undercompensated) should call our VWF Professional Negligence Hotline on 0333 888 0403 for a free assessment.

We undertake all solicitors’ negligence cases involving VWF claims on a no win, no fee basis.  Under our special VWF professional negligence no win, no fee scheme we will fund all expenses and disbursements, which means there is nothing to pay up front.  It is a genuine no win – no cost arrangement.

And remember, we are professional negligence specialists.  Our lawyers have years of experience of dealing with professional negligence and solicitors’ negligence claims.  We also have a large personal injury department so our professional negligence lawyers are able to draw on the expertise of our personal injury team when bringing a professional negligence claim involving VWF negligence.

Our expertise and experience in the area of professional negligence and solicitors’ negligence has earned us widespread recognition and we are recommended by the influential Legal 500 Directory as one of the country’s leading professional negligence practices.

For a free assessment of your VWF claim contact us now on 0333 888 0403 or email Lee Dawkins at lee.dawkins@sleeblackwell.co.uk

Professional negligence solicitor, Emma Slade considers an appeal court decision that seems likely to be fertile ground for professional negligence claims

The Court of Appeal’s controversial decision in Société Générale –v- Geys seems likely to cause huge confusion for employees and employers alike, with potential for a good sprinkling of professional negligence claims to boot.

Although the case itself was ostensibly about whether or not Mr Geys was entitled to a bonus payment of some €7.9m, the court spent considerable time working out the date his employment actually concluded.  Mr Geys claimed that the bonus payment was due during his notice period; the employers argued that it only crystallised after the date of termination of his employment.  As such, it was critical for the Court of Appeal to give consideration as to the “effective date of termination” (“EDT”).

In this particular instance, Mr Geys’ contract of employment allowed his employers to terminate his employment and give him a payment in lieu of notice (a ‘PILON’ payment as it is known).  Mr Geys was on holiday when his employment was summarily terminated.  He did not check his bank account so was not aware of any PILON payment and critically, his employers did not advise Mr Geys that this was indeed a PILON payment until after the bonuses had been called.

The Court of Appeal concluded that on a literal reading of the PILON clause, there was nothing in there that required the employer to give notice to the employee that it intended to exercise the clause.  Moreover, once the PILON clause was exercised and payment made, it had the effect of terminating the employment with immediate effect.

This case has resulted in three important principles:

• Only if a contract of employment has a PILON clause can a payment in lieu of notice be made.  If there is no such clause, a PILON payment will be in breach of contract and the EDT is at the end of the notice period.  This distinction will be important for calculating the limitation period in an Unfair Dismissal claim.
• If a PILON clause is effected, the EDT will be on the date the money is actually paid (not promised).
• Unless the contract of employment says otherwise, there is no obligation on the employer to tell the employee that this is a PILON payment and ultimately, it is up to the employee to work it out

It is this latter issue which is likely to cause the greatest confusion and likely to be the greatest potential cause of professional negligence.  This decision may still yet be appealed but either way, care must be taken in determining the type of payment that is being made to determine the limitation period. Mis-calculate a limitation date and a professional negligence claim wont be far behind.

Emma Slade is a specialist professional negligence solicitor. If you have a potential claim for negligence and would like to take advantage of our FREE case assessment offer then contact Emma now at emma.slade@sleeblackwell.co.uk 

Emma Slade, a professional negligence lawyer, considers whether a solicitor can be negligent for being too cautious, or too optimistic.

Put three lawyers in a room and you will get four different opinions. At least that is the way the joke goes. But just because you get four different opinions, doesn’t mean that 3 of the solicitors have been negligent. Practising the law is not an exact science and a large element of it is entirely subjective. Some solicitors will be naturally more cautious and pessimistic, others more bullish and optimistic, but this does not mean that either view is wrong, let alone regarded as professional negligence – provided of course the law is right!

This was considered in the High Court case of Langsam –v- Beachcroft LLP & Others [2011] EWHC 1451 (Ch). Mr Langsam had instructed Beachcrofts solicitors to bring a claim against his former accountants. Beachcroft’s were doubtful about his prospects of success and so he settled the claim. Subsequently, he brought professional negligence proceedings against Beachcrofts on the grounds that they were “overly pessimistic” about the merits of his accountants negligence claim.

The Court dismissed the claim. Firstly, Beachcroft’s had obtained Counsel’s Opinion and whilst the Court found this was “conservative”, it was justifiably so as there were numerous hypothetical arguments which affected the value of the negligence claim. Secondly, they considered that Mr Langsam had been given sufficient information by Beachcroft’s to make an informed decision. Specifically, Beachcroft’s had written to Mr Langsam advising him of his prospects of success and that he would be likely to achieve a better settlement at trial. However, the Court found that Mr Langsam was keen to settle the matter before trial.

Ultimately, the Court concluded that different lawyers will have different views on the prospects of success of a solicitors professional negligence claim but so long as the those views are within a range that any reasonably competent solicitor would adopt, it means the pessimistic, as against the bullish solicitor (and vice versa) will not be considered negligent.

Emma Slade reviews the relationship between solicitor and barrister in the context of professional negligence law and asks, ‘Can a Solicitor Rely on Counsel?’

Explaining the difference between a solicitor and barrister is not easy. Most people liken it to the distinction between a GP and a Consultant. In this sense, a solicitor is similar to a GP dealing with a general practice whilst the barrister, like a Consultant, tends to specialise in an area and have more specific expertise. It is for this reason that solicitors will usually advise you to get an Opinion from a barrister at some point during any litigation.

But whilst a second opinion from counsel can be extremely helpful, it sometimes throws up a completely different view of the case and one which even your solicitor was not expecting. If this happens, is your solicitor negligent for simply accepting it?

The question was considered in the 1991 case of Locke –v- Camberwell Health Authority. In this case, Ms Locke brought proceedings against the Defendant for causing a disability in her right arm following a failed surgical attempt to rectify her angina problems. However, her barrister felt that her case had little prospect of success and was told to discontinue the negligence claim. The Court considered the duties of a solicitor in those circumstances and came up with three rules which were re-affirmed in the 1994 case of Ridehalgh –v- Horsefield.

1. provided a barrister is properly instructed, a solicitor can rely on Counsels Advice
2. if the solicitor does not have specialist experience in a particular field, then again, it is reasonable to rely on the advice
3. however, if after seeing the advice, a reasonably competent solicitor would feel that it must be “obviously wrong”, then he cannot blindly rely on the advice but must exercise his independent judgment and reject it.

It is rare to find an advice that is “obviously wrong” in legal terms. Usually the opinions differ as counsel has noticed something about the case which changes the prospects of success. But either way, the solicitor does need to make sure he is satisfied with the final advice.

For further guidance on the question, ‘Can a Solicitor Rely on Counsel?’ contact our legal helpline.

Pro Neg solicitor, Emma Slade, reviews limitation in professional negligence actions and the difficulties that can arise in identifying the key dates.

For a free consultation about suing a solicitor for missing a limitation date contact us by phone or email.

One of the most common types of professional negligence claim against a solicitor is where a limitation date has been missed. The Limitation Act 1980 sets out what the relevant limitation periods are and for negligence claims, there is a strict six year time limit from the date of the act of negligence (or three years from date of knowledge) in which to bring a claim. However, while this might seem simple enough, identifying the exact date that the negligence occurred isn’t always straightforward.

The case of Lane –v- Cullen Solicitors illustrates the problems that can arise in determining the key dates that determine the issue of limitation.

In this case, Mrs Eason died in 1997. She had made a Will in 1993 but it was subsequently found to be invalid and so she was considered to have died intestate. As a result, her estate was to be divided between her two brothers – John and Frederick Lane – and the two children of her late sister – Paul Hobson and Ann Hannah.

In 1998, Mrs Hannah commenced a claim against the estate, arguing that she had a right to the whole of the estate. Unfortunately, her Legal Aid was revoked in 1999 and so she was unable to continue with the claim. However, it was clear that John Lane, who had been appointed the Administrator of his sister’s estate, was aware that Mrs Hannah felt she had a greater interest in the estate.

By 2001, John Lane had finalised the administration of the estate and distributed it amongst the beneficiaries. Not long later, Mrs Hannah issued court proceedings again, claiming the entirety of the estate. In 2002, the Court ordered that she was in fact entitled to the whole estate and ordered John and Frederick Lane repay the legacies they had received the year before. Frederick failed to pay up and in 2005, the Court ordered that as Administrator, John was fully liable. John issued court proceedings himself against the solicitors who had been assisting him with the administration of the estate for professional negligence. This raised the issue of limitation.

John’s argument was that, although he had been aware of Mrs Hannah’s potential claim, it wasn’t until 2002 when the Court ordered that the estate belonged to her, that her loss actually crystallised. Until then, it had only been a mere possibility and so the correct date for limitation purposes was 2002. John therefore said that he was within time for making his claim.

His former solicitors countered that 2002 was the wrong date for calculating limitation. They successfully argued that the correct date was 2001. Prior to the distribution of the estate, John had sufficient monies to pay out any potential claims. It was only after he paid out, that his position was altered. In short, the solicitors should have warned him of the possibility that Mrs Hannah could still bring a claim and he should get formal confirmation from her that she did not intend to pursue the claim. As such, John had to pay up his brother’s share and because he was time barred, could not recover compensation from his clearly negligent solicitors.

It seems like a harsh decision for John but it is a salutary lesson on how difficult it can be to identify the relevant key dates when calculating limitation.

If you have been the victim of a missed limitation date or a missed court deadline and would like to bring a claim for compensation on a No Win – No Fee basis, then call our FREE helpline today on 0333 888 0403 or send us an email with details of your case.

Negligent RICS survey: Professional negligence solicitor, Emma Slade, looks at the new RICS Condition Report and how this may impact on negligence claims against surveyors.

Contact us for a free consultation about making a negligence claim in respect of a RICS survey by calling us on 0333 888 0403 or sending brief details of your claim to us at info@proneg.co.uk

To date, there have only been three types of property survey that a home buyer can obtain:

• a full structural survey (FSS);
• a HomeBuyers survey; or
• a plain valuation.

The HomeBuyers survey was introduced by the Royal Institute of Chartered Surveyors (RICS) to bridge the gap between a FSS and a plain valuation – the FSS being an expensive and time consuming option, while the valuation gives no indication of the state of the property.

However, the HomeBuyers Report has attracted criticism for being relatively limited. They simply give an assessment of the condition of the main parts of the property and include the occasional recommendation.

This has set the RICS development team thinking and their response has been to introduce another form of property survey report: The RICS Condition Report, also known as a Level 1 Home Survey.

Like the HomeBuyers Report, the RICS Home Survey provides an assessment of the condition of the property, but it will also comment on:

• The construction and condition of the property at the date of inspection;
• Any defects in need of urgent attention;
• Any serious defects;
• Things that need further investigation to prevent serious damage to the property;
• Recommendations about likely contamination or environmental dangers;
• Potential issues that a legal advisor should consider; and
• Defects that could be considered a safety risk.

It will be interesting to see how the new report is received and what effect it will have on the number of claims for a negligent RICS survey.

If you require guidance on making a negligence claim against a surveyor or help with a negligent RICS survey then call our FREE professional negligence helpline on 0333 888 0403 or email us at info@proneg.co.uk