27. Juli 2022
Disputes Quick Read – 33 von 87 Insights
Disputes Quick Read: Defining the duty - the limits of the responsibility assumed by professionals
A former client sends a few ad hoc follow up requests a year or two after a transaction/piece of advice, which the professional responds to. There is no separate engagement letter, defining the scope and nature of the latest advice. How broadly will the Courts construe the tortious duty of care assumed by the professional?
That was the question addressed by the Court of Appeal in Spire Property Development & Another v Withers LLP [2022] EWCA Civ 970. Dealing briefly with the facts:
- In 2012, a property solicitor at Withers advised the Claimants on the acquisition of two commercial properties. She (negligently) failed to identify three extra-high voltage electric cables running under the property, which would significantly increase development costs.
- Two years later, in 2014, once the cables had been discovered, the former client sent several emails to Withers, largely seeking their views about why agreements granting UK Power Networks (UKPN) the right to lay the cables under the properties (so-called wayleave agreements) had not been discovered at the time of the acquisition. The emails also contained some limited queries concerning whether UKPN could have laid the cables without permission from the owners, asking the solicitor to "elaborate slightly" on issues such as statutory right of access.
At first instance, HHJ Pelling QC took in our view a surprisingly wide view of the duty of care assumed by Withers in dealing with these questions. He interpreted the email exchanges as requiring the solicitor to advise generally on the developers' rights if UKPN could not prove that it held a wayleave – and the compensation that the developers could seek.
The Court of Appeal unanimously disagreed. The scope of an assumed duty of care is a question of objective construction of the relevant exchanges that crossed the line between the parties. Those exchanges are to be read in the context that they were between a solicitor and former client, familiar to each other, and that the developer was a sophisticated professional. Having carried out that exercise, the Court concluded that the emails could not be construed as a request for advice on the developers' potential rights and remedies against UKPN more generally.
While the legal issues ultimately determined by the Courts were not novel – they relied on well-established principles of construing evidence – the result will be a welcome one for professionals. As Lady Justice Carr noted, there are important lessons to be learned: it is important for solicitors (and presumably professionals more generally) to be able to respond constructively to "one-off" requests for advice without fear of creating a broad legal liability, but care should still be taken to identify the limits of that advice.
In the absence of separate engagement letters (which would always be our preference), advice emails should be carefully caveated to make clear the limits of advice given, and where further work will be required.
Finally, it is worth mentioning two novel submissions by Withers on the approach to defining the duty:
- First, it relied on the Bolam principle: if the view taken by the solicitor about the scope of the task was one a reasonably competent solicitor could have adopted, that was sufficient. That was rejected as it wrongly conflated the questions of (i) defining the duty of care, and (ii) assessing breach. The duty of care is a matter of objective construction, and the views of a reasonably competent solicitor are not relevant.
- Secondly, it relied on the scope of duty test set down by the Supreme Court in Manchester Building Society v Grant Thornton in submitting that the Court should have regard to the purpose for which the advice was sought, objectively judged. That was rejected as it wrongly conflated defining the duty with assessing the recoverability of damages.
Despite submissions to the contrary, defining the duty remains as before: an objective assessment of the exchanges that cross the line between the parties.
If you'd like to know more about what this might mean for you, reach out to a member of our Disputes & Investigation team.
In dieser Serie
New SFO Director announces bold plans to tackle fraud
21. March 2024
von mehreren Autoren
What are the litigation trends for 2024?
1. February 2024
von Katie Chandler, Emma Allen
ClientEarth v FCA: Challenging Regulator Decisions
12. February 2024
von Tim Strong, Nicole Baldev
First of its kind judicial guidance on the use of AI in the courts
14. December 2023
Witness familiarisation - does it affect the court's assessment of witness credibility?
13. December 2023
The use of AI in Trial Witness Statements post-PD 57AC
23. October 2023
von mehreren Autoren
CAT to hear the first application for a collective settlement approval order
17. October 2023
Failure to prevent fraud – a new offence?
14. August 2023
von mehreren Autoren
Supreme Court rules that APP fraud victims cannot rely on Quincecare Duty
4. August 2023
von mehreren Autoren
The Law Commission's Consultation Process on the Arbitration Act 1996 – taking stock
21. July 2023
What does the latest decision of the CAT in the Mastercard/Visa proceedings mean for class actions?
10. July 2023
Disputes Quick Read: ClientEarth refused permission to pursue directors of Shell
1. June 2023
von mehreren Autoren
Disputes Quick Read – developments in the fixed costs regime
3. May 2023
von James Bryden
Disputes Quick Read: Service by email – are the rules any clearer?
20. April 2023
von James Bryden
Disputes Quick Read - What do practitioners think about making alternative dispute resolution (ADR) compulsory?
8. March 2023
Disputes Quick Read: What are the litigation trends for 2023?
2. March 2023
von Katie Chandler, Emma Allen
Disputes Quick Read: further guidance on witness statement preparation rules
14. February 2023
Disputes Quick Read: A cautionary tale – settlement agreement (un)wittingly releases all claims for fraud
13. February 2023
Disputes Quick Read: Why the UK should join the Hague Judgments Convention 2019
8. February 2023
von Jessie Prynne
Disputes Quick Read: extensive information orders granted against crypto exchanges following hack
19. January 2023
Disputes Quick Read: A new approach to giving evidence? WhatsApp with that?
3. October 2022
von Gemma Broughall
Disputes Quick Read: Ethereum Merge - what legal issues arise?
22. September 2022
von Ben Jones, Emma Allen
Disputes Quick Read: New obligations on cryptobusinesses to report under the UK sanctions regime
9. August 2022
von Nick Maday
Disputes Quick Read: Disclosure - What information can be redacted?
25. July 2022
von Edward Spencer
Disputes Quick Read: what claims exist when a smart contract is breached?
6. July 2022
von Emma Allen
Disputes Quick Read: New gateway for serving Norwich Pharmacal Orders and Bankers Trust orders out of the jurisdiction
Welcome news for those pursuing fraud claims in the English Courts
28. July 2022
Disputes Quick Read: Disclosure Pilot Scheme – here to stay
21. July 2022
von Edward Spencer
Disputes Quick Read: Defining the duty - the limits of the responsibility assumed by professionals
27. July 2022
von Stuart Broom
Disputes Quick Read: Climate change litigation – successful challenge to government's Net Zero Strategy
29. July 2022
Disputes Quick Read: Judicial Review and Courts Act 2022 – now in force
17. June 2022
von Stephanie High
Disputes Quick Read: an important reminder of the duty to disclose electronic documents in native format
13. June 2022
von Edward Spencer
Disputes Quick Read: ENRC prevails in claim against former solicitor
26. May 2022
Disputes Quick Read: Climate change litigation update – McGaughey v Universities Superannuation Scheme Limited
31. May 2022
von mehreren Autoren
Don't lose your keys: Bitcoin developers do not have a duty to assist owners in recovering lost cryptocurrency
4. April 2022
Disputes Quick Read: The new witness statement preparation rules – a year on
5. April 2022
von Stephanie High
Disputes Quick Read: ClientEarth v Shell – climate change litigation shifts focus to UK companies
31. March 2022
von mehreren Autoren
Disputes Quick Read: High Court rules that failure to provide adequate data security is not a positive act
21. September 2021
von mehreren Autoren
Disputes Quick Read: Key changes to the Disclosure Pilot Scheme
13. September 2021
von Edward Spencer
Disputes Quick Read: Judicial Review and Courts Bill – unpacking the UK government's proposed amendments
6. September 2021
von Stephanie High
Disputes Quick Read: Will litigants be compelled to participate in alternative dispute resolution?
2. August 2021
Disputes Quick Read: Freezing injunctions – maximum custodial sentence imposed for breach
21. July 2021
Disputes Quick Read: The online future of civil justice – the end of the legal profession or the end of legal drudgery?
15. July 2021
von Jessica Thomas
Disputes Quick Read: Will the courts change forever post-COVID?
26. May 2021
von David de Ferrars
Disputes Quick Read: One Blackfriars administrators cleared of misfeasance
5. May 2021
von Stephen O'Grady
Disputes Quick Read: Not your prerogative – the Independent Review of Administrative Law reports its recommendations on judicial review
21. April 2021
von Stephanie High
Disputes Quick Read: Amendments to the Disclosure Pilot Scheme – a step in the right direction
31. March 2021
Disputes Quick Read: UK Supreme Court rules on the territorial extent of the SFO's powers
26. February 2021
von Tim Strong, Akash Jamang
Disputes Quick Read: No dropping anchor – parent company liability for environmental claims
24. February 2021
Disputes Quick Read: What lawyers need to know about new witness statement preparation rules
20. January 2021
von Stephanie High
Disputes Quick Read: Should you still choose the English courts to have jurisdiction in your international contracts after Brexit?
12. January 2021
von Tim Strong
Disputes Quick Read: Privilege lost in the EU post-Brexit (with exceptions)
23. November 2020
Disputes Quick Read: Law on interest applicable to US dollar awards reaffirmed
16. October 2020
Disputes Quick Read: Care required when drafting SPA claim notices
23. September 2020
von mehreren Autoren
Disputes Quick Read: Why the modernised LCIA rules are a welcome update
7. October 2020
von Nick Storrs
Disputes Quick Read: The importance of proper service
26. May 2020
von Edward Spencer
Disputes Quick Read: government guidance for contracts impacted by COVID-19
12. May 2020
Disputes quick read: Mandatory changes to Statements of Truth
18. May 2020
von Katie Chandler
Disputes Quick Read: COVID-19 and supply chain disruption – key issues
9. April 2020
von mehreren Autoren
Disputes Quick Read: High Court orders parties to explore options for 5-week remote trial
15. April 2020
Disputes Quick Read: Tomlin Orders – ensuring the confidentiality of settlement terms
27. April 2020
von mehreren Autoren
Disputes Quick Read: UK's OFSI fines Standard Chartered Bank £20 million for sanctions breaches
21. April 2020
von Stephanie High
Disputes Quick Read: A different approach to witness evidence
11. March 2020
von James Bryden
Disputes Quick Read: Coronavirus - a growth in virtual courts?
17. March 2020
von Stuart Broom
Disputes Quick Read: Embracing remote hearings – the experience to date
26. March 2020
von mehreren Autoren
Disputes quick read: climate change activism by litigation
26. February 2020
von Tim Strong, Andrew Howell
Disputes Quick Read: Commercial Court's arbitral power shift
21. February 2020
von Andrew Howell
Disputes Quick Read: Court stays evictions during COVID-19 – is this lawful?
2. June 2020
von Georgina Jones
Disputes Quick Read: Will the civil justice system change forever post COVID-19?
16. June 2020
von Georgina Jones
Disputes Quick Read: Privilege waiver warning
2. July 2020
von Tim Strong, Georgina Jones
Disputes Quick Read: Retailers reign supreme in Visa and Mastercard proceedings
9. July 2020
Disputes Quick Read: The contra proferentem rule reconsidered?
21. July 2020
Disputes Quick Read: Scope of duty and the SAAMCo counterfactual following Manchester Building Society
3. December 2021
Disputes Quick Read: Facilitating transactions in cryptoassets - Lord Leggatt and the point of commercial law
24. November 2021
von Stuart Broom
Disputes Quick Read: Privy Council clarifies the law on freezing injunctions in aid of foreign proceedings
8. October 2021
von Katie Chandler
Disputes Quick Read: Climate change litigation – what's the latest?
10. January 2022
von Tim Strong, Jessica Thomas
Disputes Quick Read: Court decisions on the Disclosure Pilot Scheme – the 2021 roundup
20. January 2022
Disputes Quick Read: Assumption of responsibility - tax schemes and investors
22. March 2022
Disputes Quick Read: Dealing in crypto? Be careful what you call it
7. April 2022
von mehreren Autoren
Related Insights
The limits of a professional's duty of care
von Stuart Broom und Joe Pengelly
Disputes Quick Read: Assumption of responsibility - tax schemes and investors
von Stuart Broom und Samantha Brendish
Disputes Quick Read: Facilitating transactions in cryptoassets - Lord Leggatt and the point of commercial law
von Stuart Broom