Professional Negligence Limitation Period
It may be difficult to identify the precise moment when you may have an actionable cause of action against your legal advisor for professional negligence. The Court of Appeal has handed down 2 judgments against lawyers in which the Court has interpreted and clarified the limitation rules on claims against lawyers.
Our professional negligence lawyers have an excellent track record of successfully resolving negligence claims. If you are concerned about the limitation period for your professional negligence claim, please call us for a Free Consultation today on 0207 459 4037.
The Limitation General Rule
You typically have 6 years from the date of the negligent error, mistake or bad service was provided to you by the legal advisor professional to issue a claim against your former lawyer for negligence (note: the limitation date for clinical negligence claims is 3-years).
The 6-year limitation period starts on the date that the cause of action accrues. In contract, it is usually quite straightforward to establish the date; it will be when the defendant breached the contract. In tort, the cause of action accrues upon the claimant sustaining actionable damage; it can sometimes be difficult to identify the precise moment.
If you do not bring a claim within the strict timescales under the Limitation Act 1980, you may be time-barred from bringing a professional negligence claim for losses suffered (and the lawyer may have a strong defence for such a claim).
If, however the negligent act was more than 6 years ago, but you have only recently discovered that the advice received was negligent or fraud was involved, then the limitation period may be extended by 3 years from the date of knowledge.
If the limitation period has expired but there were a series of negligent incidents in connection with the same underlying matter, you may be able to recover some of your losses for the part of the claim which is not time-barred allowing you to potentially recover at least some part of the losses suffered.
Elliot v Hattens Solicitors (a firm) [2021] EWCA Civ 720 (Professional Negligence Claim against Property Legal Advisors)
The Facts
The claimant client was the freehold owner of a property in Essex. She instructed a firm of conveyancers in connection with the letting and sub-letting of her property. The claimant client instructed her former solicitors to ensure that there was a guarantor for her benefit to guarantee rental income.
The lease documents were executed by the lawyers, Hattens Solicitors on behalf of the claimant client in February 2012. However, the lawyers (i) failed to name the guarantors to the underlease and (ii) failed to advise the claimant client to obtain property insurance.
In November 2012 (9 months after the lease was executed), there was a fire at the claimant client’s property. The claimant client suffered financial loss as a consequence without insurance and any guarantee of rental income.
However, it was not until 10 April 2018, more than 6 years after the lease and underlease were executed but less than 6 years after the fire, that the claimant client issued a Claim Form at Court seeking damages for professional negligence against Hattens Solicitors.
The defendant lawyers accepted that they failed to exercise reasonable skill and care in drafting the documentation and advising Mrs Elliott thus accepting liability. However, disputed the claim on the alleging that the claim was time-barred under the Limitation Act 1980 on the basis that the claimant client suffered damage as soon as the lease and underlease were executed.
The Decision
The key issue was: When was the loss first suffered, such that the claimant’s cause of action in negligence accrued?
If it was upon executing the lease in February 2012, then the six-year limitation period had expired. However, if the loss was ‘contingent’, such that it was only first suffered when the fire occurred in November 2012, then the claim was brought within time.
When it first came before the Court, the Court decided against the lawyers, on the basis that the claimant did not suffer any loss until the fire in November 2012.
However, on appeal, the Court of Appeal overturned the decision and awarding judgment in favour of the lawyers for 2 main reasons:
a. “Mrs Elliott did not obtain the package of rights that she subjectively desired…she wanted to have the benefit of a guarantee…from the outset, but that was not provided”.
b. “Where…a flawed transaction is objectively less valuable from the start, it seems to me that the cause of action accrues at the outset. If negligence on the part of a solicitor served to reduce the market value of an asset, the claimant cannot, in my view, defer the expiry of the limitation period by pointing out that he was not intending to sell it. It is one thing to say that someone suffered damage because he did not get what he wanted regardless of whether what he got was objectively as valuable…In the circumstances, I am in no doubt that Hattens’ failure to ensure that Mr Malster’s parents were guarantors caused Mrs Elliott damage as soon as the lease and underlease were entered into and, hence, that her cause of action accrued at that point and is now statute-barred.”
The defendant solicitors admitted negligence however they were able to successfully argue that the claimant’s claim was issued out of the 6-year limitation period as the actionable cause of action accrued when the lease was executed in February 2012. The claim was struck out and the firm was not liable.
Comments on the case
It is unclear why the claimant waited so long after the fire in November 2012 to make a claim against her former solicitors for the losses suffered. This delay was fatal to her claim. If the claimant took advice within the limitation period, properly advised, she should have been informed of the limitation risks and advised to issue proceedings without delay. In such circumstances, the claimant may have a ‘loss of chance’ claim against any legal advisor she may have subsequently instructed to advise on the failed professional negligence claim.
The Limitation Act 1980 sets out the deadlines within which you must bring a professional negligence claim. Your legal rights may become time-barred if you fail to issue a professional negligence claim within the strict 6-year time limit. You must take advice regarding your negligence claim at the earliest opportunity. Firstly, the facts will not become distorted and you are not relying on memory. Secondly, the negligent professional may be more willing to settle the claim if it is recent. Thirdly, the negligent professional will have retained all the documents and there is less risk that the documents would be have been destroyed. More importantly, instructing our expert lawyers at the first opportunity optimises the strengths of your claim significantly.
If you think you have suffered a loss as a result of an error, mistake or bad service by a professional, it is important to act quickly and seek independent legal advice on the merits of your potential claim. Our expert lawyers are here to help you.
Sciortino v Beaumont [2021] EWCA Civ 786 (Professional Negligence Claim against Barrister)
The Facts
This Court of Appeal case concerns the limitation date where there are several negligent incidents arising from the same matter.
Mr Beaumont, was a barrister who was defending a claim for professional negligence in respect of two primary incidents of negligent advice given to the claimant client:
a. In April 2011, the defendant barrister advised the claimant client about the prospects of appealing against an order for possession and sale of property.
b. In May 2011, the defendant barrister advised in an email attaching a draft notice of appeal and skeleton argument that: “…It has reasonable prospects of success in my view. However, the other side will fight this appeal. They will be upset by it. I strongly advise that we try to settle with them…Once we have a figure that can be put forward as an offer of settlement, I will correspond with [Clarke Willmott] as discussed and try to settle this case. Please remember if we fight this case and do not succeed, there is a real risk that this will drive up the costs of the bankruptcy and that the Trustee will seek to get a costs order enforced against the proceeds of the sale of the house. The best time to settle this case is if and when permission to appeal is granted.”
c. The claimant client on the advice of the defendant barrister pursued an appeal on the basis that the appeal was “winnable”.
d. On 26 October 2011, the defendant barrister again gave advice on the merits of the appeal and specifically in an email advised as follows: “In my view we have 55-60% prospects of success…”. However, the defendant barrister’s advice did not provide further detail as to why he was optimistic about the appeal.
e. However, ultimately, the appeal was unsuccessful.
On 25 October 2017 (within 6-years of the advice given on 26 October 2011), the claimant client started a professional negligence claim against the defendant barrister, seeking to recover his costs of the appeal on the basis that the barrister’s advice on merits had been negligent.
It was accepted by both parties that the any claim based on the advice of April/May 2011 was statute-barred. Therefore, the claimant client could not recover losses for the initial negligent advice and the claim proceeded on the basis of the negligent advice given after 26 October 2011.
The Decision
The key issue was: Did the existence of the earlier advice in April/May 2011 render a claim based solely on the October 2011 advice statute-barred?
At first instance, it was decided that the entire claim was time-barred, on the basis that the defendant barrister’s later advice, given in October 2011, did not give rise to a separate cause of action for limitation purposes, and therefore did not start a new limitation clock running, because it was not a “new and supervening act”.
However, on appeal, the Court of Appeal overturned the decision and awarding judgment in favour of the lawyers for 2 main reasons:
a. “Where a negligent act or omission causes actionable damage outside the limitation period and further attributable damage inside the limitation period, there is one accrued cause of action and it is statute barred”;
b. “Where…there is a second negligent act or omission inside the limitation period which causes actionable damage that would not have occurred but for the second negligent act or omission, there are two accrued causes of action. The first, arising out of the first negligent act or omission, is statute barred. The second, arising out of the second negligent act or omission, is not.”
In conclusion, the claimant client could, therefore, still bring a claim in respect of appeal costs (and potentially adverse appeal costs) incurred from October 2011 onwards against the defendant barrister.
Free Consultation with Expert Professional Negligence Lawyers in London
Again, it is unclear why the claimant waited so close to the limitation date for the October 2011 advice (and after the claim in respect of the April/May 2011 negligent advice had become time-barred) to pursue a professional negligence claim. If the claimant took advice at the first opportunity a claim in relation to both negligent advices could have been issued covering the claimant client’s appeal losses.
If you wish to discuss your professional negligence claim with our lawyers, please do not hesitate to call us or complete our booking form below to schedule a Free Consultation or alternatively call us on 0207 459 4037.
