Professional Negligence

Accountant's negligence

Mr Y instructed Lewis-Simler (accountants) to advise him about the funding of a commercial property investment. As a result of the accountant's negligent advice, Mr Y could not offset the interest he paid on the mortgage against the rental income he received, with the result that he paid a lot more tax than he would have been liable for had he been correctly advised. We successfully sued the accountant for the tax that had been unnecessarily paid.

Bank's negligence

The B family gave a trusted family friend a power of attorney over their bank account with Barclays. The "friend" misused the account for his own benefit not only spending all their money but also misspent further money (about £500,000) that he had borrowed from the Bank in their name. We successfully sued the Bank, who cleared the debt and repaid £100,000 to our clients.

The B Family

Challenging your own solicitor's bill

I Ltd instructed Beachcroft Wansbroughs in a property/development scheme. The solicitors agreed to cap their costs for the legal work. Unfortunately that agreement was subsequently overlooked by the solicitors who charged over four times as much as the agreed maximum fee. We pursued a Solicitors Act assessment of the solicitors' costs and obtained a refund of almost £100,000 plus costs for the client.

I Ltd

Claim against solicitor arising from advanced fee fraud

Mr E and Mr B sued their solicitors (“BC”) for substantial financial loss resulting from an “advance fee” or “banking instrument” fraud whereby victims are induced to “advance” money a to a third party in reliance on the promise of huge financial reward. In this case the Claimants were told that their $225,000 and $150,000 investments would return them £14,000,000 and £12,500,000 respectively within one year.

In 2000, Mr B’s company was experiencing financial difficulties. He attended a meeting with BC at which he explained that he needed funds to assist his company and Mr S advised that the transaction was the best way of achieving the refinancing that Mr B’s business required. Mr B signed an agreement drafted by Mr S which provided that Mr B would pay an arrangement fee of US$225,000 to a third party company which would obtain and allocate US$15m to an account at a bank in Montreal; which money would be loaned to Mr B’s company on extremely favourable terms.

Mr B paid the arrangement fee but his company has received no loan in return because the transaction was in fact an advanced fee fraud. Mr E’s story was similar and he agreed to pay an arrangement fee of US$150,000, By reason of Mr S’s actions and alleged dishonesty, for which BC was liable, Mr B and Mr E lost the majority of their money. They instructed us to attempt to claim the monies back from Mr S’s insurers.

The background to these stories began in September 1997 when the Law Society issued Professional Standards Bulletin No. 17 to the legal profession, enclosing a “Yellow Card” warning in respect of banking instrument fraud which stated that “Prime Bank Guarantees” were not issued by the legitimate banking community and the legitimacy of such investments should always be questioned. The Yellow Card noted that the use of a solicitor in Prime Bank Guarantee schemes provided legitimacy and respectability both as regards the provision of documentation and the provision of accounts for the receipt of money. The warning concluded: “REMEMBER - if it sounds too good to be true it probably is!”

We argued that Mr S was aware that “Prime Bank Guarantees” were not issued by the legitimate banking community and that the legitimacy of any transaction or scheme involving them or purporting to involve them should always be questioned.

It was our case that both Mr B and Mr E were clients of Mr S and BC. It should have been obvious to a reasonably competent and honest solicitor that the transactions were or were likely to be frauds on Mr B and Mr E, particularly in light of the Law Society’s “Yellow Card” warning of 1997. We also advanced claims on behalf of Mr B and Mr E for breach of contract, negligence, misrepresentation and breach of fiduciary duty.

We issued proceedings against BC and recovered a substantial sum for each Claimant at a Mediation, with solicitors acting for BC and its insurers.

Mr E and Mr B

Claim for loss of chance to recover damages for fatal accident

We acted for Mrs D whose husband of 25 years had been killed in a fire in their home on 13 January 2001. The investigators found that the fire was caused by a faulty fridge-freezer which the couple had purchased from a company called TMR Domestic Appliances Ltd (“TMR”). Mrs D instructed Sanders and Co Solicitors in Essex to deal with the administration of her husband’s estate. As the probate came to an end a solicitor at Sanders and Co suggested that she sue the retailer of the fridge on a “no win no fee” basis. Mrs D claimed that she was told that the case would not cost her “a penny”. She says that it was also explained to her that if she won the case against the retailers of the fridge, then Sanders and Co’s fees would be paid by the retailer, whilst if she lost the claim then no fees would be payable by her because it was a “no win – no fee” agreement.

Legal proceedings were issued against the retailer which did not defend the claim. A judgment was obtained by Sanders and Co in 2005. Unfortunately the reason why Mrs D’s claim had not been defended was that the retailer had no assets or insurance and was in fact a defunct company..

Mrs D did not hear further from Sanders and Co until August 2008 when she received a letter from them explaining that they had tried to enforce the Judgment but that they had failed to recover any damages or costs whatsoever. Nonetheless, Sanders and Co claimed that they had “won” the case for Mrs D, because they had obtained a judgment against the defunct company, and so she must pay their fees of £73,441.44. The matter was passed to a solicitor at Sanders and Co called Matthew Reach who issued legal proceedings against Mrs D.

Mrs D was referred to us by a partner at Berrymans Lace Mawer. We took immediate steps to arrange for a fully pleaded Defence to be served on Sanders and Co. We defended the claim on several grounds including that Mrs D was not told that she would have to pay the legal costs if a judgment was obtained but no damages were recovered. We also advised Mrs D to counterclaim against Sanders and Co for losing her the chance to pursue the claim. We alleged that if Sanders and Co had pursued the matter competently they could have enforced the judgment against the directors of TMR or a successor business (which was operating from the same premises) and Mrs D would have recovered her costs and damages.

Shortly before trial Sanders and Co dropped the claim for their fees of £73,441.44 and, in addition, agreed to pay Mrs D £27,500 plus her legal costs. Therefore when she came to us, Mrs D faced a claim against her for over £73,000, but walked away £27,500 to the better.

Commercial Property solicitor's negligence in missing time limit resulting in loss of premises

The Tower Theatre had leased theatre premises in Canonbury Tower continuously since 1952. The solicitors dealing with the last lease renewals acted for free but unfortunately failed to make the necessary application to court in time in order to ensure that the Tower Theatre continued to have the right to security of tenure and a new lease. As a consequence the Landlords were able to force the Tower Theatre to vacate its premises in 2003. We successfully sued Gregory Rowcliffe Milners for the cost of acquiring alternative theatre premises and recovered £2,020,000 for our client. This is believed to be one of the largest successful claims ever made against a solicitor who was acting 'pro bono' (without charge to the client).

The Tower Theatre

Commercial Property solicitor's negligent drafting of lease resulting in unwanted premises

Mr and Mrs V instructed Lovegrove & Eliot solicitors in connection with the assignment of a 10 year lease of business premises. They decided on these particular premises because the lease contained a break clause which meant that they could move in the fifth year. Unfortunately, their solicitors failed to tell them that the break clause was only operable by the original tenant (from whom they took the assignment) and when they moved premises they could not get out of the lease and they were therefore forced to pay rent on two buildings instead of one. If they had been properly advised they would not have taken the premises. We successfully sued their solicitors and recovered £225,000 plus costs for Mr & Mrs V in respect of the wasted rent they had to pay for the now unwanted offices.

Mr & Mrs V

Conveyancing solicitor's negligence advice about size of property being purchased

Mr and Mrs P bought their first home, thinking that they would be owning the entire back garden as well as the ground floor flat. Their conveyancing solicitors, Marsons, did not explain to them that this was not the case. Mr and Mrs P later discovered that they owned only a small part of their back garden, and that their neighbour in the flat above owned the rest of the garden. As a result they paid more for their flat than it was worth. We pursued their former solicitors and won Mr and Mrs P damages for the loss of value to their home.

Mr & Mrs P

Conveyancing solicitor's negligence advice about planning permission

Mr and Mrs S instructed Curwens Solicitors to do the conveyancing on the purchase of their first home in January 2005. Following completion of the purchase Mr and Mrs S were contacted by the Local Authority’s planning department who informed them that prior to their ownership of the property, their garden had been extended onto green belt land without planning permission. Mr and Mrs S applied for retrospective planning permission but their application was unsuccessful.

Mr and Mrs S approached us to investigate a claim against their former solicitors in relation to the advice given to them during the conveyancing process. We made a claim on the basis that the checks undertaken throughout the conveyancing process were inadequate and that the Claimants were not properly advised about the status of the rear part of the garden. This meant that the property was worth less than the price they paid for it. We successfully recovered damages and costs on behalf of Mr and Mrs S to reflect the expense to which they had been put to rectify the problem and the effect on the value of their property.

Mr and Mrs S v Curwens

Conveyancing solicitor’s negligence in failing to advise about lack of access to property

The Claimants bought a detached property in Kent which had been developed by the owner of the neighbouring land. Seven months after they completed the purchase they received a letter from the Treasury Solicitor advising them that a strip of land running along the front of the property between their garden and the public highway, belonged to the Crown. The letter formally objected to the trespass by the Claimants on the land. The Claimants had no other means of accessing the property.

A claim was made to the conveyancing solicitors who initially denied liability on the grounds that a reasonably competent solicitor would not have noticed the deed giving the benefit of the strip of land to the Crown which was buried in the deeds. The Land Registry plans were admittedly difficult to decipher.

Ultimately the solicitors indemnified the Claimants against the legal costs of suing the sellers to whom the Treasury solicitors had notified of the problem before completion. The sellers claimed not to have received two letters from the Treasury Solicitor.

The claim against the sellers was settled at the door of the court.

Our clients were compensated – through damages and indemnities - for every pound that they had lost.

Conveyancing solicitor’s negligence in failing to advise adequately about onerous ground rent review clause

Our client, Miss C, purchased a flat in 2005 for £120,000. She was a first time buyer and had no experience of leasehold properties. The lease she was buying contained a very onerous ground rent clause which allowed the landlord to increase the ground rent every 21 years to an amount equal to one sixth of the open market rent for the property. The next increase took place within 15 months of our client’s purchase and the ground rent went from £100 per annum to £1374 per annum - a thirteen-fold increase. Miss C’s conveyancing solicitors, Rumke Joseph and Rabin, failed to adequately report the terms of the ground rent review clause to her, when the next review would take place, send her a copy of the lease which contained the ground rent clause, or explain how unusual a term this was. The increase in ground rent was significant when given the modest value of the property.

We obtained expert evidence regarding the loss in value of the property as of the time that Miss C bought the property and issued a claim on her behalf after her conveyancing solicitors denied liability for the claim. The claim settled shortly after service of the solicitor’s Defence.

Conveyancing solicitors negligence in failing to correctly assign notice to extend lease

Mr G instructed Simpson Millar solicitors to act for him on the purchase of a flat. The sellers also served notice to extend the lease and Simpson Millar were responsible for correctly assigning the notice to Mr G so that he could have the benefit of it. This would allow Mr G to extend the lease without having to wait until he had been registered as owner of the property for two years, after which time he would have been entitled to apply in his own right. The solicitors failed to ensure that the assignment of the notice took place at the same time as the transfer of the property to our client and the benefit of the notice therefore did not transfer. Our client had to wait for two years before he could then apply to extend the lease in his own right, during which time the cost of the premium to extend had increased. Simpson Millar admitted liability for the claim and we recovered damages for the increase to the premium, the landlord’s legal and valuation fees, our client’s own legal and valuation fees and legal fees.

Conveyancing solicitors negligence in preparing defective notices to extend lease

We acted for 2 clients, Mr G and Mr R. Both of them owned flats in the same development and were members of the Residents Association. They decided to extend the leases on their flats and instructed Askews Solicitors to act for them with a view to the other members of the Residents Association then instructing them in relation to extending their own leases. Askews prepared the notices to commence the extensions, but they were defective in a number of respects and the extensions did not progress. Mr G and Mr R both had to wait for 12 months before they were able to restart the process and had to pay the landlord’s costs for the aborted processes.

Askews admitted liability after we sent Letters of Claim and we recovered damages for our clients for the increased lease premium.

Conveyancing solicitors’ negligent transfer of wrong land

This was a professional negligence claim against our clients’ former conveyancing solicitors who had been instructed to deal with the sale of a public house owned and operated by our clients. Shortly after purchasing the pub 4 years earlier our clients had separately bought an adjoining piece of land for development purposes. When selling the pub, the defendant wrongly assumed that our clients wanted to include the land with the sale of the pub and it was transferred to the purchasers who then refused to return it.

We issued legal proceedings which lead to the land being returned. However, the defendant argued that our clients should not recover their substantial legal costs of the litigation because they should have tried harder to recover the land earlier. At the door of the hearing that was to decide the issue, the defendants finally agreed to pay the majority of the claimants’ legal costs.

Estate agent's negligence

Mr Y, resident in America, owned a flat in West London which he decided to rent out. He instructed Sinton Andrews estate agents to who promised a complete management service which would include finding a suitable tenant, obtaining the necessary references and ensuring that the rent was paid in full. In fact, Sinton Andrews failed to obtain proper references (or check the false references provided by the tenant) and the tenant failed to pay the rent. Mr Y incurred significant costs in trying to evict the tenant. We were successful in recovering from the negligent estate agent the unpaid rent and the costs Mr Y incurred in evicting the tenant.

Negligent solicitor’s failure to lodge appeal

Mr S was a police constable who resigned from the force claiming discrimination. He sued the force in the Employment Tribunal and lost his case at first instance. When his solicitors missed the deadline for lodging an appeal he came to us.

We settled the claim for Mr S for £20,000 for losing him the chance to appeal the tribunal’s decision.

Mr S

Personal Injury solicitor's negligence in missing time limit

Mr M suffered serious knee injuries as a result of a car accident. He instructed Personal Injury solicitors Lucas & Co to act in his injury claim. Lucas & Co failed to issue proceedings within the three year time limit from the date of his accident. Mr M therefore lost the chance to pursue his Personal Injury claim. The Defendants in the original claim had, before the claim became time barred, offered only £3,000 to Mr M to settle his claim. We acted for Mr M in his claim against Lucas & Co and succeeded in settling his case with damages of £30,000.

Mr M

Personal injury solicitors negligence causing strike out of claim

Mr and Mrs W instructed Molesworth Bright Clegg Solicitors to make a claim for personal injuries arising out of a serious road traffic accident that occurred in November 1998 in which the negligent driver was killed. Molesworth Bright Clegg issued legal proceedings against the Estate of the negligent driver in November 2001 and in January 2004 an offer of settlement was made for both claims. Mr and Mrs W were advised not to accept the offer and shortly thereafter the proceedings were struck out by the court because Molesworth Bright Clegg failed to comply with directions issued by the court. The Claimants lost their right to claim damages against the Estate of the deceased driver and to make matters worse the Court ordered that Mr and Mrs W pay the negligent driver’s insurers their legal costs. We sued Molesworth Bright Clegg and recovered the full amount of money that was paid into court by the original Defendant and all of the other costs that the Claimant’s incurred as a result of the aborted proceedings.

Within one year of the letter of claim being sent to Molesworth Bright Clegg we recovered all of the Claimant’s damages together with their legal costs.

Mr & Mrs W

Personal Injury solicitor's negligence

Mr P sustained horrific injuries to his arm as a result of a defective firework. Leigh Day & Co were instructed to act on his behalf in relation to his Personal Injury claim. Leigh Day & Co failed to appreciate that the successful prosecution of our client's claim was likely to be dependent upon our client being entitled to rely upon the Consumer Protection Act, applying to importers of defective products. They pursued the claim against the wrong party (the manufacturer of the defective firework). As a result Mr P's claim was struck out, and he was ordered to pay the other side's costs as well! We acted for him in a claim against his negligent solicitors, and succeeded in obtaining a settlement of approximately £24,500 compensation plus an agreement to pay the original Defendant's costs for our client.

Mr P

Personal Injury solicitor's negligence

Mr W was a chef on a ship when he suffered serious back injuries as a result of a falling accident, which meant that he had to retire from life at sea, and from his job. He instructed solicitors John Mohamed & Co to act in his personal injury claim. John Mohamed & Co obtained advice from a barrister, Mr Cahill, in respect of the time limit for issuing proceedings. Mr Cahill negligently advised that as the accident occurred at sea, that a two year time limit applied, and that therefore, the limitation period had already expired. Mr W consulted us about his claim, and we advised that in fact, there was a three year time limit, and not a two year time limit (which applies to collisions at sea) on his claim. As this three year time limit also expired while John Mohamed & Co were acting for Mr W, it was our case that both John Mohamed & Co and Mr Cahill were both negligent, and that Mr W therefore lost the chance to pursue his personal injury claim. We succeeded in recovering Mr W damages of £22,000 plus costs.

Mr W

Personal injury solicitor's negligence in missing time limits

Mrs W v Keith R Thompson and Co Solicitor's dishonesty.  In February 2003 Mrs W had an accident in the course of her employment and instructed solicitors to pursue a personal injury claim on her behalf. Legal proceedings against the employer were issued by Keith R Thompson & Co Solicitors in February 2006 just within the statutory limitation period. However proceedings were not served on the Defendant in time and as a result the claim was struck out. We sued Keith R Thompson & Co for damages for the loss of Mrs W’s opportunity to sue her employer and we recovered damages and costs on her behalf.

Mrs W

Right of way not obtained by negligent solicitor

Our client, B Ltd, is a company involved in property development. This was a claim damages for professional negligence against the Claimant’s former commercial property solicitors. B Ltd was an established client of E Solicitors. Our client instructed E Solicitors that it wished to buy development land in order to build shopping units.

Between the land and the public highway there lay an open-air car park (“the Car Park”) but the conveyance of the land ceded it no right of access to the highway, either over the Car Park or at all.

The mistake came to light when the Claimant developed a retail centre on the land and the proposed tenant objected that there was no access to the units over the Car Park and our client was forced to purchase a right of way over the Car Park. The Claimant claimed damages for this cost and for the costs associated with the purchase of the right of way and for losses including loss of rent caused by the delay. We issued legal proceedings and the claim was settled for a substantial sum shortly before trial.

B Limited

Solicitor's dishonesty

Mrs K deposited £100,000 with Graham Peries & Co in support of an application for a UK visa. No application for a visa was made and the money was stolen by her solicitor. In order to preserve evidence we obtained and executed a search order and successfully recovered Mrs K's money (and interest). Mrs K was one of eight clients of that particular firm on whose behalf we successfully recovered large sums over money that had been stolen.

Mrs K

Solicitor’s failure to transfer right to extend lease

Mr B and Ms G instructed his solicitors on the purchase of a flat and at the same time they accepted instructions to assign the benefit of the seller’s right to extend the lease which had only 70 years left to run. The assignment of the right to extend was negligently drafted and was not effective. As a result Ms G and Mr B were unable to extend the lease until they had waited a further two years, during which time the costs would rise significantly.

We settled the claim on our clients’ behalf compensating them for the increased cost of extending the lease.

Mr B and Ms G

Solicitors’ negligent drafting of will and failing to rectify

Mr B was a beneficiary under his late mother’s will. She had intended that he inherit the bulk of her estate together with discretion to make payments to her grandchildren (Mr B’s nephews) under a discretionary trust to be administered by Mr B. In fact the will was negligently drafted so that Mr B did not benefit under the will at all. He was, however effectively appointed trustee over property that benefited his nephews which included the whole of his late mother’s estate.

Due to the mistake, he instructed another firm of solicitors, the second Defendant to rectify the will, but they failed to issue rectification proceedings in time and therefore lost Mr B the chance to rectify the will to reflect his mother’s wishes.

The claim was settled by an agreement that the Defendants pay to the Claimant £170,000 in addition to his legal costs.

Mr B

Purchase of overvalued property as a result of surveyors negligence and solicitors' negligence

Our clients claimed damages from their former surveyor and conveyancing solicitor. Prior to buying three buy-to-let properties the Claimants had employed a surveyor to value the properties and a solicitor to undertake the conveyancing. After completion, it became apparent that the properties had been substantially overvalued by the surveyor. We were instructed to act for the Claimants and upon further investigation discovered that the properties were overvalued by as much as 80% and that the Claimants’ solicitors had failed to advise them that the properties had been sold for less than half the price that they were paying just a few months earlier. The solicitor also failed to advise our clients about other inconsistencies that would have alerted them to the overvaluation.

We issued proceedings against the surveyor, his employer and the Claimants' former solicitors and within two months of issuing proceedings agreed a settlement of £185,000 with two of the Defendants for the Claimants' damages and costs.

Anonymous

Surveyor’s negligent valuation of property

Mrs H and Mr B purchased a property in 2003 for £150,000. When they came to re mortgage the property in 2005, they found that despite a rising market the house was valued at £120,000. They complained to the surveyor who valued the property who denied that the house had been overvalued and pointed out that he had qualified his report by recommending that the purchasers and their solicitor investigate whether building regulations approval had been obtained for the loft conversion.

We persuaded the Defendant to pay £21,000 to the Claimants plus costs

Surveyor’s negligent valuation of property

Mr and Mrs T suffered loss as a result of the overvaluation of a buy to let property that was overvalued by over 38%.

The solicitor failed to tell our clients that the vendor did not actually own the property but had arranged to buy it from an elderly couple on the same day in a ‘back to back transaction’ for a price 44% lower than the valuation.

We advised the claimants to pursue the claim against the valuer on the basis of a straight overvaluation. The claim settled for £15,000. The claim was complicated by the existence of an exclusion clause on the face of the valuation and the fact that this was a buy to let property. In other words the defendant might have been able to argue that this was a commercial transaction and therefore that the exclusion clause was fair.

Mr & Mrs T

Wills trust and probate solicitor's negligence in failing to administer trust properly

Mrs M is an elderly lady who lives in a residential nursing home. Lewis & Dick were appointed to administer and supervise her bank accounts. However, they failed to monitor the level of funds in her account. They therefore failed to notice that they had spent all the money in her account. The law specifies that they could have applied for benefits when savings fell to £16,000. They failed to do this and not only was Mrs M left with nothing but she also owed money to her nursing home. We were successful in recovering approximately £12,500 for Mrs M.

Mrs M

Will Trust and Probate solicitor's negligent drafting of will

Mr R instructed Geoffrey Lucas Solicitors to draft his Will. Mr R had three children but was estranged from one son and instructed his solicitors that only his other two children were to benefit. Following the death of one of Mr R's children and following the death of Mr R, a drafting mistake in the Will meant that a substantial part of Mr R's estate passed to his estranged son rather than his surviving daughter, Mrs H, as Mr R had intended. As this was because of a drafting mistake by Geoffrey Lucas Mrs H then instructed England & Co Solicitors who eventually advised that an application could be made under the Administration of Justice Act 1982 to have the Will rectified. Unfortunately England & Co were also negligent because they failed to appreciate the urgency of the matter and consequently failed to issue the application for rectification within prescribed time limit of six months from the date of the grant of probate. As a result Mrs H lost the right to apply to rectify her late father's negligently drafted will. We successfully pursued solicitors' negligence claims against both firms of solicitors and recovered £45,000 for Mrs H in respect of her loss of inheritance.

Mr R