Answering your questions about how to claim for compensation for negligent Solicitor advice
Businesses and individuals can instruct Solicitors for many different reasons, e.g. to deal with business disputes, to advise about the breakdown of a relationship, to assist in the purchase of a property, to name but a few.
For whatever reason, when you instruct a Solicitor you expect to receive the highest standard of service. Sadly, the reality is professionals do make mistakes. When they do their client will usually need the assistance of another lawyer to advise whether they can pursue a claim for professional negligence against the Solicitor.
What is Professional Negligence?
To understand whether you have a claim against a Solicitor we first have to define “Professional Negligence”. This can be a confusing term but, put simply, it means that a professional, such as a Solicitor, has failed to perform their responsibilities to the required standard and has caused you a loss.
If you think you have a professional negligence claim against a Solicitor, you will need to prove three things:
That you were owed a duty of care by your Solicitor not to cause the type of harm suffered;
A duty of care is normally established when you instruct or retain a Solicitor to act on your behalf. A retainer, usually in the form of an engagement letter and/or terms of business, will set out what the Solicitor agreed to do for you and their duties are usually established by reference to this. In addition, a Solicitor will owe their clients general duties under common law. In both cases, the duties are generally expressed as requiring a Solicitor to act with reasonable care and skill.
That the Solicitor breached that duty of care; and
The standard required by a Solicitor is not one of perfection. A mere error might not amount to a breach of duty. Generally a Solicitor will be found to be negligent if they have not conformed to a practice accepted as being proper by responsible members of his/her profession.
That this breach directly resulted in you suffering financial loss.
If you are able to establish that a duty of care exists and that it was breached, then you may be able to pursue your Solicitor for compensation if their actions directly caused you to suffer a financial loss. This is known as establishing causation and loss. The rules relating to this are complex.
When a claim has been brought and proven for professional negligence against a Solicitor they will usually have the benefit of insurance to cover them for the losses claimed in successful cases. They may also be able to rely on limitation of liability clauses in their terms of business.
Claiming Against a Solicitor
Every professional negligence claim against a Solicitor is different because Solicitors are instructed for a number of different reasons. We have set out some examples of different types of Solicitor negligence on our web page “Professional Negligence Claims Against Solicitors”. Some more examples are:
- Missed limitation dates for your legal case thereby potentially preventing you from continuing with your claim;
- Under-settling a claim;
- Incorrectly drafting a legal document;
- Failing to undertake the correct searches (which would have revealed the existence of problems) when carrying out the conveyance of a property; and
- Giving the wrong advice where the law is clear or giving incomplete advice.
This is not an exhaustive list but if you feel you have suffered a loss due to Solicitor negligence please feel free to contact us or complete our form so we can call you. We offer a free, no obligation telephone assessment to give you an understanding of the merits of your claim.
What Information Will We Need?
In order to assist in pursuing a claim against your former Solicitor we will need to obtain the following information:
- The name of your Solicitor;
- The date when you instructed them;
- Details of the instruction i.e. what did you ask them to do?
- What did they do wrong?
- What do you say you have lost as a result of your former Solicitor’s actions?
- Any documents that your Solicitor may have sent/given you and copies of any documents you have sent/given them.
- Copies of all correspondence passing between you and your former Solicitor.
It is also likely that we will need to obtain your Solicitor’s file of papers as this may contain additional information/evidence (for example, file notes and internal memos).
Once we have undertaken a full review of the papers we will be able to advise you on the next steps. This will include how we can assist with funding your claim, whether any expert evidence is required and/or the likely time frames for pursuing the claim.
If we are able to confirm merits then the next step is to follow the Pre-Action Protocol for Professional Negligence (“the Protocol”).
The objective of the Protocol is to assist the parties to achieve an early settlement of the claim, if that is at all possible, without the need for court proceedings. If court proceedings are started without the parties following the Protocol, the court can decide to impose sanctions.
The Protocol aims to ensure that all of the issues between the parties are properly identified within correspondence and that there is an early exchange of evidence; meaning that if cases cannot be settled they run more smoothly within the court system or alternative dispute resolution procedures, such as mediation.
Letter of Claim
Once the claimant’s investigations are complete and it is possible to set out comprehensive details of their claim, a Letter of Claim should be prepared.
The Letter of Claim should normally be an open letter and should set out a clear chronological summary (including key dates) of the facts on which the claim is based. Key documents should be identified, copied and enclosed with the letter. It should set out the allegations against the Solicitor. What has been done wrong or not been done? What should the professional have done acting correctly?
There should also be a calculation of the estimated financial loss suffered by the claimant. Again, supporting documents should be identified, copied and enclosed with the letter. If details of the financial loss cannot be supplied, the claimant should explain why and should state when they will be in a position to provide the details. This information should be sent to the Solicitor as soon as reasonably possible. If the claimant is seeking some form of non-financial redress, this should also be made clear.
Confirmation should be given as to whether or not an expert has been appointed and their details should be provided.
Finally, the claimant should also request that a copy of the Letter of Claim be forwarded immediately to the Solicitor’s insurers, if any.
Letter of Acknowledgement
The Solicitor or its representatives should acknowledge receipt of the Letter of Claim within 21 days of receipt.
Letter of Response
The Solicitor then has three months from the date of the Letter of Acknowledgment to investigate and respond to the Letter of Claim by the provision of a Letter of Response and/or a Letter of Settlement.
If the Solicitor cannot respond within this timescale, it should contact the claimant to explain the cause of the difficulty and confirm when it expects to conclude its investigations. The claimant should agree to any reasonable requests for an extension.
The Letter of Response should be an open letter and should be a reasoned answer to the claimant’s allegations. In simple terms, if the claim is admitted the Solicitor should say so in clear terms. If the claim is denied in whole or in part, the Letter of Response should include specific comments on the allegations against the Solicitor and, if the claimant’s version of events is disputed, the Solicitor should provide their version of events.
Furthermore, if the Solicitor disputes the calculation of the claimant’s financial loss, the Letter of Response should set out the Solicitor’s own assessment. If an assessment cannot be provided, the Solicitor should explain why and when they will be in a position to provide an assessment.
The Letter of Response is not intended to have the same status as a Defence which is served during court proceedings. However, if the Letter of Response differs materially from the Defence, the court may decide, in its discretion, to impose cost sanctions on the Solicitor.
At the same time as providing a Letter of Response (or sometimes instead) the Solicitor can provide a Letter of Settlement, which may be on an open or without prejudice basis, making settlement proposals.
If the Letter of Response constitutes a complete denial of the claim and there is no Letter of Settlement then the claimant can issue court proceedings. Our specialist professional negligence solicitors will be able to guide and assist you through this process should this be necessary.
In any other circumstances, or if it appears that progress can be made within correspondence; either in order to narrow the issues in dispute or to achieve settlement, then the parties should commence negotiations with the aim of concluding them within 6 months of the date that the Letter of Acknowledgement was (or should have been) provided.
If you would like to read the Protocol in full, you can find it here.
Time Limits / Limitation Periods
Claims against Solicitors must be brought (by issuing court proceedings) within certain time limits known as limitation periods.
The usual time period is six years from the date on which the relevant cause of action accrued (which in broad terms is the date when the retainer was breached or the date when you suffered loss – these dates may be different). This time limit is known as “primary limitation”. If you try and bring a claim after this date, the Solicitor may have a complete defence to it.
A claimant may not always be aware that they have suffered a loss or have knowledge of all the material facts until after primary limitation has expired. In those circumstances, it may be possible for a claimant to bring a claim if they do so within three years of becoming aware of the material facts. This is subject to a long-stop period of 15 years from the date of the negligent act after which any claim (absent fraud or deliberate concealment) will be statute barred.
“Nelsons...client roster includes high-net-worth individuals, sports professionals and property businesses. It handles claims against solicitors and barristers, financial advisers, insurance brokers, surveyors and architects, among others. It has a notable specialism in defending professionals against claims where there is no insurance cover in place or where cover has been reserved. Although it predominantly acts for claimants, the team is also engaged by insurance companies on the defendant side.”Legal 500