In this instalment of her popular blog, Emma Slade looks at whether you can make a negligence claim if you are given an incorrect property valuation

For guidance on incorrect property valuation claims contact us for a free case assessment on 0333 888 0403 or send an email to [email protected]

They always say that buses are like bananas.  You hang around at the bus stop for ages and then the buses all turn up together – like bunches.  I think that is the way with professional negligence claims as well.  Or at least case types.

Recently, I have had a lot of claims about negligent overvaluations: where someone has bought a property, got a valuation for mortgage purposes and on the strength of that valuation, obtained a hefty mortgage.  Years later, often when they are in a position of negative equity, they find that the original price paid – based on the valuation report – was grossly-over inflated.  In those situations the client comes to me to make a compensation claim against the valuer for providing an incorrect property valuation.  I then normally arrange for an expert valuer to give a retrospective valuation.  He can look back and give an opinion as to what the correct price should have been.

If there is a difference in the price, it doesn’t mean that there is automatically a good valuer’s negligence claim though.  There has been a lot of case law in the past on this subject.  Don’t worry, I won’t start citing case names and quoting learned judges.  I will go straight to the punch line by explaining that the courts have stated that the valuer will be allowed a 10% “margin of error” before being held to have given an incorrect property valuation.  To give an example, if you bought a property and paid £430,000 for it, but the retrospective valuation is £400,000, you probably won’t have a claim.  You would have needed to have paid £440,000 or more for it to have a valid valuer’s negligence claim and overcome the 10% margin of error.

So, on to the reason for this post.

I had a call the other day from a Mr Nikolaides (not his real name, naturally) to discuss a an incorrect property valuation claim.  He gave me the details and in this instance, he had already obtained a retrospective valuation: The property had been over valued by the mortgage company’s valuer by as much as 21%.  Just as I was about to tell him that yes, he had a great claim, he told me that the property he had bought was a “buy to let”.  My heart sank.

You see, although he had overcome the “margin of error” problem, there was a case recently– and this time I will give you the name – called Scullion –v- Bank of Scotland – which has scuppered Mr Nikolaides claim.  In that case, Mr Scullion did the same as Mr Nikolaides: bought an investment property to let out, but the valuation obtained by the mortgage company was grossly overinflated as was the projected likely rental income.  He issued a valuer’s negligence compensation claim based on the incorrect property valuation.  He won in the first court, but the valuer appealed and the Court of Appeal overturned the decision.  It said that because the transaction was “commercial in nature”, Mr Scullion could not rely on the mortgage company’s valuation.

I really feel for Mr Nikolaides.  He is just an individual who decided that, rather than invest in a pension plan, he would invest in property.  If he was buying the house for his own use, he would be able to bring a negligence claim to recoup his losses caused by the incorrect property valuation, but he can’t do so because it was a buy-to-let and he relied on the valuation carried out for the mortgage company..

Emma is a specialist in negligent valuation and survey claims. If you need help with an incorrect property valuation then call her for a free case assessment on 0333 888 0403 or send an email to [email protected]

VAT negligence claims involving holiday homes

We specialise in VAT negligence claims against solicitors and accountants. To find out about making a claim on a no win, no fee basis contact our free legal helpline on 0333 888 0403 or send us an email.

We recently dealt with a number of VAT negligence claims involving holiday homes.

It concerned a development of forty luxury flats with views over the sea, valet parking, swimming pool and gym facilities.  All the properties were subject to a planning restriction that they could be used for holiday lets only.

The purchasers were aware of this restriction, but to make sure the property developer inserted a specific clause in each of the leases saying that the flats could only be used for holiday lets.  The solicitors who were dealing with the purchases, were also aware of this restriction. various

So, contracts were exchanged.  There were two things about the contract.  Firstly, there was no completion date.  The property was still being developed and so it was a clause of the contract that, after practical completion, the property developer would serve a notice on all the contract-holders and they would complete the purchase within 30 days.  This is important as the solicitors were therefore aware that the property was a new development.

The second clause was buried deep in the contract.  It said that the contract would be subject to the Standard Conditions of Sale (Fourth Edition).  Everyone was happy about this, but there is a small standard clause in those conditions of sale that nobody paid much attention to at the time.  It said that any figures quoted in the contract were “exclusive of VAT”.

The developer served notice that the property was now ready.  All the contract-holders completed on the transaction and became new flat owners.

Two years after completion, the developer (a company) went into liquidation.  Somebody at the liquidator’s office started to brush down the contracts for the purchase of the flats and found the obscure clause in the contract about the price being “exclusive of VAT”.  Even more importantly, he knew the Value Added Tax Act 1994 contains a clause that if new holiday flats are sold within three years of their development and the seller is registered for VAT, VAT must be charged on the sale price.

The developer was registered for VAT and the purchase price was deemed to be exclusive of VAT. So each of the purchasers got a demand from the liquidator for an additional 17.5% of the value of their property.

You can imagine how they felt.  Horrified would be an understatement.  One of them did try to challenge this in the VAT Tribunal, but the tribunal confirmed that VAT was chargeable.

This is where we got involved.  In light of the tribunal decision, there was very little that we could do to defend the claim by the liquidator so, after checking each of the purchase files, we brought professional negligence claims against the legal firms who dealt with the purchases on the basis that there had been solicitors’ negligence.

On checking the solicitors’ files, It was clear that each firm had completely overlooked the issue of VAT.  To be fair to them, the solicitors involved were residential conveyancing solicitors and it is unusual for VAT to be involved in residential transactions. If a commercial property lawyer had been involved (on the basis that these flats were being purchased for investment purposes) then it’s likely they would have been more aware of the possible VAT consequences.

To add insult to injury, the solicitor acting for the original developer didn’t even know himself about the purchasers’ liability for VAT.  They sent a completion statement to each of our clients at the end of the purchase transaction and it was entirely silent on the issue of VAT.

Each of the purchasers’ solicitors tried to argue that they weren’t negligent.  The main argument they raised was that if eight firms of solicitors hadn’t noticed the problem, then surely it is not reasonable to suggest they were negligent to miss it?  Unfortunately though, as they were holding themselves out as ‘reasonably competent conveyancing solicitors’ and the VAT point is one of statute, they didn’t get far with that argument.  In fact, they pretty much caved in when we served them with court papers.

If you require guidance on making a VAT negligence claim then contact our free legal helpline for a case assessment and details of no win, no fee funding.

Professional negligence solicitor Emma Slade looks at a case she recently brought to a successful conclusion which involved errors made in repect of the intestacy rules.

I have just settled a case and it is one of those cases where you almost wish it hadn’t settled as it would have been very interesting to take to Court.  It isn’t a professional negligence claim but a contentious probate claim that I took on last year.  I will try to get the facts of the inheritance dispute straight although of course, I have changed the names.

In 1922, Mum gave birth to a baby girl.  Dad was not on the scene so when she registered the child’s birth, Mum gave Alice her own surname of Morris and left the details of the father blank.

A couple of years later, Mum gave birth to a son, William.  This time, the birth certificate detailed the father, a Leonard Bettelheim:  A rather unusual surname.  In fact, Mum was also shown on the birth certificate with this surname “formerly Morris”.  There was no evidence of a marriage though.  The child was known as William Bettelheim but later, he changed his name to Charlie Morris so he had the same surname as his mother and older sister.

A few years later, Mum married Peter Richards and my client was a child of that marriage.  She was therefore the half sister to both Alice and William.  I’ll call her Louise Richards.

In 1946, Alice married.  Her marriage certificate is interesting as she calls herself Alice Morris (as per her birth certificate) and states that her father was Leonard Morris.

So there we have it.  Alice and William were both born out of wedlock.  According to the birth certificates, Alice Morris did not have a father but when she married, she said her father was Leonard Morris.  The birth certificate for William showed his father as Leonard Bettelheim but later, William changed his surname to Morris.

Moving swiftly on, in 2011, Charlie Morris (née William Bettelheim) died without making a Will.  He was unmarried and did not leave any children.  Mum had died many years previously so the only close kin he had were Alice and my client.  Now intestacy laws state that in intestacy where the deceased dies without leaving a spouse, children or parents, the person to inherit is a sibling of the whole blood.  If there are no siblings of the whole blood, then siblings of half blood inherit.

You can probably see where this is going….

Alice’s son, Michael, agreed to stand as the Administrator of his Uncle Charlie Morris’ estate.  It was not an insignificant estate either.  Michael dealt with the Estate and, in the belief that Alice was Charlie’s full blood sister, gave the entirety of the Estate to his mum.

My client didn’t feel that this was right.  Alice had told her previously that she did not think Leonard Bettelheim was her father.  Although Alice had asked her Mum about it when she was younger, Mum had brushed the subject away.  Bearing in mind having a child out of wedlock in the 1920s was frowned upon, one can understand why Mum did not dwell on the subject.

My client managed to obtain copies of all the relevant birth and marriage certificates and her doubts multiplied.  One of the things we thought was telling was that to register a child’s birth, the father needed to be present.  If Leonard Bettelheim was Alice’s father, he could easily have had her birth certificate amended whilst he was at the Registry Office registering William’s birth.  But he hadn’t.

And this is where it was getting interesting.  There was a lot of doubt that could be cast over whether or not Alice was a full or half blood sibling.  From the looks of it, Michael had only ever known his Uncle as being Charlie Morris and probably jumped to the conclusion that his mother was therefore a full blood sibling of Charlie.  Michael had been surprised when Louise had told him Charlie’s birth name.

Michael, through his solicitors, tried to argue that my client had to prove that Alice was not a full blood sibling.  All we had were the blanks on the birth certificate which is hardly a conclusive case.  Alice was by now very elderly, in care and with significant memory loss so she would not be of much help – and as she was the one benefiting from the entire estate, she would hardly wish to lose that money even if she did recall what had happened.

We did briefly consider getting DNA evidence but getting a sample from William/Charlie was now impossible.

Ultimately, we turned the argument on its head and said that it was not Louise who had to prove that Alice was not a full blood sibling, but rather it was Michael’s job as Administrator.  Part of the Administrator’s role is to identify who the correct beneficiaries are and he had not made any attempt to do so.

It was at this stage that the case settled.  I think the Administrator could see that this sort of inheritance dispute was never going to have a full and proper answer.  It really could go either way and the whole estate would be eaten up in legal costs.  He made an offer to my client to settle for one quarter of the Estate.  She was pleased to receive that – she had made her point.

I still think it would have been a great case to take to Court.  If we could show the burden of proof was on Michael, I feel sure we would have won.  But at the end of the day, the parties probably made the right decision.  At least there was some inheritance still left to give away!

How we can help

You can find further information about the intestacy rules here. If you require assistance with an inheritance dispute you can call our specialist helpline on 0333 888 0407. And if you wish to pursue a professional negligence claim then contact Emma Slade on 0333 888 0403. Alternatively send an email with details of your case to us at [email protected]

I am lucky.  I enjoy my work and I don’t think there are a lot of people out there who can say that.  Oh there are days when I could happily tear my hair out (or the eyes of my opponent!) but generally, I enjoy it.  I think it is because of the variety of work that I get to see and deal with.  As a professional negligence lawyer, I obviously need to understand basic civil law tenets like duty of care and causation but I also have to understand other areas of law to understand and evaluate whether a solicitor has been negligent. It might be a divorce negligence case one day and a commercial property negligence case the next. And that’s just the solicitors’ negligence claims. We also require an understanding of building in order to sue a negligent builder, architect or surveyor: Or an understanding of finance and pensions to sue an IFA.  You get the idea.

It isn’t always limited to that though.  Take one case that I settled recently all about sewage rights and drainage.  I had to become familiar with various regulations and requirements about the installation of a septic tank, drainage on a hill, porosity of soil etc.  In fact, I now know more about sewage treatment than any girl has a right to know!  It was however, an interesting case.

I had an advantage in this case.  I had a lovely client, but as a result of an act of huge generosity on his part, he was now being sued.  He lived in a terrace of three houses which were linked up to a septic tank on someone else’s land.  The sewage system failed and so he offered to install a new septic tank system on his land to serve all three properties.  At the same time, he was selling his house and as part of the contract, he agreed that he would ensure the new system was of reasonably satisfactory condition.

The system was installed, the house was sold and all was quiet for over 18 months.  During that 18 months though, the Claimant (who had purchased my client’s house), alleged that the sewage system was fundamentally flawed, that it had broken down and was not fit for purpose.  However, rather than sitting down with the two neighbours to try and sort something out, he simply stopped the neighbours’ access to the system.  One of the neighbours was able to install his own system, but the other neighbour did not have the land to do that so brought proceedings against the Claimant.  The neighbour won and the Claimant was faced with a massive legal bill – about £180k.  So the Claimant decided to sue my client on the grounds that the system was not reasonably satisfactory and was in breach of contract.  They claimed not only the cost of installing a new system but also the legal costs of the previous proceedings.  All in all, my client was facing a bill of in excess of £225k.

This is where the fun started.  We had to investigate all the requirements for installing a septic system with a soakaway system, the length of the soakaways, depth, area etc and all this dating back 6-7 years ago.  We also had to investigate the types of septic tank systems and pumps, what could cause their failure, water tables, percolation tests and groundwater levels.  At times it was mind-boggling but always interesting and not the sort of thing that one would usually come across.  In fact, it stood me in good stead because not long after this case, I then got instructed on two more cases involving septic tanks and drainage systems!  All of a sudden, I had become an expert in what could have been a crappy area of law (pardoning the pun!)

So how did the case end?  Unfortunately, we found out that some surface water was getting into the sewage system when it shouldn’t have been.   The neighbour who had issued the first set of proceedings had linked her guttering to the sewage system and although it was outside of my client’s area of works, it meant our defence wasn’t as watertight as we would like.  So, we made an offer.  We offered the princely sum of £5,000 – an over-the-top estimation of what it would have cost to re-route the neighbour’s guttering had the Claimant been sensible about it right from the start reached a sensible solution.  The other side accepted the offer and as a result, my client is having to pay some of his legal costs.  It will be a pyrrhic victory though for the Claimants: they still have to pick up the tab for the legal costs of the previous case and although my client will have to pay some of the costs of this case, there will be a huge discount on the basis that the Claimant vastly over-inflated the value of their claim.

But at least I know something about sewage systems now!

What happens if there is a mistake in a Will?

If you have lost out due to a mistake in a Will then contact our specialist solicitors for a free case assessment and guidance on claiming compensation on a no win, no fee basis. Call 0333 888 0403 or send an email to [email protected]

We have all done it.  Written something down or typed something up only to go back to re-read it and realise that missed a bit.  See?  I have just done it there.  It should have said, “and realise that we’ve missed a bit”.  But you can easily go back and correct the error, using a small arrow or hitting the insert button, possibly even the rewind button.  However, sometimes you get an error which, for various reasons, cannot be corrected by the writer.  Like errors with a Will.  Usually the error only comes to light once the maker of the Will has died when it is too late for him to correct it. As a result, someone benefits when that is not what the Testator intended.

Take for example the recent case of Marley –v- Rawlings. The facts were quite simple.  Mr & Mrs Rawlings had two children (Michael and Terry) but had also informally adopted Terry Marley as a child.  After Michael & Terry Rawlings left home, Terry Marley stayed with the Rawlings and cared for them as they got older.  In recognition of this, the Rawlings made identical Wills, giving their respective estates to each other or, if they failed to survive, to Mr Marley.  There was nothing for Michael or Terry.

However, there was a bit of a mix-up when it came to signing the Wills.  Mr Rawlings signed his wife’s Will and Mrs Rawlings signed her husband’s.  This error only came to light after both of them had passed away.  I am sure I do not need to tell you that s9 Wills Act 1837 says that “no will shall be valid unless it is in writing and signed by the testator”. Neither Will had been signed by the actual testator so, on a precise reading of the Wills Act, the Wills were invalid and Mr & Mrs Rawlings had died intestate.  And because Mr Marley had not been legally adopted by the Rawlings, he wouldn’t get a look-see into the Estate – everything would go to the Rawlings’ natural sons.

Of course, now that both of the Rawlings were dead, the matter could not be rectified by them so Mr Marley applied to the Court to see what it could do.  Under the Administration of Justice Act 1982 – s20 if you are interested – a Court can rectify a Will where it believes the Will fails to carry out the Testator’s intentions as a result of a clerical error.

I concluded a case last year using this very same section.  In that case, dad had executed a Will giving his house to his carer but subsequently changed his mind and wanted to leave the house to his daughter, with the rest of his estate to be distributed equally amongst his children, of which there were four. He gave instructions to his solicitor but rather than taking the carer’s name out of the paragraph and substituting that of my client (the daughter), they just deleted the paragraph all together.  It wasn’t until after dad died, that this error was noticed and by then, it was too late to get it corrected.  It seemed pretty obvious from the Will that a paragraph was missing as it didn’t read properly.  Plus, there was an attendance note where it was recorded that dad wanted my client to have the property.  Unfortunately, the attendance note was a bit ambiguous.  Added to that, the solicitor who drafted it and my client’s siblings defended it.  I am pleased to say though that we came to an amicable settlement following mediation.

Not so in the Marley –v- Rawlings case.  This one went right through the entire court system.  In both the High Court and the Court of Appeal, Mr Marley lost.  As I have explained, the requirement for a valid Will is for the testator to sign the Will himself and it would appear that the judges in these two courts felt that it was such a fundamental requirement, that it could not be rectified – the Courts could not override a statute.  This is despite the fact that Mr & Mrs Rawlings’ Wills were identical, there was clear evidence of their intentions but the solicitor had, well, let’s face it, he’d screwed up!

It seems a pretty harsh outcome. Even Lady Justice Black in the Court of Appeal said, “this is a conclusion I have reached with great regret”, but still went ahead and found against Marley.

Fortunately, I can say that the Supreme Court disagreed with the lower courts and concluded that this was such an obvious case of clerical error and that, had Mr & Mrs Rawlings been there, they would have corrected it in the blink of an eye, they had no compunction in rectifying Mrs Rawlings’ ‘Will’ so it now became Mr Rawlings’ Will.  Mr Marley is therefore now entitled to their Estate, which I understand to be worth in the region of £70,000.

To me, this seems a sensible outcome as it really was an obvious error.  I can see and understand the concerns raised by the lower courts that by tinkering with the Will, it is overriding a statute settled by Parliament and certainly, if the facts were less than clear cut, I doubt if the Supreme Court would have come to this conclusion.

Whilst it is a nice outcome for Mr Marley though, it wasn’t such good news for the solicitors whose negligence had created the problem. They were ordered to make a contribution to the costs incurred by the parties in this long running dispute.

How we can help you

Emma Slade is a Solicitor specialising in Professional Negligence claims including Solicitors Negligence. Emma and her professional negligence colleagues work closely with our specialist contentious wills and probate team when bringing a claim for compensation following a solicitor’s mistake in relation to a will or the administration of an estate. This blend of expertise allows us to draw together skills and knowledge from two complex legal areas to provide our clients with a first class service. You can read what our contentious probate team have said about these cases in two informative articles published on a specialist legal site, Can a beneficiary sue a solicitor for negligence?  and What can I do if a solicitor makes a mistake when preparing a will?

You can call Emma Slade on 0333 888 0403 for a FREE case assessment or drop us an email at [email protected]

Making a professional negligence claim on a No Win, No Fee basis

To make a professional negligence claim on a No Win, No Fee basis contact our free legal helpline by calling 0333 888 0403 or sending us an email at [email protected]

Can I make a professional negligence claim on a No Win, No Fee basis?

Making any legal claim is expensive, but the costs involved in pursuing a professional negligence action are particularly high. And it isn’t only your own legal fees that you need to worry about. Because the loser usually has to pay some of the winner’s costs, you may also be liable for your opponent’s legal costs as well as your own.  Is it any wonder therefore that we are regularly asked, ‘Can I make a professional negligence claim on a No Win, No Fee basis?’

It is probably a good idea if we explain very briefly about how no win, no fee and in particular a Conditional Fee Agreement (“CFA”) works in a professional negligence claim.

If we enter into a CFA with you, we agree to defer our fees until the conclusion of the claim.  If you lose your claim, our fees get written off – hence the name, ‘No Win, No Fee’.  You may however still be liable for the other side’s legal fees. These are fixed by law and an insurance policy can be taken out to cover you for that eventuality.

If you win your claim, then we will charge you our hourly rate, plus a percentage uplift on those costs – known as a success fee.  This percentage uplift is set at the outset of a claim and takes into account the risk that we will be taking in supporting your claim as, in effect, we will be gambling on the success of the case.

If you recover fixed costs from the losing party then we will credit these against what you have to pay. We also offer to cap our fees (including the success fee) so that you are guaranteed to receive a minimum percentage of your compensation, no matter what the costs ultimately are.

Working under a CFA involves certain obligations and responsibilities that both parties to the agreement must comply with. Plus, the Agreement will cover issues like termination, interim payments and the like.  Before you enter into any CFA with us, we will spend time with you going through the Agreement and explaining to you the full effects and consequences of a CFA.

But going back to the beginning of this article and the question we so often get asked, “Can I make a professional negligence claim on a No Win No Fee basis?” as you have seen, the answer is ‘yes’.

Obviously, we will not take on cases that do not have a good chance of winning. There must also be a certain level of financial loss that arises from the negligence for it to be cost effective for a No Win, No Fee arrangement. The starting point for a No Win No Fee claim to be commercially viable is £25,000.

We are happy to review your case free of charge to see if we think that there is a good claim.  If there are poor prospects of success or the value is too low, we will tell you so candidly and discuss the other options available to you.  However, if we think the prospects are good enough and we are happy to enter into a CFA, gambling our time and fees on it, you can be safe in the knowledge that your claim must have reasonable prospects of success if a lawyer is prepared to bet their time and money on it.

For a free consultation about making a No Win, No Fee professional negligence claim call us on 0333 888 0403 or send an email [email protected]

A couple of articles have recently come to my attention in the Law Society Gazette to do with ‘cannibalism’, a phrase coined by a defendant lawyer to describe a new form of litigation: claimant lawyers suing claimant lawyers.

It seems to have started off with an apparently new raft of claims where solicitors are being sued for under-settling personal injury cases.  Personally, I cannot say that it is a “new” influx of cases – I have been dealing with under-settled claims for quite a while now – but I suspect that, with the new regime of fixed fees in PI claims, the number of negligent injury settlements is likely to increase.  Whilst it may seem like a good idea to keep a cap on legal costs, the fact that they are so low, with correspondingly tight profit margins, it is easy to see how corners can be cut leading to claims being under-settled.  However, whatever the pressures the lawyers are working under this can never be acceptable practice and practitioners have to appreciate that professional negligence claims will surely follow.

But it seems that the new breed of cannibalism isn’t stopping there.  A large national law firm has recently run an article stating that they are now going to be actively pursuing professional negligence claims against solicitors who fail to give proper costs advice to their client, both about methods of funding and protective insurance policies.

Again, this is not new.  The Solicitors Code of Conduct makes it very clear that at the outset of a retainer, a solicitor must discuss with a client the best way to fund a case and how to protect themselves against an adverse costs order where they have to pay the other side’s costs.  Although a solicitor is not obliged to take on a case on a no-win, no-fee basis, they do have an obligation to advise the client that other firm’s may be prepared to offer this in the form of a conditional fee agreement.  Importantly, the solicitor should be advising about insurance, both insurance the client may already have (legal expenses insurance) or insurance that can be purchased specifically for the claim (‘after the event’ insurance).  If the client subsequently loses their case and is faced with a huge costs bill, there could be a claim against their solicitor for their failure to give this advice.  Indeed, I have a case on my desk at this very moment where the solicitors failed to advise about conditional fee agreements, failed to ask if the client had any insurance (and when it transpired they did, failed to tell the client that they did not have to change solicitors like the insurers demanded), failed to take out ATE insurance until two days before the trial and failed to make sure the cover was sufficient.

Slee Blackwell Solicitors offer a free Helpline facility.  Potential clients can call us with their legal problems and we will chat it through with them, giving guidance and help where we can.  If there is a potential professional negligence claim, we will ask the client to send in their case papers, so we can have a better look before deciding whether to take the claim on.  For a professional negligence case, this is usually done on a no-win-no-fee basis.  However, a lot of calls fall by the wayside as it quickly becomes evident there isn’t a viable claim, much to the frustration of the caller who may have suffered a loss.  Take this one for instance.

Fourteen years ago, Mr Price (not his real name of course) was the beneficiary under his Uncle’s Will.  The Estate comprised a large farm with a number of fields and a farmhouse.  The farmhouse was to go to Mr Price whilst the fields were to be sold off.  The field adjacent to the farmhouse could only be accessed along the driveway to the farmhouse so before the field got sold off, the solicitors dealing with the Estate granted an all-purpose right of way over the driveway. So whoever purchased the field could get access.

A couple of years ago, Mr Price decided to sell the farmhouse.  He knew that there was a right of way over the driveway for the owner of the field but had presumed that the right of way was for agricultural purposes only.  He was taken aback a bit to find it was an all-purpose right of way.

He had the house valued and found that the house was worth about £300,000 less than he thought it was worth.  He blamed the original solicitors dealing with his Uncle’s Estate for granting an all-purpose right of way and felt that it was that which had reduced the value of the property. He therefore wanted to bring a lawyers negligence claim.

I have to admit that I was a bit surprised by that.  I am not a valuer but found it difficult to imagine that an extensive right of way like that would cause such a massive devaluation of the property.  Mr Price then told me the reason why he was wanting to sell up.

Apparently, the ownership of the adjacent field had changed hands a few times over the years and now belonged to a group of Travellers.  Much as Mr Price hated to admit it, he had to agree that it was undoubtedly the presence of the Travellers on the field that caused the devaluation rather than the right of way.

I had to explain to Mr Price that whilst the solicitors may have been negligent, the best he would get would be the diminution in the value of the house fourteen years ago.  You can only claim damages that are reasonably foreseeable and I cannot see a Court agreeing that fourteen years ago, the solicitor could have foreseen the field being owned by Travellers and causing a devaluation in the property. Any devaluation caused by the more extensive right of way was likely to be modest and we discussed the commercial considerations of bringing a solicitors’ negligence claim. There were also limitation concerns and it’s a good opportunity to remind people of the 15 year longstop limitation date for latent damage claims – but the details of that are for another time.

Making a professional negligence claim against a lawyer

Emma Slade looks at the issues involved in making a professional negligence claim against a lawyer on a no win, no fee basis. Contact our free legal helpline for guidance on your case. Call 0333 888 0403 or email us at [email protected]

When I take on a file with a view to bringing legal proceedings for professional negligence, I usually have a pretty good idea of what I am looking for. Invariably, I will have had a chat with the client and we will have discussed what has happened and why they think there has been negligence on the part of the lawyer, surveyor, accountant or other professional.  I can then guide my investigations to identify the evidence required to support what the client is alleging.

However, my enquiries aren’t limited purely to seeking out evidence to support what the client has said, but also to see if there is any other allegation that can be made.  This is quite important as it would be negligent of me to look through the papers and tell the client they don’t have a claim based on their own allegations when it is glaringly obvious that they have a claim on another basis.

I have been thinking about this quite a bit recently, simply because I have just finished a lengthy trial involving a professional negligence claim against a lawyer on a no win, no fee basis which revolved around this issue, and am awaiting the judgment.

The basic facts:  My client had just struck a really great deal with a big commercial organisation which I will call – inspiringly – “BCO”.  BCO were keen to get the agreement in writing and get it all signed up as they, according to my client (who I will call, just as inspiringly, “Mr Client”), were as keen as he was to get the deal finalised.

It was rather a good deal from Mr Client’s point of view.  He had a patent in an item which BCO wanted.  Part of the deal was that Mr Client would give them a licence in the patent in exchange for which, he would become an employee of BCO on what one can only describe as, ‘healthy terms’.  For some reason that I cannot fathom, BCO set up the deal in two agreements – a Licence Agreement for the patent and a Contract of Employment for Mr Client’s services.  Mr Client was happy about this as he understood that if one was terminated, the other would be terminated also.  In fact, his Contract of Employment specifically said that the Licence Agreement was an ‘essential’ part of it.

Now Mr Client is not, by his own admission, one for paperwork so when he got the documents, he phoned up a recommended law firm (might as well go for the hat trick and call it “Law Firm”!) and made an appointment to see a solicitor about his Contract of Employment.  The solicitor had a look at it and said to Mr Client that she felt she ought to have a look at the Licence Agreement as well.

Having reviewed the documents, she gave Mr Client the thumbs up and he signed the documents, excited about the new project.  At least he was excited for a whole year.  Right up until the time BCO terminated the contract.  In fact, right up until the time they pointed out that there was a defect in the Licence Agreement and whilst the Licence Agreement was ‘essential’ to the Contract of Employment, the Contract of Employment was not ‘essential’ to the Licence Agreement.  More importantly, because of the way the agreements were set up, it was the Contract of Employment that held all the financial terms; the Licence Agreement was silent on the issue of money.  In short, BCO were able to get rid of Mr Client on his ‘healthy terms’ employment contract and continue to licence the patent for free!

We have argued throughout that Law Firm were negligent.  They should have noticed that the two agreements did not hinge together the way that Mr Client understood.  Law Firm countered this by saying that their instructions were only to read through and advise on the Contract of Employment, not the Licence Agreement.  They confirm this by pointing to their Client Care letter which says that is all they will do.  We counter-argued (as is the wont of lawyers) that they had expanded the retainer by asking to see the Licence Agreement and by agreeing to read it, they therefore had a duty to point out the huge problems with it.

The case is a lot more complicated than this, with many more issues and counter-issues than I can possibly get into a short article.  You can hardly have six years of litigation over such a small point without developing others.  However, what I have highlighted above is the crux of the matter.

I am not sure how it is going to turn out, but given there is so much case law that supports our position, I am pretty confident we will succeed.  At the same time though, I am sure that my opposing solicitor is probably saying the same thing, as there is case law which supports her position.  I suppose it comes down to the old joke – get five solicitors in a room; you’ll get six different opinions!

However, the case does underline the need for lawyers and their clients to look at the broader picture when undertaking any transaction to ensure that the various pieces fit together as the parties intend. Failure to do so is likely to lead rapidly to a professional negligence claim

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Making a claim for conveyancing negligence

I had an enquiry the other day about a potential professional negligence claim against a conveyancing solicitor and it reminded me of a case I dealt with a year or so ago.

Mr Adeyemo* purchased a buy-to-let flat in Manchester. Well, it wasn’t actually in Manchester but we will say it was there for argument’s sake! Anyway, back to the story: he purchased a flat in Manchester. It was a flat in an old house that had been converted and he bought the downstairs flat with the benefit of a mortgage. He instructed solicitors to deal with the conveyancing and it all went through swimmingly.

The area where the flat was in was pretty popular and within days of purchasing the property, Mr Adeyemo had found some tenants. Their rent was sufficient to pay the mortgage and give him some additional income.

About a year or so later, his tenants handed him a letter that they had received addressed to him from the local council. It appeared the house had been converted into two flats without planning permission and the Council wanted it converted back to a single property, else Mr A would start facing some stiff penalties.

Mr Adeyemo ignored the correspondence for as long as he could but the Council started to get a bit insistent that the problem be remedied. They had written first to the occupier of the upstairs flat and then the mortgage companies who in turn, wrote to Mr Adeyemo. He could no longer ignore it.

I got his conveyancing solicitors file and went through it. Firstly, I noticed that the Estate Agents details advertised the property as being newly converted into flats. This should have set the solicitors’ alarm bells ringing, but they clearly missed it. They also missed that the Seller had confirmed in his documents that work had been carried out at the property to convert it into two flats. And they also missed the fact that the documents from the Council showed that no planning permission had been applied for on the property. In short, the solicitors had been negligent.

Unfortunately, the matter started to become very messy. There were two flats owned by two different owners both mortgaged with two different mortgage companies with two sets of negligent solicitors who each had their own insurers. And yes, the solicitor for the owner of the upstairs flat had also made the same mistake as Mr Adeyemo’s solicitors!

It took a long time to sort out this muddle. We had to get the insurance companies talking to each other first of all to see how they wanted to deal with it but clearly neither wanted to take responsibility. Then we had to get them to talk to the mortgage companies to see how they wanted to be recompensed before we could start talking about recompensing Mr Adeyamo.

Ultimately, I managed to settle the matter. Mr Adeyemo had to serve notice on his tenants to vacate the premises. Once they had, the insurance company bought the flat back from him and paid off his mortgage. I did try to argue for some compensation for Mr Adeyemo on the basis that the property had been an investment flat with a view to providing him with some additional income but they pointed out that Mr A could easily purchase a new investment property and reap his reward that way so that is what he agreed to.

All in all, it was an interesting negligence case although at times, whilst trying to get the insurance companies talking to the mortgage companies, it seemed like a Gordian knot. Fortunately, we managed to cut it.

*not my client’s real name, naturally.

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