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Professional negligence claims against solicitors

If you run a business, it’s extremely likely that you’ll need to seek help from a solicitor (and other professionals) at some point for advice and support for a whole range of different reasons.

Unfortunately, taking professional advice isn’t always foolproof and mistakes can sometimes be made, which is why we’ve put together this article to help you if you’re thinking about making a professional negligence claim against a solicitor.

What is professional negligence?

The term ‘professional negligence’ means that a professional has failed to perform their responsibilities to the required standard, and that this has in turn could have caused you loss.

In order to establish a potential professional negligence claim against a solicitor, there are three elements that all need to be proven in the first instance:

  • The solicitor owed you a duty of care: A solicitor who is instructed to act on your behalf will automatically owe you a duty of care to act with reasonable care and skill. (Additionally, when you instructed the solicitor, you will have received a retainer – this will likely be in the form of an engagement letter setting out their terms of business and what you can expect the solicitor to do for you, i.e., their duties.)
  • The solicitor breached that duty of care: Whether there has been a breach of the duty of care owed to you by way of negligence will generally be measured by the standard of whether the service or advice you received was so poor that it fell below a reasonably acceptable standard for the profession.
  • The breach suffered has led to financial loss: If you’re able to prove that the actions of the solicitor caused you a financial loss (known in legal terms as ‘causation’), then you may be able to pursue compensation.

Examples of solicitor negligence

As mentioned above, there are a multitude of reasons why you might instruct a solicitor to act for you throughout the lifetime of your business and that means examples of potential negligence span a wide range of scenarios. For illustration purposes, some of these examples might be:

  • You’ve been given incorrect or incomplete legal advice on which you have relied;
  • There has been insufficient checks done in a legal transaction such that you have incomplete or incorrect information when deciding if or how to proceed;
  • An administrative mistake has been made, e.g. in the drafting of court documentation;
  • An important court deadline has been missed and has led to adverse sanctions for you and your case;
  • A limitation date has been missed (the time required by the law for bringing your case to the court’s attention in formally commencing proceedings), meaning that you’re unable to continue with it;
  • The solicitor has under-settled your case for significantly less than it’s actually worth;
  • The solicitor has failed to advise you about all of your funding options.

What’s the difference between a complaint and a claim?

Whilst there is a link between complaints and claims against solicitors, there are also differences between the two and it’s advisable to seek advice from a specialist professional negligence lawyer.

It’s a good idea to complain directly to the firm the solicitor works at first as soon as you believe something has gone wrong. In general, a complaint can generally be considered a claim when a financial loss occurs as a result of the solicitor’s breach of duty.

What evidence do you need to make a claim?

As with any claim, you will need to have enough evidence to successfully prove your case. If you instruct a lawyer to pursue the claim on your behalf, it’s highly likely that they will require sight of the solicitor’s file, along with a few other key pieces of information. This will include the date you instructed them and what you instructed them to do, details of what you allege they did wrong and how this has affected you by way of a loss.

As an aside, whilst many types of professional negligence claims require evidence from an independent expert to be given to the court, it’s not usually the case in professional negligence claims against solicitors – this is because it’s assumed that the judge has the necessary expertise to consider the issues appropriately.

How do you make a claim against a solicitor?

1. Adherence to the Pre-Action Protocol for Professional Negligence

If the lawyer you instruct agrees that you can pursue a professional negligence claim against the solicitor in question after assessing the evidence referred to above, it will then be necessary to follow the Pre-Action Protocol for Professional Negligence (“the Protocol”). The Protocol sets out the steps that a claimant ought to take in the course of a professional negligence claim before beginning (“issuing”) court proceedings, with the objective of achieving an early settlement of the claim without the need for proceedings if they can be avoided. The primary steps will be to send a Letter of Claim and await an acknowledgment and subsequent Letter of Response (see points 2 to 4 below). Should issuing a claim be necessary despite adhering to the Protocol, then taking these steps should have served the purpose of ensuring that all of the issues between the parties are identified and that all evidence has been exchanged in a timely manner.

2. Preparing a Letter of Claim

Assuming that an early resolution of the claim could not be reached, the next thing your lawyer will do is draft a Letter of Claim. This letter should clearly summarise key dates and facts, along with outlining the allegations of negligence and an estimation of the financial loss that you’ve suffered. All pertinent documentation in support of the claim and the calculation of loss should be included with this letter, and if for any reason details of the financial loss cannot be provided at this stage, then the letter should explain why and when this can be rectified.

The other important piece of content the Letter of Claim should include is a request that a copy of it is immediately made available to the solicitor’s professional indemnity insurers.

3. Awaiting a Letter of Acknowledgment

The Protocol says that a Letter of Acknowledgment in response to the Letter of Claim should be received from the solicitor or its representatives within 21 days of receipt.

4. Awaiting a Letter of Response

Once they or their representatives have sent a Letter of Acknowledgment, the solicitor then has three months from the date on that letter to investigate and fully respond to your Letter of Claim, either by way of a Letter of Response or potentially a Letter of Settlement. It ought to be transparent within the contents of the Letter of Response whether the solicitor admits the claim or denies it fully or partially – if it is the latter stance then the letter should include comment upon each of your allegations and their version of events. Similarly, if the estimated financial loss in the Letter of Claim is disputed, the Letter of Response should include their assessment and again, give reasons if that alternative assessment cannot be provided just yet. (It’s also worth highlighting here that a Letter of Settlement containing possible settlement proposals may accompany a Letter of Response, rather than being sent instead of one.)

In the event that no settlement letter is received or if the Letter of Response outright denies the claim, you will then be entitled to issue formal court proceedings.

Is there a time limit for professional negligence claims to be made against solicitors?

As with all types of claims, there is a time limit referred to as a limitation period for bringing a professional negligence claim against a solicitor. This is six years from the date on which the relevant cause of action accrued (this means the date when your retainer with the solicitor was breached or the date upon which you suffered the loss, which may be slightly different). These six years would be classed as a primary limitation period.

What if you’re not aware that you suffered a loss, or you don’t know all of the material facts until after the six-year limitation period has expired?

In these circumstances, there’s a possibility that you can still bring a claim after the six-year primary limitation period has elapsed, as long as you do so within three years of when you would be deemed as becoming aware of the material facts. This is, however, subject to a long-stop period of 15 years from the date of the negligent act (unless there are allegations of fraud or deliberate concealment), after which any claim will be statute barred.

The requirement for solicitors to hold professional indemnity insurance

Solicitors are obliged by law under the SRA’s Indemnity Insurance Rules to have professional indemnity insurance (PII) in place at all times, including for a “run off” period of 6 years after any firm has closed down. This insurance should meet the costs of any compensation you receive if your claim is successful. Once the firm with which you have an issue is aware of your claim or potential claim, they should put their insurers on notice of it immediately.

Summary

Whatever the size of your business, it’s important to take legal advice as soon as possible if you believe that you have a professional negligence claim against a solicitor, and in doing so you will also be informed of the different ways such an action might be funded. Acting quickly means that you stay well within the limitation period for bringing a claim, should this become necessary if the steps outlined in the Protocol do not lead to a successful resolution or an alternative means of settling the dispute outside of court.

About our expert

Barik Haider

Barik Haider

Senior Dispute Resolution Solicitor
Barik is a dispute resolution solicitor with over 15 years’ experience in litigation and dispute resolution. Having qualified in 2005, he trained and progressed at large national firms and has also worked at smaller specialist litigation firms. Barik has acted for a variety of clients including large companies, SMEs and individuals and is often involved in complex high value disputes. He is a Recommended Lawyer in the Legal 500.


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