An unfavourable outcome will not always mean that an adviser was negligent 

20 September 2024

Professional negligence claims may be made where a professional (such as a solicitor, architect, surveyor etc.) has failed to perform their responsibility to a set standard. When providing services professionals are under a duty to exercise a reasonable degree of skill and care. If they do not, their client may have grounds to pursue a claim for professional negligence. 

When it comes to professional negligence in the context of legal services, discrepancies in decisions made by advisors can potentially constitute justifiable grounds to bring a professional negligence claim, although much will depend on the circumstances. 

In this blog, we examine the recent decision in King (and others) v DWF LLP (and others) [2023] EWHC 3132, albeit based on the unusual facts of that case, to see what lessons can be learned both for legal practitioners and their clients alike. 

The facts of King v DWF LLP 

The Claimants in this case alleged gross breach of fiduciary duty and negligence against their former legal advisors at various stages during the conduct of misrepresentation proceedings held in May 2017. In particular, it was said that they were advised to discontinue their claim on day 10 of the trial of those proceedings, to apologise in open court and to agree to pay costs on the indemnity basis, even though the Claimants maintain that the claim had a very strong prospect of success. 

The misrepresentation proceedings arose out of a transaction in December 2013, whereby the Claimants had sold a stake in their family business to external investors pursuant to a Share Purchase Agreement (SPA). In those proceedings, the Claimants had sued the investors alleging that the SPA resulted from, among other things, fraudulent misrepresentation and economic duress. 

In the subsequent professional negligence proceedings, the Claimants made especially serious allegations based on an alleged mistake by their solicitor when advising on the transaction. When the Claimants sued the investors in 2015, it was said that the solicitor chose to cover up his previous default by allowing documents to be filed which he knew were misleading on the issue of quantum, and that other members of the legal team were negligent in not checking the contemporaneous documents which showed the filed documents to be wrong. Additionally, it was alleged that once the case reached trial and the alleged dishonesty became apparent, further attempts were made by the solicitor and barristers to conceal this. It was also alleged that advice was given to discontinue the claim because of the possible personal consequences for the legal team if the case continued to a judgment, even though they all knew that this was contrary to their clients' best interests. 

The decision in King v DWF LLP 

It was held by Mr Justice Henshaw that there was not the slightest merit in the allegations made by the Claimants against their former legal advisors, and that the extremely serious allegations made against each of the Defendants were entirely without foundation. In particular, the Claimant’s allegations of conspiracy, if true, would have required a deliberate decision by at least three legal professionals to abandon their clients' interests in order to protect themselves. That would have been an unusual occurrence and those individuals had, in any event, no reason to do any such thing. 

While an evidential error had been made early on in the misrepresentation proceedings, the solicitor was not responsible for this error. The error had also been corrected at trial and had caused no loss. Additionally, the advice to discontinue was given based on irreconcilable issues with the factual evidence presented at trial and the Claimant’s lack of credibility during cross-examination. 

What we can take away from King v DWF LLP 

Even though the High Court found that the allegations in King v DWF LLP were devoid of merit and wholly untenable, the principles outlined in this case still underscore the need for legal practitioners to exercise sound judgment and professional conduct at all times. This is because the subjective nature of legal work, often involving decisions based on judgment, can be fallible. 

Equally, for those looking to sue their legal advisors, the King case emphasises that professional conduct will not be deemed negligent simply because it results in an unfavourable outcome. Instead, negligence will be assessed based on whether decisions made fell beyond the range of what competent professionals might have chosen under similar circumstances. 

The Dispute Adviser

A legal blog by Melissa Worth
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