Claim value in 'lost litigations'

Patricia Dixon v Clement Jones (Court of Appeal - 8 July 2004) The defendant firm of solicitors adm...

Patricia Dixon v Clement Jones (Court of Appeal - 8 July 2004)

The defendant firm of solicitors admitted breach of duty in that Mrs Dixon's claim against her accountants was struck out for failure to serve a statement of claim. Mrs Dixon alleged that her accountants had been negligent when they failed to advise her properly on a business transaction.

At first instance, the judge assessed the claimant's loss at 30% of the total value of her claim against the accountants. Although she had lost something of real and substantial value, it was found that she would probably have pursued her business venture even if the accountants had correctly advised her of the financial risks involved. The defendant appealed, arguing that the claim should have been dismissed, or assessed at a negligible value.

The Court of Appeal dismissed the appeal. In cases where the claimant loses the opportunity to pursue a claim ('lost litigation' claims), the claimant is not required to prove that he or she would have acted in accordance with the non-negligent advice if it had been given. Judges need to assess the chances of success of the underlying claim. If the claimant has lost something of value, in the sense that it was more than negligible, then the judge needs to put a value on what was lost. The judge did not err in assessing the value at 30% of the 'lost litigation' claim.

COMMENT: In 'lost litigation' professional negligence claims against solicitors, and where the claimant has lost something of value, the trial judge will assess the overall chances of success. The claimant can be compensated even if they probably would have ignored the advice that should have been given. Genevieve Rich, BLM London

- These law reports are contributed by insurance law firm Berrymans Lace Mawer (http://www.blm-law.com).

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