Business Law & Compliance

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How to avoid business negligence

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Certain types of company are more susceptible to professional negligence claims than others. Some of the more common examples are detailed below.

Accountants and financial advisors

When a client entrusts someone else to manage their money, they have the right to expect that all advice and information passed onto them is accurate and complete.

An accountant could face a claim if they make mistakes in tax payments, receive penalty fees for late payments or fail to secure investment in a client’s business through their own poor performance.

Financial advisors may face a claim if their advice results in a client losing money. For example, they could recommend investing in something without ensuring the client has been fully briefed on all the risks involved.

Architects and surveyors

When it comes to building or buying property, it only takes one small detail out of place to cost a client potentially thousands of pounds.

For example, poor planning on the part of an architect could see a building completed to a poor or unsafe standard, or the project may run over budget. They may also have recommended using a particular material at the expense of a cheaper and equally suitable alternative.

Surveyors must ensure clients are advised on every aspect of a property before they commit to a purchase. Should they fail to properly inspect the building, potential faults could be missed, resulting not only in the buyer paying an inflated price but also having to pay to correct the issue.

Solicitors, barristers and expert witnesses

While it falls to the legal profession to pursue allegations of professional negligence, they themselves are not immune to these claims.

Solicitors and barristers are duty bound to represent clients to the highest standard, but there have been cases where this has not happened. For example, personal injury cases are usually subject to a three-year time limit, so if your representative fails to register the claim in time, you would not be eligible for compensation.

A claimant would not even have to lose their case for a solicitor to have been negligent. A poorly handled claim could see the client awarded much less compensation than they should have been entitled, and a change of solicitor could see the claimant pursue this outstanding amount.

Previously, expert witnesses were immune from professional negligence claims, the theory being that they would be less likely to offer assistance if their advice could come back to haunt them at a later date.

However, they can now be held liable if their bad advice causes a claim to fail, and this can be applied retrospectively up to six years after the witness gave evidence.

Other types

A much rarer and more recent form of professional negligence case is educational negligence, where an institution stands accused of failing to provide an acceptable learning environment for a child.

Medical negligence, while very common and certainly centred around the negligence of professionals, stands alone as a separate type of claim. As the injuries here are physical rather than financial, the consequences are obviously of a different nature entirely, and as such require a different approach.

Mark Nolan is head of employment law at Orbis Solicitors.

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