We are often asked whether claims are viable and sometimes they are not because, even if the solicitor, accountant, financial adviser or surveyor did a dreadful job, causing considerable distress or inconvenience, unless that poor work actually caused a loss, there is no claim.
Essential elementsThe essential elements of any professional negligence claim are:
- That the professional owed you a duty of care, which might arise because there is a contract between you and them, or because there was a particular relationship that gave rise to the need for that professional to be careful in their work;
- That duty must have been breached by poor advice or work. The test is whether the professional did a poor job by comparing what a reasonably competent professional in their position would have done; and
- And the breach must have caused loss, whether to a physical asset or pure financial loss.
ProcessThe first step is the pre-action protocol. A claim must be set out in a Letter of Claim, and the professional has three months in which to provide a reasoned reply. The parties are then expected to consider whether the claim can be resolved out of court. If that is not possible then a Claim Form can be issued at court. Once the parties have set out their cases in writing, the court will set up a timetable to resolve the dispute, dealing with a full exchange of relevant documents, an exchange of written recollections of the witnesses and opinions of experts and then a date for trial. Typically, the whole process from the first letter of claim to a trial can take up to two years. At any stage mediation can be considered and for lower value claims (up to £150,000) possibly the Financial Ombudsman Service can be used to provide an independent assessment of the claim and award compensation instead of making a claim at court.
Damages – and sharing the blameIf a claim succeeds then the negligent professional (who should usually have professional indemnity insurance) will be ordered to pay compensation. The aim is to put the claimant in the position they would have been in had the professional negligence not occurred. Sometimes if the professional believes the loss was also caused by or added to by the actions of the person claiming against them, then they can defend themselves by alleging ‘contributory negligence’. That can result in the amount of compensation being reduced to reflect the relative blame of each party.
CostsUsually the losing defendant also pays a high proportion of the claimant’s legal costs to make the claim. But, if the case is lost, then the person making the unsuccessful claim usually needs to pay the defendant’s costs – although that risk can often be insured in advance.
Time limitsClaims need to be made within six years of the date that loss was caused. Sometimes a claim can be made later if the loss was not known about: in that situation a claim can be made within three years of knowledge of the loss. These rules on time limits can be very difficult to apply in practice though so if you are concerned that you may have a professional negligence claim then it is best to seek legal advice sooner rather than later. When you make a professional negligence claim you need an expert who really understands what you want to achieve and is committed to making the process as swift and effective as possible. Susan Hopcraft is a lawyer at Wright Hassall who advises on all aspects of dispute resolution and has extensive experience of professional negligence work. Image source
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