Limitation in professional negligence

Slee Blackwell’s Emma Slade, a partner who specialises in professional negligence compensation claims, gives consideration to a new case dealing with the issue of limitation in professional negligence.

Limitation in professional negligence: When the limit to limitation is not quite as limited as it seems

Working out the limitation date for making a professional negligence claim is fairly easy, right?  A quick peek at s2 and s5 Limitation Act 1980 suggests that limitation in professional negligence is  straightforward. The claim must be commenced in court within 6 years of the date that the cause of action accrued. But what is the “cause of action”?  Is it when the act of negligence occurred or when the damage occurred?  And what is damage?

In most cases they are one and the same, but not always.  Take the case of Law Society -v- Sephton & Co  In that case, a solicitor had been misappropriating money from clients from 1989 to 1995 before a complaint was made to the Law Society in 1996.  Realising the extent of the misappropriation, the Law Society started making compensatory payments to the affected clients, the first payment being made in July 1996.  In May 2002, the Law Society issued a claim against the solicitors to recover the payments the Law Society had made on Sephton’s behalf.  Sephton tried to argue that the date the damage occurred was the date that each misappropriation occurred and so the claim was out of time; the Law Society argued that the actual damage occurred when the Law Society had to make compensatory payments.  The House of Lords agreed and declared that a cause of action accrues in tort when a quantifiable / ascertainable loss is suffered; the mere possibility of a loss is not enough to start the time running.

It is still not easy determining when the damage occurred, but there has been a more recent case that seems to confirm Sephton.

Ms Christie owned a leasehold property but fell into arrears with her service charge.  The freeholders (her local council) threatened to forfeit the lease and so Ms Christie contacted the Mary Ward Legal Centre for advice.  Their suggestion was that she ought to try and sell the property and use the proceeds to pay off the arrears.  What they failed to tell her is that she could apply for relief from forfeiture and ask for the service charge arrears to be created as a charge over her property with a suitable payment plan involved.  Instead, she followed the advice and went ahead and sold the property in July 2013.  It was only later that Ms Christie found out about the relief from forfeiture avenue whereupon she issued court proceedings against the legal centre in 2019.  It was immediately argued that Ms Christie was out of time as the advice she relied on had been given more than six years before the claim had been issued.

The Court did not agree.  It concluded that the damage occurred when Ms Christie was no longer able to seek remedy in a claim for relief by way of a loan or charge against her property.  It was the inability to do that which forced her into completing the sale of the property and that is when the actual damage occurred.

The case is different to Sephton.  In Sephton, had the affected clients brought a claim against the defendant, the time limit would have been from the date of the misappropriation (or the date the client found out about it) but the Law Society’s position was slightly different in that they were being called in to provide compensation to those affected and only at that stage did they incur the damage.  The Christie case does not have those features.  It is a fact-sensitive claim but in this one, the cause of action occurred when the damage was irremediable.

It will be interesting to watch the next stage of the Christie claim as leave to appeal has been granted.  What will the Court of Appeal make of it?

We specialise in professional negligence claims, so if you need expert guidance on limitation in professional negligence then we are here to help. You can call Emma on 0333 888 0404 to discuss your case or you can send an email with brief details to either [email protected] or to Emma personally at  [email protected]

 

 

 

Emma Slade

Emma Slade

Emma Slade is a civil litigation solicitor, specialising in claims against professionals, including surveyors, architects, financial advisers, and solicitors.
Emma Slade

Emma Slade

Emma Slade is a civil litigation solicitor, specialising in claims against professionals, including surveyors, architects, financial advisers, and solicitors.

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