How to spot professional negligence.

What can be claimed?

A professional will enter into a contract with a client under which he agrees to perform particular tasks in return for a fee. If the professional fails to carry out the tasks agreed, or carries out those tasks in such a manner as to be negligent, a client may be in a position to claim any loss suffered as a result.

The most common method of claiming such a loss is by establishing a negligent act and by proving that this act caused a foreseeable loss. The damages awarded are intended to put the client into the position he would have been in but for the negligence.  The usual measure of assessing loss is to compare what the client’s position would have been if there had been no negligence, and what the client’s actual position is.

For example, a solicitor may fail to take certain steps in connection with a client’s application for a new extended lease which results in the application being deemed withdrawn. The tenant may be forced to wait a year to commence a second application at which date the premium to be paid for the lease extension may be substantially higher due to a diminished lease term or perhaps a rise in the market.  This is especially relevant in circumstances when there are very few years remaining on the lease.  In these circumstances it might be possible for a client to claim the difference in the premium from his advisor.

It may also be possible to claim for expenses incurred. A client could therefore seek to recover any wasted fees paid to a professional as a result of the negligent advice, together with any costs paid to a third party (e.g. a valuer).

All things being equal premiums for new leases, or freehold interests, will rise over time in reflection of the diminishing term of the lease. This rise is of course steeper where there are very few years remaining on the lease. However, in a falling market it is possible that the opposite may be the case, i.e. that the value of a premium could fall over the course of a year. This is more likely to happen when the term of the lease remaining is relatively long. In such circumstances it is quite possible that an advisor’s negligence in dealing with a claim results in little or no loss at all.  In such circumstances potential claimants may find that despite the extreme inconvenience and delay suffered as a result of an advisor’s negligence, no damages can be claimed. 

A client who wishes to pursue an action against a professional should seek advice as quickly as possible. Regard should be had to the pre-action protocol for professional negligence claims before commencing an action. The objective of the protocol is to assist the parties to achieve an early settlement of claims, if possible, without the need for court proceedings. A claimant who proceeds with a claim for negligence without having followed the protocol, may find that he may not be able to recover all or any of their costs incurred in making the claim, even if they win.