A Court of Appeal ruling that a law firm which admitted breach of duty was liable for 'loss of chance' damages to a client was overturned by the Supreme Court today. In a widely-awaited judgment in Perry v Raleys Solicitors five justices allowed an appeal by now-defunct Yorkshire firm Raleys, restoring the county court's finding in a professional negligence claim. The ruling affirms that courts are right to require negligence claimants to prove that loss was caused by the breach of duty.  

Raleys, which went into administration in 2016, had acted for a retired coal miner in a compensation claim for vibration white finger. The claimant, Frank Perry, settled for general damages of £11,600 in 1999 but went on to make a professional negligence claim against the firm, saying its failure to provide competent advice deprived him of the chance to claim a services award of more than £17,000.

At Leeds County Court Raleys admitted breach of duty, but denied causing loss. The court agreed and dismissed Perry's claim. This finding was reversed by the Court of Appeal which in 2017 found that the county court judge had conducted a ‘trial within a trial’ that it was ‘intellectually unsound’ to require the court to investigate whether a claimant could prove what he would have done many years earlier. It awarded 'loss of chance' damages of £14,556.15 plus interest. 

Today's judgment by Lord Briggs and agreed by Lady Hale, Lord Wilson, Lord Hodge and Lord Lloyd-Jones, allows an appeal by Raleys and restores the 'detailed and lucid' judgment of the county court judge. It was not wrong in law or in principle for the judge to have conducted a trial of the question whether Perry would have brought an honest claim for a services award had he been given competent advice by Raleys, the judgment states. 'That was something which Mr Perry had to prove on the balance of probabilities.' 

As well as finding that the county court had made no legal error, the justices ruled that the Court of Appeal wrongly interfered with a factual determination: 'the very stringent test for appellate court interference was not met in this case'. 

In a statement, national firm BLM, which acted for Raleys (in administration) noted that the appeal was funded by a pre-2013 conditional fee agreement providing for a success fee with costs at least an order of magnitude greater than the sum claimed. 'It surely at the very least raises the question as to whether such a modest claim would ever have reached a contested trial, still less the Court of Appeal and Supreme Court had it not been that the stakes in relation to costs were so high.'

 

The appellant (Raleys) was represented by Michael Pooles QC and Ben Quiney QC, instructed by Berrymans Lace Mawer; Jonathan Watt-Pringle QC and John Greenbourne, instructed by Fry Law, appeared for the respondent.