Sale of property and related matters — Principles set out as to duty of care — Whether breach of standard of care — Whether intervening act of third party breaking chain of causation — Whether sufficient to act on client’s instructions — Judgment for the plaintiff
The plaintiff sought damages and interest against the defendant firm of solicitors in relation, inter alia, to the sale of Holkwood Hall, Norfolk. She alleged breaches of duty owed to her by her solicitors acting for her in connection with the sale and subsequent to the sale. The defendant firm contended, among other matters, questions of causation and novus actus interveniens.
Held Judgment for the plaintiff.
1. In setting down various propositions of law with regard to negligence of solicitors towards their clients, his lordship stated that those general principles had to be suited to the particular facts of each case. The propositions were as follows:
(1) With regard to the duty of care which a solicitor owed to his client, the standard required was that of a reasonably competent solicitor. (2) The duty extended as to the services for which the solicitor was retained and what he was instructed to do. (3) The standard of care was to be judged in relation to circumstances as they occurred in prospect. Hindsight was not a factor. (4) The solicitor did not guarantee that a particular result would be achieved so that a solicitor did not give a warranty as to outcome. (5) Hazards must be pointed out to lay clients and the advice given on the existence of obvious risks; the phrase “legal hazards” was of no assistance in this particular case. (6) The solicitors duty was wider when his client was inexperienced. (7) The duty of the solicitor was to inform and advise. That entailed ensuring understanding on the part of the client. (8) While the client’s prerogative was to manage his affairs, he should not be allowed to do so on inadequate instructions. (9) Subject to the above considerations the solicitor was not an advisor on his client’s business affairs.
2. On the facts of the instant case, the lawyers failed to identify the risk to the client in clear terms of the agreement which she had entered into and had not sought to establish whether it was a binding agreement or had been procured by undue influence. The client had been left to negotiate on her own and it was not adequate to state that the solicitors were carrying out instructions. Client’s instructions were not an adequate prop for the duties of a solicitor and did not absolve a solicitor from giving advice. Instructions from a client were to be relied upon, on the basis of clear and full advice and on the setting out of alternatives open to him or her in the circumstances of the case.
3. The actions of the purchaser both at the time of the agreement and subsequently did not break the chain of causation and all proper costs were recoverable against the solicitors.
Nicholas Stewart QC and Robin de Wilde QC (instructed by Howes Percival, of Norwich) appeared for the plaintiff; Nicholas Elliott (instructed by Mills & Reeve, of Norwich) appeared for the defendant.
