Settlement at the doors of court – no liability
Judgment has been handed down in Dunhill v W Brook & Co (1) and Crossley (2), exonerating both the solicitor and counsel in respect of a settlement reached at the doors of the court in 2003. Mills & Reeve acted for the first defendant law firm, instructing Jamie Smith QC and Glenn Campbell.
Nearly six years later, the claimant brought two actions: the first sought to re-open the RTA claim on the basis that she had lacked mental capacity at the time of settlement (the injury alleged to have arisen from the accident). This issue went all the way to the Supreme Court, and in 2014 the claimant was found to have lacked capacity and the court refused to retrospectively approve the settlement. This meant that almost a decade later, RTA insurers had to re-open the claim (which is ongoing).
The second action was a claim against the solicitors and counsel. While a number of allegations were made during the proceedings, the only one of substance that remained live at the trial on liability was that the claimant’s legal team had been negligent with regard to advice given concerning the settlement reached at court in 2003. The court found that neither defendant had been negligent in this regard.
Settlement at the doors of the court: Each case is dependent on its specific facts, as to the circumstances in which a decision is taken to settle the claim at the doors of the court. Here, counsel found himself with a key witness failing to attend, assessed this as a significant setback for the prospects of success and advised the claimant that there was a real risk she may lose and receive nothing.
The judgment is a useful reminder that when advice to settle is given at the doors of the court, that fact in itself forms part of the context when assessing whether the advice was negligent. In a climate of post-settlement remorse, this decision is positive for the profession. It can be far too easy for clients to agree a settlement, be it at court or in mediation, only to feel disgruntled afterwards, think they should have done better and then blame their solicitors.
Role of the solicitor/trainee, and relationship with counsel: The court accepted that a solicitor will not be liable if they rely on the advice of counsel properly instructed, but having exercised their own judgement and challenged anything that is “obviously or glaringly wrong”. The court found that the advice to settle was not negligent, and after analysis of the inter-relationship between counsel and solicitor, the solicitor could clearly not be negligent either.
The other aspect for practical consideration is the decision as to whether or not to send a trainee/un-qualified staff to attend hearings and/or trials. Often this may well be appropriate (and indeed insisted upon by clients for cost purposes), but each case will depend on its own facts.
Evidence: It would not be a solicitors' negligence case without some comment about the file and the importance of attendance notes. The trial primarily focused on events that took place some 13 years ago. Recollections were understandably hazy or non-existent. The judge herself was reminded of, and referred in her judgment to, the “unreliability of human memory” and the difference and difficulties between a direct memory of events and a reconstruction of what a witness thinks happened.
The solicitors had produced a number of attendance notes, including the only note of the trial day. While the court found that some notes were accurate records, others were found to have their (understandable) limitations. From a claims perspective, the existence of detailed file-notes and advice letters remain the best route to avoiding exposure, but equally documents need to be considered in context as does any oral testimony, and then assessed collectively.
The decision is very much dependant on its facts, but it does provide a salient reminder that when dealing with cases going back more than a few years, evidence can be more difficult to analyse and assess, and it is important not to apply hindsight.
Background
The claimant instructed the solicitors to pursue a RTA claim against a motorcyclist. A liability-only trial was ordered in January 2003, and attended by a trainee solicitor on behalf of the solicitors’ firm, and counsel. The claim was settled on a full and final basis for £12,500, after one of the claimant’s witnesses failed to attend.Nearly six years later, the claimant brought two actions: the first sought to re-open the RTA claim on the basis that she had lacked mental capacity at the time of settlement (the injury alleged to have arisen from the accident). This issue went all the way to the Supreme Court, and in 2014 the claimant was found to have lacked capacity and the court refused to retrospectively approve the settlement. This meant that almost a decade later, RTA insurers had to re-open the claim (which is ongoing).
The second action was a claim against the solicitors and counsel. While a number of allegations were made during the proceedings, the only one of substance that remained live at the trial on liability was that the claimant’s legal team had been negligent with regard to advice given concerning the settlement reached at court in 2003. The court found that neither defendant had been negligent in this regard.
Comment
A number of issues arise out of the judgment:Settlement at the doors of the court: Each case is dependent on its specific facts, as to the circumstances in which a decision is taken to settle the claim at the doors of the court. Here, counsel found himself with a key witness failing to attend, assessed this as a significant setback for the prospects of success and advised the claimant that there was a real risk she may lose and receive nothing.
The judgment is a useful reminder that when advice to settle is given at the doors of the court, that fact in itself forms part of the context when assessing whether the advice was negligent. In a climate of post-settlement remorse, this decision is positive for the profession. It can be far too easy for clients to agree a settlement, be it at court or in mediation, only to feel disgruntled afterwards, think they should have done better and then blame their solicitors.
Role of the solicitor/trainee, and relationship with counsel: The court accepted that a solicitor will not be liable if they rely on the advice of counsel properly instructed, but having exercised their own judgement and challenged anything that is “obviously or glaringly wrong”. The court found that the advice to settle was not negligent, and after analysis of the inter-relationship between counsel and solicitor, the solicitor could clearly not be negligent either.
The other aspect for practical consideration is the decision as to whether or not to send a trainee/un-qualified staff to attend hearings and/or trials. Often this may well be appropriate (and indeed insisted upon by clients for cost purposes), but each case will depend on its own facts.
Evidence: It would not be a solicitors' negligence case without some comment about the file and the importance of attendance notes. The trial primarily focused on events that took place some 13 years ago. Recollections were understandably hazy or non-existent. The judge herself was reminded of, and referred in her judgment to, the “unreliability of human memory” and the difference and difficulties between a direct memory of events and a reconstruction of what a witness thinks happened.
The solicitors had produced a number of attendance notes, including the only note of the trial day. While the court found that some notes were accurate records, others were found to have their (understandable) limitations. From a claims perspective, the existence of detailed file-notes and advice letters remain the best route to avoiding exposure, but equally documents need to be considered in context as does any oral testimony, and then assessed collectively.
The decision is very much dependant on its facts, but it does provide a salient reminder that when dealing with cases going back more than a few years, evidence can be more difficult to analyse and assess, and it is important not to apply hindsight.