Professional negligence: Was Your Loss Induced From the Negligence?

One of the first things we ask our clients when talking about simple debt recovery matters is “Can the debtor pay?” Is it worth pursuing the debtor for money which he simply cannot pay and therefore incurring further costs in doing so?

In professional negligence claims this usually isn’t a problem as the professional is obliged to have professional indemnity insurance which covers potential claims. However, you may want to carefully think about the loss you have suffered. Can this be attributable to the actions of the professional? Or was it caused by a separate independent reason?

A recent case has highlighted the dangers of proceedings with a claim for professional negligence where the loss did not flow directly from the professional’s negligence. In Luffeorm Limited –v- Kitsons LLP [2015], the Claimant brought a claim against the Defendant solicitors for failing to advise them to include restrictive covenants within the purchase of a lease of a pub. Shortly after the purchase, one of the sellers (who happened to be the chef) took over a nearby pub. Subsequently approximately half of the clientele followed the chef to his new pub leaving the Claimant with a less profitable business. Following the downturn in business, the Claimant sold the lease at a much reduced rate. The Claimant subsequently issued a claim for the loss suffered which they claimed was as a result of the solicitor’s negligence.

Whilst the Judge held that the solicitors were negligent and breached the contract, it was held that had the solicitors fully advised the Claimant as to the absence of any restrictive covenants, the Claimant would have proceeded with the purchase anyway as their plan was to drastically change the menu and atmosphere of the pub. As such, the Claimant had not seen the chef as competition and would not have required the restrictions.

If you have suffered loss and want to know whether this was caused by the professional’s negligence, give our specialist professional negligence department a call on 0113 244 9931.