Professional Negligence

A significant amount of publicity arose out of the Court’s decision at first instance in this case, arguably seen as an opportunity for Buy to Let investors (“BTL”) to pursue Buy to Let claims against valuers for negligence where the investors had failed to obtain a valuation report of their own and instead relied upon the report produced by their lender’s valuer.

Colleys, who was the valuer engaged by Mr Scullion’s lender and the Defendant in this case, appealed the decision.

On 17th June 2011 the Court of Appeal handed down its’ decision and disagreed with the Court at first instance. The Court of Appeal held that a valuer, instructed on behalf of a lender, owed no duty of care to a BTL investor.

It had been held, prior to the Court of Appeal’s ruling, that a negligent valuer did owe a duty of care to a Buy to Let investor in respect of both a capital and rental valuation.

In 2002 Mr Scullion bought a two bedroom flat on a Buy to Let basis. Colleys was instructed to produce a capital and rental valuation to Mr Scullion’s lender and the valuer was paid £35 for doing so, although importantly no contractual relationship existed between Mr Scullion and Colleys.

Exchange of Contracts took place on Mr Scullion’s purchase before the valuation report had been shown to Mr Scullion and it later transpired that the valuation report over-valued both the capital value and the likely rental income of the property.

As a result Mr Scullion brought a claim for negligence against the valuer, seeking damages caused by the over-valuation of the report because he was ‘out of pocket’ on the rental income and was successful.

Colleys denied liability throughout, claiming no duty of care existed and causation was disputed on the grounds that Mr Scullion only received the valuation report post exchange of contracts.

Colleys appealed the decision.

Colleys argued that no duty of care arose in the absence of a contract between the parties and further that a Buy to Let investor was not an ordinary residential purchaser and could therefore be distinguished from cases such as Smith v Bush which Mr Scullion had sought to rely upon.

The Court at first instance had held that Mr Scullion was not “in no sense a professional property developer”. The Court of Appeal disagreed. They held the case did not involve an “ordinary domestic householder purchasing his home” and it was not therefore foreseeable that Mr Scullion would rely upon the valuer’s report as opposed to obtaining his own.

The Court of Appeal’s decision is likely to have an impact upon Professional Negligence claims arising out of Buy to Let investments and it will make it significantly more difficult for such investors to pursue Buy to Let claims against valuers in the absence of a contractual relationship.

When a motorcyclist from Liverpool was hit by a car back in 2001 he probably couldn’t have imagined his case would end up being a focal point at the Supreme Court as a point of general public importance.

The Supreme Court has decided that a rule that protected expert witnesses through immunity for over 400 years should be scrapped allowing them to be sued in the civil courts. This is a decision that has been welcomed by personal injury solicitors in the UK.

The victim of the road traffic accident, Paul Wynne Jones of Liverpool, on the recommendation of the expert witness, had to settle for a much smaller settlement than would have been the case if he was allowed to pursue the driver for damages. Wynne Jones, unhappy with this, decided to go down the route of professional negligence and issue proceedings against the expert witness which was thrown out when a High Court judge ruled that the expert witness was entitle to immunity. The case eventually ended up at the Supreme Court where the landmark decision was made by a majority of 5 to 2.

Lord Phillips said of the decision: “All who provide professional services which involve a duty of care are at risk of being sued for breach of that duty. They customarily insure against that risk.

“It would be quite wrong to perpetuate the immunity of expert witnesses out of mere conjecture that they will be reluctant to perform their duty to the court if they are not immune from suit for breach of duty.”

Personal Injury and Professional Negligence cases often go hand in hand especially when the victim is unhappy with their damages. QualitySolicitors Keith Park’s Professional Negligence team will review your case which generally, after an initial discussion with you, can be carried out on a No Win No Fee basis. Our Personal Injury department can also assist by reviewing any previous personal injury claims you have made in the last 6 years to ensure that you got the maximum amount of compensation possible first time round.

• Personal Injury
• Family Law
• Private Client / Making a Will
• Criminal Law
• Professional Negligence
• Conveyancing / Moving House
• Prison Law
• Employment

Lawyers for an eleven-year old child who claims he has suffered brain damage as a result of a defective vaccine have been left to ponder over the exact implications of the Supreme Court ruling in the case.

Paul Balen, a partner at Freeth Cartwright, has been acting for the claimant and said the ruling has left lawyers “baffled”.

Declan O’Byrne was given two doses of an anti-meningitis vaccine manufactured by French pharmaceutical giant Aventis Pasteur SA and distributed in Britain through its UK subsidiary, Aventis Pasteur MSD.

The boy’s family initially brought proceedings against the subsidiary within the strict ten-year timeframe set by the EU’s product liability directive. The distributor retorted that it was not the correct defendant and that the claimant should instead sue the parent company as the manufacturer of the drug. By the time this defence was put up however, the claim against the manufacturer was time-barred. Appeal judges have rejected a medical negligence claim by a prisoner who developed breast cancer in jail.

Cheryl Carter alleged that her prison doctor was negligent in failing to refer her to a breast clinic following her complaint of a lump in her right breast. Breast cancer was diagnosed after her release and she later had a mastectomy. Giving judgment in Carter v Ministry of Justice [2010] EWCA Civ 694, Sir Scott Baker said the trial judge’s “natural sympathy” for Carter led him to a conclusion that was “unsustainable in law”.

He went on: “Here we are concerned with whether a general practitioner was negligent. In determining what should have been done by Dr Premaratne, the judge was not entitled to impose his own opinion regardless of the practice of the medical profession.”

Sir Scott Baker said the trial judge, Sir Christopher Holland, had not referred to the guidelines established by case law nor “to the fact that there was, apparently, a responsible body of medical opinion that would not have referred Ms Carter on the facts he found in this case.

“Sad though the outcome of this case is, I cannot find any breach of duty on the part of Dr Premaratne. In a case such as the present, where a general practitioner has found nothing potentially sinister, the law does not require routine referral for specialist investigation.”

Lord Justice Leveson, who delivered the leading judgment, said Carter frequently attended the healthcare department of Cookham Wood for what the trial judge described as “all manner of complaints”.

She complained of a lump in her breast on separate occasions to three prison doctors. Sir Christopher rejected the claims against the first two doctors and found that the third, Dr Premaratne, had not been negligent in her examination but in failing to make a referral.

However, Leveson LJ said he could see “no basis” for the argument that the doctor was in breach of her duty. “On the contrary, in the light of the authorities governing allegations of clinical negligence, his decision that referral was not mandated is fatal to the claim.” Lord Justice Leveson allowed the appeal by the Ministry of Justice. Sir Scott Baker and Lady Justice Smith agreed.

Source: http://www.solicitorsjournal.com/story.asp?sectioncode=2&storycode=16429&c=3&eclipse_action=getsession

The claimant secured a substitution of defendant in the Court of Appeal but, after two references to the European Court of Justice, the Supreme Court has now ruled in O’Byrne v Aventis Pasteur [2010] UKSC 23 that this substitution was not allowed under the directive.

In its most recent ruling in the case, the European court held that substitution was contrary to the directive if it resulted in allowing the claimant to sue the producer outside the limitation period.

It left open the possibility to substitute the parent for the subsidiary where the parent company which manufactured the product determined when it was put into circulation – though only if proceedings against the subsidiary had already been brought within the ten-year limitation period.

Looking at the European court’s ruling, Lord Rodger said the parent-subsidiary relationship was only one factor to consider when identifying the entity controlling the putting into circulation of the product.

“The fact that [the subsidiary] was a wholly-owned subsidiary was simply one – by no means decisive – factor to be taken into account by domestic courts when assessing how closely the subsidiary was involved with its parent’s business as […] a producer”, he said.

“All the circumstances would have to be taken into account”, he continued. “If [the parent company] was indeed in a position to decide when the product was to be distributed, then [the subsidiary] would be integrated into the manufacturing process and so tightly controlled by [the parent] that proceedings against [the subsidiary] could properly be regarded as proceedings against the parent”.

Discussing the European court’s earlier ruling, SJ regular Paul Stanley QC suggested it allowed the distributor of the vaccine to be treated as a supplier that failed to identify the manufacturer within a reasonable time, which was then deemed to be a ‘producer’ under the directive and the correct defendant.

Stanley also said it remained open to the national court to assess whether the putting into circulation of the product in question was, in fact, determined by the parent company which manufactured it, and that the time limit was effectively paused against the producer.

The Supreme Court ruling however suggests that neither interpretation applied in the O’Byrne case. While accepting the possibility of substitution, the court decided the parent company and its subsidiary could not be regarded as one and the same in this case.

Paul Balen added that the only certainty in the justices’ decision was that “the old authorities on substitution are gone”, and that the only opening left to argue was the point on wholly-owned subsidiaries.

Source: http://www.solicitorsjournal.com/story.asp?sectioncode=2&storycode=16289&c=3&eclipse_action=getsession

Claims against Surveyors

This could be where a valuer has negligently overvalued the property then you may claim the difference between the correct price and the overvalued price at the time of the valuation. Usually a discrepancy of 10% or more will be sufficient to show negligence.
Claims relating to overvaluation or overestimation of rental returns

This has been very common and sometimes estimated rental returns bear no resemblance to the real rents that can be achieved. It is possible to make a claim against a valuer who has prepared the valuation for the mortgage lender rather than you. Valuers have a duty to look at any discounts that have been given as this will often affect the value. For example, if numerous flats have been sold in a block with discounts and the Land Registry is showing the prices paid without discounts it is possible this information will give an inaccurate and inflated picture of the values.

The reasons you or your clients may have a claim are so numerous that is best to give our Solicitor a chance to check the surveyors file.

Claims against Solicitors

This is appropriate when Solicitors have negligently advised on the purchase of the property, including:- 1. Not checking if the property will be used solely for residential, 2. Does what you are buying include all what you believe including car parking spaces etc. 3. etc. 4. etc.

The reasons you or your clients may have a claim are so numerous that is best to give our Solicitor a chance to check the previous solicitors file.

Claim Against Developers or their Builders

Several questions arise, what have you bought? is the build acceptable? did you get a guarantee? is the guarantee worth suing on? is the developer worth suing? if they had a separate builder? if the developer is no longer trading? is the builder still trading? Your dissatisfaction needs checking.

You should be aware that any claim against the developer might be hindered if the developer goes out of business. The advantage of a claim against a valuer or a solicitor is that they have insurance.

It is best to give our Solicitors a chance to check all of your papers relating to your purchase and the papers relating to your subsequent problems.

Claim Against a Middleman

It is also possible you might have a claim against various ‘middle men’ including brokers and buying clubs where they have misled you and encouraged you to buy property. Time and time again we hear how buyers are told that they must act quickly as they are buying the ‘last flat’. Often agents will tell the buyer that they are the local experts and that the buyer should leave all the research to them. The buyer then finds that the agent has not told them about local conditions or features which make it difficult to rent out flats or affect the value of the property or rental yields.

It is best to give our Solicitors a chance to check all of your papers relating to your purchase.

Claims against Mortgage Brokers

Are you in a mortgage relationship that is unsuitable for you. Some brokers, certainly not all, placed their own interests above yours.

They may have put you in a “honeytrap” mortgage with a sub prime lender because they made more commission and you eventually lose out twice because not only do you get a dearer deal but when you want more finance you will be discriminated against, a double whammy.

It is best to give our Solicitors a chance to check all of your papers relating to your mortgage.

For consumers the advent of “Tesco Law” with the promise of low or fixed fee legal services may be a welcome relief.  This is especially so in an environment where consumers seek value for money, but how do you measure value?  Solicitors and Barristers have for many years charged their time at a set hourly rate.

Recently the Master of the Rolls predicted that Tesco Law would remove from the market place the “billable hour” and replace it with fixed fees.  Any lawyer who has worked with fixed fees will know that this does not automatically mean low fees.  What consumers are acquiring is a great deal of expertise backed with years of education and continuous training in order to provide the commodity that they seek.

Tesco are clearly experts in the field of providing mass products at low prices but anybody who thinks that a legal service is akin to a can of beans is in for a shock.

The only way that low or discounted fixed fees are going to come about is by the services to which they relate being provided by lesser qualified individuals.  The Legal Services Act 2007 will do little I suspect in providing the safeguards around ‘non-law firms’ to ensure quality of products, which standards lawyers have had to aspire to under the Code of Conduct 2007 and its predecessor.

The only saving grace for traditional law firms with the dawn of ‘Tesco Law’ is the potential to ultimately market for mass Professional Negligence claims against the providers of volume, remotely accessed legal services at low prices.  Such suppliers, in trying to produce these services cheaply, may do so as a consequence without sufficient regard for quality. That quality having been achieved traditionally by reason of the work being done at reasonable hourly rates, reflecting the many years expertise and qualification which apply to such areas of work.

Ask any law firm who have had to advise families whose deceased relatives have used certain ‘Will writing companies’ only to discover that the Wills are negligently drafted or the companies no longer exist and didn’t carry Professional indemnity insurance.

There is a well known and perhaps suitable adage to be applied in this context that you only get what you pay for; let’s hope that consumers are more discerning about the acquisition of legal services than they are cans of beans.

Nick Hall
Keith Park Solicitors