First National Commercial Bank Plc v Loxleys (A Firm)
| Jurisdiction | England & Wales |
| Judgment Date | 06 November 1996 |
| Date | 06 November 1996 |
| Court | Court of Appeal (Civil Division) |
Court of Appeal
Before Lord Justice Nourse, Lord Justice Waller and Sir John May
Duty of care - solicitors' disclaimer - issue not suitable for determination under summary judgment procedure
Conveyancing solicitors inaccurately replying to inquiries before contract on the standard "Oyez" form were not, by relying on the printed disclaimer from liability, entitled to have a negligence action brought against them struck out for disclosing no reasonable cause of action.
The issue was not suitable to be determined under the summary judgment procedure of Order 14A of the Rules of the Supreme Court because under section 11 of the Unfair Contract Terms Act 1977 the solicitors had to establish that it was fair and reasonable for them to rely on the disclaimer having regard to all the circumstances and that required consideration at a trial of the particular facts, going much wider than the fairness and reasonableness of the disclaimer itself.
The Court of Appeal so held allowing an appeal by the plaintiff bank, First National Commercial Bank plc, and directing a trial of the action to take place, from the judgment of Judge Tibber, sitting as a judge of the High Court, in February 1996 whereby he had struck out its claim against a firm of solicitors, Loxleys, for disclosing no reasonable cause of action.
The disclaimer printed on the Oyez form provided "These replies…are given on behalf of the proposed vendor and without responsibility on the part of his solicitors…They are believed to be correct but the accuracy is not guaranteed and they do not obviate the need to make appropriate searches, inquiries and inspections."
Mr James Townend, QC and Mr Stephen Shay for the bank; Mr Mark H Lomas for the solicitors.
LORD JUSTICE NOURSE said that before the judge and on appeal the matter had by consent of the parties been treated as an application under Order 14A, rule 1.
The bank claimed damages against the solicitors for negligent mis-statement in replying to inquiries before contract in a mortgage transaction in 1988 between a client of the solicitors as borrower and the bank as lender, the amount of the loan being £1.2 million. The solicitors were not acting for the bank which was being represented in that transaction by its legal department.
The inquiries before contract were made on a standard Oyez form which appeared to have been introduced on the initiative of the the Law...
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