Julia Patricia Holt v Holley & Steer Solicitors (A Firm)

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
JudgeLord Justice McCombe,Lady Justice King,Mr Justice Keehan
Judgment Date07 July 2020
Neutral Citation[2020] EWCA Civ 851
Docket NumberCase No: B2/2019/2830
Date07 July 2020

[2020] EWCA Civ 851

IN THE COURT OF APPEAL (CIVIL DIVISION)

ON APPEAL FROM THE COUNTY COURT AT BRISTOL

His Honour Judge Ralton

E90BS412

Royal Courts of Justice

Strand, London, WC2A 2LL

Before:

Lord Justice McCombe

Lady Justice King

and

Mr Justice Keehan

Case No: B2/2019/2830

Between:
Julia Patricia Holt
Appellant
and
Holley & Steer Solicitors (A Firm)
Respondent

Roderick Moore (instructed by Slee Blackwell LLP) for the Appellant

Benjamin Fowler (instructed by DAC Beechcroft LLP) for the Respondent

Hearing date: 24 June 2020

Approved Judgment

Lord Justice McCombe

Introduction

1

This is the appeal of Ms Julia Holt (“Ms Holt”) from the order of 23 October 2019 of HH Judge Ralton, sitting in the County Court at Bristol. By his order, the judge allowed an appeal by the respondent, Holley & Steer Solicitors (“the Firm”) from the order of District Judge Watkins of 3 June 2019.

2

The proceedings are brought in respect of Ms Holt's claim for alleged professional negligence against the Firm in the course of their acting for her in financial relief proceedings on her divorce from her husband, Mr Timothy Rawlings (“the Husband”). Her complaint, in essence, is that, in the course of those proceedings, the Firm negligently failed to obtain expert evidence as to the value of certain real properties and jewellery, and to secure permission to admit such evidence at the financial remedies hearing.

3

The District Judge in the present action had found that Ms Holt's claim against the Firm, so far as founded in contract, was time barred, after expiry of the 6 year limitation period, by virtue of s.5 of the Limitation Act 1980, but that her claim founded on tort was not so barred by the equivalent provision in s.2 of that Act. The Firm appealed against the District Judge's order, in respect of his conclusion as to the claim in tort. Judge Ralton allowed that appeal. The judge found that Ms Holt's claim as a whole, therefore, was barred by both s. 2 and s. 5 of the 1980 Act. As a result, he awarded summary judgment in favour of the Firm pursuant to CPR Part 24. The judge ordered Ms Holt to pay the costs of the action to be assessed. He directed that any further application for permission to appeal from his order should be made to this court. Permission to appeal was granted by Floyd LJ by his order of 14 January 2020 (sealed on 16.1.20).

4

The background facts, essentially as stated by the District Judge and adopted in summary by Judge Ralton, are as follows.

Background Facts

5

Ms Holt retained the Firm to act for her in the financial relief proceedings, which had been initiated by the Husband on 15 February 2011. The first directions appointment (“FDA”) in those proceedings was held on 1 July 2011 and the financial dispute resolution (“FDR”) hearing took place on 11 October 2011. At the FDA, the court ordered valuation of the family home, and of some adjoining land, by a joint expert and that report was available at the FDR. No directions were given for the valuation of some nine “buy-to-let” properties held by Ms Holt and the Husband in their separate names, although an order was made for provision of the completion statements for those properties. At the FDR, further orders were made for the Husband to provide evidence as to the existence and value of items of jewellery that he was claiming that Ms Holt had. No further orders for valuation evidence were sought by the Firm on Ms Holt's behalf. Ms Holt claims in these proceedings that the Firm negligently failed to obtain expert evidence of the value of the investment properties and of her jewellery.

6

The final hearing of the financial relief proceedings was fixed, at or shortly after the FDR, for a date in mid-February 2012. On 19 January 2012, a solicitor at the Firm wrote to a firm of estate agents asking them to provide up-date valuations of the “buy-to-let” properties in Ms Holt's name on a “drive-by” basis, saying that “… the previous values we have given to the court were estimates by [Ms Holt] herself”. The agents produced such a valuation on 24 January 2012 and a copy was sent to the Husband's solicitors on 10 February 2012, asking them to agree that the valuation should be admitted in evidence in the proceedings. This new material set the value of Ms Holt's investment properties at £84,500. The Husband's solicitors responded that the values of the properties had been agreed at the FDA and it was impermissible to seek to adduce new, unilateral valuations a matter of days before the hearing. It seems that the matter was not taken further by the Firm by way of application to the court to admit the additional evidence.

7

The hearing before a District Judge (District Judge Daniel) duly took place on 4 days (2 x 2 days), between 16 February and 16 March 2012. He circulated his draft judgment to the parties on 10 April 2012; he handed the judgment down formally on 30 May 2012 and made his order on that day.

8

Departing here from District Judge Watkins' summary of the background facts, in his judgment in the present proceedings, it is convenient to summarise the effect of District Judge Daniel's judgment by reference to the summary given on behalf of Ms Holt in her Particulars of Claim in this action.

9

In respect of the contentious items, namely the property portfolio and the jewellery, District Judge Daniel found that the properties in the names of both parties had a combined net value of £435,000, of which properties worth £217,000 (net) were in the Husband's name and £218,000 (net) were in Ms Holt's name. The jewellery was taken to be worth £50,000. (District Judge Watkins recorded District Judge Daniel's finding that Ms Holt was “… not being straightforward about the extent and values of jewellery in her possession”.) Total net matrimonial assets, after deduction of a joint overdraft, were found to be worth £483,000.

10

District Judge Daniel decided to increase Ms Holt's capital share, from the starting point of equality, to achieve a “clean break” solution in the case, with an absence of any continuing maintenance obligation on the Husband's part, and having regard to Ms Holt's past and future care of the three minor children and her inferior pension provision. He awarded Ms Holt 60% of the net (non-pension) assets, leaving her with approximately £290,000. To implement this, he directed the joint debts to be left with the Husband and ordered him to pay a lump sum of £13,000 to Ms Holt.

11

Ms Holt sought permission to appeal against the order, but her application was refused, with costs to be paid by her, by HH Judge Marston on 21 August 2012. The Husband's costs of the application were assessed at £2,764.80, to be satisfied by set-off against the lump sum order.

The Present Proceedings

12

On 6 February 2016, Ms Holt sent to the Firm a “formal letter of complaint”, claiming to have suffered losses, for which the firm was responsible, in the sum of £268,000, made up under numerous heads of loss, including £100,000 for distress and £100,000 in respect of the property valuations. On 26 April 2016, Ms Holt's present solicitors asked the Firm to send to them the financial relief file, in respect of which the Firm then claimed a lien in respect of their unpaid costs. In January 2017, Ms Holt made an application for pre-action disclosure of the file. That order was granted on 8 March 2017.

13

On 16 March 2018, Ms Holt's solicitors wrote a pre-action protocol letter to the Firm, claiming breaches of duty on the Firm's part in failing to advise the obtaining of formal valuations of the property portfolio and of the jewellery, which, they said, had adversely affected her position in the financial relief proceedings. The letter concluded by asserting that limitation in respect of the claim might expire on 10 April 2012 (i.e. 6 years from the date of the circulation of District Judge Daniel's draft judgment) and proposed a “standstill agreement”. In their response (on 28 June 2018), the Firm's solicitors asserted that the latest date for limitation purposes was 16 March 2012 (i.e. the last day of the financial relief hearing). In turn, it was contended by Ms Holt's solicitors that the question in issue, for limitation purposes, was when Ms Holt became financially worse off by reason of the breaches of duty alleged; that date, it was said, was only reached when the final judgment was handed down and the order was made (30 May 2012). Until that time, it was argued, any party could have applied to the court in the divorce proceedings to adduce further evidence, including the valuation evidence in question.

14

On 28 March 2018, the Firm issued proceedings against Ms Holt in respect of their unpaid fees in a sum of £48,708.71. On 5 April 2018, the Claim Form in the present proceedings was issued. On the Firm's case, therefore, the claim was instituted after the expiry of the six-year limitation period. On Ms Holt's case, the proceedings were issued within that period. Particulars of Claim were served on 1 August 2018, claiming a total of £124,470.

The Application for Summary Judgment and the Judgments Below

15

On 19 September 2018, the Firm's solicitors issued an application for summary judgment, on the basis that the claim was statute barred, and was therefore bound to fail. The application came before District Judge Watkins on 18 January 2019. He handed down his judgment on 22 May 2019, granting summary judgment to the Firm in respect of the contract claim and dismissing that part of the claim, but finding that the claim in tort was not time barred.

16

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