Reader and Others v Molesworths Bright Clegg
| Jurisdiction | England & Wales |
| Judge | Lady Justice Smith,Lord Justice Moses,Lord Justice Longmore |
| Judgment Date | 02 March 2007 |
| Neutral Citation | [2007] EWCA Civ 169 |
| Court | Court of Appeal (Civil Division) |
| Date | 02 March 2007 |
| Docket Number | Case No: B3/2006/1843 |
[2007] EWCA Civ 169
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM Sheffield County Court
HH JUDGE BULLIMORE
40LO7139
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Longmore
Lady Justice Smith and
Lord Justice Moses
Case No: B3/2006/1843
Mr Christopher Limb (instructed by Messrs Ast Hampsons) for the Appellant
Mr Bernard Livesey QC & Mr George Spalton (instructed by Messrs Weightmans) for the Respondent
Hearing date: 15 February 2007
Introduction
This is an appeal from the judgment of HH Judge Bullimore at Sheffield County Court on trial of preliminary issues in a solicitor's negligence claim.
The Factual Background
The history of the matter goes back to November 1989 when Mr Peter Reader was injured in a motor accident due to the negligent driving of a man named Roy Cordingly. Mr Reader consulted a solicitor, Mr Lettall of Molesworths, now Molesworths Bright Clegg. In July 1991, proceedings were begun in the Rochdale County Court, with the benefit of legal aid funding. Liability was admitted. Causation and quantum remained in issue. Mr Reader's case was that, as a result of his injuries, he was permanently unfit for work as a self-employed decorator. By 1991, Mr Reader was suffering from clinical depression which, according to a psychiatric report obtained by Mr Lettall from Dr George Hay, was attributable to the accident. By 1994, there had been other developments. Mr Reader's marriage to his wife Carol was in difficulties. She had moved out of the matrimonial home. He was the main carer for the couple's three children, Aaran (born 17.12.80), Naomi (born 31.3.83) and Brook (born 19.9.87).
On 24 th December 1994, Mr Reader committed suicide. On his death, his cause of action was transmitted to his estate by operation of law. He died intestate. At some time before 9 th January 1995, but we do not know when, someone, probably Mrs Reader (but we do not know that for sure) told Mr Lettall that Mr Reader had died. It seems likely (although there no evidence on this point) that Mr Lettall was told that Mr Reader had taken his own life. Mrs Reader, the widow, was obviously the person who would become the administratrix of the estate and in fact she took out letters of administration on 24 th February 1995. However, on 9 th January 1995, at a time when Mr Lettall was without any instructions from any person capable of providing them, he wrote to James Chapman and Co, the solicitors instructed by Mr Cordingly's insurers, to inform them that Mr Reader had died and that the claim was to be discontinued. He sent a consent form for signature; it provided that the action should be discontinued with no order for party and party costs but legal aid taxation of the plaintiff's costs. Not surprisingly, James Chapman & Co agreed and signed and returned the form on 11 th January. Although it was never lodged with the court, it was binding as between Mr Cordingly and Mr Reader's estate because Mr Lettall had ostensible or apparent authority to discontinue the action.
On 3 rd February 1995 Mrs Reader went to see Mr Lettall about the claim. We have not seen an attendance note of that meeting. We can only infer what was said from a letter that Mr Lettall wrote on 8 th February, in which he said that he was confirming the advice he had given on the 3 rd. Also on 3rd February (whether before or after his appointment with Mrs Reader is not clear) Mr Lettall wrote to Chapman & Co, referring to a conversation of the previous day in which it is clear that he had told them that he had made a mistake in suggesting that the action must be discontinued. He now appreciated that the action could proceed through the personal representative. He said that he was 'currently obtaining instructions' with a view to determining whether the personal representatives wished to instruct him to continue the action. He apologized for his error and promised to contact them again when he received instructions.
It is clear from Mr Lettall's letter of 8 th February that, by 3 rd February at the latest, Mrs Reader had retained Mr Lettall to act on her behalf as putative administratrix of the estate. From that letter it appears that Mr Lettall had not told Mrs Reader that he had taken steps to discontinue the action. No doubt he was hoping to retrieve the situation he had brought about by his error. He had told her that it was possible for her to continue the action as personal representative. But, he had made it sound rather problematical, saying that the legal aid certificate would be discharged and the estate would have to fund the cost of the action. He added: 'Proceeding with the case would entail obtaining a Court Order approving that and indemnifying you against any potential loss suffered by the estate as a result of the action.' It rather appears that Mrs Reader had been sufficiently discouraged by this account of the difficulties that she had advised Mr Lettall that she did not wish the action to proceed but wished him to negotiate the best terms available. It appears that not a word had been said about the possibility of a claim for damages for bereavement or loss of support for the children, subject of course to obtaining a further report from Dr Hay, dealing with the causal link between the accident, the depression and the suicide.
On 16 th February, Chapman & Co wrote to say that, in their view, there was a binding agreement compromising the claim and that Mr Lettall should advise his client to consult other solicitors. On 24 th March, Mr Lettall wrote to Mrs Reader. It appears that he had not seen her since 3 rd February. He admitted to her that he had notified the solicitors that the claim was to be discontinued. He suggested that it might be possible still to continue the claim but that the other side would allege a binding agreement. There was still no word about a possible claim under the FAA. He advised her to consult other solicitors. That she did and in June 1995, Mrs Reader's new solicitors Atherton Standring Taylor (AST) asked Mr Lettall to send the file. It was sent in August 1995.
The Action for Solicitor's Negligence
In March 1998, AST wrote to Molesworths claiming damages for professional negligence. They relied on the admission of negligence in the letter of 24 th March and asserted that, if the claim had not been wrongfully discontinued, claims under the Fatal Accidents Act 1976 (FAA) would have been added by amendment. Reference was made to a further report dated October 1996 from Dr George Hay, who opined that the suicide was causally related to the depression which had been caused by the injuries in the car accident. AST quantified the personal injury claim, with added interest. They claimed an award for bereavement for the widow and damages for loss of care and services on behalf of the three children.
Weightmans, the solicitors instructed to deal with this claim by Molesworths' insurers, responded in detail in July 1998. They accepted that there was liability for the personal injury claim and were taking instructions on settlement. They rejected the widow's claim for bereavement, saying that this was a separate cause of action which she could have pursued against Mr Cordingly at any time until 3 years after the death (24 December 1997). Molesworths had not been retained since 24 th March 1995; they were not liable for any loss. So far as the children's claims were concerned, no loss had been caused by Molesworths. The claims were separate and could all still be pursued against Mr Cordingly because time did not begin to run until each child reached 18 and would not be time barred until each child reached 21. Molesworth's had caused them no loss.
In March 1999, Weightmans offered £55,000 in settlement of the whole claim. In June 1999, AST indicated that this would be acceptable for the personal injury claim but they maintained their claims under the FAA. They had taken counsel's advice and he was of the view that the negligent discontinuance of the personal injury claim had brought an end to the possibility of bringing a FAA claim against Mr Cordingly. Further, even if it had not, Molesworths could not require the dependants to bring a fresh claim in order to mitigate the loss they (Molesworths) had caused. A number of authorities were cited in support of both propositions.
By September 1999, Weightmans had taken counsel's advice. He disagreed with AST's counsel. However, in October 1999, Weightmans agreed that the offer of £55,000 should stand only as the personal injury damages, leaving the dependants to bring further proceedings for the alleged loss of the FAA claims if they chose.
Mrs Reader (who at some stage remarried and became Mrs Carol Wood) accepted the advice of her counsel that it was not possible to bring a FAA claim on the children's behalf because such a claim had been irrevocably lost. It was not until December 2004 that the children issued proceedings against Molesworths for Mr Lettall's negligence. The claim was put on the basis that, on the death of Mr Reader, the benefit of the retainer with Mr Lettall, which obliged him to act with all reasonable skill and care, passed to the personal representative (the widow/mother) and to the children (the claimants) who had rights to dependency damages. Therefore Mr Lettall owed a duty of care in relation to the potential rights of the claimants. The claim for Mr Reader's personal injuries could and should have been amended to include the dependency claim. As the result of Mr Lettall's...
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