Swindle v Harrison

JurisdictionEngland & Wales
CourtCourt of Appeal (Civil Division)
Judgment Date25 Mar 1997

Court of Appeal

Before Lord Justice Evans, Lord Justice Hobhouse and Lord Justice Mummery

Swindle and Others
and
Harrison and Another

Negligence - solicitors - failure to disclose not fraudulent - causation

Negligence without fraud attracts no damages

A person who raised a mortgage on her home, obtained a bridging loan and purchased another property was not entitled to recover from the solicitors who had provided the loan but had failed to disclose material facts and so were in breach of fiduciary duty, damages or compensation for loss of the value of equity in her home except on proof either that they had acted fraudulently or in a manner equitably equivalent to fraud, or that she would not have completed the purchase if full disclosure had been made and the breach not occurred.

The Court of Appeal so stated in a reserved judgment when dismissing an appeal by the second defendant, Mary Harrison, against an order of Mr Recorder Sir Andrew Watson at Warwick County Court on November 6, 1995 that no damages flowed from breach of duty and negligence by the plaintiffs, Stephen Swindle, Timothy Fillmore, Tony Cox and Rosalind Rowett, of Alsters, Leamington Spa, a firm of solicitors, in respect of making Mrs Harrison a bridging loan to purchase a property.

The judge had found that the plaintiffs were negligent and in breach of fiduciary duty in failing to disclose two material facts that Mrs Harrison's son's bank was unwilling to provide a reference which could mean he was unable to secure a loan to assist with the purchase and that the plaintiffs would profit from the bridging loan transaction.

Mr Duncan Matheson, QC and Mr Stephen Neville for the plaintiffs; Mr Edward Bannister, QC and Miss Isabel Hitching for Mrs Harrison.

LORD JUSTICE EVANS said that Mr Bannister had submitted that because the plaintiffs were in breach of duty therefore, applying Brickenden v London Loan & Savings CoUNK ((1934) 3 DLR 465, 469), they were liable to restore Mrs Harrison financially to the position she was in when their breach of duty occurred. It was not relevant to inquire whether or not she would have completed the purchase in any event. It was enough that she did in fact do so, and as enabled to do so by the plaintiffs' loan.

His Lordship would reject that argument because the authorities also showed that the stringent rule of causation or measure of damages, identified inCIBC Mortgages plc v PittELR ([1994] 1 AC 200) and Brickenden did not apply on breaches...

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63 cases
3 books & journal articles
  • Remoteness Criteria in Equity
    • United Kingdom
    • The Modern Law Review Nbr. 65-4, July 2002
    • 1 July 2002
    ...USA.588* Barrister, London. I am grateful to Dr James Edelman for his comments on an earlier version of this note.1Swindle vHarrison [1997] 4 All ER 705 (CA) 733; Re Mulligan [1998] 1 NZLR 481, 509;O’Halloran vRT Thomas & Family Pty Ltd (1998) 45 NSWLR 262 (CA) 273–278; Maguire vMakaron......
  • Remedies for Breach of Trust
    • United Kingdom
    • The Modern Law Review Nbr. 78-4, July 2015
    • 1 July 2015
    ...at [63].66 Eg FHR n 55 above at [1] per Lord Neuberger.67 cf ibid at [120] per Lord Reed.68 This was recognised in Swindle vHarrison [1997] 4 All ER 705, 732 by Mummery LJ who observed,whilst discussing claims for compensation for breach of fiduciary duty in Nocton vLord Ashburton[1914] AC 9......
  • The Corporate Opportunity Doctrine: The Shifting Boundaries of the Duty and its Remedies
    • United Kingdom
    • The Modern Law Review Nbr. 61-4, July 1998
    • 1 July 1998
    ...trenchant in this view.64 See Bristol and West Building Society vMothew (t/a Stapley & Co) [1997] 2 WLR 436 and SwindlevHarrison [1997] 4 All ER 705, 716–717 per Evans LJ. Although in both cases the determinationthat no breach of such a core duty of loyalty had taken place is something ......

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