Vitalijus Dziugys v Ersan and Co Solicitors Ltd
[2024] EWHC 434 (KB)
Riad Tawfiq Al Sadik v Clyde & Co LLP & Ors
12 April 2024
[2024] EWHC 818 (Comm)
High Court
A wealthy investor sued his lawyers for losing a case. The court decided some of the claims were too late and others had no chance of winning. One claim, about bad lawyer advice on another legal action, will go to trial.
Key Facts
- •Riad Tawfiq Al Sadik (C) brought a professional negligence claim against his former legal advisors (Ds) regarding an unsuccessful Cayman Islands claim (Investcorp Claim).
- •The Investcorp Claim involved a complex and costly dispute, ultimately resulting in C's loss.
- •The present claim alleges negligence in relation to a failed reamendment application and the failure to advise on the risks of an anti-suit injunction related to Dubai proceedings.
- •The claims against D2, D3, and D4 are based on the tort of negligence and are subject to limitation periods.
- •The court considered limitation issues and applications for reverse summary judgment.
- •C argued that Ds owed a continuing duty of care to advise on their potential negligence.
Legal Principles
Limitation Act 1980, s.14A and Cayman Limitation Law (1996 Revision), s.14 – extended limitation period for latent damage.
Limitation Act 1980, s.14A; Cayman Limitation Law (1996 Revision), s.14
Knowledge required for bringing an action includes knowledge of material facts about the damage and attributability of damage to the alleged negligence.
Limitation Act 1980, s.14A(6)-(8); Cayman Limitation Law (1996 Revision), s.14(5)-(7)
Continuing duty of care: Solicitors do not generally owe a continuing duty to advise clients of past negligence, unless expressly agreed or a necessary incident of another undertaken duty.
Bell v Peter Browne & Co [1990] 2 QB 495; Gold v Mincoff & Gold [2001] Lloyd’s Rep PN 423; Tesco v Costain Construction [2003] EWHC 1487 (TCC); Nouri v Marvi [2010] EWCA Civ 1107; Capita (Banstead 2011) Ltd v RFIB Group Ltd [2015] EWCA Civ 1310; Sciortino v Beaumont [2021] EWCA Civ 786
Loss of a chance: The court assesses the claimant's prospects of success, considering whether the lost argument had a real and substantial prospect of success.
Allied Maples Group Ltd v Simmons & Simmons (a firm) [1995] 4 All ER 907; Perry v Raleys Solicitors [2019] UKSC 5
Summary judgment: The court considers whether the claimant has a realistic prospect of success, without conducting a mini-trial.
Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch)
Estoppel by convention: A party can be estopped from denying a proposition based on mutual assent and reliance, making it unfair to resile from the common assumption.
Spencer Bower: Reliance-Based Estoppel (5th ed., 2017)
Outcomes
Claims against D2, D3, and D4 regarding the late reamendment application are time-barred.
C had the requisite knowledge in December 2011; no continuing duty existed.
Reverse summary judgment granted for all Ds on claims related to the reamendment application.
The claims lacked a real prospect of success; even if the reamendment had been allowed, it wouldn't have changed the outcome.
Reverse summary judgment granted for D2 on the claim regarding advice on the anti-suit injunction.
D2 was not instructed to advise on the risk; the client was already aware of the risk.
Reverse summary judgment refused for D1 on the claim regarding advice on the anti-suit injunction; the claim proceeds to trial.
Causation issues are fact-sensitive and require further investigation at trial.
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