Katherine Playfair & Ors v Pannells LLP (formerly PKF (UK) LLP) & Ors
[2024] EWHC 1933 (Ch)
James Lonsdale & Ors v Wedlake Bell LLP & Ors
27 March 2024
[2024] EWHC 712 (KB)
High Court
A family's trust was messed up by their lawyers. Even though the dad (Settler) waited too long to sue, the judge said his kids (beneficiaries) and the trust managers (Trustees) could still sue the lawyers because they had good arguments. The judge felt the lawyers should have kept helping and giving right advice, not just once in 2011. The kids' share of the trust money became smaller because of the lawyer mistake. The judge didn't want the family to lose out just because of a mistake in timing or other technical things
Key Facts
- •Solicitors acted negligently in advising on a 1987 Discretionary Trust.
- •Negligent advice prevented the variation of the Trust to reflect the Settlor's wishes.
- •Claimants include the Settlor, Trustees, and the Settlor's children.
- •Defendants are the solicitors' firms and their insurer.
- •Claims are for professional negligence, with damages sought for loss of income and diminished trust fund value.
- •Defendants argue no loss to Trustees, no duty of care to children, and statute-barred claims.
- •The Settlor's email of 13 August 2018 was deemed significant due to its contents.
- •A previous claim (QB-2021-002695) was dismissed due to late service.
- •The Deed of Variation (10 February 2020) excluded two beneficiaries.
- •The trust fund involved life insurance policies and investments worth approximately £2 million.
- •The central dispute concerns the applicability of the White v Jones exception to the usual rule regarding duty of care to intended beneficiaries.
Legal Principles
Duty of care owed to intended beneficiaries under a will where there would otherwise be a lacuna (White v Jones exception)
White v Jones [1995] 2 AC 207
Limitation Act 1980, Section 14A: Extension of time for bringing a claim
Limitation Act 1980, Section 14A
Imputation of knowledge from one trustee to others
Graham v Entec [2003] 4 All ER 1345
Continuing duty of care
Capita Banstead v RFIB [2016] QB 836; Midland Bank Trust Co Ltd v Hett, Stubbs & Kemp [1979] Ch 384; Bell v Peter Browne Co [1990] 2 QB 495
Duty of care owed to beneficiaries even without a White v Jones lacuna
Yudt v Leonard Ross & Craig (1998/99) 1 ITELR 531
Claims by representatives for losses suffered by beneficiaries (Chappell v Somers & Blake)
Chappell v Somers & Blake [2004] Ch. 19
Richards v Hughes: Uncertainty in the law regarding duty of care to beneficiaries in inter vivos trusts
Richards v Hughes [2004] PNLR 35
Outcomes
Defendants' application to strike out the claim or grant summary judgment dismissed.
The court found arguable claims for the Trustees and Children, based on the principles of White v Jones and subsequent case law, despite the Settlor's potential claim being statute-barred. The court also found a continuing duty of care, meaning that the claims were not necessarily time-barred.
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