Siddiqui & Anor v James and Charles Dodd (A Firm)

In a professional negligence claim arising from the loss of an appeal, damages require proof that the lost appeal offered a real rather than fanciful prospect of success and that the breach caused identifiable loss.

Where the appeal would have been reheard, the court must assess both the merits of the appeal and the likely consequences of success. A successful appeal restoring a licence does not establish business loss where the venture was independently unviable and further regulatory approval was unrealistic. Damages for distress are generally unavailable for an ordinary professional retainer unless securing pleasure, relaxation or peace of mind was a major or important contractual object.

The claimants sued their former solicitors for professional negligence and breach of contract after an appeal against an emergency order cancelling registration of their medical day-surgery premises was dismissed because the notice of appeal was sent to the wrong address.

The defendants admitted breach but argued that the appeal would not have produced any lasting benefit. The issues included whether the Registered Homes Tribunal would have reheard and allowed the appeal, whether the business could have continued with restored registration or obtained general-anaesthetic approval, whether any business or property loss was proved, and whether damages for distress were recoverable.

1. Lost appeal. The court assumed in the claimants’ favour that the Registered Homes Tribunal would conduct a rehearing rather than a limited review. The emergency closure order was justified on the evidence available to the health authority, particularly the uncertainty over emergency drugs and patient safety. Nevertheless, on the assumed evidence of the drugs available for the proposed vasectomy, there was a reasonable prospect that the tribunal would have allowed the appeal, while imposing strict future conditions.
2. Consequences of success. Restored registration would not have made the business viable. The Mini Hospital had attracted very few patients, had no established NHS or insurer contracts, and had limited prospects of obtaining sufficient self-funded work. The court also found that the premises and proposed staffing were unsuitable for general-anaesthetic procedures, making further registration and any successful challenge to its refusal highly improbable.
3. Loss and valuation. The speculative business valuations were unsupported by reliable accounts, forecasts or evidence of a viable market. The claimants failed to prove business losses caused by the solicitors’ breach. They also failed to establish loss on the property, which was subject to the bank’s control and was likely to be sold in any event.
4. Distress and mitigation. Applying the principles in Watts v Morrow [1991] 1 WLR 1423, as adopted in Johnson v Gore Wood and Co (A Firm) [2001] 2 WLR 72, and qualified by Farley v Skinner [2001] UKHL 49, distress damages were not recoverable because peace of mind was not a major or important object of the solicitors’ retainer. It was unreasonable, given the claimants’ precarious finances, to expect them to spend further money reapplying for registration.
5. The claimants therefore failed to prove actionable loss. Any recoverable loss appeared limited to wasted costs incurred in pursuing the appeal, but no order was made on that issue because it had not been addressed.

The claim was brought in the High Court as a first-instance professional negligence action. The underlying appeal to the Registered Homes Tribunal had been dismissed after the notice was sent to the wrong address, but that tribunal decision was not the judgment under appeal in these proceedings.