Nouri v Marvi & Ors

In a negligence claim concerning a forged conveyance, actual damage arose when the solicitor released the forged transfer into circulation, because that immediately placed a blot on the claimant’s registered title. The damage was measurable by the cost of remedying that detriment. The later contingency that the title might actually be defeated was not the first actionable damage.

A claim cannot avoid limitation by claiming only the later and more substantial loss. The breach was complete at completion and there was no continuing duty requiring the solicitors subsequently to discover their negligence or prevent its consequences.

The claimant was the registered proprietor of a leasehold property. An imposter instructed the defendant solicitors to act on a purported sale, and the solicitors released a forged transfer. The transfer was later registered, transferring the title by operation of section 69 of the Land Registration Act 1925.

The claimant brought proceedings more than six years after the forged transfer had been released but within six years of its registration. He alleged that the solicitors owed him a tortious duty arising from an assumption of responsibility and argued that damage occurred only when his title was defeated. The issue was whether the claim was time barred.

1. Actual damage and contingent loss. A cause of action in negligence accrues when the claimant suffers actual damage which is more than negligible. A loss flowing only from a contingency is not actual damage until the contingency occurs, but an immediate, measurable economic disadvantage is actionable even if a greater loss remains contingent. The analysis in Law Society v Sephton & Co [2006] 2 AC 543 was applied.
2. Release of the forged transfer. Before 2 April 2001 the claimant had an inviolable registered title. By releasing the forged transfer, the solicitors placed a document outside the claimant’s control which could be used to defeat that title. This created an immediate blot and a detriment measurable by the cost of removing it. The cause of action therefore accrued on 2 April 2001, when the transfer was put into circulation.
3. Analogy with protective steps. Bell v Peter Browne [1990] 2 QB 495 supported the conclusion that immediate loss may arise from failure to protect an existing property interest, even though a greater loss remains contingent. The claimant could not postpone accrual by suing only for the eventual loss of the property.
4. Continuing duty. The solicitors’ breach was a once-for-all breach at completion. The continuing existence of a remedy for the initial detriment did not postpone accrual, and there was no continuing tortious duty to discover the negligence or insulate the claimant from its consequences.
5. Outcome. The claim was statute barred and was dismissed on the limitation issue.