Di Matteo v Marcus Lee & Co

In a professional negligence claim concerning a lost opportunity to litigate, the claimant must show a prospect of success that is more than negligible or fanciful. The court assesses the lost litigation as a whole, without conducting a trial within the trial. Causation may require separate assessment of whether the claim would have been pursued, whether it had a real prospect of success, and whether the relevant settlement or outcome would probably have occurred.

Damages reflect the value of the lost chance. Loss caused by later, supervening events, including increased property values during an appeal, is not recoverable. Costs incurred in pursuing an independent appeal are likewise excluded where they were not caused by the solicitor’s breach.

The claimant sued his former solicitors for negligence and breach of contract after they failed properly to issue and serve claims against two earlier firms of solicitors. Liability for that breach was admitted. The issue was whether the claimant lost a valuable chance of establishing that the earlier firms had failed to notify him of a settlement offer in ancillary relief proceedings.

The court considered whether the claimant would have pursued the negligence claim, whether the earlier solicitors had received the offer, whether the claimant would have made a £40,000 counter-offer, and whether it would have been accepted. It then determined the appropriate damages and the recoverability of later losses and appeal costs.

1. Loss of chance. The claimant had to establish that the lost claim had more than a negligible prospect of success. The assessment was not a trial within the trial. The court instead evaluated the prospects of the material issues in the lost litigation, applying the evidential approach identified in Mount v Barker Austin [1998] PNLR 493.
2. The claimant would have pursued a claim against Charsley Harrison, but not against Fort & Co. The evidence established a substantial prospect that Charsley Harrison had received the Calderbank offer. There was no sufficient prospect that Fort & Co had received it.
3. The claimant had a 25 per cent prospect of making a £40,000 counter-offer if informed of the offer. There was a 20 per cent, more than speculative, prospect that his former wife would have accepted it. The claimant therefore lost a chance of value.
4. Damages were assessed by reference to the £100,000 order made in the ancillary relief proceedings, together with approximately £2,000 costs, less the £40,000 settlement figure, and reduced by 25 per cent. The later settlement of £150,000 was not the correct measure because the increase resulted from rising property values during the claimant’s appeal, which was a supervening event and not a foreseeable consequence of the defendant’s breach.
5. No deduction was made for the likely failure of a claim against Fort & Co. The court distinguished the situation considered in Harrison v Bloom Camillin (a firm) (No 2) (2001) PNLR 7, because the claimant, properly advised, would not have pursued that claim. Appeal costs and related correspondence were also not caused by the defendant’s breach.
6. Judgment was entered for the claimant in the sum of £15,500 plus interest.