Hughmans (A Firm) v Dunhill

Summary judgment is appropriate where a claim or defence has no realistic prospect of success, but the court must avoid conducting a mini-trial and should consider evidence reasonably expected at trial. A claim should proceed where fuller investigation may affect the outcome.

A solicitor’s duty depends on the particular retainer and facts. A general retainer concerning matrimonial affairs may extend beyond the principal application where the surrounding circumstances support that conclusion, but it does not automatically cover every related trust or financial issue. Solicitors retained by one parent to seek maintenance for children do not thereby become retained by, or owe an independent duty of care to, the children where that would conflict with the client’s interests.

Hughmans, a firm of solicitors, claimed unpaid fees from Ms Dunhill arising from its work in matrimonial proceedings concerning variation of maintenance orders. Ms Dunhill counterclaimed for professional negligence, breach of fiduciary duty, wasted costs and compensation, and sought to advance claims said to belong to her children.

The applications followed extensive financial proceedings between Ms Dunhill and her former husband. Those proceedings culminated in a consent order approved by Moylan J on 27 June 2014, while Ms Dunhill’s appeals from orders made by DJ Berry were dismissed by consent. The central issues were whether Ms Dunhill’s claims had a realistic prospect of success, the scope of Hughmans’ retainer, whether duties were owed to the children, and whether alleged breaches caused loss.

1. Summary judgment. The court applied the approach summarised in Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) and approved in AC Ward & Son v Catlin (Five) Ltd [2009] EWCA Civ 1098; [2010] Lloyd’s Rep IR 301. The court had to distinguish a realistic prospect from a fanciful one, avoid a mini-trial, and consider evidence reasonably expected at trial. The court could decide a short legal or construction point where the evidence and argument were sufficient.
2. Ms Dunhill’s application. The Second 2003 Consent Order took effect when made under section 24(1)(c) of the Matrimonial Causes Act 1973. The trust was varied, the trustees were appointed and the new beneficial interests vested despite the absence of the contemplated deed of variation. The legal effect of the subsequent transfers and the purchase of 71 Eaton Terrace required further investigation and was unsuitable for summary determination. The disputed accuracy of Ms Dunhill’s Form E and witness statement also required trial-level assessment.
3. Fees and professional negligence. The alleged £25,000 costs representation had no realistic prospect of establishing actionable misrepresentation or negligence. The proposed assessment of fees was out of time under section 70(3) of the Solicitors Act 1974. The retainer principally concerned the variation application, but arguably extended to the cross-application, relevant financial aspects of the matrimonial affairs, Ms Dunhill’s Form E and investigation of Mr Turner’s earlier disclosure. It did not extend to advising on the AST as such.
4. Children and causation. The children were not parties to the retainer. Seeking periodical payments for their benefit did not make them clients, and Hughmans had not assumed responsibility to them. An independent duty would also conflict with Hughmans’ duty to Ms Dunhill. Most alleged breaches had no realistic prospect of success. Although inadequate investigation of Mr Turner’s earlier non-disclosure was arguable, Ms Dunhill had no realistic prospect of proving causation, particularly in light of the adverse outcome of the 2013 Family Proceedings and the 2014 Consent Order.
5. Disposition. Hughmans was granted summary judgment on its claim for unpaid fees. Ms Dunhill’s counterclaim was dismissed, and the proposed amendments were refused to the extent addressed in the judgment.

The judgment does not state that this decision was appealed.