Orientfield Holdings Ltd v Bird & Bird LLP

In a solicitor-negligence claim arising from a property purchase, causation is assessed by asking what a competent solicitor would have communicated, how the client would probably have responded, and what would then have occurred. A judge need not prescribe the exact wording of a hypothetical report if the judgment, read with the pleadings and evidence, makes those causal steps clear. A solicitor who obtains a planning search revealing a potentially significant development should summarise its effect, explain the scope for further enquiries, and invite instructions. The appeal was dismissed because proper reporting would have led to investigation, disclosure of the development’s details, and withdrawal before exchange.

Orientfield Holdings Ltd claimed that Bird & Bird LLP had acted negligently during a proposed purchase of a substantial London property by failing to report the significance of a planning search. Following a six-day trial, the High Court found negligence, causation and no failure to mitigate in the judgment reported at [2015] EWHC 1963 (Ch).

Permission to appeal was limited to causation. The central issue was whether a non-negligent summary of the search would have highlighted a major development at a nearby school site and caused the respondent to investigate further or withdraw before exchanging contracts.

Appeal dismissed. Lady Justice King agreed with Lady Justice Gloster.

1. The appeal involved a narrow causation challenge. The appellant could not challenge the finding that, if the respondent had been informed of the development’s details before exchange, it would not have exchanged contracts. The question was whether proper reporting would have revealed those details.
2. Although the judge could have worked through causation more methodically, the judgment, read in the context of the pleadings, evidence and arguments at trial, made positive findings. A proper summary would have highlighted the development and explained its potential significance. The respondent would then have instructed the solicitors to investigate it, and the details would have emerged.
3. A first-instance judge need not formulate the precise wording of a hypothetical report. It is enough that the judgment clearly identifies the substance of the information that should have been supplied and the resulting causal sequence. The absence of a detailed draft summary did not undermine the findings.
4. The Plansearch report showed a potentially significant development with multiple uses at the school site. In that context, and given the qualified replies to the property information form, a competent solicitor could have prepared a brief explanatory summary, identified further enquiries that could readily be made, and invited instructions. The solicitor was not entitled unilaterally to treat the information as immaterial.
5. There was no basis to disturb the judge’s conclusion that the summary would have revealed the development. Once that conclusion stood, the challenge that the respondent would have proceeded with the purchase fell away. The respondent would have withdrawn before exchange.

• Court of Appeal (Civil Division): dismissed Bird & Bird LLP’s appeal on the permitted causation grounds.
• High Court of Justice, Chancery Division: HHJ Pelling QC found in favour of Orientfield Holdings Ltd after trial, finding negligence, causation and no failure to mitigate, in [2015] EWHC 1963 (Ch).