Holt v Holley & Steer Solicitors (a firm)

In a professional-negligence claim arising from litigation, tortious damage accrues when negligence causes a material diminution in the value of the claimant’s position and the resulting loss is measurable, even if it cannot yet be precisely quantified. A claimant need not await final judgment, settlement or exact assessment of damages. Where negligent conduct deprives a party of a real opportunity to advance its case on proper evidence, the lost chance may constitute actual damage once that opportunity has effectively gone. Financial-remedies proceedings do not attract a different limitation rule merely because the court exercises a broad discretion or the spouse’s rights are not assignable. A genuinely contingent liability remains different: damage does not accrue until the contingency occurs.

Ms Holt alleged that her solicitors negligently failed to obtain and secure permission to adduce expert valuations of investment properties and jewellery in financial-remedies proceedings on divorce.

District Judge Watkins held that the contract claim was barred by section 5 of the Limitation Act 1980, but that the tort claim was not barred under section 2. HH Judge Ralton allowed the Firm’s appeal, held that damage arose by the end of the final hearing on 16 March 2012, and granted summary judgment under Part 24. The appeal concerned whether damage accrued only when judgment and the order were made on 30 May 2012, or earlier when the opportunity to rely on proper valuation evidence had materially diminished.

1. Appeal dismissed. The Court of Appeal, comprising Lord Justice McCombe, Lady Justice King and Mr Justice Keehan, unanimously upheld the summary judgment dismissing Ms Holt’s action.
2. Accrual of damage in negligence is fact-sensitive. The relevant question is when the claimant suffers loss falling within the applicable measure of damage. Precise quantification is unnecessary if the loss is measurable. The comparison is between the claimant’s actual position and the position that would have existed if the duty had been performed. This approach was consistent with [1997] 1 WLR 1627 and the reasoning considered in Axa Insurance Limited v Akhtar & others, [2010] 1 WLR 1662.
3. The pleaded negligence deprived Ms Holt of the opportunity to present valuation evidence supporting a better financial outcome. That loss of opportunity was capable of measurement when the evidence could no longer realistically be introduced. The claimant did not have to wait for the final judgment, settlement or precise quantification. The court applied the reasoning in Forster v Outred & Co., [1982] 1 WLR 86, concerning loss of a chance, and the majority reasoning in Berney v Saul, [2013] EWCA Civ 640.
4. The broad discretion exercised in financial-remedies proceedings did not alter the analysis. Such proceedings involve computation of asset values followed by distribution of the assets. A negligent failure affecting the computation stage can diminish the value of a spouse’s money claim before the distribution decision. Non-assignability of that right was not a principled basis for a different limitation rule.
5. The case was not analogous to the genuinely contingent liability in Law Society v Sephton & others, [2006] 2 AC 543. Here there was, at the latest by the end of the hearing on 16 March 2012, a real risk that the assets would be valued on the allegedly inflated basis. The tort claim was therefore barred by section 2 of the Limitation Act 1980 when issued on 5 April 2018.

1. Court of Appeal (Civil Division): The appeal from HH Judge Ralton’s order of 23 October 2019 was dismissed. The court upheld the conclusion that the tort claim was statute barred.
2. County Court at Bristol: HH Judge Ralton allowed the Firm’s appeal from District Judge Watkins, granted summary judgment under Part 24 and dismissed Ms Holt’s action.
3. County Court at Bristol: District Judge Watkins granted summary judgment on the contract claim but held that the tort claim was not time barred.