Burleigh House (PTC) Ltd v Irwin Mitchell LLP

Summary judgment is appropriate where a party has no realistic prospect of success and there is no compelling reason for a trial. The court may decide a short point of law or construction where the evidence is sufficient, but should avoid final determination where fuller factual investigation may affect the outcome.

A contractual prohibition on assignment may extend to concurrent tortious rights arising from the retainer. The breadth of the clause and the commercial consequences are relevant. Clear language would be needed before assuming that the parties intended to permit assignment of such rights.

Burleigh House (PTC) Ltd, as purported assignee of Paul Baxendale-Walker, brought contractual and tortious professional-negligence claims against Irwin Mitchell LLP. The claims concerned alleged failures to advise on refinancing a high-interest loan and the consequences for subsequent proceedings.

The defendant applied for summary judgment under CPR 24.2 on three grounds: that the assignment was prohibited by the retainer, that no duty to advise on refinancing existed, and that the relevant refinancing terms had not been communicated to the defendant.

1. The defendant was entitled to summary judgment on the whole claim under CPR 24.2. The claimant had no real prospect of establishing that the causes of action had been validly assigned, and there was no other compelling reason for a trial.

2. The court applied the summary-judgment principles derived from Easyair Ltd v Opal Telecom Ltd [2009] EWHC 339 (Ch) and approved in AC Ward & Sons Ltd v Catlin (Five) Ltd [2010] Lloyd’s Rep. I.R. 301. A realistic prospect is more than an arguable or fanciful case. The court must avoid a mini-trial, but need not accept unsupported assertions at face value. It may decide a short legal or construction issue where the evidence is sufficient.

3. The retainer expressly prohibited assignment of contractual rights. Applying the approach in Linden Gardens Trust Ltd v Lenesta Sludge Disposal Ltd [1994] 1 A.C. 85, the contractual assignment was ineffective.

4. The same prohibition also covered the claimant’s tortious rights. The words referring to rights and benefits “under” the agreement had to be read in the context of the clause’s broad scope. Applying the commercial construction principle in Fiona Trust & Holding Corp v Privalov [2007] Bus. L.R. 1719, the parties would not be taken to have intended the commercially undesirable consequences of permitting assignment of overlapping tortious claims without clear language. No such language existed.

5. The court would not have granted summary judgment on the no-duty ground. The scope of a solicitor’s duty depends on the retainer and circumstances. Whether advice on refinancing was reasonably incidental to this retainer, including in light of the client’s experience and the possible connection with the underlying proceedings, required fuller factual exploration.

6. The court would also not have granted summary judgment on the no-terms ground. The issue of whether the defendant knew, or should have discovered, the alleged refinancing terms was fact-sensitive and further relevant evidence was likely to emerge before trial. Those conclusions were academic because the assignment ground disposed of the claim.