Spire Property Development LLP & Anor. v Withers LLP

A solicitor who answers an informal request from a former client assumes responsibility only for the task which, objectively and in context, the communications show was undertaken. The parties’ subjective understandings do not determine its scope.

The Bolam principle governs the standard of care after the duty’s scope has been established. It does not determine that scope. A professional negligence duty concerned with the content of required conduct must also be distinguished from the purpose-based scope-of-duty principle governing recoverable loss.

Answers about why an issue had not been discovered during an earlier transaction did not, without more, amount to comprehensive advice about future rights and remedies. Informal advice should therefore be assessed by its precise request, response and surrounding context.

The Developers purchased two properties beneath which high-voltage electricity cables were later discovered. They sued their former solicitors for negligence relating both to the pre-purchase investigations and to informal advice given by email after the discovery.

The High Court, in [2021] EWHC 2400 (Comm), upheld both claims. On the later-advice claim, it held that the solicitors had assumed responsibility to advise upon the Developers’ rights and remedies against the electricity company, including removal of the cables or compensation under the Electricity Act 1989.

The solicitors appealed only that finding. The central issue was whether, objectively construed in context, their answers to three specific questions assumed responsibility for wider advice about the Developers’ rights and remedies if the electricity company could not establish authority to maintain the cables.

1. Appeal allowed unanimously. The solicitors did not assume responsibility for advising upon the Developers’ rights and remedies against the electricity company. The High Court’s decision on the later-advice claim was therefore displaced.

2. Assumption of responsibility, and its scope, must be determined objectively and in context, without hindsight. The primary focus is on communications crossing the line between the professional and the claimant. Informal exchanges are not construed as formal legal instruments, but the client’s experience and sophistication and the parties’ wider relationship form part of the context.

3. The correspondence preceding the decisive request had concerned what had been known, or should have been discovered, when the properties were purchased. The request sought thoughts on three identified questions, including a slight elaboration about statutory access rights. Properly read, it asked whether the cables could originally have been laid without the owners’ permission and why their existence had not appeared in the transaction documents. The response answered those questions. It did not undertake comprehensive advice about present remedies if no valid wayleave existed.

4. The uncertainty concerning when and under what authority the cables had been installed reinforced that construction. The solicitors knew that future enquiries would be made of the electricity company. The stated purpose of preparing for that approach did not enlarge the specific questions which the solicitors undertook to answer.

5. The Bolam principle concerns the standard of professional care after the scope of the duty has been established. It does not determine the existence or scope of the assumed duty, which is a question of law and objective construction.

6. The court left open whether, outside a retainer, an assumed duty can extend to matters reasonably incidental to the volunteered task. Even if that principle were available, advice about remedies was not reasonably incidental to explanations concerning the earlier non-discovery of the cables.

7. The purpose test discussed in [2021] UKSC 20 and [2021] UKSC 21 concerns whether loss falls within the risks against which an established professional duty protects. It does not determine the anterior content of the conduct which the professional undertook to perform.

8. Actual reliance did not expand the duty. The solicitor’s subjective understanding and the client’s subjective reaction were both non-determinative. Reliance upon the omission of wider advice as positive advice that no remedy existed was objectively unreasonable.

1. Court of Appeal (Civil Division): In [2022] EWCA Civ 970, unanimously allowed the solicitors’ appeal against the finding of liability on the 2014 advice claim.

2. High Court, Commercial Court: In [2021] EWHC 2400 (Comm), HHJ Pelling QC found the solicitors liable on both the 2012 conveyancing claim and the 2014 advice claim. The appeal concerned only the latter finding.