Harrington Scott Limited v Coupe Bradbury Solicitors Limited

On an application for strike out and summary judgment in a professional-negligence claim concerning lost litigation opportunities, the court may decide short points of law or construction where the evidence is sufficient, but must not conduct a mini-trial. A lost-claim damages case requires proof that the underlying claim would have been brought in time and honestly, followed by valuation of the lost chance.

A contractual right to terminate cannot be introduced retrospectively into the assessment of loss where the right was never exercised and the facts are known. Contractual interest is penal only if it is a secondary obligation imposing a detriment out of all proportion to the innocent party’s legitimate interest. A claim for interest at the judgment rate is not inherently bad in law. A claim may nevertheless be struck out for abuse where the claimant’s conduct makes a fair trial unsafe, although that is an exceptional remedy.

Harrington Scott Limited claimed damages from its former solicitors, Coupe Bradbury Solicitors Limited, alleging that professional negligence caused it to lose the opportunity to pursue contractual claims against companies in the Kinross mining group.

The defendant applied to strike out and/or obtain summary judgment on multiple issues, including the identity of the contracting parties, the construction of recruitment agreements, contractual waiver, the scope of the lost claim, contractual and statutory interest, and alleged dishonesty and disclosure failures by the claimant’s controlling director.

The central questions were whether any viable underlying claim survived and whether the claimant’s conduct made a fair trial impossible or unsafe.

1. Summary judgment and lost claims. The court applied the principles in Easyair Ltd v Opal Telecom Ltd and held that a realistic prospect is more than merely arguable, while the court must avoid a mini-trial. Short points of law or construction may be determined summarily where the evidence and submissions are sufficient. In a lost-litigation professional-negligence claim, the claimant must first establish that it would have brought an honest claim in time and that the lost claim had a real and substantial prospect of success. Its value is then assessed as a loss of chance.
2. SVP and ERR contracts. The contracts did not entitle the claimant to fees where third-party recruiters supplied the successful candidates. Clause 5.1 concerned applicants submitted by the company, and no exclusivity term could be implied because the contracts were commercially coherent without it and the proposed term contradicted the comprehensive express fee structure.
3. Termination and damages. It was not permissible to assess damages on the assumption that Kinross had exercised its contractual right to terminate the ERR contract when it had not done so. The correspondence showed that Kinross affirmed the contract until 26 October 2010. The counter-factual approach in Durham Tees Valley Airport Ltd v BMI Baby Ltd applied only where the extent of loss remained uncertain; it could not rewrite known history.
4. Scope, waiver and RVP claim. The ERR contract covered no more than 24 named individuals and more probably the 21 invoiced positions. The SVP claim was barred by contractual waiver by accord and satisfaction or, alternatively, waiver by estoppel. The claim for further fees for replacing Dr Cowley under the RVP contract was hopeless: he resigned voluntarily, and the claimant had accepted that the replacement search was required without further fee.
5. Interest. Clause 10.6 was a secondary obligation, but the defendant had not shown on the application that 2% interest for each 14-day period was self-evidently exorbitant, extravagant or unconscionable. The claim for interest at 8% was not bad in law; the appropriate rate was fact-sensitive and suitable for determination at trial.
6. Abuse of process and outcome. The claimant’s dishonest exaggeration, false assignment document and unreliable evidence justified concern that a judgment in its favour would be unsafe. The court nevertheless considered a conditional case-management order initially appropriate. After post-draft submissions, however, no viable pleaded claim remained. The whole claim was struck out and summarily dismissed with costs. The court declined to revisit the unresolved identity-of-contracting-party issue, which would have required trial had recoverable loss survived.