Robert David Mackenzie v Rosenblatt Solicitors (a firm) & Anor

A solicitor may plead unlawful means conspiracy where the client’s instructions and available material provide reasonable grounds for a properly arguable case. Direct evidence identifying every conspirator or each act is not always required, particularly where the relevant discussions were concealed from the claimant.

Separately, a solicitor must advise the client of material weaknesses, changed circumstances affecting the litigation strategy, and the risk of an early strike-out or summary judgment application. A breach of that duty does not establish recoverable loss unless the claimant proves that proper advice would probably have produced a different course of action.

The claimant, a former chairman and chief executive of AA, sued his former solicitors for negligence and breach of contract. He alleged that they improperly advised him about, pleaded and pursued an unlawful means conspiracy claim against AA, its subsidiary and several directors.

The conspiracy claim was issued in March 2018 and later abandoned. The claimant alleged that the solicitors should not have sent the preliminary letter of claim, should not have pleaded the conspiracy, and should have warned him that the claim was weak and vulnerable to strike out. He also claimed damages for costs incurred and alleged misrepresentation concerning a later fixed-fee agreement.

1. Claim dismissed. The court found four breaches of duty: failure to advise before issue that the conspiracy claim appeared weak; failure to explain that the original pressure-and-settlement strategy had been undermined; failure to warn of the risk of a strike-out or summary judgment application; and failure to communicate Leading Counsel’s provisional advice that there was a significant strike-out risk.
2. The preliminary letter of claim was not a formal pre-action protocol letter. The relevant professional-conduct restrictions did not prevent its dispatch, and the letter contained no scandalous or unwarranted allegations.
3. The restrictions in the SRA Code of Conduct 2011, including IB(5.7) and IB(5.8), applied, or applied analogously, to pleading unlawful means conspiracy. The solicitor had to consider the allegation properly arguable and supported by reasonable grounds. The client’s account could constitute part of the supporting material, although reliability and consistency had to be assessed.
4. The pleaded conspiracy was not so hopeless that it should never have been brought. It was sufficient to plead a combination of two or more persons, unlawful means, an intention to injure and resulting loss. Direct evidence of the combination, or precise knowledge of who did what and when, was not essential where the claimant had been excluded from the relevant discussions. The claim was weak and vulnerable, but remained prima facie arguable.
5. The solicitors should nevertheless have explained before issue that the imminent dismissal of a proposed conspirator, the low share price, the lack of hard evidence and the failure to divide the defendants materially weakened both the merits and the original tactical strategy.
6. Those breaches caused no loss. On the evidence, the claimant would probably still have issued the conspiracy claim. The later fixed-fee payment was also not caused by the earlier failures, and the alleged misrepresentation was not proved. Any hypothetical loss would have been limited to £155,000 plus the claimant’s own costs of the conspiracy claim between issue and 1 August 2018.

First-instance decision. The claim was dismissed, with consequential matters adjourned for further argument.