Niprose Investments Limited & Ors v Vincents Solicitors Limited

An amendment after expiry of limitation may be permitted only if it does not introduce a new cause of action, or if the new cause arises from the same or substantially the same facts already in issue. The inquiry is substantive and requires careful comparison of the essential facts, with the stage 2 analysis more abstract than the stage 3 analysis. A solicitor’s duty may, in an appropriate and fact-sensitive case, include taking reasonable steps to ensure that advice is understood and advising against entering a transaction. Such duties require proper pleading of the transaction’s features and the client’s characteristics. A loss must nevertheless fall within the scope of the duty allegedly breached. A late amendment introducing a wholly new case may be refused where it would cause undue prejudice and transform the litigation.

The claimants purchased residential units in a buyer-funded, off-plan development. The development failed following the developer’s insolvency, and the claimants sued their conveyancing solicitors for professional negligence. The defendant applied to strike out the claims or obtain summary judgment.

Following an earlier judgment, the claimants sought permission to amend their particulars of claim. The proposed amendments concerned duties to ensure that advice was understood, advise against entering the transactions, and advise that the deposit arrangements offered no meaningful protection. They also sought to introduce allegations of negligent individual advice by email or telephone and further scope-of-duty and duty-nexus pleas. The central issues were whether the amendments were time-barred new causes of action, whether they arose from the same or substantially the same facts, and whether permission should be granted.

1. Amendment jurisdiction. The court applied the three questions identified in Ballinger v Mercer Ltd [2014] EWCA Civ 996: whether the amendments were arguably out of time, whether they added a new cause of action, and whether any new cause arose from the same or substantially the same facts. The first question was answered affirmatively because the relevant limitation periods had expired.
2. Amendments adding duties to ensure that advice was understood and to advise against entering the transactions did not introduce new causes of action. Those duties were implicit in the existing pleaded duties to draw risks adequately to the claimants’ attention and to consider whether advice against proceeding was necessary. The amendments supplied particulars of the factual basis, including the transaction’s features and the claimants’ financial sophistication. Alternatively, they arose from facts already in issue.
3. The proposed allegations of negligent advice given by email or telephone were a new cause of action. However, because the defence had itself placed individual advice in issue, the amendments arose from the same or substantially the same facts for the purposes of the jurisdictional test.
4. The stage 2 inquiry requires comparison of the essential facts in the original and amended pleadings. The stage 3 inquiry is broader and more granular, requiring consideration of the defence and of whether the defendant would have to investigate facts outside the ambit of the existing case. “Same or substantially the same” does not mean merely “similar”.
5. The court permitted the amendments concerning understanding, advice against proceeding, individual characteristics, additional criticisms of the report on title, and the plea that loss exceeding 10% of the purchase price was within the scope of duty. The amendments were coherent, properly arguable, supported by credible material, and caused no disproportionate prejudice.
6. The court refused permission for the individual email and telephone advice allegations. They were wholly new, introduced late, unexplained, and would fundamentally transform the claim. It also refused the proposed plea that the release of deposits could be inferred to have failed to add value to the development. The pleaded facts did not logically establish that proposition and were unsupported by credible material.
7. The strike-out and summary-judgment applications were dismissed. The amended claims disclosed reasonable grounds and realistic prospects of success. If the claimants established a duty to advise against entering the transactions, there would be a sufficiently clear nexus between breach of that duty and loss of the deposits. Consequential amended pleadings and further case-management directions were ordered.

This was a first-instance decision. It followed the court’s earlier judgment in the same proceedings, [2024] EWHC 801 (Ch), which had adjourned final determination to permit amendment.