Israel Russell v Barry Coulter

A professional negligence claim against a barrister requires proof of an error which no reasonably competent member of the profession would have made. The assessment must reflect the client’s instructions and the litigation choices reasonably open to counsel.

Even if an omission was negligent, the claimant must prove causation. In a lost-litigation claim, the claimant must show a real and substantial prospect of a better outcome. A claim cannot operate as a backdoor appeal or collateral attack on unappealed factual findings.

The Consumer Credit Act 1974 is not a complete code. Unless displaced by the Act, common-law rights remain available, including a conversion claim in an appropriate case.

The claimant had previously been represented by the defendant barrister in proceedings concerning hire-purchase agreements for shipping containers. The underlying claim sought delivery up or the value of containers, while the claimant counterclaimed under the Consumer Credit Act 1974 and alleged conspiracy and other economic torts.

The underlying proceedings succeeded against the claimant and his counterclaim was dismissed. Permission to appeal was refused by Lewison LJ and, on renewal, by Burnett LJ in [2017] EWCA Civ 1027.

The claimant alleged that the defendant had negligently pleaded and argued issues concerning termination, enforcement, default notices, protected goods, apportionment, unfair relationships and Practice Direction 7B. The central questions were whether any breach of duty was established and, if so, whether it caused a real and substantial loss.

1. Claim dismissed. The defendant had not breached his duty of care. In any event, none of the alleged omissions caused loss.
2. The applicable standard was that of the ordinary skilled barrister. An error is negligent only if no reasonably competent member of the profession would have made it. The assessment must take account of the client’s instructions and the strategic choices reasonably open to counsel.
3. The pleaded termination case was advanced on the claimant’s instructions and was consistent with the factual case he wished to present. It did not remove the claimant’s statutory protections or determine the underlying agreements in a way that caused the adverse result.
4. The Consumer Credit Act 1974 did not create an exclusive code. Section 134 preserved a conversion claim in an appropriate case. The authorities relied on by the claimant concerned different statutory provisions and restitutionary claims, and did not establish that conversion was unavailable.
5. The underlying judge had properly considered the arguments under sections 60, 61, 65, 87, 88, 90, 91, 140A and related provisions. The absence of a default notice, improper execution and the alleged failure to obtain an enforcement order did not prevent the conversion claim on the findings made.
6. The protected-goods argument failed independently because the claimant had not proved payment of one-third of the relevant price and had consented to the August arrangement concerning the containers at Hale Wharf. The proposed reliance on section 81 and Chartered Trust v Pitcher would not have changed the result.
7. The unfair-relationship argument was properly treated as a broad, fact-sensitive assessment. The underlying judge had found that the creditor had assisted the claimant rather than acted unfairly. Those findings could not be reopened through a professional negligence claim.
8. The claimant failed to establish a real and substantial chance of success in the underlying proceedings. The claim was in substance a backdoor appeal against the underlying judgment and the Court of Appeal’s refusal of permission. The claim was dismissed.

The judgment concerned a first-instance professional negligence claim. It described the earlier underlying proceedings and the refusal of permission to appeal:

• Central London County Court: judgment for Adaptainer; the claimant’s counterclaim was dismissed.
• Court of Appeal: permission to appeal was refused on the papers by Lewison LJ and, on renewal, by Burnett LJ in [2017] EWCA Civ 1027.