Minkin v Landsberg (practising as Barnet Family Law) [17.11.15]
Solicitor not under a duty to advise Claimant against settlement of ancillary relief proceedings when she was retained only to codify an agreement reached without her involvement; claim would have failed on causation in any event.
The Claimant, an experienced accountant, negotiated a settlement of financial issues with her then husband following their divorce. After having doubts about that settlement, she instructed a firm of solicitors which advised her that the settlement might not be fair and that there were options available to her. The Claimant elected to proceed with the settlement and dis-instructed her solicitors.
She and her husband submitted a consent order drafted by them to the County Court, which was rejected due to a lack of precision in the drafting. The Claimant then instructed the Defendant to draft an appropriate consent order which would be approved by the County Court. The Defendant carried out those instructions and the consent order was approved.
The Claimant later alleged that the settlement was less advantageous than it might have been had she received appropriate warnings from the Defendant before it was concluded. The Claimant made a claim against the Defendant for failing to provide warnings and wider advice on the terms of the settlement. The Defendant’s primary defence was that she was under no duty to proffer such advice, which had not been requested by the Claimant, and that the advice fell outside the scope of her retainer.
The claim failed at first instance on the basis that the Defendant’s retainer was limited, with the effect that she was not under a duty to advise or warn the Claimant about the merits of the agreement, which was reached without reference to the Defendant.
The Court of Appeal rejected the Claimant’s appeal on all grounds. In doing so, Lord Justice Jackson set out the general principles to be considered when deciding the scope and extent of a solicitor’s retainer:
- A solicitor’s contractual duty is to carry out the tasks that the client has instructed and the solicitor has agreed to undertake.
- The solicitor must proffer advice reasonably incidental to the work being carried out.
- Regard must be had to the character and experience of the client.
- The solicitor and client may, by agreement, limit the duties which would otherwise form part of the retainer - this should be agreed in writing.
Jackson LJ concluded that the Defendant’s retainer was limited (which is often the case in the matrimonial context), irrespective of the limitation not having been recorded in writing. He found that no additional advice to the Claimant was required to discharge the Defendant’s (limited) duty. Importantly, he also found that the claim would have failed on causation grounds in any event, as the Claimant would not have acted differently, even if she had received the advice she contended she should have.
Lady Justice King, concurring with Jackson LJ, addressed the problems arising from the lack of availability of legal aid/public funding and the importance of ‘unbundled’ services provided to lay clients concerning discrete parts of matrimonial finance cases. She considered that there would be serious consequences if solicitors could not accept instructions on a limited basis for fear of a far broader duty of care being imposed on them.
When operating under a limited retainer, any professional should, as a matter of course, document the extent (and limitations) of the services being provided. Even so, limited retainers are increasing common and the scope of any retainer should be considered carefully where a solicitor faces a claim that they should have given wide-ranging advice or warnings to their client.
There is a need for solicitors to be able to give bespoke (and often limited) advice to lay clients dealing with the financial implications of divorce in circumstances where they lack the funding for full representation. The Court of Appeal’s decision allows them to do so with some confidence that they will not have wide-ranging duties imposed on them where these duties were not in their contemplation.
The decision will also be a welcome development for the insurers of the many firms of solicitors who are facing a rash of negligence claims concerning the alleged under-settlement of ancillary relief proceedings dating back to 2000. It represents a timely reminder to claimants of the need to prove primary causation before the court will consider the value of any lost chance. This decision is likely to prove a significant hurdle for many of those claimants, as the Court of Appeal held that the Claimant’s claim would have failed on causation even had a breach of duty been established.