The Supreme Court recently handed down the much anticipated decision in Edwards on behalf of the estate of the late Thomas Arthur Watkins (Respondent) v Hugh James Ford Simey Solicitors (Appellant)1. This case considered the approach to assessing “loss of chance” claims where the Claimant, Mr. Watkins, had lost the opportunity to pursue a claim against a third party due to the negligence of his solicitor.

Mr. Watkins worked as a miner for the National Coal Board in Wales from 1964 to 1985. As a result of using vibratory tools, Mr. Watkins developed Vibration White finger (“VWF”) which, by way of example, can often lead to a sufferer being unable to carry out routine everyday tasks without assistance.

A group of test cases established that British Coal was negligent in not taking steps to limit the exposure of miners to VWF. As a result, a government scheme was set up in 1999 to provide tariff-based compensation to miners. The Scheme’s purpose was to provide quick and efficient compensation and operated in a way which was not akin to a formal piece of commercial litigation. The Scheme provided compensation for: (i) pain, suffering and loss of amenity (“General Damages”); and (ii) for other financial losses such as loss of past and/or future earnings (“Special Damages”). Special damages also included a “services award” for miners who needed assistance in performing routine domestic tasks.

Mr. Watkins instructed Hugh James Ford Simey solicitors to act for him in order to file a claim under the Scheme. A medical assessment supported Mr. Watkins’ claim for general damages but also for a services award. He was ultimately made a scheme offer that did not, however, include an allowance for a services award. Mr. Watkins accepted that offer but five years later pursued a claim against his former solicitors in negligence in failing to bring a claim for a services award under the Scheme.

At first instance, the court held that had Mr. Watkins been properly advised, he would have rejected the settlement offer and pursued a services claim. However, a medical expert was appointed who found that if Mr. Watkins’ health had been properly evaluated at the time he would not have received any compensation for special damages and a much reduced claim for general damages. His claim therefore failed as he had suffered no loss even though his solicitors had been negligent.

This decision was overturned by the Court of Appeal on two main grounds: (i) the judge should not have conducted a “trial within a trial” to establish the loss which Mr Watkins might have suffered; and (ii) it was wrong to rely upon expert medical evidence which would not have been available at the time the original claim was pursued.

The Court of Appeal’s decision was upheld by the Supreme Court. It followed the decision in Perry v Raleys2 (another VWF miners’ case), where Lord Briggs said, adopting the leading Allied Maples3 decision on loss of chance claims, “For present purposes the courts have developed a clear and common sense dividing line between those matters which the client must prove, and those matters which may be better assessed upon the basis of the evaluation of a lost chance.”

In Watkins, the Supreme Court held that there was no reason why a judge could not conduct a detailed analysis at trial of what the Claimant would have done at the time he lost his chance in order to establish whether there had been a breach of duty by his solicitor which had caused the Claimant to suffer loss (i.e. a “trial within a trial”). However, a “trial within a trial” could not be used to establish the quantum of loss as that required an inquiry into the hypothetical response of third parties by way of an evaluation of the prospects of a particular recovery on a percentage chances of success basis.

In that regard, loss of chance claims are assessed across a spectrum of possible outcomes: i) where there is substantial certainty that the Claimant would have received a benefit from the third party, the Claimant could be fully compensated; ii) where there was less than substantial certainty but more than a negligible chance of compensation the loss is assessed on a percentage basis (e.g. a 40% chance of a recovery); and finally, where the Claimant’s chances of making a recovery were negligible it would lead to no compensation being awarded at all.

The Watkins case did not create new law but importantly re-enforced the decision in Perry. It also found that in this case you could not rely upon medical evidence which was not available at the time the claim was lost to re-assess what recovery might have been achieved had a claim been put into the Scheme.

Commentary

This decision by the Supreme Court is important because it follows Perry v Raleys and re-establishes Allied Maples as providing a clear road map for pursuing loss of chance claims with more rigour and clarity which should benefit professionals and their insurers equally. Also, it clarified that the loss of chance principles apply to loss of chance claims in other transactions including those concerning other professionals such as architects, surveyors, brokers etc