There is no duty to warn a client in respect of a risk falling outside of a solicitor’s retainer – Cathal Anthony Lyons v Fox Williams LLP [2018] EWCA Civ 2347

The Defendant was instructed to advise on an accidental death and dismemberment claim (“the ADD Claim”) brought by the Claimant against his employers’ insurers. Their retainer was later extended to include advice on a severance agreement with the Claimant’s employers.

During negotiations, the Defendant stated that all other claims arising from the accident would “need to be addressed separately” – this was in connection with a separate long-term disability (“the LTD Claim”). The Claimant did not bring the LTD Claim before the expiry of the relevant limitation period.

Relying on the cases of Credit Lyonnais SA v Russell Jones & Walker1 and of Minkin v Landsberg2 (“Minkin”), the Claimant sued the Defendant for their failure to warn him that the limitation date was approaching. The Claimant submitted that the Defendant had breached his duty to warn him of “a risk or a potential risk” which the Defendant had allegedly become aware of “during the course of doing that for which he was retained”.

It was argued that Minkin – the leading authority – imposed a duty of care upon the Defendant to warn the Claimant in respect of any problem or risk for the Claimant, of which it was reasonable to assume he was not aware, which the Defendant noted, or ought to have noted, in the course of carrying out his instructions. Many Claimants rely on Minkin to argue that the alleged duty of care arose because it was reasonably incidental to the solicitor’s retainer.

The High Court found that the Defendant’s knowledge of the existence of the LTD Claim did not cause him to “become aware of a risk or potential risk to the Claimant” and that “it was not objectively unreasonable for [the Defendant] to omit to flag up any such risk to the Claimant.” The Defendant’s knowledge of the LTD Claim did not necessarily create a duty to advise in respect of that claim. The retainer made no reference to the LTD Claim and, in the absence of anything further, no duty to advise had arisen in relation to that claim. The fact the Defendant may have briefly considered documentation relevant to the LTD Claim was not sufficient.

The Claimant appealed. He argued that the Defendant’s review of the relevant policies had given rise to a duty to warn him of the applicable time limits, of the steps necessary to preserve the LTD Claim and of his right to obtain legal advice.

The Court of Appeal upheld the High Court’s findings and dismissed the appeal. Elaborating on Minkin, Lord Justice Patten clarified that “…although cases like Minkin are often cited as authority in support of a legal duty to warn, they are in fact decisions about the scope of a solicitor’s duty based on a particular retainer…..the solicitor's obligation to bring to the client's attention risks which become apparent to the solicitor when performing his retainer does not involve the solicitor in doing extra work or in operating outside the scope of his retainer.”

On that basis, the Court of Appeal rejected the Claimant’s submission. The fact the Defendant had seen documents relating to the LTD claim and had extended the scope of his retainer to include negotiations on the Claimant’s severance package, did not impose a duty on the Defendant to advise the Claimant in respect of the LTD Claim. 

The case affirms that, for the purposes of measuring liability in a professional negligence claim, the scope of a professional’s duty of care must be assessed by reference to the professional’s retainer.

This is another significant judgement which benefits the professional indemnity market.