The recent decision in Chweidan contains a useful summary of the law on quantifying damages in loss of chance litigation cases.
Mr Chweidan (Mr C) retained Mishcon de Reya in 2008 to bring employment tribunal claims against his former employer JP Morgan. Although Mr C was initially successful in his claim for unlawful direct disability discrimination and unfair dismissal against JP Morgan, and was awarded in excess of £550,000, the unlawful disability discrimination findings were overturned on appeal. A cross-appeal on behalf of Mr C was not lodged in time (and an application for an extension of time was unsuccessful). The end result of the proceedings against JP Morgan was an award of approximately £68,000 to Mr C for unfair dismissal but a costs bill that exceeded that sum.
Professional negligence claim
Mr C brought a claim against Mishcon de Reya. The firm admitted breach of duty in relation to its failure to lodge a cross-appeal in time (with the result that the cross-appeal, which included an appeal against the dismissal of Mr C’s unlawful age discrimination claim, could not proceed) but denied further allegations of breach. Mr C’s claims based on the additional alleged breaches failed and the Court was left to consider whether the admitted breach had caused any loss and, if so, what was its value.
Mishcon de Reya’s position was that the failure to lodge a cross-appeal in time had not caused Mr C to lose an opportunity of any value because the grounds of cross-appeal had no more than a negligible prospect of success.
Approach to quantifying damages for loss of chance
Mrs Justice Simler summarised her approach to this issue in the following six points.
- The Claimant must prove that the claim had a real and substantial, rather than merely a negligible prospect of success.
- If the Court decides that the Claimant's chances were more than merely negligible then it will have to evaluate them. That requires the Court to make a realistic assessment of what would have been the Claimant's prospects of success had the original litigation been fought out.
- This means that the Court should assess the likely level of damages which the Claimant would most probably have recovered had the underlying action proceeded to judgment and then apply an appropriate fraction to that sum to reflect the uncertainties of recovering such damages.
- In some loss of a chance cases it may be appropriate to view the prospects on a fairly broad brush basis whilst in other cases it may be correct to look at the prospects in greater detail.
- The oral and documentary evidence available (and whether or not it is more limited than what would have been available in the action) and the possibility that the claim might have settled are features that must be factored into any assessment. It would be wrong in any event, to conduct a trial within a trial or to make any firm findings as to what would have been decided.
- If there are "separate hurdles", the percentage prospects on each should be multiplied together to give an overall lower percentage prospect.
Outcome in this case
The Judge posed two questions in relation to the admitted breach of failing to lodge a cross-appeal in time, namely:
- did Mr C have more than a minimal prospect of success on appeal in relation to any of his grounds (and, if so, which grounds); and
- if so, did Mr C have a more than minimal prospect of success in any remitted claim before an employment tribunal (if so, what was the most probable value of the claim and what was the overall chance of success).
The Judge did not consider the prospects of success on appeal and/or the underlying claim to be so poor as to be negligible, so she had to assess the chance of Mr C making a recovery by award or settlement.
The Judge considered that Mr C had a “slightly less than 50% chance of success” on two of Mr C’s three grounds of appeal (these two grounds were his appeals against the tribunal’s refusal to order specific disclosure and its rejection of his age discrimination claim). The Judge then considered that Mr C had “at best, a one third chance of success” of proving his unlawful age discrimination claim in the underlying action. The Judge recognised that a strictly mathematical approach to the successive percentages would produce an overall percentage chance of success of c.16% but allowed a slight uplift to an overall chance of success of 18% on the basis that, had Mr C succeeded on his appeal, JP Morgan may have viewed the underlying litigation differently.
As the two unlawful discrimination claims were similar (for age and for disability discrimination), the Court applied the 18% to a figure of c.£360,000 (being the amount Mr C would have had in his hands after he had paid tax and national insurance on the original unlawful disability discrimination award of c.£550,000). This resulted in Mishcon de Reya being ordered to pay c.£65,000 to Mr C.
The Judge in Chweidan followed the approach in earlier loss of chance litigation cases, Mount v Barker Austin and Dixon v Clement Jones . In the Court of Appeal judgment in the Mount case, Simon Brown LJ identified that, although the legal burden lies on the claimant to prove that in losing the opportunity to pursue his claim he has lost something of value, the evidential burden lies on the defendant to show that despite their having acted for the plaintiff in the litigation and charged for their services, that litigation was of no value to their client, so that he lost nothing by their negligence. Simon Brown LJ observed that plainly the burden is heavier in a case where the solicitors have failed to advise their client of the hopelessness of the position and if the solicitors have advised their client with regard to the merits of his claim (or defence) such advice is likely to be highly relevant. Against this background, the age old issue of what advice was evidenced in attendance notes and/or recorded in writing was once again prominent.
Further reading: Chweidan v Mishcon de Reya  EWHC 2685 (QB)