For a long time the playing field for professional negligence claims has been reasonably well defined and understood. The Hunter v Hanley test in Scotland and its more famous cousin in England, the Bolam test, have been tweaked and expanded upon over the years, but have remained fundamentally unchanged.

However, recent case law has introduced the uncertainty of an additional test applicable to a doctor’s duty to warn a patient about risks and then expanded that test to other professionals. Now the Court of Appeal, in a few short paragraphs, may well have restricted this new test back to the world of medical negligence.

A New Test?

In March 2015 the Supreme Court upset the apple cart in the case of Montgomery v Lanarkshire Health Board, which concerned the advice a doctor must give to a patient on the risks involved in a medical procedure and not the care itself. The Supreme Court innovated and widened the doctor’s duties to include highlighting any ‘material’ risk, with ‘materiality’ judged from the patient’s perspective, not against other doctors’ views.

Subsequent cases in the English and Northern Irish courts then picked up the Supreme Court’s baton and ran with it, beyond medical practice, into the wider field of general professional negligence. A new test had seemingly developed to the effect that any professional, when giving advice and warnings about risks involved in a particular course of action, has to consider what a reasonable client would consider material, and provide information on reasonable alternatives.

Listening to the Devil’s Advocate

The English Court of Appeal has now delivered its judgment in the appeal of Barker v Baxendale-Walker and apparently taken the opportunity to limit the further spread of the Montgomery test.

The facts of Barker are set out in our original review of the High Court decision from 2016. Briefly, Mr Baxendale-Walker was a specialist tax solicitor who had advised his client to enter into a complex inheritance tax avoidance scheme that was later challenged by HMRC.

In his original judgement Roth J found that Mr Baxendale-Walker had not been negligent in giving the advice and had not been under a duty to warn Mr Barker that there was a risk of his interpretation of the Inheritance Tax Act being wrong. However, he should have given a high level ‘general health warning’ to the effect that HMRC was likely to challenge the scheme simply because it involved tax avoidance.

The Court of Appeal took a different view of the underlying tax legislation and thought Mr Baxendale-Walker’s interpretation of it was probably wrong, though not necessarily negligently so. This led to the inevitable conclusion that he should have warned Mr Barker that there was a possibility his advice could be wrong.

Accordingly the appeal succeeded on the facts.

Where there is a ‘significant risk’ of a contrary interpretation or opinion being correct, a warning to that effect should be given. This is a highly fact sensitive judgment call for any professional to make, but the Court of Appeal gives some helpful guidance in its opinion on the factors which should be taken into account.

Perhaps the lesson to learn is that law, or indeed the giving of professional advice in any field, is not an exact science and professional advisers need to look at both sides of the argument and to avoid falling into the very human trap of confirmation bias. All good professional advisers will have an internal devil’s advocate and this case clearly shows they should be listened to.

A limit to the march of Montgomery?

Perhaps the more wide-ranging point in the Court of Appeal’s judgment is its attempt to put some limitations on the application of the Supreme Court’s test in Montgomery.

Counsel for Mr Baxendale-Walker argued the Montgomery test was of limited scope, acting only to plug a gap where the Bolam test didn’t apply. The Bolam test was designed to deal with the exercise of professional judgment, but the extent to which a doctor may be inclined to discuss risks with a patient was not a matter of medical learning so a different test was applied.

In accepting this point the Court of Appeal noted Montgomery had focused on the relationship between doctor and patient and ‘changing social mores’. The duty to take reasonable care to ensure a patient is aware of material risks was a policy decision to be considered separately from the medical expertise exercised in treating the patient. That was the explanation for the Supreme Court applying a more onerous test to the question of medical warnings as required to be given in Montgomery.

Put simply, or as simply as it can be, the Court of Appeal was of the opinion the Bolam test applies to matters of professional expertise and the Montgomery test only steps in when policy guides the advice being given, rather than professional judgment.

In applying this distinction to Mr Barker’s case, the Court of Appeal opined that Mr Baxendale-Walker’s advice, and his decision over whether to warn his client that advice could be wrong, was squarely a matter of legal expertise, not a policy decision. Accordingly the Bolam test applied.

Where do we go from here?

In practice this may prove a very difficult distinction to make. The doctor cannot decide what risks to warn a patient about without exercising some degree of medical judgment.

Equally, any professional’s decision to dismiss certain risks without issuing a warning to their client must involve an element of policy decision when deciding which risks are sufficiently serious to warrant mention.

Ultimately Mr Barker’s case succeeded on the facts and the Court of Appeal’s differing interpretation of the tax legislation. It did not turn on the application of the Montgomery test and in that respect it is only of persuasive authority. It is doubtful we have seen the end of this debate.