Wellesley Partners LLP v Withers LLP

Wellesley Partners LLP v Withers LLP

In cases of concurrent liability in contract and tort for professional negligence, the contractual test for remoteness of damage applies. On the facts, the loss of the opportunity to earn profits from US expansion was not too remote and was recoverable. The assessment of damages for loss of a chance was correctly conducted by the trial judge, reflecting the real and substantial chance of obtaining the Nomura mandates. Withers LLP was also negligent in failing to correct the misimpression regarding the origin of the critical clause on 3 February 2009, which contributed to the breakdown in relations and additional loss.

Parties
Claimant: Wellesley Partners LLP; Defendant: Withers LLP
Jurisdiction
England and Wales
Judgment Date
11 November 2015
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Cross Appeals From High Court
Outcome
Appeal allowed in part; cross-appeals otherwise dismissed.
Legal Topics
Remoteness of Damage, Concurrent Liability, Loss of a Chance, Solicitor's Duty of Care, Assessment of Damages
Professional Negligence Contract Law Tort Law Remoteness of Damage Concurrent Liability Loss of a Chance Solicitor's Duty of Care Assessment of Damages

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Parties

Wellesley Partners LLP

Claimant

Withers LLP

Defendant

Procedural Posture

Civil Appeal / Court of Appeal Judgment on Cross Appeals From High Court

Legal Issues

  1. 1 What is the appropriate rule for remoteness of damage where a claimant has concurrent causes of action for pecuniary loss in tort and in contract?
  2. 2 How should the 'loss of a chance' principle be applied to the assessment of damages in professional negligence?
  3. 3 Was Withers LLP negligent in its advice and conduct on 3 February 2009?

Ratio Decidendi

In cases of concurrent liability in contract and tort for professional negligence, the contractual test for remoteness of damage applies. On the facts, the loss of the opportunity to earn profits from US expansion was not too remote and was recoverable. The assessment of damages for loss of a chance was correctly conducted by the trial judge, reflecting the real and substantial chance of obtaining the Nomura mandates. Withers LLP was also negligent in failing to correct the misimpression regarding the origin of the critical clause on 3 February 2009, which contributed to the breakdown in relations and additional loss.

Court Disposition

Appeal allowed in part; cross-appeals otherwise dismissed.

Orders

  • The appeal is allowed on the issue of negligence on 3 February 2009 and the assessment of damages for the diversion of Mr Channing’s time.
  • The award for the diversion of Mr Channing’s time is increased from the equivalent of one month (£125,000) to four months (£500,000).