Thai Trading v Margery Taylor & Wilfred David Taylor (CA 1998)

The defendants were husband and wife. Mrs Taylor was the litigant and her husband was also her solicitor. The trial judge found that there was an understanding between them that Mrs Taylor would not be liable to pay her solicitor for any profit costs except in the event of success in the litigation and an order for costs in her favour, when she would be liable for their normal profit costs.

In finding that there was neither champerty or maintenance in the arrangement, the Court of Appeal concluded that there is nothing unlawful in a solicitor acting for a party to litigation to agree to forgo all or part of his fee if he loses, provided that he does not seek to recover more than his ordinary profit costs and disbursements if he wins.

This decision may well enable claims consultants to offer more attractive deals to potential clients in the construction industry.

IM Properties plc v Cape and Dalgleish

(a firm); CA, The Times, 28 May 1998

The defendant accountants carried out an audit of the plaintiff’s accounts. The audit was done negligently, which enabled a fraud to be committed by the plaintiff’s former chief executive. On 18 June 1993, before the plaintiff commenced proceedings, the former chief executive transferred to the plaintiff £430,000 of shares in return for the plaintiff waiving all claims against him. The judge assessed the plaintiff’s recoverable loss resulting from the fraud at £704,568. After taking into account the value of the shares recovered the judge reduced the judgment sum to £274,568. However, he awarded interest on the whole of the recoverable loss up to 18 June 1993.

In claims for damages in the High Court, section 35A of the Supreme Court Act 1981, (inserted by section 15(I) and Part 1 of Schedule 1 to the Administration of Justice Act 1982), did not empower the court to award interest on sums recoverable by a plaintiff against a defendant which were paid prior to commencement of proceedings, and which, accordingly, formed no part of the judgment sum.

This is an important decision for claimants and arbitrators to be aware of, in view of the wide discretion, which is now given to arbitrators under the 1996 Act, to award interest.

QBD 1997, TLR 9 May 1997

Although an expert witness might have acted differently from the defendant practitioner, he should make it clear whether the defendant acted in accordance with a practice accepted as proper by a responsible body of practitioners skilled in the relevant field.

HL 1997, TLR 27 November 1997)

A court or arbitrator was not bound to hold that a defendant practitioner escaped liability for negligence simply because he led evidence from a number of experts who were genuinely of the opinion that his actions accorded with sound practice in that particular field. The court or arbitrator had to be satisfied that the expert opinion relied upon demonstrated that such an opinion had a logical basis.

Beaufort Developments (NI) Ltd v Gilbert-Ash (NI) Ltd & others (HL 1998)

The House of Lords has held that the court has the same power as an arbitrator who has been appointed to decided disputes under a JCT standard form building contract to open up, review and revise the decisions and certificates of the Architect. The decision of the Court of Appeal in NRHA v Derek Crouch Construction Co Ltd (26BLR1) was wrong and must be overruled. The decision of the Court of Appeal in Balfour Beatty v Docklands Light Railway (78BLR42) was also overruled.