LIABILITY OF McKENZIE FRIEND: EXCLUSIVE NOTE OF JUDGMENT:

There was considerable discussion yesterday about the decision of HHJ Eady (sitting as a High Court judge) in Wright -v-Troy Lucas. My colleague Colm Nugent has been kind enough to send me  a note of the judgment (where he appeared for the claimant),

COLM’S NOTE

“The underlying claim
  1. This was a quasi-professional negligence matter arising out of the defendants’ handling of the claimant’s clinical negligence action.
  2. Mr Wright had undergone operative treatment in 2004 by the Basildon & Thurrock Hospital NHS Trust (‘the Trust’). The resulting operative treatment left him with a massive cruciform scar across his entire abdomen and pieces of the ‘Bogota’ bag used in the surgery, still in his wound.  These were later removed but the resulting operation left the claimant with a destroyed abdominal wall and this in turn led to difficulties in movement, walking and working.
Engagement of the defendants
  1. The claimant approached the defendants at the very end of the primary limitation period in November 2008. The defendant operated as a one-person firm in Essex and styled themselves as ‘Troy Lucas – The Litigation Company’.  The impression the firm sought to convey (for example in their headed paper) was that whey were regulated by the SRA, had a number of consultant and partners (including solicitors) to assist them and that they were skilled in the conduct of clinical negligence claims.  All these assertions were determined to be false.  The principal also claimed to be a member of APIL.  The Judge found that the defendants sought to portray themselves as legal service professionals.
  2. Despite denials, the court found that the defendants persuaded the claimant to sign a contract in December 2008, which provided for them to be paid £150 ph, with a minimum payment of £10,000 and the hourly rate would rise for £225 ph if the damages exceeded £225,000.
  3. The contract was illegal in that it was for the provision of services that the defendants were not permitted to provide, it purported to be a CFA without giving notice to the Trust or it was a DBA at a time when DBA’s (outside of employment litigation) were not lawful.
  4. The defendants thereafter essentially adopted the role of a legal services professionals, and went on to draft the particulars of claim, the schedule of loss, letters to the court and to the NHS Trust’s lawyers. They later went on to engage in negotiations for settlement and instructed the medico-legal expert.
  5. As the Judge found, the defendants was entirely out of their depth and their conduct of the case was highly damaging. The schedules of loss (for £1.1m rising to almost £3m upon amendment) were unsupported by medical or documentary evidence, the responses to offers were either dismissive or responded by fantastical counter-offers, which were only ever likely to undermine the prospects of settlement.
  6. The Judge noted that the particulars of claim and the schedules were signed with statements of truth by the claimant, and were acknowledged to be untrue, especially in relation to the loss of earnings.
  7. Eventually, after a string of interlocutory applications which resulted in the claim being struck out bit-by-bit with adverse costs orders, the claimant dispensed with the defendant services in June 2011. But not before the claim had been irreparably damaged.  Eventually, the claimant was forced to accept an earlier Part 36 offer of £20,000 (essentially general damages only), but as a consequence meet all the Trusts costs from that point; assessed at approximately £74,000.
The claim
  1. The claim against the defendants was on the basis that they adopted the role of legal services providers who professed skill and experience in the conduct of litigation, including clinical negligence claims. Had they conducted the matter non-negligently, the claim would have been compromised at or before June 2011 at a much higher figure, with no adverse costs.
  2. The claimant called two experts Mr RM Charnley, a Consultant Surgeon in Gastroenterology and a care/OT expert who prepared reports on the basis of the information available as at the end of 2011 only (the likely trial date).  Mr Charnley agreed that the operative treatment carried out had been negligent, The Trust had previously made a limited liability concession in respect of the foreign material left in the wound.
  3. The Judge determined that in considering the nature and standard of duty of care owed, the defendants ought to be held to the standard that they themselves professed to offer – that of legal service professionals with expertise in the conduct of claims of this nature. That was so irrespective of whether they were permitted to offer the services they professed to have expertise in.
  4. The Judge determined that the schedules of loss were drafted without references to evidence and the claimant was given no proper advice as to the conduct of his claim, the settlement offers made or that ought to be made, or the proper value of his claim to enable him to make informed choices.
  5. In the absence of explicit authority on the point, the court considered and adopted the analogous decision in Freeman v Marshall & Co (1966) 200 EG 777 QBD, a matter in which an individual was held to the same standard of care as a surveyor, despite not being qualified, as he had purported to offer the same services and skills as a surveyor.
  6. The court held that the duties owed by the defendants were not consequential upon the expectation or demand for payment, in accordance with the decision in Chaudhary v Prabhakar (1988) 1 W.L.R. 29, CA.
  7. The Judge went on to assess the damages that would have been agreed at a JSM or mediation, had the matter been conducted competently, as follows:
Head of loss
Sum ‘awarded’
1
General damages
£  35,000
2
Past loss of Earnings
£100,800
3
Past Care
£ 37,474
3
Aids/equipment medication
£       75
4
Future loss of income
£  60,000
5
Future care
£  54,332
6
Other assistance
£  15,040
7
Aids and equipment
£  10,210
8
Future therapy & healthcare
£   5,342
9
Future mobility & transport
£   7,510
10
Adverse costs
£ 80,000
Total
£405,783
  1. The Judge then went on to consider the loss of chance, and the claimant’s signature upon the schedules in the clinical negligence claim which he accepted were false claims. The Judge rejected the submission from the defendants that the exaggeration meant that the claimant had lost nothing of value as the claims were susceptible to being struck out.  The Judge considered the most likely scenario in 2011 was that those parts of the claim which were exaggerated would have been discounted leaving the remainder of the claim intact, or it was a factor which would have played a part in any JSM or mediation.
  2. The Judge considered that the exaggeration was a factor she could take into account when considering the loss of chance discount, which she assessed at 35%, which was deducted from the sum above.
                                                                               CN  – 19/3/19″