PROVING THINGS 147: CLAIM FOR NOT PURSUING NEGLIGENT SOLICITORS LEADS TO NOMINAL DAMAGES ONLY: NO DAMAGES FOR “LOSS OF CHANCE”
The judgment in Waraich & Anor v Ansari Solicitors (A firm)  EWHC 1038 (Comm) HHJ Pearce also contains yet another example of claimants failing to prove any loss at trial. There was no evidence to support any claim for damages, even based on “loss of chance”.
“the Claimants have failed to show that they have lost anything of value in their claim against Khan’s. Only one small aspect of the claim can be said to have had a real and substantial prospect of success. The value of that claim is so small and the costs involved in the likely manner of pursuing it as to mean that they cannot be said to have lost anything of value.”
The claimants brought an action against the defendant solicitors on the grounds that they had failed to bring an action against negligent solicitors within the limitation period. The original solicitors “Khan’s” were found to be negligent in their giving of advice in relation to an application in relation the claimants’ immigration status. The major issue was whether the claimants could establish that the failure to pursue this solicitor had led to any loss.
THE JUDGMENT ON THE CLAIM FOR DAMAGES
The judge considered the value of the claimants’ loss of chance. This involved a consideration of what would have happened if Khan’s hand not been negligent.
a. Again it follows from the analysis above that the advice given was negligent. This was a misconceived application.
a. This is a matter to be decided on the balance of probabilities, given that it relates to steps that the Claimants themselves would have taken. I have no hesitation in concluding that the Claimants would have given instructions to make whatever applications were necessary to secure their remaining in the United Kingdom. that is what they have done at every opportunity. That would almost certainly have been an application for a further work permit for the First Claimant and applications for further leave to remain for both Claimants.
a. But for Khan’s breach of duty as identified above, I have no doubt that the Claimants would have been advised to ask New Mughli to apply for a work permit and themselves to apply for leave to remain.
b. However the determination of such applications would have been complex, given what actually happened in the First Claimant’s applications for work permits after the refusal of his application in August 2006.
i. The first application was made by Khan’s on 7 November 2006 and was on form WP1X for an extension of an existing work permit (2/348). It would appear that that application was refused on the basis that the employer the New Mughli differed from that on which the first work permit was issued (namely The Mughli) – this can be discerned from Khan’s letter of 16.11.06 at 2/356.
ii. A further application for a work permit on WP1 (based on the new name of the employer) was made on 16 November 2006 (see 2/361). It would appear that this was refused because the new job was not advertised in accordance with the then requirements for a work permit application – see 2/374. Notwithstanding protestations on behalf of Mr Waraich, that decision was not reviewed.
iii. On 1 March 2007, a work permit extension application was made relating to Mr Waraich by Amjad Malik’s Solicitors (2/384), albeit that Mr Waraich says that he was not working at this time – I have dealt with that matter above. No evidence of refusal of that application appears in the documents. One might infer, particularly from the letter at 2/407, that the application was refused on the same ground as the work permit application made by Khan’s.
iv. On 6 March 2007, a work permit application was made by Amjad Malik’s (see 2/404). Presumably that was refused, though again there is no letter of refusal in the documents before the court.
v. On 29 May 2007, an application for a work permit was made by the Defendant – see 2/414. It appears from the letter at 2/446 that a work permit was granted in July 2007 and this may well have been as a result of this application.
c. In addition to the work permit applications, the First Claimant made applications for leave to remain.
i. In November 2007, an application was made by the Defendants on his behalf – 2/437. This was refused as set out at2/446. The grounds are not clearly stated, but appear to include not only that there was a period when the Claimants had been in the United Kingdom without valid leave to remain but also that fact that Mr Waraich had continued to work for the New Mughli Takeaway notwithstanding his lack of work permit.
ii. On 5 September 2008, the Defendant wrote a further letter, seemingly in support of the application of November 2007 (see 2/449). It would seem that that application was granted in January 2009 (see 2/454, 2/455 and 2/465).
iii. On 23 September 2009, the First Claimant made an application for indefinite leave to remain (4/460). That was refused due to the lack of 5 years’ continuous presence as a work permit holder (see 2/467).
iv. Notwithstanding a request for reconsideration, that decision was maintained in a decision letter dated 21 July 2010 (2/473).
v. A further application for indefinite leave to remain was made on 1 December 2010 (2/493). That application was refused on 6 July 2011 on grounds that the First Claimant had a conviction on 30 April 2008, namely that for sale of alcohol to a person under the age of 18, that was not spent. However a grant of limited leave to remain was made, expiring in July 2014.
vi. An application for limited leave to remain was made by Thornhills Solicitors on behalf of the Claimants on 2 July 2014 (3/771). That was granted on 3 October 2014 for a three year period (3/779).
vii. In 2017 an application for indefinite leave to remain was made by the Claimants. That was granted in around February 2018 (see 4/1194).
d. This complex immigration history shows the difficulties that the Claimants would have had in obtaining even if they had sought limited leave to remain earlier than 2009. There were two distinct problems standing in the way of the Claimants getting leave to remain at an earlier date:
i. The time spent in the country following expiry of leave to remain;
ii. The fact that the First Claimant was working in this period.
e. In order to avoid the first of these problems, the First Claimant would have needed to make an application for a work permit before leave to remain expired on 13 August 2006. But given my finding that he first instructed Khan’s in late July 2006, there was very limited time to achieve this end.
f. The Claimants have never clearly pleaded a route by which the First Claimant may have achieved further leave to remain at an earlier time. In closing submissions, Mr Mahmood on their behalf contended that an application could have been made for an extension to the First Claimant’s work permit coupled with a further leave to remain application. Mr Mahmood contended that there was time for this to be achieved without the Claimants becoming overstayers. He contended that the Home Office had been notified of the change of employer in 2003 by the letter at 2/315 so the application should have been granted.
g. On the other hand, Mr Bailey for the Defendant contended that this time scale was completely unrealistic:
i. It should be recorded first that the Defendant at various points in this case has complained about the lack of clarification of the Claimants’ case as to how they could have obtained leave to remain at an earlier date. In the event, as indicated above, the Claimants attempted for the first time in closing submissions to plug this gap in their case. The Defendant objected to this manner of advancing the case against them and said that the very fact that a positive case had not been advanced sooner underlined the weakness of the argument.
ii. An application for an extension of a work permit would have required Mr Chaudhury, as the First Claimant’s employer, to cooperate in the application. There is no evidence that he would have done so. In any event, time would have been spent in seeking his cooperation such that any such application may not have been made before the existing leave to remain expired.
iii. An application for a work permit extension would have been refused, just as the application on 7 November 2006 was refused, on the basis that original permission had been granted to work at the Mughli Takeaway but Mr Waraich was not working at the New Mughli Takeaway.
iv. It would have been to no avail that there was a letter dated 2003 at 2/315 referring to the change of name. The Home Office were not persuaded that the work permit extension was appropriate when the application of 7 November 2006 was made and there is no reason to think that things would have been any different with an earlier application.
v. If the First Claimant’s employer had made a work permit application (either instead of a work permit extension application or following a failed application for extension), that would have required advertisement of the job under the relevant immigration rule absent which the application would have been refused just as the 16 November 2006 application was refused.
vi. The suggestion that the work permit issue could have been resolved before expiry of the First Claimant’s leave to remain is fanciful. The process of advertising the job would have taken 28 days and this could not have been achieved before expiry of the existing leave to remain. Thus he would have been an overstayer in any event.
vii. Had the First Claimant been an overstayer, it is highly likely that he would have continued to work. Thus, he would have been faced with exactly the same problems as is identified at (d) above.
viii. The Defendant concludes that the Claimants’ prospects of obtaining earlier leave to remain are so speculative as to be incapable of assessment as a loss of a chance.
h. There is considerable force in the Defendant’s analysis of the Claimants’ case in this regard. The case as advanced by the Claimants simply fails to show any clear route to the earlier grant of leave to remain. It is always possible that an earlier application may have led to a better outcome. But the court has no material on which to begin to assess the chance of this. For example, it was postulated at various points in the trial that there was a 28 day period of grace following the expiry of a work permit, during which the permit holder would not be treated as an overstayer. But there is no evidence of such a rule being in force at the time of this application, therefore no basis for concluding that an application within that 28 day period would have been dealt with differently.
i. In my judgment, the chance that, but for the breach of duty, the Claimants would have been granted further leave to remain earlier than 9 January 2009 is a classic example of the kind of speculative chance that Stuart-Smith LJ in Allied Maples Group v Simmons & Simmons  1 WLR 1602 and Simon Brown LJ in Mount v Baker Austin  PNLR 493.
a. Of the Claimants’ losses summarised at paragraph 2 above, all but that referred to at sub-paragraph 2.e appear to be said to flow from the failure to obtain leave to remain earlier.
b. Of the legal costs claimed, the costs relating to the application made by Khan’s can be distinguished from the others.
c. As to the costs of the Khan’s application, including Home Office fees of £1,250, it appears to me that these were incurred as a result of Khan’s putative breach of duty in that, but for that breach, the application for indefinite leave to remain would not have been made. To that extent, the First Claimant has suffered loss as a result of the breach of duty. Since Khan’s went on to make work permit applications on the Claimants’ behalf that would not have been avoided, in the counter factual scenario I suppose, the claim must be limited to only that part of Khan’s fees relating to the original application. As the Defendant points out there is no bill breaking down the sum claimed. Doing the best I can, I would apportion one half of the total solicitors’ costs to the inappropriate application. With the addition of the Home Office fees, the claim comes to £2,750.
d. As to the other legal costs, for reasons referred to in paragraph 92 above, I can see no basis for concluding that, but for any breach of duty by Khan’s, they would have been avoided. The Claimants fail to show any real and substantial prospect of pursuing a route to obtaining leave to remain that would not have incurred such costs, since the evidence indicates that this would have been a difficult immigration application in any event.
e. As identified above, the Claimants fail to show that the Second Claimant’s bankruptcy flows from the breach of duty alleged against Khan’s. In any event, it is difficult to see how the claim could be quantified as general damages. In principle it is possible to see how an avoidable bankruptcy might be causative of loss, but that would be by way of special damages. The Claimants’ case does not particularise a case that could lead to such an award.
f. The claim for damages for “Stress, and/or distress and/or inconvenience” is a general damages claim. It presupposes that this is a contract pursuant to the breach of which such damages are recoverable. The Court of Appeal in Channon v Lindley Johnstone  EWCA Civ 353, applying Johnson v Gore Wood  2 WLR 72, held that a solicitors’ retainer is not normally a contract for the provision of a “pleasurable amenity” for the breach of which general damages are recoverable. Only if the Claimant demonstrated “some particular feature of the Defendant’s retainer which amounted to a contract to protect the Claimant from mental distress or disappointment or actually to procure for him a particular beneficial result.” No such particular features are shown here and this head of loss cannot be substantiated.
a. The Claimants could have sought indefinite leave to remain after 5 years’ presence during which the First Claimant had continuously worked under a work permit. The difficulties in achieving that are identified above.
b. The factors that prevent the Claimants from showing a real and substantial chance of obtaining an earlier grant of further leave to remain apply with equal force to the application for indefinite leave to remain.
c. It is equally impossible to put a time on this end being achieved.
a. I have dealt at paragraph 93 above with losses said to flow from the delay in the application for further leave to remain. All of the criticisms and findings made above apply with equal force to the claim for damages flowing from the failure to obtain indefinite leave to remain earlier. Apart from the original costs of Khan’s, none of these are proven losses (even on the basis of a loss of a chance) in this action.
a. The Claimants’ application for British Nationality was even more problematic than the application for leave to remain. The only plausible route by which it is suggested that it may have been achieved was through an application following a period of one year indefinite leave to remain. But the First Claimant’s convictions and his and his wife’s bankruptcies would have been substantial factors against such an application succeeding.
b. An application for British Nationality must show that they are of good character, The Guidance Notes indicate that a person who has a conviction that is not “spent” under the Rehabilitation of Offences Act 1974 is unlikely to be considered to be of good character. The relevant rehabilitation period for the offences committed by the First Claimant and noted above is in each case 5 years. Thus, since 2008, there has never been a point at which the First Claimant has been of good character within this definition. The Claimants have never addressed this bar to their claim for losses associated with British Nationality.
c. It is also arguable that losses flowing from the failure to gain the status of British Citizenship fell outside of the scope of Khan’s retainer (see the decision of the Supreme Court in Hughes-Holland v BPE Solicitors  UKSC 21). Given that this is a hopeless case on the facts, it is not necessary to consider this point further.
a. The Claimants claim a head of general damages relating to the failure to obtain British Nationality. It is entirely unclear what this is meant to encompass and written and oral submissions at trial have not elucidated this matter.
b. The Claimants separately contend that the cost of British Nationality will now be costlier than it otherwise would have been. In principle, such a loss might be capable of recovery were the Claimants to be able to show that they have lost the chance of gaining that status. Sadly for them they cannot.
a. It follows from my conclusion above that:
i. A claim for wasted expenditure on the application made by Khan’s had very good prospects of success.
ii. No other aspect of the claim against those solicitors had a sufficient chance of success to be quantifiable as a loss of a chance.
a. The claim against Khan’s would have been issued by August 2012. A notional trial date of August 2015 is realistic.
a. The Claimants would doubtless have pursued the proposed claim against Khan’s with the same determination as they have pursued this claim against Ansari’s. They are convinced that their lives during the last 12 years have been blighted by the failure of Khan’s to advise on bringing the right application.
b. The claim against Khan’s would have had a settlement value. However, if it had been pursued as one small part of a large claim for damages (as it has been in this case) there would have been little prospect of settlement without a degree of insight on the part of the Claimants as to the weakness of their case and the lack of evidence in support. They would have had to forego nearly all of their claim. Even if the claim had settled without going to trial (which I consider unlikely, given the manner in which this case has been conducted), it is highly unlikely that the damages that they would have recovered (£2,750, as set out above) together with interest would have exceeded their irrecoverable costs. If, as I consider to be more likely, the Claimants would have pursued an unrealistic claim to trial (just as they have here), the overwhelming likelihood is that their damages award would have been swallowed by their own irrecoverable costs or conceivably an adverse costs order.
c. Given the sums at stake, I am driven to the conclusion that the Claimants cannot be said to have lost anything of value in this claim. What they have lost is the chance to pursue a claim of very modest value, the cost of doing which would have far exceeded that value.
For the reasons set out above, the Claimants have failed to show that they have lost anything of value in their claim against Khan’s. Only one small aspect of the claim can be said to have had a real and substantial prospect of success. The value of that claim is so small and the costs involved in the likely manner of pursuing it as to mean that they cannot be said to have lost anything of value.