WHEN DOES THE LIMITATION PERIOD START TO RUN WHEN A BARRISTER GIVES TWO ADVICES?

In Sciortino v Beaumont [2021] EWCA Civ 786 the Court of Appeal allowed a claimant’s appeal against a finding that a negligence action against a barrister was statute barred. Although this is a case about limitation and negligence it has to be said that this is yet another example (the second this week) where litigants have waited six years to issue negligence proceedings and then fallen foul of a limitation period. In the Sciortino case only a small part of the claim was not statute barred.

THE CASE

The claimant instructed the defendant barrister to advise on an issue in relation to bankruptcy issues.  The defendant gave advice in conference on the 20th April 2011. An appeal was launched on the basis of the advice given.  Further advice was given on the 26th October 2011 and, as a result, the legal aid certificate was extended and the appeal continued.  That appeal was unsuccessful.

THE NEGLIGENCE CLAIM AGAINST THE BARRISTER

(It has to be stressed that these are allegations of negligence, no negligence has been established).  The claim form alleging negligence was issued on the 25th October 2017.  The defendant barrister pleaded that the action was statute barred. In a Reply the claimant admitted that the action based on the advice in April and May 2011 were statute barred. The claimant argued that the claim based on the advice on the 26th October was not statute barred.

THE APPLICATIONS TO STRIKE OUT THE CLAIM

The defendant was successful before the Master and High Court judge in arguing that the action should be struck out.  It was held that the action was based on the advices given earlier in 2011 and the entire claim statute barred.

THE CLAIMANT’S SUCCESSFUL APPEAL TO THE COURT OF APPEAL

The Court of Appeal allowed the claimant’s appeal against the decision on limitation.  It was held, essentially, that the advice on 26th October was “divisible”, the appeal continued as a result of that advice and further costs incurred.   For that reason the action based on the allegation could continue.

THE JUDGMENT ON THIS ISSUE

The primary judgment was from Lord Justice Coulson.

5. Issue 1: Analysis and Conclusions
5.1 The Nature of the Appellants’ Claim
    1. For the reasons set out below, I consider that both the Master and the Judge were wrong to conclude that the claim in negligence arising out of the advice of 26 October 2011 was statute-barred.
    1. Both were plainly distracted by the way in which the case has been pleaded in paragraph 68 of the Particulars of Claim. There, the allegations of professional negligence expressly referred both to the advice of April/May, and the advice of October, without differentiating between them. That can be clearly seen at [46] of the Master’s judgment. It is therefore perhaps unsurprising that both the Master and Judge took the elision of the two advices as their starting point.
    1. However, as I have said, the concession in the Reply, that any claims arising out of the April/May advice are statute-barred, means that paragraph 68 must be read as alleging negligence based on the October advice alone. It must also be accepted that, in consequence, any claim for the costs of issuing the original appeal against the District Judge’s orders for possession and sale, and other costs liabilities incurred during the period prior to 26 October, cannot be recovered by the Appellant from the Respondent. But what about the Appellant’s costs and costs liabilities thereafter, and in particular the costs of the hearing on 15 November 2011? That is the damage for which, on the Appellant’s pleaded case as it now stands, he seeks to make the Respondent liable.
    1. In my view, if the October advice had been the only advice provided by the Respondent in this case then, on the face of it, a claim in negligence based on that advice, limited of course to the costs incurred in reliance upon it from 26 October onwards, would not be statute-barred. All the necessary ingredients would be in place: a relevant duty; a breach of that duty; a foreseeable category of loss and damage for which the barrister would be liable; and importantly, the necessary causation between the breach and the loss. On the Appellant’s case, the written advice caused the legal aid cap to be lifted to £12,500. If the advice had been different, it is said, the cap would not have been lifted, there would have been no appeal hearing, and the Appellant would not have incurred the costs of the appeal hearing or any further costs attributable to the continuation of the appeal.
    1. The question then becomes whether the existence of the earlier advice in April/May (and in particular the fact that, on the basis of that earlier advice, an appeal against the orders for possession and sale was already up and running by October 2011), renders a claim based solely on the October advice statute-barred? If I was unconstrained by authority, I would answer that question in the negative, both as a matter of general principle and on the particular facts of this case.
5.2 General Principle
    1. The general principle must be that a claim based on negligent advice, given to and relied on by a claimant during the relevant limitation period, gives rise to a valid claim. That can be tested in this way. Assume that a barrister gives negligent advice on the merits at the outset of the litigation. Instead of advising that the underlying claim will fail, he advises that it has a good prospect of success. In consequence, costs of £200,000 are incurred up to the pre-trial review. Immediately before the pre-trial review the barrister is asked to advise on the merits again. Obviously, there is considerably more material available at that stage. It gives the barrister the opportunity to say, “No, I was wrong, this claim will fail”. But he does not take that opportunity, and instead advises that there is a strong chance of success. In consequence, another £100,000 is incurred by the client, and the claim fails.
    1. Those additional costs of £100,000 are attributable to the negligent advice given on the eve of the pre-trial review. If there is a limitation issue in respect of the original advice, but no limitation issue in respect of the advice given before the pre-trial review, I can see no reason in principle why the barrister would not be liable in damages for the £100,000.
    1. In short, in a case where there are two (or more) allegedly negligent advices, and therefore two separate breaches of duty, there is no general principle of logic or common sense which requires any sort of ‘relation back’, such as to say that the limitation period was triggered by the first occasion on which the negligent advice was given, regardless of any subsequent breaches of duty.
    1. I accept, however, that this general principle may be subject to the facts of the individual case. If, for example, the claimant was irretrievably committed to a course of action as a result of the first negligent advice, then it may be that the second negligent advice will not have caused any further loss. A consideration of the facts of this case, however, brings me to the second reason why I consider that, in this case, the claim in respect of the 26 October advice is not statute-barred.
5.3 The Factual Background to and the Nature of the Two Advices
    1. In the conference in April 2011, as summarised very shortly in the email of 4 May 2011, the Respondent said that there were good prospects of success on the appeal. That was of course sufficient to allow the appeal process to be launched. But he said expressly that his strategy was to endeavour to obtain permission to appeal on the basis of the dismissal argument, and then look to negotiate a settlement. It was therefore advice given with a very limited and specific aim in mind.
    1. In any event, the advice could not but be limited because the Respondent did not have all of the relevant information. One of the areas of debate at the conference was the nature of the communications with the court in July 2010 to which the Appellant had never been a party. Moreover, because they did not exist when the Respondent first advised in April, he did not have (and so could not take account of) the detailed observations by Vos J in July 2011, or the Respondent’s Notice, or the three witness statements served in September, or the trustee’s skeleton argument provided in October.
    1. In contrast to the limited information available and the limited strategy that had been devised in April/May, by October 2011, when he was asked to advise in writing on the merits for the specific purpose of obtaining an extension of legal aid to enable the appeal to proceed, the Respondent was in possession of all the relevant material. By then, his original strategy had been thwarted, because permission to appeal had not been granted in advance of the appeal hearing itself. It was therefore an appropriate time, with all the information available, and the possible need for a new strategy, for the Law Centre to ask the Respondent to advise on the merits. There was also the need to extend the legal aid certificate.
    1. Of course, it was open to the Respondent on 26 October to advise that, because permission was now being dealt with at a rolled-up hearing, and in the light of all of the new information which had become available, the appeal had less chance of success than he had previously thought, and even to advise that the appeal should be abandoned. The Appellant was not bound to fight the appeal to the bitter end simply because the process had been started. He was not irrevocably committed to the costs of a hearing if that hearing was going to result in defeat. Here, the Respondent did not give such negative advice, and so the appeal went on to the hearing.
    1. It seems to me that any alleged negligence in October 2011 was different in nature and extent to any prior negligence in April/May. The Respondent was being asked to give different and more comprehensive advice, in very different circumstances. Although there was an overlap – the merits of the dismissal argument obviously remained a crucial element of both advices – there were also significant differences in the nature and scope of the advices provided and the material available for consideration on each occasion.
    1. Mr Davidson sought to persuade us that the advice of 26 October was merely confirming the earlier advice that had been given by the Respondent outside the limitation period. This was to allow him to argue that, where a second advice is merely confirmatory of a first advice, the relevant cause of action accrues at the earlier date. I do not accept either premise.
    1. First, for the reasons that I have given, I do not accept that, as a matter of fact, the advice of 26 October was merely confirmatory of the advice of April/May, or even the brief advice in the email of 19 October (paragraph 23 above). It was a separate and full advice on the merits that took into account a raft of material that had not previously been considered by the Respondent. On a fair reading of the advice itself, I would venture to suggest that that was how the Respondent saw it too. But secondly, I do not accept that there is any rule of law that requires the court to ignore for limitation purposes a second negligent advice (where that breach of duty gave rise to specific loss), and to find that, because the ultimate issue on which both advices were sought was the same or similar – should there be an appeal and will it succeed? – there was only one cause of action and it accrued at the date of the first negligent advice.
    1. I should mention here that, in connection with the Appellant’s argument that, if the advice of 26 October had been different, the legal aid certificate would not have been extended and there would have been no appeal hearing on 15 November 2011, Mr Davidson referred us to some parts of the Legal Services Commission Manual. This was, I think, to demonstrate that, because the case was concerned with Housing, and was of overwhelming importance to the Appellant, it did not necessarily follow on the facts that a less optimistic advice shortly before the hearing would have meant that there would have been no appeal hearing. That may well be part of the argument to be deployed at trial, but it cannot be resolved summarily, and the pleaded causative link between the advice, the certificate and the hearing on 15 November 2011 must be assumed in the Appellant’s favour for present purposes.
    1. For these reasons, on the facts as they are or as we must assume them to be, I consider that a claim limited to the losses caused by the alleged negligent advice on 26 October was not statute-barred.
5.4 The Authorities
    1. The remaining question, therefore, is whether the authorities constrain me to reach a different conclusion. In my view, on a proper analysis of the authorities, they do not: on the contrary, I consider that the analysis set out above is supported by them.
    1. The authorities are primarily concerned with the situation where the original breach gave rise to real damage outside the limitation period, and then that same breach (what Sir Murray Stuart-Smith called “the same wrongful acts” in Khan) gave rise to further damage within the limitation period. The occurrence of that further loss did not prevent the claim from being statute-barred: see BellKnapp and Khan. Although I do not consider the label very helpful, I agree with Mr Hill-Smith that they are all cases of non-feasance, in the sense that nothing further was done after the original error.
    1. Those authorities are not concerned with the situation where there are two separate breaches, or two separate causes of action, one outside and one inside the limitation period. Chadwick LJ’s reference to the possibility of a later “supervening” event (which I do not consider should be elevated into any form of test or rule in any event) is intended to highlight the different considerations that may apply where, for example, there are two separate breaches of duty. In my view, a second breach, giving rise to a separate cause of action, would, a fortiori comprise a “supervening event”.
    1. As I have said, it is to avoid this difficulty that claimants have often sought to argue that the lawyers owed a continuing duty of care to review their earlier advice, in order to found their claim on a later breach of that continuing duty which was within the limitation period. That might be called an attempt to turn a non-feasance case into a misfeasance case. That has consistently failed, at least as a general proposition: see BellKhan and Maharaj, as well as the other cases referred to at paragraph 48 above.
    1. In contrast, the present case is not concerned with non-feasance, and has no need of the potential artifice of an alleged continuing duty to review previous advice. Instead, this is a case about misfeasance in which there were two separate alleged errors: the negligent advice in April/May 2011, which led to the launching of the appeal, and the negligent advice in October 2011, which led to legal aid being extended to fight the appeal through to a conclusion. The claim in respect of the first advice is statute-barred, and so there will be elements of the costs of the appeal against the possession and sale orders which the Appellant incurred and which he will not be able to recover from the Respondent. But there is no reason in law to conclude that the claim in respect of the second advice is statute-barred: it simply gives rise to a separate, albeit smaller, claim.
    1. There is no authority to support the proposition that, if there were two advices, the cause of action accrued at the time of the first and the second was irrelevant: see paragraphs 62 and 70 above.
    1. On the contrary, because there were two separate breaches here, the situation is akin to that in St. Anselm. Although there was an attempt to distinguish St. Anselm on the basis that there were two separate sets of instructions in relation to the two separate flats, that is not a point of distinction at all. Here, there were also two separate sets of instructions: the original instructions to advise in conference in April; and the later instructions in September and repeated in October for a written advice on the merits of the forthcoming appeal hearing.
    1. On analysis, the Appellant’s position is even stronger than that of the successful appellant in St. Anselm. There it was found that the claim in respect of the lease of flat 26 was not statute-barred, even though the negligent error in respect of the lease of flat 26 was precisely the same error as had led to the negligent advice in respect of the lease of flat 27. Here, on the other hand, for the reasons set out above, the factual position in October 2011 was very different to that in April/May, so that the advice and therefore the negligence – if that is what it was – was also very different.
5.5 Conclusions
    1. For these reasons, I consider that the Master applied the wrong test at [51] of his judgment (see paragraph 33 above). This was not a case where Chadwick LJ’s comment about “a new or supervening act or omission” was relevant. That approach may be applicable in cases of a single breach which caused damage outside and then later inside the limitation period, not cases where there were two separate breaches of duty, the second of which was within the limitation period, and gave rise to a distinct head of loss which would not have been suffered if the second breach had not occurred.
    1. Further and in any event, for the reasons that I have given, I consider that, even if that was a proper approach in a case like this, the circumstances in October 2011 which prompted the second advice were new and different, and that advice caused definable, separate damage. It was therefore a separate cause of action which, on any view, comprised a supervening event.
    1. For completeness, I should say that, in my view, the Judge was wrong at [35] and [36] of his judgment (paragraph 34 above) to focus on the fact that there was just one appeal and that, once the appeal had been launched, the Appellant’s position was somehow irremediable. It was open to the Respondent in his written advice of 26 October 2011 to point out that, through no fault of his own, his preferred strategy had not worked and that the new information meant that the appeal was likely to be lost. On the assumptions that must be made for the purposes of this appeal, such advice would have caused the legal aid certificate not to be extended, and there would have been no appeal hearing. The Judge failed to recognise that a claim for the costs consequences from 26 October onwards was a claim that was referrable to the negligent advice of 26 October 2011, regardless of what may have happened before.
    1. I therefore conclude that the claim in respect of the advice of 26 October 2011 was not statute-barred. Subject to Issue 2, I would set aside the relevant part of the orders of the Judge and the Master.