Claims for lost opportunity - 'after coming' evidence isn't always a knock out blow

20 Nov 2019

Edwards v Hugh James Ford Simey Solicitors [2019] UKSC 54

Claims against professionals for lost opportunity have recently been under the spotlight in the Supreme Court. Not long ago we had the judgment in our case of Perry v Raleys [2019] (see our newsflash here) which focussed on the correct legal approach to causation.

Some nine months on from Perry and the Supreme Court has again wrestled with the challenges of lost opportunity claims in Edwards v Hugh James Ford Simey Solicitors as to what evidence should be considered when assessing the value of the lost opportunity: the evidence available at the notional trial date of the underlying claim or ’after coming’ evidence?

Coincidentally both cases had as their backdrop claims by former miners for Vibration White Finger (VWF), but their application moving forward will impact claims for lost opportunity across a far wider spectrum both on the principles to be applied and the evidence to be considered.

The facts

Mr Watkins, a former miner, suffered from VWF caused by excessive occupational exposure to vibratory tools. He instructed Hugh James to pursue a claim via a government scheme set up to handle volume claims made by miners for VWF and which was administered via a Claims Handling Arrangement (“the CHA”). It aimed to manage those claims effectively and at proportionate cost.

A medical examination (MAP1) confirmed if the claimant suffered from VWF and graded the severity of the condition. In February 2003 Mr Watkins accepted an offer of £9,478 for general damages in line with the scheme. No claim was pursued for services (gardening, decorating, DIY, car maintenance, car washing and window washing). To claim for services, a claimant had to prove that prior to suffering from VWF he performed those tasks without assistance; but that due to VWF disability he could no longer do so. 

Many years later Mr Watkins pursued a claim against Hugh James alleging they had failed to give him appropriate advice as to his claim for services and as a result he had lost the opportunity to claim a services award. He said his VWF meant that he couldn’t now carry out any of those tasks without assistance.

A vascular surgeon, Mr Tennant, was jointly instructed to consider the extent of any VWF disability and if he suffered from other ‘comorbid conditions’, which would impact on his ability to perform services tasks. Importantly, the agreed letter of instruction left it open to the expert to provide his opinion upon whether or not VWF was diagnosed at all. He reported in mid-2013 – 10 years post settlement of the original VWF claim and assessed the severity of Mr Watkins’ VWF as being lower than the original MAP1 report. Such a reduced grading would not have met the threshold entitlement to pursue a services claim under the CHA.

The journey to the Supreme Court

The claimant died in 2014 and his daughter continued the claim on behalf of his estate. At trial, Hugh James were considered to be in breach of duty regarding their advice and the Judge found that properly advised, the claimant would have pursued a services claim on an honest basis. That left focus on how to approach the assessment of loss and in particular the valuation of the lost chance to pursue services.  

It was found that on the full facts, including crucially the evidence of Mr Tennant, that Mr Watkins’ VWF grading was less severe than had been found on the original MAP1 examination. Not only did he not have a claim for services, but he had been overcompensated for general damages. His cause of action was of no value and the claim was dismissed.  

On appeal as to the assessment of loss, the estate argued the court had been wrong to take into account evidence which was not and could not have been available at the time of a notional trial – namely Mr Tennant’s report; that was not available in 2003 when the VWF claim was settled nor in 2005 when it as argued that the putative services claim would have settled under the CHA. The Court of Appeal largely agreed, commenting…"what the claimant should recover in the professional negligence claim is not established by answering the question: how much of the original claim can he prove now? Rather it is established by answering the question: what was the value of what he lost then?  

Some limits to that approach were accepted – it wouldn’t apply where there is fraud or an unexpected development which has a significant impact on what would have been recovered in the underlying claim. But these are exceptions – it’s a threshold test - …"a requirement for a significant or serious scale to the consequences of the supervening event, before it should be permitted to establish an exception to the normal rule." The Court of Appeal gave no further guidance on this ‘threshold test’ and with no such exception being identified here, the appeal was successful. Hugh James appealed to the Supreme Court.

The Supreme Court decision

The appeal was narrow in its scope – whether or not the Bwllfa principle applied and the interplay with Mr Watkin’s entitlement to the assessment of loss/damages under the standard compensatory principle of restoring a claimant to the position he would have been in had the negligence not occurred. 

It’s a reference to Bwllfa & Merthyr Dare Steam Collieries (1891) Ltd v The Pontypridd Waterworks Co [1903] AC 426 whereby a claim for statutory compensation (indexed to the changing price of coal) was assessed, not at the date of a statutory notice but at the date of the later arbitration. The rationale was a just conclusion requiring the arbitrator to consider all the evidence then available.  

In its judgment the SC focussed on the previous findings that Hugh James were in breach of duty as to the advice that they gave, and properly advised Mr Watkins would have made an honest services claim – on that basis the only remaining issue was the assessment of loss. In determining that, the SC concluded the expert medical evidence was simply not relevant (although it may have been relevant as to causation). What Mr Watkins had lost was the value of his claim …under the Scheme as it would have been administered in accordance its terms. 

Adopting the rigid process under the Scheme there would have been no equivalent report as that obtained during the course of the professional negligence claim. As the Judge says, Hugh James was seeking "… to add to the counterfactual situation the effect of a further medical examination which would never have been commissioned." There was no justification for that and it was wrong to do so. So far from the after coming medical evidence in the form of Mr Tennant’s report being a "knockout blow" – it was to be disregarded. 

On that basis the Bwllfa principle was simply not relevant – we are not considering here, in the SC’s view, an unknown fact – there was medical evidence obtained under the CHA which had already determined Mr Watkins' diagnosis, grading and eligibility to make a services claim.  The fact that the honesty of the putative services claim was accepted at first instance meant that the approach to assessing causation pursuant to Perry v Raleys, which might have rendered Mr Tennant’s report admissible, was simply not engaged.

What this means for you

The SC appears to have had no appetite to offer analysis or refinement regarding the ‘threshold test’ advocated by the Court of Appeal, instead preferring to characterise the issue as relating purely to the applicability or otherwise of the Bwllfa principle. The reality is the test presently remains as little more than a theoretical concept with the SC choosing not to provide examples of its practical application. As such the seriousness or otherwise of the supervening event which might satisfy the test and so allow after coming evidence to be considered when assessing loss, remains fact sensitive to be grappled with on a case by case basis. 

That the underlying VWF claim proceeded under a statutory compensation scheme, rather than standard common law civil litigation, significantly influenced the SC decision not to allow the after coming medical evidence to form part of the evidential scene in assessing loss. With the Government committed to driving forward reforms in low value personal injury claims to enable large numbers of similar claims to be presented, examined and resolved expeditiously, the future claims handling landscape could look rather more like a statutory compensation scheme than standard common law civil litigation, at which point the SC’s exclusion on after coming evidence may have more far reaching consequences beyond its current rather narrower scope. With ever increasing numbers of under settlement claims against solicitors, will this result in defendants being unable to rely on after coming evidence involving known facts in increasingly extended circumstances, save where the fraud exception is present? 

That said, this decision does nothing to limit the relevance of after coming evidence, medical or otherwise, to the causation analysis identified in Perry, insofar as the evidence relates to the credibility/honesty of the claimant and challenging the assertion that if so advised the claimant would have acted in a certain manner. This is of course good news for defendants and their advisors looking to head off claims before entering the more claimant friendly waters of the assessment of loss.

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Disclaimer: This document does not present a complete or comprehensive statement of the law, nor does it constitute legal advice. It is intended only to highlight issues that may be of interest to customers of BLM. Specialist legal advice should always be sought in any particular case.

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