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England and Wales Court of Appeal (Civil Division) Decisions
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Cite as:  EWCA Civ 1977,  Lloyd's Rep PN 13
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IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT
(MR JUSTICE NEUBERGER)
B e f o r e :
LORD JUSTICE CLARKE
LORD JUSTICE SCOTT BAKER
|MESSRS G A MOFFAT & OTHERS||Claimants/Respondents|
|MESSRS BURGES SALMON (A FIRM)||Defendant/Appellant|
Smith Bernal Wordwave Limited
190 Fleet Street, London EC4A 2AG
Tel No: 020 7404 1400 Fax No: 020 7831 8838
(Official Shorthand Writers to the Court)
MR J RANDALL QC and MR L ASHWORTH (instructed by Wragge & Co, 55 Colmore Row, Birmingham, B3 2AS) appeared on behalf of the Respondents
(AS APPROVED BY THE COURT)
Crown Copyright ©
Friday, 20 December 2002
LORD JUSTICE CLARKE:
THE CLAIMS AGAINST THE NFU
THE CLAIMS IN THIS ACTION
"Each of the claims in the present proceedings against the defendants, Burgess Salmon, arises out of their alleged failure properly to advise the claimants as to the risk of not issuing proceedings against the NFU timeously. In other words, each of the claimants contends that the [defendants] owed a duty of care to advise them that, if they failed to issue their writs against the NFU promptly, and in particular about two years before they actually did so, they would be at risk of losing some of the damages they could otherwise recover from the NFU, because of the very point upon which the NFU succeeded before Jacob J, namely the limitation point."
" ... and upon the Defendant by Counsel conceding that if the Claimants had issued their writs timeously against the NFU (i.e. if the Claimants establish that the Defendant owed a duty to give them advice to take that course, that the Defendant failed in that duty, and that if the Defendant had carried out that duty, the Claimants would have issued their writs timeously) then the NFU action would have been heard earlier, and that the Court would have reached precisely the same conclusions on all points which Evans Loam J reached later in his main judgment, save that those periods of loss which were held to be time-barred would not have been held to have been time-barred.
IT IS ORDERED THAT
1. (1) For the purpose of proving their losses alleged in these proceedings:
(a) the Claimants are entitled to rely on the terms of the entire judgment of Evans Loam J in the NFU litigation, and
(b) (without prejudice to the generality of (a), and for the avoidance of doubt) those 4 Claimants who were lead Plaintiffs in the NFU litigation and in respect of whom Evans Loam J made specific findings of fact in his said judgment, are entitled respectively to rely on those specific findings as representing the terms of the notional judgment which the Court would have delivered in timeously commenced proceedings against the NFU, save only as regards those periods of loss which Evans-Lombe J held to be time-barred ...
(a) Permission to re-amend the Master Defence so as to include paragraph 91(4) of the draft served under cover of a letter dated 28th May, 2002 be refused ... ."
"In my judgment, therefore, save possibly for the purpose of Civil Evidence Act Notices and cross-examination, the judgment of Evans-Lombe J need play no part in these proceedings in relation to the issues of duty, breach of duty, reliance or causation."
"Accordingly, there is no question of the claimants being able to rely on any of the findings made in the main judgment in relation to questions such as the date upon which any claimant instructed the defendants, the nature of the duty owing by the defendants to each claimant, whether and if so in what way that duty was breached, and whether the claimant in any way relied on advice actually given by the defendants, or would have relied on advice which ought to have been given by the defendants. All those matters will have to be determined in these proceedings as between the claimants and the defendants, and the only value of the NFU action in such a connection may be that some of the evidence in it may found the basis of a Civil Evidence Act Notice (which in turn may be challenged) or may found the basis of some questions in cross-examination in these proceedings."
The judge added in paragraph 40:
"However, if the claimants establish these other fundamental features of their claim against the defendants (duty, breach of duty, reliance and causation) then the claimants contend that the main judgment will form a very important ingredient in connection with the assessment of the damages which each claimant can recover from the defendants."
THE FOUR LEAD PLAINTIFFS
"41 I start by considering the position of the four claimants who were also lead plaintiffs in the NFU action, i.e. plaintiffs whose claims against the NFU Evans-Lombe J considered not only in the first, more general, part of his judgment, but also in the second, more specific, part of his judgment. Those claimants, Mr Moffat, Mr Dent, Mr Rowell, and Mr Martin, contend that, if they succeed in establishing the necessary duty, breach of duty, reliance and causation as against the defendants, then the measure of damages they will recover is effectively a foregone conclusion, and is to be determined by reference to the main judgment, i.e. the decision of Evans-Lombe J.
42. This argument proceeds on the following basis. As the defendants plead in paragraph 91 of their proposed re-amended Defence:
`If, which is denied, the defendant was in breach of duty to the claimants and if, which is denied, the breach caused any loss, the loss properly described can be claimed as a result thereof, is the loss of the chance to recover greater sums against the NFU than were in fact recovered.'
43. Those `greater sums' are the sums referable to the greater periods of loss which Evans-Lombe J would have held as recoverable by the four claimants against the NFU if they had not been time barred, in addition to the sums referable to the periods of loss which did not fall foul of the Limitation Act 1980.
44. The claimants rely heavily on a concession made comparatively recently by the defendants (and, particularly in a less than straightforward case such as this, I intend no criticism of the defendants when characterising the concession as having been made recently). That concession is that if the claimants had issued their writs timeously against the NFU (i.e. if the claimants establish that the defendants owed a duty to give them advice to take that course, that the defendants failed in that duty, and that if the defendants had carried out that duty, the claimants would have issued their writs timeously) then the NFU action would have been heard some two years earlier, and that Evans-Lombe J (or if it had been a different tribunal, another Judge) would have reached precisely the same conclusions on all points which he reached two years later in his main judgment, save that, of course, those periods of loss which were held to be time-barred would not have been held to have been time-barred.
45. In light of that concession, Mr Randall contends that, once one gets to the question of assessment of damages in this action in relation to each of the four claimants, one simply looks at the periods of loss claimed by each such claimant which were held by Evans-Lombe J to be time-barred, and (subject to adjustment in terms of interest to allow for the notional earlier trial date) there can be no further issue in relation to the periods of loss for which damages are recoverable.
46. I have reached the conclusion that that argument is correct. Once one is simply down to assessing what loss the lead claimants have suffered as a result of the defendants' negligence (which, on this basis, one must assume to have been established), it is common ground that loss is the lost opportunity to recover the damages which the Court would have awarded them in a trial some two years earlier than the actual trial date on the basis of notional writs against the NFU issued some two years earlier than the actual writs. One knows exactly what those extra damages would have been, because of the defendants' concession that, with the exception of the limitation point and its effect, the periods of loss for which the notional Judge would have held damages recoverable would have been identical to the periods of loss for which Evans-Lombe J would actually have held damages recoverable, were it not for the limitation point.
47. It seems to me that this conclusion is entirely consistent with Mr Croxford's concession, which I think itself is correct, to the effect that there should be no discount in respect of the four claimants' loss. As I have said, it seems to me that the defendants have correctly characterised the claimants' loss as `the loss of [a] chance'. The proper approach to the assessment of damages where the loss is properly characterised as the loss of a chance has been considered in a number of decisions of the Court of Appeal, most notably Allied Maples Group Limited -v- Simmons & Simmons (A Firm) 1 WLR 1602, Mount -v- Barker Austin  PNLR 493 and Charles -v- Hugh James Jones & Jenkins (A Firm) 1 All ER 289."
"The unusual feature of this case is that, because the right to bring proceedings against the NFU was not entirely lost (at least in the case of the claimants) it is unnecessary to speculate about the result of the proceedings: there is the detailed judgment of Evans-Lombe J. Thanks to the concessions sensibly made by the defendants, it is not even necessary to consider whether there is any chance that, had there been no negligence (which is assumed for present purposes), and the writs had been issue earlier, the correspondingly earlier notional decision would have been different in any respect (other, of course, than in respect of a limitation defence) than the actual decision two years later in the main judgment."
The judge concluded in paragraph 49 as follows:
"49 Accordingly, Mr Croxford accepts that, whatever damages would otherwise be recoverable by the claimants against the defendants, there would be no question of applying a discount in the four claimants' cases, even though this is a loss of a chance case. As a matter of logical analysis, that concession is based on the fact that one can be confident that those claimants would have recovered whatever they claim they should have recovered if there had been no time-bar problem, because one actually knows what Evans-Lombe J decided, and, thanks to the defendants' realistic concession, one knows what he (or another Judge) would have decided two years earlier. It seems to me that this logic supports the claimants' contention which is disputed by the defendants on the second issue: if the defendants had not been negligent, as I am assuming it had been for present purposes, then, as again I am assuming for present purposes, the claimants would have issued their proceedings against the NFU timeously, and, in the light of the defendants' concession, Evans-Lombe J (or another Judge) would have found for the four claimants on liability two years earlier than he actually did, in respect of periods of loss which one can assess from considering his actual judgment, because it is accepted that any notional earlier judgment would have come to precisely the same conclusions (save in relation to the limitation point)."
"One example (amongst many) relates to the Claimant Mr Dent. In June 1998 Mr Dent, a lead Claimant in the NFU litigation, initially said that he was given advice about SLOM Compensation by the NFU when the NFU's Gillian Darling told him to `keep an eye on the press'. This is evident from a schedule produced by the Claimants in the NFU litigation. As that schedule also shows, by way of amendment, he later considered the matter again and put the date of advice at July 1989. The NFU disputed that the conversation in 1989 related to SLOM Compensation but Mr Evans-Lombe J found for Mr Dent as regards that conflict of evidence. Plainly there was room for dispute as to when Mr Dent was advised by the NFU and hence as to whether he was statute-barred against the NFU. Furthermore, as described by Mr Newton [in a witness statement] it will be the evidence of [the appellants'] Mr Neville that his understanding at the time was that advice about SLOM Compensation was not generally dispensed by the NFU before the end of 1991 or the beginning of 1992. [The appellants] would not be able to test and explore this essential part of the Claimants' case against it, if the judgment of Neuberger J stands."
"If, which is denied, the defendant was in breach of duty to the claimants and if, which is denied, the breach caused any loss, the loss properly described can be claimed as a result thereof, is the loss of the chance to recover greater sums against the NFU than were in fact recovered."
"1. The legal burden lies on the plaintiff to prove that in losing the opportunity to pursue his claim (or defence to counter-claim) he has lost something of value, i.e. that his claim (or defence) had a real and substantial rather than merely a negligible prospect of success. (I say `negligible' rather than `speculative' -- the word used in a somewhat different context in Allied Maples Group Ltd v Simmons and Simmons  1 WLR 1602 -- lest `speculative' may be thought to include considerations of uncertainty of outcome, considerations which in my judgment ought not to weigh against the plaintiff in the present context, that of struck-out litigation.)
4. If and when the court decides that the plaintiff's chances in the original action were more than merely negligible it will then have to evaluate them. That requires the court to make a realistic assessment of what would have been the plaintiff's prospects of success had the original litigation been fought out. Generally speaking one would expect the court to tend towards a generous assessment given that it was the defendants' negligence which lost the plaintiff the opportunity of succeeding in full or fuller measure. To my mind it is rather at this stage than the earlier stage that the principle established in Armory v Delamirie  1 Stra. comes into play."
"In stating the principles generally applicable to this class of case, I indicated in Mount v Barker Austin ... a two stage approach. First, the court has to decide whether the claimant has lost something of value or whether on the contrary his prospects of success in the original action were negligible. Secondly, assuming the claimant surmounts this initial hurdle, the court must then make a realistic assessment of what would have been the plaintiff's prospects of success had the original litigation been fought out."
"In that case [i.e. Davis v Taylor] the court was not concerned to distinguish between causation and quantification of loss. But, in my judgment, the plaintiff must prove as a matter of causation that he has a real or substantial chance as opposed to a speculative one. If he succeeds in doing so, the evaluation of the chance is part of the assessment of the quantum of damage, the range lying somewhere between something that just qualifies as real or substantial on the one hand and mere certainty on the other. I do not think it is helpful to seek to lay down in percentage terms what the lower and upper ends of the bracket should be."
"Those 'greater sums' are the sums referable to the greater periods of loss which Evans-Lombe J would have held as recoverable by the four claimants against the NFU if they had not been time-barred, in addition to the sums referable to the periods of loss which did not fall foul of the Limitation Act 1980."
"56 In order to explain why the defendants wish in effect to challenge certain findings made by Evans-Lombe J as to the advice sought from and given by the NFU, and the lead claimants reaction to that advice, Mr Croxford has identified certain points which, he says, cast doubt on the correctness of some of the conclusions reached by Evans-Lombe J in the main judgment. I am unimpressed with those points, essentially for two reasons.
57 The first, and broader, reason is that it seems to me that, in the present case, where one has both the judgment of Evans-Lombe J and the concession that he would have reached precisely the same conclusion two years earlier on a notional trial (with the exception of the limitation point), then it should require an exceptional case before the defendants should be allowed to mount an attack on that conclusion for the purpose of deciding what the claimants lost as against the NFU. As I have said, on the face of it, the combination of the main judgment and the concession that a notional judgment two years earlier would have been no different, seems to me to mean that there can be no further argument as to the measure of damages so far as the lead claimants are concerned if they succeed on duty, breach of duty, reliance and causation, at least in the absence of exceptional circumstances. During argument, I was concerned as to what sort of `exceptional circumstances' would justify departing from that conclusion, given that the conclusion is one of principle, and one is always a little uneasy in suggesting that a principle may not apply in `exceptional circumstances' without considering what those circumstances might be. To leave the matter on such a loose basis can be said to cast doubt on the principle and/or on the question of whether exceptional circumstances could exist."
THE REMAINING CLAIMANTS
Order: Appeal dismissed with costs, subject to detailed assessment. The Appellants to make an interim payment of £30,000 within 14 days.