![]() |
[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback] |
|
United Kingdom House of Lords Decisions |
||
|
You are here: BAILII >> Databases >> United Kingdom House of Lords Decisions >> White v Jones [1995] UKHL 5 (16 February 1995) URL: http://www.bailii.org/uk/cases/UKHL/1995/5.html Cite as: [1995] 1 All ER 691, [1995] 2 AC 207, [1995] 2 WLR 187, [1995] UKHL 5 |
||
[New search] [Help]
Parliamentary
Archives,
HL/PO/JU/18/255
White and another (Respondents)
v.
Jones
and others (Appellants)
JUDGMENT
Die Jovis 16° Februarii 1995
Upon Report from the Appellate Committee to
whom was
referred the Cause White and another against Jones and
others,
That the Committee had heard Counsel as well on Monday the
7th
as on Tuesday the 8th, Wednesday the 9th, Thursday the 10th
and
Monday the 14th days of March last upon the Petition and
Appeal
of John Brynmor Jones of 37 Manor Road, Button Coalfield,
West
Midlands, David John King of 606 Bromford Lane, Ward
End,
Birmingham B8 2DP and Giles Horton Peppercorn of The Citadel,
190
Corporation Street, Birmingham B4 6TU, praying that the
matter
of the Order set forth in the Schedule thereto, namely an
Order
of Her Majesty's Court of Appeal of the 3rd day of March
1993,
might be reviewed before Her Majesty the Queen in Her Court
of
Parliament and that the said Order might be reversed, varied
or
altered or that the Petitioners might have such other relief
in
the premises as to Her Majesty the Queen in Her Court
of
Parliament might seen meet; as upon the case of Carol
Brenda
White and Pauline Elizabeth Heath lodged in answer to the
said
Appeal; and due consideration had this day of what was
offered
on either side in this Cause:
It is Ordered and Adjudged, by
the Lords Spiritual and
Temporal in the Court of Parliament of Her
Majesty the Queen
assembled, That the said Order of Her Majesty's
Court of Appeal
of the 3rd day of March 1993 complained of in the
said Appeal be,
and the same is hereby, Affirmed and that
the said Petition and
Appeal be, and the same is hereby, dismissed
this House: And it
is further Ordered. That the Appellants
do pay or cause to be
paid to the said Respondents the Costs
incurred by them in
respect of the said Appeal, the amount thereof
to be certified
by the Clerk of the Parliaments if not agreed
between the
parties.
Cler: Parliamentor:
HOUSE OF LORDS
OPINIONS OF THE LORDS OF APPEAL FOR JUDGMENT
IN THE CAUSE
WHITE AND
ANOTHER
(RESPONDENTS)
v.
JONES AND
OTHERS
(APPELLANTS)
ON 16TH FEBRUARY 1995
Lord
Keith of Kinkel
Lord Goff of Chieveley
Lord
Browne-Wilkinson
Lord Mustill
Lord Nolan
LORD KEITH OF KINKEL
My Lords,
I have had the
advantage of reading in draft the speech to be delivered
by my
noble and learned friend Lord Mustill, and I agree with it.
I am unable to
reconcile the allowance of the plaintiffs' claim with
principle,
or to accept that to do so would represent an appropriate advance
on
the incremental basis from decided cases. The position is that
the
defendant Mr. Jones contracted with the testator, Mr. Barratt,
to perform a
particular service for him, namely to take the
appropriate steps to enable Mr.
Barratt's revised testamentary
intentions to receive effect. He negligently
failed to take these
steps with due expedition with the result that upon Mr.
Barratt's
death the plaintiffs did not become entitled to the
testamentary
provisions which but for that failure they would have
been taken.
The contractual
duty which Mr. Jones owed to the testator was to
secure that his
testamentary intention was put into effective legal form
promptly.
The plaintiffs' case is that precisely the same duty was owed to
them
by Mr. Jones in tort. If the intended effect of the contract between
Mr.
Jones and the testator had been that an immediate benefit,
provided by Mr.
Jones, should be conferred on the plaintiffs, and
by reason of Mr. Jones's
deliberate act or his negligence the
plaintiffs had failed to obtain the benefit,
the plaintiffs would
have had no cause of action against Mr. Jones for breach
of
contract, because English law does not admit of jus quaesitum tertio.
Nor
would they have had any cause of action against him in tort,
for the law
would not, I think, allow the rule against jus
quaesitum tertio to be
circumvented in that way. To admit the
plaintiffs' claim in the present case
would in substance, in my
opinion, be to give them the benefit of a contract
to which they
were not parties.
- 1 -
Further there
is, in my opinion, no decided case the grounds of
decision in
which are capable of being extended incrementally and by way
of
analogy so as to admit of a remedy in tort being made available
to the
plaintiffs. Hedley Byrne & Co. Ltd. v. Heller &
Partners Ltd. [1964] A.C.
465 was a case where the defendants,
in response to a request from the
plaintiffs, had made a
representation about the financial soundness of a certain
concern,
in reliance upon which the plaintiffs had acted and in doing so
had
suffered financial loss. This House held that but for a
disclaimer of liability
the defendants would have been liable in
damages for negligence in the
making of the representation. In
that case there was a direct relationship
between the parties
creating such proximity as to give rise to a duty of care.
Here
there was no relationship between the plaintiffs and Mr. Jones, nor
did
Mr. Jones do or say anything upon which the plaintiffs acted
to their
prejudice. No damage was done by Mr. Jones to any
existing financial or
other interest of the plaintiffs. The
intention to benefit the plaintiffs existed
only in the mind of
the testator, and if it had received legal effect would have
given
them only a spes successions of an ambulatory character
In Henderson
v. Merrett Syndicates Ltd. [1994] 3 W.L.R. 761 the
managing
agents were engaged in conducting the financial affairs of the
Names
belonging to the syndicates under their charge. It was alleged
that
they managed these affairs with a lack of due care which
involved the Names
in enormous losses. It was held by this House
that the managing agents owed
to the Names a duty of care in tort,
it being irrelevant that no contractual
relationship existed
between them. Here Mr. Jones was not engaged in
managing any
aspect of the plaintiffs' affairs. He was employed only to deal
with
a particular aspect of the testator's affairs.
Upon the whole
matter I have found the conceptual difficulties involved
in the
plaintiffs' claim, which are fully recognised by all your Lordships,
to
be too formidable to be resolved by any process of reasoning
compatible with
existing principles of law.
I would therefore allow the appeal
LORD GOFF OF CHIEVELEY
My Lords,
In this appeal,
your Lordships' House has to consider for the first time
the much
discussed question whether an intended beneficiary under a will
is
entitled to recover damages from the testator's solicitors by
reason of whose
negligence the testator's intention to benefit him
under the will has failed to
be carried into effect. In Ross v.
Caunters [1980] Ch. 297, a case in which
the will failed
because, through the negligence of the testator's solicitors,
the
will was not duly attested, Sir Robert Megarry V.C. held that
the disappointed
- 2 -
beneficiary
under the ineffective will was entitled to recover damages from
the
solicitors in negligence. In the present case, the testator's
solicitors
negligently delayed the preparation of a fresh will in
place of a previous will
which the testator had decided to revoke,
and the testator died before the new
will was prepared. The
plaintiffs were the two daughters of the testator who
would have
benefited under the fresh will but received nothing under
the
previous will which, by reason of the solicitors' delay,
remained unrevoked.
It was held by the Court of Appeal, reversing
the decision of Turner J., that
the plaintiffs were entitled to
recover damages from the solicitors in
negligence. The question
which your Lordships have to decide is whether, in
cases such as
these, the solicitors are liable to the intended beneficiaries
who,
as a result of their negligence, have failed to receive the
benefit which the
testator intended they should receive.
The facts
I shall now set
out the facts of the present case, and for this purpose
I shall
gratefully adopt the account of the Vice-Chancellor, Sir
Donald
Nicholls, set out in [1993] 3 W.L.R. 730, 733E-734H, which
reads as
follows:
"The
action arises out of an unfortunate family rift. Mr. Arthur
Barratt
and his wife lived at 84, Whitecroft Road, Sheldon,
Birmingham.
They had two children, Carol and Pauline. Carol
married twice,
first to Peter Gould, and later to David White. She
lived next
door at 82, Whitecroft Road. She moved there to be close
to her
parents after her father had a stroke in 1983. Carol had three
girls:
Mandy and Maxine by her first marriage, Karen by her second.
Pauline,
the other daughter, also lived nearby, three or four minutes'
walk
away. She was married to John Heath, and they had two boys,
Stephen
and Andrew.
Mrs. Barratt
died on 23 January 1986. There was then a family row
between Mr.
Barratt and Pauline (Mrs. Heath) about the removal of a
money box
belonging to Mrs. Barratt. Carol (Mrs. White) sided with
her
sister. Mr. Barratt felt so strongly that he made a will cutting
both
his daughters out of his estate. There was no evidence that
he had
previously made a will. The will, executed on 4 March 1986,
was
prepared by the defendant firm of solicitors, Philip Baker
King & Co.
The first defendant, Mr. John Jones, was a legal
executive employed
by the firm. He had known Mr. Barratt for some
years. Mr.
Barratt's estate consisted principally of a house worth
£27,000, about
£1,000 in a building society, and
insurances totalling some £1,000.
By his will Mr. Barratt
appointed his former son-in-law Peter Gould,
his granddaughter
Mandy, and Mr. Jones to be his executors. He gave
£100 each
to two of his grandchildren, Karen and Andrew. Apart
from these
small legacies he left his estate equally between Peter
Gould,
Mandy and Maxine. He left nothing to either daughter.
- 3 -
Happily, the
estrangement between Mr. Barratt and his daughters did
not
continue for long. By mid-June 1986 they were reconciled. Mr.
Barratt
became concerned at the terms of the will he had made. He
told his
daughters what he had done and what he wished to happen.
He told
Mr. Jones on the telephone that he wanted to change his will.
Carol
White also spoke to Mr. Jones on the telephone about her
father's
wishes. Mr. Jones suggested that Mr. Barratt should jot down
what
he wanted and he, Mr. Jones, would deal with it. Mr.
Barratt
destroyed his copy of the March 1986 will. Mr. Heath was
in the
habit of writing letters for Mr. Barratt. In the middle of
July he wrote
out a letter addressed to Mr. Jones setting forth
instructions for the
new will: Carol and Pauline were to have
£9,000 each, the five
grandchildren £1,600 each, Carol
and Pauline were to be responsible
for the legal costs, and they
were to dispose of the contents of the
house. The letter said: 'I
have destroyed the original will ... I trust
the above is as
required.' The letter was signed by Mr. Barratt. It
was posted to
the solicitors and received by them on 17 July.
Regrettably,
nothing was done by Mr. Jones to give effect to these
instructions
for a month. Appointments were made for Mr. Jones to
call round to
see Mr. Barratt on three successive Thursdays but Mr.
Jones did
not keep them. Then on 16 August he dictated an internal
memorandum
to a member of the firm's probate department, which
read:
'Re: Arthur
Thomas Barrett [sic] - New Will. Keith Amos
drew up a will which
is filed away under reference 30C.
Please see Mr. Barrett's
instructions in his letter received on 17
July. I have considered
the matter and feel possibly a new will
should be drawn up if an
addendum cannot be made. Would
you be kind enough to do it as soon
as possible and let me
know the amount of your costs. Mr. Barrett
is a friend of
mine and I [will] pop along to his house to witness
the will and
obtain costs. I have an appointment to see Mr.
Barrett on
[blank] and if at all possible could you let me have
the will by
that date.'
On the
following day Mr. Jones went away on holiday. A week later,
on 23
August, Mr. Barratt went off to Weston-super-Mare for a
fortnight's
holiday. Mr. Jones returned to the office on Monday, 1
September,
and Carol arranged an appointment for him to call and see
Mr.
Barratt on 17 September. That was the first available date after
Mr.
Barratt's return from holiday. Meanwhile nothing further had
been
done within the firm regarding Mr. Barratt's will. Indeed, the
memo
dictated by Mr. Jones on 16 August was not even transcribed
until
5 September, four days after Mr. Jones came back from holiday.
- 4 -
While on
holiday Mr. Barratt, who was aged 78, fell and hit his head.
He
returned home on 6 or 7 September. At the weekend he suffered
a
heart attack, and he died on 14 September.
In due course
the will executed in March 1986 was admitted to
probate. So there
were the two documents: the will and the letter of
instructions
for a new will. The letter was not witnessed as required
by the
Wills Act 1837 (7 Will. 4 & 1 Vict. c. 26), so it could
not
itself stand and take effect as a will. The family were unable
to agree
on how the estate should be divided. The daughters took
the view that
Mr. Jones's inexcusable delay was the cause of their
not having
received £18,000 from their father's estate. Had
Mr. Jones done what
he should have done, the March 1986 will would
have been revoked
and replaced with a new will benefiting them. So
they brought an
action for damages for negligence."
The decisions of the courts below
The action was
heard by Turner. J. He dismissed the plaintiffs' claim.
First, he
decided not to apply Ross v. Caunters [1980] Ch. 297 in a
case
where there had been a failure to draw up the will for
execution, as opposed
to a case where (as in Ross v. Caunters)
the will had been drawn up and
executed, but had not been
properly attested. Second, he held that on the
facts of the
present case the damage was too speculative and uncertain in
extent
to be recoverable. The Court of Appeal [1993] 3 W.L.R. 730,
however,
reversed Turner J.'s decision on both these issues and so allowed
the
appeal, holding that the solicitors owed a duty of care to the two
plaintiffs,
and were in breach of that duty. They assessed the
damages recoverable by
the two plaintiffs at £9,000 each,
being the minimum sum which each would
have received under the
second will if it had been drawn up and duly
executed. The
decision of the Court of Appeal to reverse the decision of
Turner
J. on the first of these issues raises a point of principle to which
I will
return later.
Experience in other countries
I turn to the
principal issue which arises on the appeal, which is
whether in
the circumstances of cases such as Ross v. Caunters
[1980]
Ch. 297 and the present case the testator's solicitors are liable to
the
disappointed beneficiary. As I have already stated, the
question is one which
has been much discussed, not only in this
country and other common law
countries, but also in some civil law
countries, notably Germany. There can
be no doubt that Ross v.
Caunters has been generally welcomed by academic
writers (see,
e.g., Salmond and Heuston on the Law of Torts, 20th ed.,
(1992)
pp. 215, 217; Winfield & Jolowicz on Tort, 13th
ed., (1989) pp. 88-89, 96,
106; Fleming on Torts, 8th ed.,
(1992) p. 184, and Markesinis and Deakin
on Tort Law, 3rd
ed., (1994) pp. 95-98). Furthermore it does not appear to
- 5 -
have been the
subject of adverse comment in the higher courts in this
country,
though it has not been approved except by the Court of
Appeal in the present
case. Indeed, as far as I am aware, Ross
v. Caunters has created no serious
problems in practice since
it was decided nearly fifteen years ago. A similar
conclusion has
been reached in the courts of New Zealand (see Gartside
v.
Sheffield, Young & Ellis [1983] N.Z.L.R. 37), and the
law appears to be
developing in the same direction in Canada (see,
in particular Peake v. Vernon
& Thompson (1990) 49
B.C.L.R. (2d) 245, and Heath v. Ivens (1991) 57
B.C.L.R.
(2d) 39). The position in Australia (to which I will refer in
a
moment), is at present less clear. In the United States,
following two earlier
decisions in California (Biakanja v.
Irving 320 P. 2d 16 (1958), in which
liability was held to
arise in tort, and Lucas v. Hamm 364 P. 2d. 685 1961,
in
which the disappointed beneficiary was treated as a third party
beneficiary
of the testator's right of action against the
negligent attorney), the trend now
appears to be moving strongly
in favour of liability (see 61 A.L.R. (4th) 464
(1988) at pp.
473-475 (Joan Teshima). For the American position generally,
see
the Restatement of the Law Governing Lawyers, Tentative Draft
No. 7
(April 7 1994), para. 73(3), and in particular Comment f.,
and Illustration 2.
Other cases are cited in the Reporter's Note
under para. 73.) In Germany, a
disappointed beneficiary may be
entitled to claim damages from the testator's
negligent solicitor
under the principle known as contract with protective effect
for
third parties (Vertrag mit Schutzwirkung fur Dritte). I shall discuss
the
relevant German law on the subject in greater detail at a
later stage in this
opinion. It also appears that a similar
conclusion would be reached in France:
see Jurisprudence (1979)
19243, Cass. civ. ler, 23 Nov. 1977; and
Jurisprudence (1982)
19728, Cass. civ. ler, 14 Jan. 1981, which appears to
be based on
the broad principle that a notary is responsible, even as
against
third parties, for all fault causing damage committed by
him in the exercise
of his functions. On facts very similar to
those of the present case, the Court
of Appeal of Amsterdam has
held a notary liable in negligence to the intended
beneficiary:
see NJ No. 740 31 Jan. 1985.
The conceptual difficulties
Even so, it has
been recognised on all hands that Ross v. Caunters
[1980]
Ch. 297 raises difficulties of a conceptual nature, and that as a
result
it is not altogether easy to accommodate the decision
within the ordinary
principles of our law of obligations. Perhaps
the most trenchant criticism of
Ross v. Caunters is to be
found in the judgments of Lush J. and (especially)
Murphy J. in
the decision of the Full Court of the Supreme Court of Victoria
in
Seale v. Perry [1982] V.R. 193, in which particular stress is
laid upon the
conceptual difficulties which it raises. It is
however right to point out that,
in that case, McGarvie J. took a
rather different view; and further that the
court, in declining to
follow Ross v. Caunters, had also to decline to follow
the
decision of the Full Court of the Supreme Court of Western Australia
in
Watts v. Public Trustee of Western Australia [1980]
W.A.R. 97, in which
Ross v. Caunters was followed. Moreover
in Finlay v. Rowlands, Anderson
- 6 -
& Hine
[1987] Tas. R. 60, Seale v. Perry was not followed, the
reasoning in
Ross v. Caunters being preferred. The
decision of the High Court of
Australia in Hawkins v. Clayton
(1988) 164 C.L.R. 539, in which it was held
by a majority that
a solicitor who had retained custody of a will was liable in
tort
to the executor for loss suffered by reason of the solicitor's
failure to
locate and notify him in due time of the testatrix's
death, provides an
indication that the High Court may be prepared
to take a less strict approach
to cases such as Ross v.
Caunters than that adopted by the majority of the
court in
Seale v. Perry.
It is right
however that I should immediately summarise these
conceptual
difficulties. They are as follows:
(1) First, the
general rule is well established that a solicitor acting on
behalf
of a client owes a duty of care only to his client. The
relationship
between a solicitor and his client is nearly always
contractual, and the scope
of the solicitor's duties will be set
by the terms of his retainer; but a duty of
care owed by a
solicitor to his client will arise concurrently in contract and
in
tort (see Midland Bank Trust Co. Ltd. v. Hett, Stubbs &
Kemp [1979] Ch.
384, recently approved by your Lordships'
House in Henderson v. Merrett
Syndicates Ltd. [1994] 3
W.L.R. 761). But, when a solicitor is performing
his duties to his
client, he will generally owe no duty of care to third
parties.
Accordingly, as Sir Donald Nicholls V.-C. pointed out in
the present case, a
solicitor acting for a seller of land does not
generally owe a duty of care to
the buyer: see Gran Gelato Ltd.
v. Richcliff (Group) Ltd. [1982] Ch. 560.
Nor, as a
general rule, does a solicitor acting for a party in
adversarial
litigation owe a duty of care to that party's
opponent: see Al-Kandari v. J.R.
Brown & Co. [1988] Q.B. 665, 672, per Lord Donaldson of Lymington M.R.
Further
it has been held that a solicitor advising a client about a
proposed
dealing with his property in his lifetime owes no duty of
care to a prospective
beneficiary under the client's then will who
may be prejudicially affected: see
Clarke v. Bruce Lance &
Co. [1988] 1 W.L.R. 881.
As I have said,
the scope of the solicitor's duties to his client are set
by the
terms of his retainer; and as a result it has been said that the
content
of his duties are entirely within the control of his
client. The solicitor can,
in theory at least, protect himself by
the introduction of terms into his contract
with his client; but,
it is objected, he could not similarly protect himself
against any
third party to whom he might be held responsible, where there is
no
contract between him and the third party.
In these
circumstances, it is said, there can be no liability of the
solicitor
to a beneficiary under a will who has been disappointed by reason
of
negligent failure by the solicitor to give effect to the
testator's intention.
There can be no liability in contract,
because there is no contract between the
solicitor and the
disappointed beneficiary; if any contractual claim was to
be
recognised, it could only be by way of a ius quaesitum tertio,
and no such
- 7 -
claim is
recognised in English law. Nor could there be liability in
tort,
because in the performance of his duties to his client a
solicitor owes no duty
of care in tort to a third party such as a
disappointed beneficiary under his
client's will.
(2) A further
reason is given which is said to reinforce the conclusion that
no
duty of care is owed by the solicitor to the beneficiary in tort.
Here, it is
suggested, is one of those situations in which a
plaintiff is entitled to damages
if, and only if, he can establish
a breach of contract by the defendant. First,
the plaintiffs
claim is one for purely financial loss; and as a general
rule,
apart from cases of assumption of responsibility arising
under the principle in
Hedley Byrne & Co. Ltd v. Heller &
Partners Ltd. [1964] A.C. 465, no
action will lie in respect
of such loss in the tort of negligence. Furthermore,
in
particular, no claim will lie in tort for damages in respect of a
mere loss
of an expectation, as opposed to damages in respect of
damage to an existing
right or interest of the plaintiff. Such a
claim falls within the exclusive zone
of contractual liability;
and it is contrary to principle that the law of tort
should be
allowed to invade that zone. Of course, Parliament can
create
exceptions to that principle by extending contractual
rights to persons who are
not parties to a contract, as was done,
for example, in the Bills of Lading Act
1855 and the Carriage of
Goods by Sea Act 1992. But as a matter of
principle a step of
this kind cannot be taken by the courts, though they can
redefine
the boundaries of the exclusive zone, as they did in Donoghue
v.
Stevenson [1932] A.C. 562.
The present
case, it is suggested, falls within that exclusive zone.
Here, it
is impossible to frame the suggested duty except by reference to
the
contract between the solicitor and the testator - a contract
to which the
disappointed beneficiary is not a party, and from
which, therefore, he can
derive no rights. Second, the loss
suffered by the disappointed beneficiary is
not in reality a loss
at all; it is, more accurately, a failure to obtain a benefit.
All
that has happened is that what is sometimes called a spes succesionis
has
tailed to come to fruition. As a result, he has not become
better off; but he
is not made worse off. A claim in respect of
such a loss of expectation falls,
it is said, clearly within the
exclusive zone of contractual liability.
(3) A third,
and distinct, objection is that, if liability in tort
was
recognised in cases such as Ross v. Caunters [1980] Ch.
297, it would be
impossible to place any sensible bounds to cases
in which such recovery was
allowed. In particular, the same
liability should logically be imposed in cases
where an inter
vivos transaction was ineffective, and the defect was not
discovered
until the donor was no longer able to repair it.
Furthermore,
liability could not logically be restricted to cases
where a specific named
beneficiary was disappointed, but would
inevitably have to be extended to
cases in which wide, even
indeterminate, classes of persons could be said to
have been
adversely affected.
-8-
(4) Other
miscellaneous objections were taken, though in my opinion they
were
without substance. In particular:
Since the testator himself owes
no duty to the beneficiary, it
would be illogical to impose any
such duty on his solicitor. I
myself cannot however see any
force in this objection.
To enable the disappointed
beneficiary to recover from the
solicitor would have the
undesirable, and indeed fortuitous,
effect of substantially
increasing the size of the testator's estate
- even of doubling
it in size; because it would not be possible
to recover any part
of the estate which had lawfully devolved
upon others by an
unrevoked will or on an intestacy, even
though that was not in
fact the testator's intention. I cannot
however see what
impact this has on the disappointed
beneficiary's remedy. It
simply reflects the fact that those who
received the testator's
estate, either under an unrevoked will or
on an intestacy, were
lucky enough to receive a windfall; and
in consequence the
estate is, so far as the testator and the
disappointed
beneficiary are concerned, irretrievably lost.
(5) There is
however another objection of a conceptual nature, which was
not
adumbrated in argument before the Appellate Committee. In the
present
case, unlike Ross v. Counters itself, there was no
act of the defendant solicitor
which could be characterised as
negligent. All that happened was that the
solicitor did nothing
at all for a period of time, with the result that the testator
died
before his new testamentary intentions could be implemented in place
of
the old. As a general rule, however, there is no
liability in tortious
negligence for an omission, unless the
defendant is under some pre-existing
duty. Once again, therefore,
the question arises how liability can arise in the
present case in
the absence of a contract.
Point (5)
apart, such were the principal arguments addressed to the
Appellate
Committee by Mr. Matheson Q.C. on behalf of the appellants in
the
present case. In addition Professor Jolowicz Q.C. developed,
on behalf of the
appellants, the argument based upon the principle
of an exclusive zone of
contractual liability. I myself was much
assisted by these arguments, as I was
by the admirable argument
addressed to the Committee by Mr. Mitting Q.C.
on behalf of the
respondents.
Robertson v. Fleming
There is
undoubted force in the principal contentions advanced on
behalf of
the appellants. Moreover the appellants were able to rely, in
support
of their argument, on a decision of your Lordships' House,
Robertson v.
Fleming 1861 4 Macq. 167, which came before
this House on appeal from the
Court of Session. In that case,
sureties were seeking to claim damages from
a solicitor,
instructed by the debtor "for behoof of" the sureties to
prepare
- 9 -
documentation
designed to enable the sureties to have the benefit of security
in
the form of leasehold property to which the debtor was entitled.
The
relevant document, which took the form of a bond of relief and
assignation in
favour of the sureties, failed to achieve the
desired effect because, through the
negligence of the solicitor,
notice of the assignation was not given to the
landlord. In the
litigation, the principal issue related to the meaning of
the
expression "for behoof of", the question being
whether it meant "by authority
of", so that it was
effective to create the necessary privity between the sureties
and
the solicitor; or whether it simply meant "for the benefit of",
in which
case it did not have that effect. In the course of their
speeches in the House
some of their Lordships, when stating that
the mere fact that the work was
done for the benefit of the
sureties was not sufficient to give rise to liability
on the part
of the solicitor to the sureties, referred to the example of a
claim
against a solicitor by a disappointed legatee as being so
contrary to principle
as to illustrate clearly why the claim in
the case before them was unfounded:
see p. 177, per Lord
Campbell L.C.; p. 185, per Lord Cranworth; and pp.
200-201,
per Lord Wensleydale. Lord Campbell spoke in particularly
strong
terms, when he said of the sureties' argument (at p. 177):
"If this
were law a disappointed legatee might sue the solicitor
employed
by a testator to make a will in favour of a stranger, whom
the
solicitor never saw or before heard of, if the will were void for
not
being properly signed and attested. I am clearly of opinion
that this
is not the law of Scotland, nor of England, and it can
hardly be the
law of any country where jurisprudence has been
cultivated as a
science."
Statements such
as these no doubt represented the law as understood
in this
country over a century ago. Moreover, as I have already observed,
the
general rule today is that, subject to his duties to the court
and the
professional duties imposed upon his profession, a
solicitor when acting for
his client owes no duty to third
parties. But the problem which arises in the
present case relates
to the particular position of an intended beneficiary under
a will
or proposed will to which the solicitor has negligently failed to
give
effect in accordance with the instructions of his client, the
testator; and the
question is whether exceptionally a duty of care
should be held to be owed by
the solicitor to the disappointed
beneficiary in those circumstances. I myself
do not consider that
the existence of such a duty of care can simply be
dismissed by
reference to the sweeping statements made in Robertson v.
Fleming.
For the law has moved on from those days. Nowadays questions
such
as that in the present case have to be considered anew, and
statements
of the law, such as that of Lord Campbell, cannot be
allowed to foreclose the
argument of the plaintiffs in the present
case; indeed, although they
demonstrate the importance attached to
the doctrine of privity of contract in
1861, nevertheless they did
not form part of the ratio decidendi of the case,
in which the
question at issue in the present case did not fall to be decided.
It
follows that, although the views expressed on the point in Robertson
v.
Fleming are still entitled to great respect, your Lordships
are in my opinion
- 10 -
free to depart
from them without having recourse to the Practice Direction of
1966
for that purpose. Even so, they add force to the conceptual
argument
advanced on behalf of the appellants in the present case.
The impulse to do practical justice
Before
addressing the legal questions which lie at the heart of the
present
case, it is, I consider, desirable to identify the reasons of justice
which
prompt judges and academic writers to conclude, like Megarry
V.-C. in Ross
v. Caunters, that a duty should be owed by
the testator's solicitor to a
disappointed beneficiary. The
principal reasons are, I believe, as follows.
In the forefront stands the
extraordinary fact that, if such a duty is not
recognised, the
only persons who might have a valid claim (i.e., the testator
and
his estate) have suffered no loss, and the only person who has
suffered a
loss (i.e., the disappointed beneficiary) has no
claim: see Ross v. Caunters
[1980] Ch. 297, 303A, per
Sir Robert Megarry V.-C. It can therefore be said
that, if
the solicitor owes no duty to the intended beneficiaries, there is
a
lacuna in the law which needs to be filled. This I regard as
being a point of
cardinal importance in the present case.
The injustice of denying such a
remedy is reinforced if one considers
the importance of legacies
in a society which recognises (subject only to the
incidence of
inheritance tax, and statutory requirements for provision for
near
relatives) the right of citizens to leave their assets to
whom they please, and
in which, as a result, legacies can be of
great importance to individual
citizens, providing very often the
only opportunity for a citizen to acquire a
significant capital
sum; or to inherit a house, so providing a secure roof over
the
heads of himself and his family; or to make special provision for
his or
her old age. In the course of the hearing before the
Appellate Committee
Mr. Matheson Q.C. (who was instructed by the
Law Society to represent the
appellant solicitors) placed before
the Committee a schedule of claims of the
character of that in
the present case notified to the Solicitors' Indemnity
Fund
following the judgment of the Court of Appeal below. It is
striking that,
where the amount of the claim was known, it was,
by today's standards, of
a comparatively modest size. This
perhaps indicates that it is where a testator
instructs a small
firm of solicitors that mistakes of this kind are most likely
to
occur, with the result that it tends to be people of modest means,
who need
the money so badly, who suffer.
There is a sense in which the
solicitors' profession cannot complain if
such a liability may be
imposed upon their members. If one of them has been
negligent in
such a way as to defeat his client's testamentary intentions,
he
must regard himself as very lucky indeed if the effect of the
law is that he is
not liable to pay damages in the ordinary way.
It can involve no injustice to
render him subject to such a
liability, even if the damages are payable not to
his client's
estate for distribution to the disappointed beneficiary (which
might
have been the preferred solution) but direct to the
disappointed beneficiary.
- 11 -
(4) That such a
conclusion is required as a matter of justice is reinforced
by
consideration of the role played by solicitors in society. The point
was
well made by Cooke J. in Gartside v. Sheffield, Young &
Ellis [1983]
N.Z.L.R. 37, 43, when he observed that:
"To deny
an effective remedy in a plain case would seem to imply a
refusal
to acknowledge the solicitor's professional role in the
community.
In practice the public relies on solicitors (or statutory
officers
with similar functions) to prepare effective wills."
The question
therefore arises whether it is possible to give effect in law
to
the strong impulse for practical justice which is the fruit of the
foregoing
considerations. For this to be achieved, I respectfully
agree with the
Sir Donald Nicholls V.-C. when he said (see [1993]
3 W.L.R. 730, 739) that
the court will have to fashion "an
effective remedy for the solicitor's breach
of his professional
duty to his client" in such a way as to repair the injustice
to
the disappointed beneficiary.
Ross v. Caunters and the conceptual problems
In Ross v.
Caunters [1980] 1 Ch. 297, Sir Robert Megarry V.-C.
approached
the problem as one arising under the ordinary principles of the
tort
of negligence. He found himself faced with two principal
objections to the
plaintiff's claim. The first, founded mainly
upon the decision of the Court of
Appeal in Groom v. Crocker
[1939] 1 K.B. 194, was that a solicitor could not
be liable in
negligence in respect of his professional work to anyone except
his
client, his liability to his client arising only in contract and not
in tort.
This proposition Sir Robert rejected without difficulty,
relying primarily upon
the judgment of Oliver J. in Midland
Bank Trust Co. Ltd. v. Hett, Stubbs &
Kemp [1979] Ch. 384
(recently approved by this House in Henderson v.
Merrett
Syndicates Ltd. [1994] 3 W.L.R. 761). The second, and
more
fundamental, argument was that, apart from cases falling
within the principle
established in Hedley Byrne & Co. Ltd.
v. Heller & Partners Ltd. [1964] A.C.
465, no action lay
in the tort of negligence for pure economic loss. This
argument
Sir Robert approached following the path traced by Lord
Wilberforce
in Anns v. Merton London Borough Council [1978] A.C. 728,
751-752; and on that basis, relying in particular on Ministry
of Housing and
Local Government v. Sharp [1970] 2 Q.B. 223
(which he regarded as
conclusive of the point before him), he held
that here liability could properly
be imposed in negligence for
pure economic loss, his preferred basis being by
direct
application of Donoghue v. Stevenson [1932] A.C. 562 itself.
It will at once
be seen that some of the conceptual problems raised by
the
appellants in argument before the Appellate Committee were not raised
in
Ross v. Caunters [1980] Ch. 297. Others which were
raised plainly did not
loom so large in argument as they have done
in the present case. Thus the
point founded on the fact that in
cases of this kind the plaintiff is claiming
- 12 -
damages for the
loss of an expectation was briefly touched upon by Sir Robert
(at
p. 322) and as briefly dismissed by him, but (no doubt for good
reason,
having regard to the manner in which the case was
presented) there is no
further analysis of the point. It is
however my opinion that, these conceptual
arguments having been
squarely raised in argument in the present case, they
cannot
lightly be dismissed. They have to be faced; and it is
immediately
apparent that they raise the question whether the
claim properly falls within
the law of contract or the law of
tort. This is because, although the plaintiffs'
claim has been
advanced, and indeed held by the Court of Appeal to lie, in
the
tort of negligence, nevertheless the response of the appellants has
been that
the claim, if properly analysed, must necessarily have
contractual features
which cannot ordinarily exist in the case of
a an ordinary tortious claim. Here
I refer not only to the fact
that the claim is one for damages foi pure
economic loss, but also
to the need for the defendant solicitor to be entitled
to invoke
as against the disappointed beneficiary any terms of the
contract
with his client which may limit or exclude his liability;
to the fact that the
damages claimed are for the loss of an
expectation; and also to the fact (not
adverted to below) that the
claim in the present case can be said to arise from
a pure
omission, and as such will not (apart from special circumstances)
give
rise to a claim in tortious negligence. Faced with points
such as these, the
strict lawyer may well react by saying that the
present claim can lie only in
contract, and is not therefore open
to a disappointed beneficiary as against the
testator's solicitor.
This was indeed the reaction of Lush and Murphy JJ. in
Seale v.
Perry [1982] V.R. 193, and is one which is entitled to great
respect.
It must not be
forgotten however that a solicitor who undertakes to
perform
services for his client may be liable to his client for failure
to
exercise due care and skill in relation to the performance of
those services not
only in contract, but also in negligence under
the principle in Hedley Byrne
& Co. Ltd. v. Heller &
Partners Ltd. [1964] A.C. 465: (see Midland Bank
Trust Co.
Ltd. v. Hett, Stubbs & Kemp [1977] Ch. 384,) on the basis
of
assumption of responsibility by the solicitor towards his
client. Even so there
is great difficulty in holding, on ordinary
principles, that the solicitor has
assumed any responsibility
towards an intended beneficiary under a will which
he has
undertaken to prepare on behalf of his client but which, through
his
negligence, has failed to take effect in accordance with his
client's
instructions. The relevant work is plainly performed by
the solicitor for his
client; but, in the absence of special
circumstances, it cannot be said to have
been undertaken for the
intended beneficiary. Certainly, again in the absence
of special
circumstances, there will have been no reliance by the
intended
beneficiary on the exercise by the solicitor of due care
and skill; indeed, the
intended beneficiary may not even have been
aware that the solicitor was
engaged on such a task, or that his
position might be affected. Let me take
the example of an inter
vivos gift where, as a result of the solicitor's
negligence, the
instrument in question is for some reason not effective for
its
purpose. The mistake comes to light some time later during the
lifetime of
the donor, after the gift to the intended donee should
have taken effect. The
donor, having by then changed his mind,
declines to perfect the imperfect gift
- 13 -
in favour of
the intended donee. The latter may be unable to obtain
rectification
of the instrument, because equity will not perfect an imperfect
gift
(though there is some authority which suggests that exceptionally it
may
do so if the donor has died or become incapacitated: see
Lister v. Hodgson
(1867) L.R. 4 Eq. 30, 34-35 per Romilly
M.R.). I for my part do not think
that the intended donee could in
these circumstances have any claim against
the solicitor. It is
enough, as I see it, that the donor is able to do what he
wishes
to put matters right. From this it would appear to follow that the
real
reason for concern in cases such as the present lies in the
extraordinary fact
that, if a duty owed by the testator's
solicitor to the disappointed beneficiary
is not recognised, the
only person who may have a valid claim has suffered
no loss, and
the only person who has suffered a loss has no claim. This is a
point
to which I will return later in this opinion, when I shall give
further
consideration to the application of the Hedley Byrne
principle in circumstances
such as those in the present case.
The German experience
The fact that
the problems which arise in cases such as the present
have
troubled the courts in many jurisdictions, both common law and
civil
law, and have prompted a variety of reactions, indicates
that they are of their
very nature difficult to accommodate within
the ordinary principles of the law
of obligations. It is true that
our law of contract is widely seen as deficient
in the sense that
it is perceived to be hampered by the presence of an
unnecessary
doctrine of consideration and (through a strict doctrine of
privity
of contract) stunted through a failure to recognise a jus
quaesitum tertio. But
even if we lacked the former and possessed
the latter, the ordinary law could
not provide a simple answer to
the problems which arise in the present case,
which appear at
first sight to require the imposition of something like a
contractual
liability which is beyond the scope of the ordinary jus
quaesitum
tertio. In these circumstances, the effect of the
special characteristics of any
particular system of law is likely
to be, as indeed appears from the authorities
I have cited, not so
much that no remedy is recognised, but rather that the
system in
question will choose its own special means for granting a
remedy
notwithstanding the doctrinal difficulties involved.
We can, I
believe, see this most clearly if we compare the English and
German
reactions to problems of this kind. Strongly though I support
the
study of comparative law, I hesitate to embark in an opinion
such as this upon
a comparison, however brief, with a civil law
system; because experience has
taught me how very difficult, and
indeed potentially misleading, such an
exercise can be.
Exceptionally however, in the present case, thanks to
material
published in our language by distinguished comparatists, German
as
well as English, we have direct access to publications which
should
sufficiently dispel our ignorance of German law and so by
comparison
illuminate our understanding of our own.
- 14 -
I have already
referred to problems created in the English law of
contract by the
doctrines of consideration and of privity of contract. These,
of
course, encourage us to seek a solution to problems of this kind
within our
law of tortious negligence. In German law, on the other
hand, in which the
law of delict does not allow for the recovery
of damages for pure economic
loss in negligence, it is natural
that the judges should extend the law of
contract to meet the
justice of the case. In a case such as the present, which
is
concerned with a breach of duty owed by a professional man (A) to
his
client (B), in circumstances in which practical justice
requires that a third
party (C) should have a remedy against the
professional man (A) in respect
of damage which he has suffered by
reason of the breach, German law may
have recourse to a doctrine
called Vertrag mit Schutzwirkung fur Dritte
(contract with
protective effect for third parties), the scope of which
extends
beyond that of an ordinary contract for the benefit of a
third party. (See
Professor Werner Lorenz in The Gradual
Convergence, ed. Markesinis (OUP
1994), pp. 65, 68-72.) This
doctrine was invoked by the German Supreme
Court in the
Testamentfall case (BGH 6 July 1965, NJW 1965, 1955) which
is
similar to the present case in that the plaintiff (C), through the
dilatoriness
of a lawyer (A) (instructed by her father (B)) in
making the necessary
arrangements for the father's will, was
deprived of a testamentary benefit
which she would have received
under the will if it had been duly made. The
plaintiff (C) was
held to be entitled to recover damages from the lawyer (A).
Professor
Lorenz has expressed the opinion (p. 70) that the ratio of that
case
would apply to the situation in Ross v. Caunters itself.
In these cases, it
appears that the court will examine "whether
the contracting parties intended
to create a duty of care in
favour of" the third person (BGH NJW 1984 355,
356), or
whether there is to be inferred "a protective obligation . . .
based on
good faith ..." (BGHZ 69, 82, 85 et seq.).
(Quotations taken in each case
from Professor Markesinis' article
on "An Expanding Tort Law - the Price of
a Rigid Contract
Law" (1987) 103 L.Q.R. 354, 363, 366, 368.) But any
such
inference of intention would, in English law, be beyond the
scope of our
doctrine of implied terms; and it is legitimate to
infer that the German
judges, in creating this special doctrine,
were extending the law of contract
beyond orthodox contractual
principles.
I wish next to
refer to another German doctrine known as
Drittschadensliquidation,
which is available in cases of transferred
loss
(Schadensverlagerung). In these cases, as a leading English
comparatist has
explained:
" ... the
person who has suffered the loss has no remedy while the
person
who has the remedy has suffered no loss. If such a situation
is
left unchallenged, the defaulting party may never face
the
consequences of his negligent conduct; his insurer may receive
an
unexpected (and undeserved) windfall; and the person on whom
the
loss has fallen may be left without any redress." See
Markesinis, The
German Law of Torts, 3rd ed., (1994) p. 56.
- 15 -
Under this
doctrine, to take one example, the defendant (A), typically
a
carrier, may be held liable to the seller of goods (B) for the
loss suffered by
the buyer (C) to whom the risk but not the
property in the goods has passed.
In such circumstances the seller
is held to have a contractual claim against the
carrier in respect
of the damage suffered by the buyer. This claim can be
pursued by
the seller against the carrier; but it can also be assigned by him
to
the buyer. If, exceptionally, the seller refuses either to exercise
his right
for the benefit of the buyer or to assign his claim to
him, the seller can be
compelled to make the assignment. (See
Professor Werner Lorenz in Essays
in Memory of Professor F.H.
Lawson (1986) 86, 89-90), and in The Gradual
Convergence
(OUP 1994) ed. Markesinis, 65, 88-89, 92-93; and Professor
Hein
Kotz in (1990) 10 Tel Aviv University Studies in Law 195,
209.)
Professor Lorenz (Essays at p. 89) has stated that it
is at least arguable that
the idea of Drittschadensliquidation
might be "extended so as to cover" such
cases as the
Testamentfall case, an observation which is consistent with
the
view expressed by the German Supreme Court that the two
doctrines may
overlap (BGH 19 January 1977, NJW 1977, 2073 = VersR
1977, 638:
translated in Markesinis, German Law of Torts, 3rd
ed., 293). At all events
both doctrines have the effect of
extending to the plaintiff the benefit of what
is, in substance, a
contractual cause of action; though, at least as seen
through
English eyes, this result is achieved not by orthodox
contractual
reasoning, but by the contractual remedy being made
available by law in order
to achieve practical justice.
Transferred loss in English law
I can deal with
this topic briefly. The problem of transferred loss has
arisen in
particular in maritime law, when a buyer of goods seeks to
enforce
against a shipowner a remedy in tort in respect of loss of
or damage to goods
at his risk when neither the rights under the
contract nor the property in the
goods has passed to him (see
Leigh & Sillivan Ltd. v. Aliakmon Shipping Co.
Ltd. [1985]
Q.B. 350, 399, per Robert Goff L.J. and [1986] A.C. 785,
820,
per Lord Brandon of Oakbrook). In cases such as these
(with all respect to
the view expressed by Lord Brandon in [1986] A.C. 785, 819) there was a
serious lacuna in the law, as was
revealed when all relevant interests in the
city of London called
for reform to make a remedy available to the buyers
who under the
existing law were without a direct remedy against the
shipowners.
The problem was solved, as a matter of urgency, by the Carriage
of
Goods by Sea Act 1992, I myself having the honour of introducing the
Bill
into your Lordships' House (acting in its legislative
capacity) on behalf of the
Law Commission. The solution adopted by
the Act was to extend the rights
of suit available under section 1
of the Bills of Lading Act 1855 (there
restricted to cases where
the property in the goods had passed upon or by
reason of the
consignment or endorsement of the relevant bill of lading) to
all
holders of bills of lading (and indeed other documents): see
section 2(1) of
the Act of 1992. Here is a sweeping statutory
reform, powered by the needs
of commerce, which has the effect of
enlarging the circumstances in which
- 16 -
contractual
rights may be transferred by virtue of the transfer of
certain
documents. For present purposes, however, an important
consequence is the
solution in this context of a problem of
transferred loss, the lacuna being filled
by statute rather than
by the common law. Moreover this result has been
achieved, as in
German law, by vesting in the plaintiff, who has suffered
the
relevant loss, the contractual rights of the person who has
stipulated for the
carrier's obligation but has suffered no loss.
I turn next to
English law in relation to cases such as the present.
Here there
is a lacuna in the law, in the sense that practical justice
requires
that the disappointed beneficiary should have a remedy
against the testator's
solicitor in circumstances in which neither
the testator nor his estate has in law
suffered a loss. Professor
Lorenz (Essays in Memory of Professor F.H.
Lawson, p.90)
has said that "this is a situation which comes very close to
the
cases of 'transferred loss', the only difference being that
the damage due to
the solicitor's negligence could never have been
caused to the testator or to his
executor". In the case of
the testator, he suffers no loss because (in contrast
to a gift by
an inter vivos settlor) a gift under a will cannot take effect
until
after the testator's death, and it follows that there can be
no depletion of the
testator's assets in his lifetime if the
relevant asset is, through the solicitors'
negligence, directed to
a person other than the intended beneficiary. The
situation is
therefore not one in which events have subsequently occurred
which
have resulted in the loss falling on another. It is one in which
the
relevant loss could never fall on the testator to whom the
solicitor owed a
duty, but only on another; and the loss which is
suffered by that other, i.e. an
expectation loss, is of a
character which in any event could never have been
suffered by the
testator. Strictly speaking, therefore, this is not a case
of
transferred loss.
Even so, the
analogy is very close. In practical terms, part or all of
the
testator's estate has been lost because it has been despatched to
a
destination unintended by the testator. Moreover, had a gift
been similarly
misdirected during the testator's lifetime, he
would either have been able to
recover it from the recipient or,
if not, he could have recovered the full
amount from the negligent
solicitor as damages. In a case such as the present,
no such
remedies are available to the testator or his estate. The will
cannot
normally be rectified: the testator has of course no
remedy: and his estate
has suffered no loss, because it has been
distributed under the terms of a valid
will. In these
circumstances, there can be no injustice if the intended
beneficiary
has a remedy against the solicitor for the full amount which
he
should have received under the will, this being no greater than
the damage for
which the solicitor could have been liable to the
donor if the loss had occurred
in his lifetime.
A contractual approach
It may be
suggested that, in cases such as the present, the simplest
course
would be to solve the problem by making available to the
disappointed
- 17 -
beneficiary, by
some means or another, the benefit of the contractual rights
(such
as they are) of the testator or his estate against the negligent
solicitor,
as is for example done under the German principle of
Vertrag mit
Schutzwirkung fur Dritte. Indeed that course has been
urged upon us by
Professor Markesinis in (1987) 103 L.Q.R. 354,
396-397, echoing a view
expressed by Professor Fleming in (1986) 4
O.J.L.S. 235, 241. Attractive
though this solution is, there is
unfortunately a serious difficulty in its way.
The doctrine of
consideration still forms part of our law of contract, as does
the
doctrine of privity of contract which is considered to exclude
the
recognition of a jus quaesitum tertio. To proceed as Professor
Markesinis has
suggested may be acceptable in German law, but in
this country could be open
to criticism as an illegitimate
circumvention of these long established
doctrines; and this
criticism could be reinforced by reference to the fact that,
in
the case of carriage of goods by sea, a contractual solution to a
particular
problem of transferred loss, and to other cognate
problems, was provided only
by recourse to Parliament.
Furthermore, I myself do not consider that the
present case
provides a suitable occasion for reconsideration of doctrines
so
fundamental as these.
The Albazero principle
Even so, I have
considered whether the present problem might be
solved by adding
cases such as the present to the group of cases referred to
by
Lord Diplock in The Albazero [1977] A.C. 774, 846-847. In
these cases,
a person may exceptionally sue in his own name to
recover a loss which he
has not in fact suffered, being personally
accountable for any damages so
recovered to the person who has in
fact suffered the loss. Lord Diplock was
prepared to accommodate
within this group the so-called rule in Dunlop v.
Lambert
(1839) 6 Cl. & F. 600, on the principle that:
"... in a
commercial contract concerning goods where it is in the
contemplation
of the parties that the proprietary interests in the goods
may be
transferred from one owner to another after the contract has
been
entered into and before the breach which causes loss or damage
to
the goods, an original party to the contract, if such be the
intention
of them both, is to be treated in law as having
entered into the contract
for the benefit of all persons who have
or may acquire an interest in
the goods before they are lost or
damaged, and is entitled to recover
by way of damages for breach
of contract the actual loss sustained by
those for whose benefit
the contract is entered into." [Emphasis
supplied].
Furthermore, in
Linden Gardens Trust Ltd. v. Lenesta Sludge
Disposals Ltd.
[1994] A.C. 85, your Lordships' House extended this group
of
cases to include a case in which work was done by the defendants
under a
contract with the first plaintiffs who, despite a
contractual bar against
assignment of their contractual rights
without the consent of the defendants,
had without consent
assigned them to the second plaintiffs who suffered
- 18 -
damage by
reason of defective work carried out by the defendants. It was
held
that, by analogy with the cases referred to in The Albazero,
[1977] A.C.
774 the first plaintiffs could recover the damages
from the defendants for the
benefit of the second plaintiffs. In
so holding, your Lordships' House relied
upon a passage in Lord
Diplock's speech (at p. 847) that "there may still be
occasional
cases in which the rule [in Dunlop v. Lambert] would
provide a
remedy where no other would be available to a person
sustaining loss which
under a rational legal system ought to be
compensated by the person who has
caused it".
The decision is
noteworthy in a number of respects. First, this was a
case of
transferred loss; and Lord Diplock's dictum, as applied by
your
Lordships' House, reflects a clear need for the law to find a
remedy in cases
of this kind. Second, your Lordships' House felt
able to do so in a case in
which there was a contractual bar
against assignment without consent; and as
a result, unlike Lord
Diplock, did not find it necessary to look for a common
intention
that the contract was entered into for the benefit of persons such
as
the second plaintiffs, which in this case, having regard to the
prohibition
against assignment, it plainly was not. Third, the
consequence was that your
Lordships' House simply made the remedy
available as a matter of law in
order to solve the problem of
transferred loss in the case before them.
Even so, the
result was only to enable a person to recover damages in
respect
of loss which he himself had not suffered, for the benefit of a
third
party. In the present case, there is the difficulty that the
third party (the
intended beneficiary) is seeking to recover
damages for a loss (expectation
loss) which the contracting party
(the testator) would not himself have
suffered. In any event,
under this principle, the third party who has suffered
the loss is
not able to compel the contracting party to sue for his benefit,
or
to transfer the right of action to him; still less is he
entitled to sue in his own
name. In the last analysis, this is
because any such right would be contrary
to the doctrine of
privity of contract. In consequence a principle such as this,
if
it could be extended to cases such as the present, would be of
limited value
because, quite apart from any other difficulties,
the family relationship may
be such that the executors may be
unwilling to assist the disappointed
beneficiary by pursuing a
claim of this kind for his benefit. Certainly, it
could not assist
the plaintiffs in the present case, who very understandably
are
proceeding against the solicitors by a direct action in their
own name.
The tortious solution
I therefore
return to the law of ton for a solution to the problem. For
the
reasons I have already given, an ordinary action in tortious
negligence on
the lines proposed by Sir Robert Megarry V.-C. in
Ross v. Caunters [1980]
Ch. 297 must, with the greatest
respect, be regarded as inappropriate,
because it does not meet
any of the conceptual problems which have been
raised.
Furthermore, for the reasons I have previously given, the
Hedley
Byrne principle cannot, in the absence of special
circumstances, give rise on
- 19 -
ordinary
principles to an assumption of responsibility by the testator's
solicitor
towards an intended beneficiary. Even so it seems to me
that it is open to
your Lordships' House, as in the Lenesta
Sludge case [1994] A.C. 85, to
fashion a remedy to fill a
lacuna in the law and so prevent the injustice which
would
otherwise occur on the facts of cases such as the present. In
the
Lenesta Sludge case [1994] A.C. 85, as I have said, the
House made available
a remedy as a matter of law to solve the
problem of transferred loss in the
case before them. The present
case is, if anything, a fortiori, since the nature
of the
transaction was such that, if the solicitors were negligent and
their
negligence did not come to light until after the death of
the testator, there
would be no remedy for the ensuing loss unless
the intended beneficiary could
claim. In my opinion, therefore,
your Lordships' House should in cases such
as these extend to the
intended beneficiary a remedy under the Hedley Byrne
principle
by holding that the assumption of responsibility by the
solicitor
towards his client should be held in law to extend to
the intended beneficiary
who (as the solicitor can reasonably
foresee) may, as a result of the solicitor's
negligence, be
deprived of his intended legacy in circumstances in which
neither
the testator nor his estate will have a remedy against the
solicitor.
Such liability will not of course arise in cases in
which the defect in the will
comes to light before the death of
the testator, and the testator either leaves
the will as it is or
otherwise continues to exclude the previously intended
beneficiary
from the relevant benefit. I only wish to add that, with the
benefit
of experience during the fifteen years in which Ross v.
Caunters has been
regularly applied, we can say with some
confidence that a direct remedy by
the intended beneficiary
against the solicitor appears to create no problems in
practice.
That is therefore the solution which I would recommend to
your
Lordships.
As I see it,
not only does this conclusion produce practical justice as
far as
all parties are concerned, but it also has the following
beneficial
consequences:
There is no unacceptable
circumvention of established
principles of the law of
contract.
No problem arises by reason of
the loss being of a purely
economic character.
Such assumption of responsibility
will of course be subject to
any term of the contract between the
solicitor and the testator
which may exclude or restrict the
solicitor's liability to the
testator under the principle in
Hedley Byrne. It is true that
such a term would be most
unlikely to exist in practice; but as
a matter of principle it
is right that this largely theoretical
question should be
addressed.
Since the Hedley Byrne
principle is founded upon an
assumption of
responsibility, the solicitor may be liable for
- 20 -
negligent
omissions as well as negligent acts of commission:
see the Midland
Bank Trust Co. case [1979] Ch. 384, 416, per
Oliver J.,
and Henderson v. Merrett Syndicates Ltd.
[1994] 3 W.L.R.
761, 777, per Lord Goff of Chieveley. This
conclusion
provides justification for the decision of the Court
of Appeal to
reverse the decision of Turner J. in the present
case, although
this point was not in fact raised below or before
your Lordships.
(5) I do not
consider that damages for loss of an expectation are
excluded in
cases of negligence arising under the principle in
Hedley
Byrne, simply because the cause of action is classified
as
tortious. Such damages may in principle be recoverable in
cases of
contractual negligence; and I cannot see that, for
present
purposes, any relevant distinction can be drawn
between the two
forms of action. In particular, an expectation
loss may well occur
in cases where a professional man, such as
a solicitor, has
assumed responsibility for the affairs of
another; and I for my
part can see no reason in principle why
the professional man
should not, in an appropriate case, be
liable for such loss under
the Hedley Byrne principle.
In the result,
all the conceptual problems, including those which so
troubled
Lush and Murphy JJ. in Seale v. Perry [1982] V.R. 193, can be
seen
to fade innocuously away. Let me emphasise that I can see no
injustice in
imposing liability upon a negligent solicitor in a
case such as the present
where, in the absence of a remedy in this
form, neither the testator's estate
nor the disappointed
beneficiary will have a claim for the loss caused by his
negligence.
This is the injustice which, in my opinion, the judges of
this
country should address by recognising that cases such as
these call for an
appropriate remedy, and that the common law is
not so sterile as to be
incapable of supplying that remedy when it
is required.
Unlimited claims
I come finally
to the objection that, if liability is recognised in a case
such
as the present, it will be impossible to place any sensible limits to
cases
in which recovery is allowed. Before your Lordships, as
before the Court of
Appeal, Mr. Matheson conjured up the spectre
of solicitors being liable to an
indeterminate class, including
persons unborn at the date of the testator's
death. I must confess
that my reaction to this kind of argument was very
similar to that
of Cooke J. in Gartside v. Sheffield, Young & Ellis
[1983]
N.Z.L.R. 37, 44, when he said that he was not
"persuaded that we should
decide a fairly straightforward
case against the dictates of justice because of
foreseeable
troubles in more difficult cases". We are concerned here with
a
liability which is imposed by law to do practical justice in a
particular type of
case. There must be boundaries to the
availability of a remedy in such cases;
but these will have to be
worked out in the future, as practical problems come
- 21 -
before the
courts. In the present case Sir Donald Nicholls V.-C. observed
that,
in cases of this kind, liability is not to an indeterminate class,
but to the
particular beneficiary or beneficiaries whom the client
intended to benefit
through the particular will. I respectfully
agree, and I also agree with him
that the ordinary case is one in
which the intended beneficiaries are a small
number of identified
people. If by any chance a more complicated case
should arise to
test the precise boundaries of the principle in cases of this
kind,
that problem can await solution when such a case comes forward
for
decision.
Conclusion
For these reasons I would dismiss the appeal with costs.
LORD BROWNE-WILKINSON
My Lords,
I have read the
speech of my noble and learned friend Lord Goff of
Chieveley and
agree with him that this appeal should be dismissed. In
particular,
I agree that your Lordships should hold that the defendant
solicitors
were under a duty of care to the plaintiffs arising
from an extension of the
principle of assumption of responsibility
explored in Hedley Byrne and Co.
Ltd. v. Heller and Partners
Ltd. [1964] A.C. 465. In my view, although the
present case is
not directly covered by the decided cases, it is legitimate to
extend
the law to the limited extent proposed using the incremental
approach
by way of analogy advocated in Caparo Industries Plc.
v. Dickman
[1990] 2 A.C. 605. To explain my reasons requires
me to attempt an analysis
of what is meant by "assumption of
responsibility" in the law of negligence.
To avoid
misunderstanding I must emphasise that I am considering only
whether
some duty of care exists, not with the extent of that duty which
will
vary according to the circumstances.
Far from that
concept having been invented by your Lordships House
in Hedley
Byrne, its genesis is to be found in Nocton v. Lord
Ashburton
[1914] A.C. 932. It is impossible to analyse what is
meant by "assumption
of responsibility" or "the
Hedley Byrne principle" without first having regard
to
Nocton's case. In that case, the plaintiff, Lord Ashburton,
had relied on
advice by his solicitor, Nocton, in relation to
certain lending transactions.
The determination of the case was
bedeviled by questions of pleading. The
trial judge and the Court
of Appeal took the view that on the pleadings the
plaintiff could
only succeed if he proved fraud. In their view Lord Ashburton
could
not succeed in negligence since it had not been pleaded. This
House
(whilst rejecting the finding of fraud against Nocton) held
that the pleadings
sufficiently alleged a fiduciary duty owed to
Lord Ashburton by Nocton as his
solicitor and held that Nocton had
breached that fiduciary duty by giving
- 22 -
negligent
advice. In rejecting the notion that Derry v. Peek (1889) 14
App.
Cas. 337 precluded a finding of such liability, Viscount
Haldane L.C. said,
at p. 948:
"Although
liability for negligence in word has in material respects
been
developed in our law differently from liability for negligence
in
act, it is none the less true that a man may come under a
special duty
to exercise care in giving information or advice. I
should accordingly
be sorry to be thought to lend countenance to
the idea that recent
decisions have been intended to stereotype
the cases in which people
can be held to have assumed such a
special duty. Whether such a duty
has been assumed must depend on
the relationship of the parties, and
it is at least certain that
there are a good many cases in which that
relationship may be
properly treated as giving rise to a special duty of
care in
statement."
Lord Haldane
reverted to the same point in Robinson v. National Bank
of
Scotland Ltd. 1916 S.C. (H.L.) 154, 157:
"I wish
emphatically to repeat what I said in advising this House in the
case
of Nocton v. Lord Ashburton, that it is a great mistake to
suppose
that, because the principle in Derry v. Peek
clearly covers all cases of
the class to which I have
referred, therefore the freedom of action of
the courts in
recognising special duties arising out of other kinds of
relationship
which they find established by the evidence is in any way
affected.
I think, as I said in Nocton's case, that an exaggerated
view
was taken by a good many people of the scope of the decision
in Derry
v. Peek. The whole of the doctrine as to fiduciary
relationships, as to
the duty of care arising from implied as well
as expressed contracts,
as to the duty of care arising from other
special relationships which the
courts may find to exist in
particular cases, still remains, and I should
be very sorry if any
word fell from me which should suggest that the
courts are in any
way hampered in recognising that the duty of care
may be
established when such cases really occur."
In my judgment,
there are three points relevant to the present case
which should
be gathered from Nocton. First, there can be
special
relationships between the parties which give rise to the
law treating the
defendant as having assumed a duty to be careful
in circumstances where,
apart from such relationship, no duty of
care would exist. Second, a fiduciary
relationship is one of those
special relationships. Third, a fiduciary
relationship is not the
only such special relationship: other relationships may
be held to
give rise to the same duty.
The second of
those propositions merits further consideration, since if
we can
understand the nature of one "special relationship" it may
cast light on
when, by analogy, it is appropriate for the law to
treat other relationships as
- 23 -
being
"special". The paradigm of the circumstances in which
equity will find
a fiduciary relationship is where one party, A,
has assumed to act in relation
to the property or affairs of
another, B. A, having assumed responsibility,
pro tanto, for B's
affairs, is taken to have assumed certain duties in relation
to
the conduct of those affairs, including normally a duty of care.
Thus, a
trustee assumes responsibility for the management of the
property of the
beneficiary, a company director for the affairs of
the company and an agent
for those of his principal. By so
assuming to act in B's affairs, A comes
under fiduciary duties to
B. Although the extent of those fiduciary duties
(including duties
of care) will vary from case to case some duties (including
a duty
of care) arise in each case. The importance of these considerations
for
present purposes is that the special relationship (i.e. a
fiduciary relationship)
giving rise to the assumption of
responsibility held to exist in Nocton does not
depend on
any mutual dealing between A and B, let alone on any
relationship
akin to contract. Although such factors may be
present, equity imposes the
obligation because A has assumed to
act in B's affairs. Thus, a trustee is
under a duty of care to his
beneficiary whether or not he has had any dealing
with him: indeed
he may be as yet unborn or unascertained and therefore any
direct
dealing would be impossible.
Moreover, this
lack of mutuality in the typical fiduciary relationship
indicates
that it is not a necessary feature of all such special relationships
that
B must in fact rely on A's actions. If B is unaware of the
fact that A has
assumed to act in B's affairs (e.g. in the case of
B being an unascertained
beneficiary) B cannot possibly have
relied on A. What is important is not that
A knows that B is
consciously relying on A, but A knows that B's economic
well being
is dependent upon A's careful conduct of B's affairs. Thus, in
my
judgment Nocton demonstrates that there is at least one
special relationship
giving rise to the imposition of a duty of
care that is dependent neither upon
mutuality of dealing nor upon
actual reliance by the plaintiff on the defendants
actions.
I turn then to
consider Hedley Byrne [1964] A.C. 465. In that case
this
House had to consider the circumstances in which there could be
liability
for negligent misstatement in the absence of either a
contract or a fiduciary
relationship between the parties. The
first, and for present purposes perhaps
the most important, point
is that there is nothing in Hedley Byrne to cast doubt
on
the decision in Nocton. On the contrary, each of their
Lordships treated
Nocton as their starting point and asked
the question "in the absence of any
contractual or fiduciary
duty, what circumstances give rise to a special
relationship
between the plaintiff and the defendant sufficient to justify
the
imposition of the duty of care in the making of statements?"
The House was
seeking to define a further special relationship in
addition to, not in
substitution for, fiduciary relationships: see
per Lord Reid, p. 486; Lord
Morris of Borth-y-Gest, p. 502;
Lord Hodson, p. 511; Lord Devlin, p. 523;
Lord Pearce, p. 539.
- 24 -
Second, since
this House was concerned with cases of negligent
misstatement or
advice, it was inevitable that any test laid down required both
that
the plaintiff should rely on the statement or advice and that the
defendant
could reasonably foresee that he would do so. In the
case of claims based on
negligent statements (as opposed to
negligent actions) the plaintiff will have
no cause of action at
all unless he can show damage and he can only have
suffered damage
if he has relied on the negligent statement. Nor will a
defendant
be shown to have satisfied the requirement that he should
foresee
damage to the plaintiff unless he foresees such reliance
by the plaintiff as to
give rise to the damage. Therefore,
although reliance by the plaintiff is an
essential ingredient in a
case based on negligent misstatement or advice, it
does not follow
that in all cases based on negligent action or inaction by
the
defendant it is necessary in order to demonstrate a special
relationship that the
plaintiff has in fact relied on the
defendant or the defendant has foreseen such
reliance. If in such
a case careless conduct can be foreseen as likely to cause
and
does in fact cause damage to the plaintiff that should be sufficient
to
found liability.
Third, it is
clear that the basis on which (apart from the disclaimer)
the
majority would have held the bank liable for negligently
giving the reference
was that, were it not for the disclaimer, the
bank would have assumed
responsibility for such reference.
Although there are passages in the speeches
which may point the
other way, the reasoning of the majority in my judgment
points
clearly to the fact that the crucial element was that, by choosing
to
answer the enquiry, the bank had assumed to act, and thereby
created the
special relationship on which the necessary duty of
care was founded. Thus
Lord Reid, at p. 486, pointed out that a
reasonable man knowing that he was
being trusted, had three
possible course open to him: to refuse to answer, to
answer but
with a disclaimer of responsibility, or simply to answer without
such
disclaimer. Lord Reid then said:
"If he
chooses to adopt the last course he must. I think, be held to
have
accepted some responsibility for his answer being given carefully,
or
to have accepted a relationship with the inquirer which requires
him
to exercise such care as the circumstances require."
Lord Morris of Borth-y-Gest said, at p. 503:
"Furthermore,
if in a sphere in which a person is so placed that others
could
reasonably rely upon his judgment or his skill or upon his ability
to
make careful inquiry, a person takes it upon himself to
give
information or advice to, or allows his information or advice
to be
passed on to, another person who, as he knows or should
know, will
place reliance upon it, then a duty of care will
arise."
Lord Hodson, at
p. 514, in agreeing with the formulation of Lord Morris
referred
to the maker of the careless statement being a person who "takes
it
upon himself to give information or advice to ... another
person." Although
- 25 -
Lord Devlin did
not find it necessary for the decision of that case to go
further
than to hold that a special relationship giving rise to a duty of
care
would exist when the relationship was "equivalent to
contract" he indicated (at
p. 530) that he agreed with the
formulation by the other members of the
committee of the general
rules giving rise to a "voluntary undertaking to
assume
responsibility". Moreover he had previously (at p. 526) referred
to
Coggs v. Bernard (1703) 2 Ld. Raym. 909 (where Gould J.
held a gratuitous
bailee liable because of "the particular
trust reposed in the defendant, to which
he has concurred by
his assumption, and in the executing which he has
miscarried
by his neglect") and the statement of Lord Finlay L.C. in
Banbury
v. Bank of Montreal [1918] A.C. 626, 654 "He
is under no obligation to
advise, but if he takes it upon himself
to do so, he will incur liability if he
does so negligently".
Lord Devlin, at p. 530, drew a distinction between the
case where
there is a general relationship (such as solicitor and client
or
banker and customer) where the pre existing relationship is
enough to create
the special relationship necessary and a case
such as that before the House
where what is relied upon is a
particular relationship created ad hoc. He said
that in such a
case it would be necessary to examine the particular facts to
see
whether there is an express or implied undertaking of
responsibility. This and
the other passages that I have quoted
indicates that even in the case of an ad
hoc special relationship
the requirement is to show that the defendant has
assumed to act
by giving an answer.
Just as in the
case of fiduciary duties, the assumption of responsibility
referred
to is the defendants, assumption of responsibility for the task not
the
assumption of legal liability. Even in cases of ad hoc
relationships, it is the
undertaking to answer the question posed
which creates the relationship. If
the responsibility for the task
is assumed by the defendant he thereby creates
a special
relationship between himself and the plaintiff in relation to which
the
law (not the defendant) attaches a duty to carry out carefully
the task so
assumed. If this be the right view, it does much to
allay the doubts about the
utility of the concept of assumption of
responsibility voiced by Lord Griffiths
in Smith v. Eric S.
Bush [1990] 1 A.C. 831, 862 and by Lord Roskill in
Caparo
Industries Plc v. Dickman [1992] A.C. 605, 628: see also
Barker
Unreliable Assumptions in the Modern Law of Negligence
(1993) 109 L.Q.R.
461. As I read those judicial criticisms
they proceed on the footing that the
phrase "assumption of
responsibility" refers to the defendant having assumed
legal
responsibility. I doubt whether the same criticisms would have
been
directed at the phrase if the words had been understood, as I
think they should
be, as referring to a conscious assumption of
responsibility for the task rather
than a conscious assumption of
legal liability by the plaintiff for its careful
performance.
Certainly, the decision in both cases is consistent with the view
I
take.
In Henderson
v. Merrett Syndicates Ltd. [1994] 3 W.L.R. 761 your
Lordships
recently applied the concept of assumption of liability to
cases
where the defendants (the managing agents) had pursuant to a
contract with
a third party (the members' agents) undertaken the
management of the
-26-
underwriting
affairs of the plaintiffs. For the present purposes the case
is
important for two reasons. First, it shows (if it was
previously in doubt) that
the principle of a special relationship
arising from the assumption of
responsibility is as applicable to
a case of negligent acts giving rise to pure
economic loss as it
is to negligent statement. Second, it demonstrates that the
fact
that the defendant assumed to act in the plaintiffs' affairs pursuant
to a
contract with a third party is not necessarily incompatible
with the finding
that, by so acting, the defendant also entered
into a special relationship with
the plaintiff with whom he had no
contract. (I should add that I agree with
my noble and learned
friend Lord Mustill that this factor should not lead to
the
conclusion that a duty of care will necessarily be found to exist
even
where there is a contractual chain of obligations designed by
the parties to
regulate their dealings).
Let me now seek
to bring together these various strands so far as is
necessary for
the purposes of this case: I am not purporting to give
any
comprehensive statement of this aspect of the law. The law of
England does
not impose any general duty of care to avoid
negligent misstatements or to
avoid causing pure economic loss
even if economic damage to the plaintiff
was foreseeable. However,
such a duty of care will arise if there is a special
relationship
between the parties. Although the categories of cases in which
such
special relationship can be held to exist are not closed, as yet only
two
categories have been identified, viz. (1) where there is a
fiduciary relationship
and (2) where the defendant has voluntarily
answered a question or tenders
skilled advice or services in
circumstances where he knows or ought to know
that an identified
plaintiff will rely on his answers or advice. In both
these
categories the special relationship is created by the
defendant voluntarily
assuming to act in the matter by involving
himself in the plaintiff's affairs or
by choosing to speak. If he
does so assume to act or speak he is said to have
assumed
responsibility for carrying through the matter he has entered
upon.
In the words of Lord Reid in Hedley Byrne [1964] A.C. 465, 486 "he has
accepted a relationship ... which requires
him to exercise such care as the
circumstances require", i.e.
although the extent of the duty will vary from
category to
category, some duty of care arises from the special
relationship.
Such relationship can arise even though the
defendant has acted in the
plaintiffs affairs pursuant to a
contract with a third party.
I turn then to
apply those considerations to the case of a solicitor
retained by
a testator to draw a will in favour of an intended beneficiary. As
a
matter of contract, a solicitor owes a duty to the testator to use
proper skill
in the preparation and execution of the will and to
act with due speed. But as
the speech of Lord Goff demonstrates
that contractual obligation is of little
utility. Breach by the
solicitor of such contractual duty gives rise to no
damage
suffered by the testator or his estate; under our existing law
of
contract, the intended beneficiary, who has suffered the
damage, has no cause
of action on the contract.
- 27 -
Has the
intended beneficiary a cause of action based on breach of a
duty
of care owed by the solicitor to the beneficiary? The answer to
that
question is dependent upon whether there is a special
relationship between the
solicitor and the intended beneficiary to
which the law attaches a duty of care.
In my judgment the case
does not fall within either of the two categories of
special
relationships so far recognised. There is no fiduciary duty owed
by
the solicitor to the intended beneficiary. Although the
solicitor has assumed
to act in a matter closely touching the
economic wellbeing of the intended
beneficiary, the intended
beneficiary will often be ignorant of that fact and
cannot
therefore have relied upon the solicitor.
However, it is
clear that the law in this area has not ossified. Both
Viscount
Haldane L.C. (in the passage I have quoted [1914] A.C. 932, 948)
and
Lord Devlin (in Hedley Byrne [1964] A.C. 465, 530-531)
envisage that
there might be other sets of circumstances in which
it would be appropriate
to find a special relationship giving rise
to a duty of care. In Caparo Lord
Bridge of Harwich [1990] 2 A.C. 605, 618, recognised that the law will
develop novel
categories of negligence "incrementally and by analogy
with
established categories". In my judgment, this is a case
where such
development should take place since there is a close
analogy with existing
categories of special relationship giving
rise to a duty of care to prevent
economic loss.
The solicitor
who accepts instructions to draw a will knows that the
future
economic welfare of the intended beneficiary is dependent upon
his
careful execution of the task. It is true that the intended
beneficiary (being
ignorant of the instructions) may not rely on
the particular solicitor's actions.
But, as I have sought to
demonstrate, in the case of a duty of care flowing
from a
fiduciary relationship liability is not dependent upon actual
reliance by
the plaintiff on the defendant's actions but on the
fact that, as the fiduciary is
well aware, the plaintiffs economic
wellbeing is dependent upon the proper
discharge by the fiduciary
of his duty. Second, the solicitor by accepting the
instructions
has entered upon, and therefore assumed responsibility for, the
task
of procuring the execution of a skilfully drawn will knowing that
the
beneficiary is wholly dependent upon his carefully carrying
out his function.
That assumption of responsibility for the task
is a feature of both the two
categories of special r