Perry v Raleys Solicitors [2019] UKSC 5

A retired miner with Vibration White Finger sued his former solicitors for negligently failing to advise him to claim a Services Award. The Supreme Court restored the trial judge's decision, holding the claimant had failed to prove he would have made an honest claim.

Facts

Mr Frank Perry, a retired miner, developed Vibration White Finger (VWF), a condition caused by excessive use of vibratory tools that can reduce grip strength and manual dexterity. Following the establishment in 1999 of a government compensation scheme (administered under a Claims Handling Arrangement) for miners suffering from VWF, qualifying claimants could obtain both general damages and a Services Award. The Services Award compensated those who, because of VWF, could no longer perform, without assistance, six routine domestic tasks (gardening, window cleaning, DIY, decorating, car washing and car maintenance) that they had previously carried out unaided.

Mr Perry retained Raleys Solicitors to pursue his claim. Although a medical examination staged his VWF at a level that would have entitled him to a presumption in favour of a Services Award, he settled in November 1999 for general damages only (£11,600), making no claim for a Services Award within the available time-frame. In 2009 he issued professional negligence proceedings against Raleys, claiming that their negligent failure to advise him had caused him to lose the opportunity to claim a Services Award worth approximately £17,300. Raleys admitted breach of duty shortly before trial but denied causation.

After a two-day trial, Judge Saffman dismissed the claim, finding that Mr Perry lacked credibility and had not proven he could have made an honest claim for a Services Award. His evidence of disability was undermined by medical records showing no contemporaneous complaint of manual dexterity problems, and by photographic and other evidence of him fishing and gardening at relevant times. The Court of Appeal reversed this decision, and Raleys appealed to the Supreme Court.

Issues

The principal issues were: (1) whether the trial judge had erred in law by conducting a ‘trial within a trial’ of factual questions that would have arisen in the underlying Services Award claim; (2) whether the judge wrongly imposed the burden on Mr Perry to prove, on the balance of probabilities, that he would have made an honest (and successful) claim; and (3) whether the Court of Appeal was entitled to overturn the trial judge’s findings of fact.

Arguments

Raleys argued that the judge had correctly applied the law on causation in professional negligence claims, that Mr Perry was required to prove on the balance of probabilities that he would have brought an honest claim, and that the Court of Appeal had wrongly interfered with carefully reasoned findings of fact.

Mr Perry argued that the judge had impermissibly conducted a trial within a trial, had wrongly required him to prove that his underlying claim would have succeeded on the balance of probabilities rather than treating the matter as a loss of a chance, and that the Court of Appeal was entitled to reverse the findings of fact.

Judgment

The Supreme Court (Lord Briggs, with whom Lady Hale, Lord Wilson, Lord Hodge and Lord Lloyd-Jones agreed) allowed Raleys’ appeal and restored the trial judge’s order.

The Law on Causation

Lord Briggs affirmed the dividing line established in Allied Maples Group Ltd v Simmons & Simmons [1995] 1 WLR 1602: matters which depend on what the claimant would have done had they received competent advice must be proved on the balance of probabilities, whereas matters depending on what third parties would have done fall to be assessed on a loss of chance basis. Mr Perry therefore had to prove on the balance of probabilities that, properly advised, he would have made a claim for a Services Award.

Honesty Requirement

The Court held the claim would also have to be an honest one. Relying on Kitchen v Royal Air Force Association [1958] 1 WLR 563, the Court observed that nuisance value claims fall outside recoverable lost claims, and dishonest claims must a fortiori be excluded. The Court identified three policy reasons: solicitors would not advise pursuit of claims not honestly grounded; the court may presume clients would only make honest claims; and courts should not reward dishonesty.

Trial Within a Trial

The Court held that the judge was entitled to conduct a full adversarial trial of whether Mr Perry would have brought an honest claim. The authorities relied on by the Court of Appeal (including Mount v Barker Austin, Hanif v Middleweeks, Sharif v Garrett and Dixon v Clement Jones) all concerned situations where a pending claim was already in existence and the client did not have to prove that they would have done something to initiate the claim. Those cases fell on the loss of chance side of the Allied Maples dividing line. They did not establish a principle that it is always wrong to investigate facts relevant to causation simply because those same facts would have arisen in the underlying claim.

The Judge’s Approach

Reading the reserved judgment as a whole, the Supreme Court concluded that Judge Saffman had not imposed an additional burden of proving success beyond proving an honest claim with a more than negligible prospect of success. The reference to a ‘successful’ claim was shorthand for the prospects-of-success threshold.

Findings of Fact

Citing Henderson v Foxworth Investments Ltd, McGraddie v McGraddie and Fage UK Ltd v Chobani UK Ltd, the Court emphasised the very stringent constraints on appellate interference with findings of fact. The question is whether the decision is one no reasonable judge could have reached. The Court of Appeal’s criticisms – concerning the adequacy of cross-examination putting dishonesty to Mr Perry, the weight given to medical evidence from Professor Kester and Mr Tennant, the alleged misunderstanding of the Scheme, and the rationality of rejecting the family’s evidence – did not meet that high threshold. Credibility was pre-eminently a matter for the trial judge, and there was ample material (including hostile medical records and photographic evidence) upon which he could reach his conclusions.

Implications

The decision reaffirms the Allied Maples dividing line in professional negligence cases: what the claimant would have done must be proved on the balance of probabilities, while what third parties would have done is assessed as a loss of chance. It confirms that the loss of chance doctrine does not prevent a court from conducting full adversarial examination of facts where those facts bear on matters the claimant must prove to establish causation, even where those same facts would have been in issue in the underlying claim.

The case is significant for establishing that clients cannot recover damages in professional negligence for the lost opportunity to bring a dishonest claim. This matters to solicitors defending professional negligence actions, particularly those arising from mass tariff-based compensation schemes, and to claimants who must expect rigorous forensic scrutiny of their evidence concerning what they would have done had competent advice been given.

The judgment also reinforces the strict limits on appellate interference with trial judges’ findings of fact, particularly on credibility. An appellate court cannot substitute its own view merely because it would have decided differently; it must find that no reasonable judge could have reached the decision under appeal. The decision is thus important both for the law on causation in professional negligence and for the doctrine of appellate restraint regarding factual findings.

Verdict: Appeal allowed. The Supreme Court set aside the Court of Appeal’s decision and restored the trial judge’s order dismissing Mr Perry’s claim. The trial judge had correctly held that Mr Perry failed to prove on the balance of probabilities that, properly advised, he would have made an honest claim for a Services Award, and the Court of Appeal had been wrong both in law and in interfering with the judge’s findings of fact.

Source: Perry v Raleys Solicitors [2019] UKSC 5