A Chance, Ever So Small

We last looked at the law relating to loss of chance in the Winter 2001 Solicitors' Liability Briefing, and noted then that claims relating to lost litigation are on the increase. Part of the reason for this is that claims for loss of chance arguably constitute an easier route to a successful award than proving a claim on the balance of probabilities. With the latter, success can lead to a full recovery whereas failure yields nothing; loss of chance claims offer the prospect of some recovery, arguably without the same burden of proof. The recent Court of Appeal decision in Sharpe v Addison shows that even a very small prospect of success in the original claim can be sufficient to found a successful claim against the solicitor who conducted that litigation.

A SMALL CHANCE IS ENOUGH

We assume that most readers will be familiar with the leading authorities on loss of chance, such as Kitchen v RAFA (1958) and Allied Maples v Simmons & Simmons (1991). The common thread underpinning this line of authorities is that the assessment of the chance that the Claimant has lost depends on the actions of a hypothetical third party. In lost litigation claims, the 'independent third party' is either the court (which will involve speculation as to what would have happened at trial) or the other party to the litigation (speculation about the basis on which the claim would have settled etc). In order to succeed, the Claimant has to show firstly that on the balance of probabilities, the litigation in question would in fact have proceeded, and secondly, that on the balance of probabilities there was a 'real or substantial, rather than a speculative' chance that the third party would have acted to confer a benefit on the Claimant (Stuart-Smith LJ in Allied Maples). Once the Claimant has established that the Defendant's negligence deprived him of that 'real or substantial' chance, the valuation of that chance is purely a question of quantum, and can therefore, in percentage terms, be less than the balance of probabilities threshold which is 50%.

In Sharpe v Addison (2003), the Claimant pedestrian suffered serious injuries when struck by a taxi while crossing a road, and consulted the Defendant solicitor who brought an action against the driver on the Claimant's behalf. However, the Defendant failed to notify the driver's insurers pursuant to road traffic legislation with the result that insurers were released from their obligation to indemnify the driver. As...