Case update: The Extent of a Professional’s Duty of Care

By James Gould on

We have previously looked at duties of care and the tort of negligence in another article. Here we saw that the duty of care owed by a professional to his client is likely to be wider than that of a non-professional.  However, how wide is it?  Can a professional limit his duty of care solely to matters that he has been instructed to address? Or does his duty of care extend to any matter that may come to his attention while he is instructed?

Following the case of Credit Lyonnais SA v Russell Jones & Walker [2002] EWHC 1310, it had appeared that the latter was the case.  However, this has now been called into question by a recent decision of the High Court in the case of Denning v Greenhalgh Financial Services Ltd [2017] EWHC 143 (QB)

Background

This case concerned a claim for professional negligence against a pensions adviser. Mr Denning argued that under the terms of the relevant retainer, the pensions adviser should have reviewed advice given to Denning by an alternative pensions adviser eight years before.  The pensions adviser had not reviewed the earlier advice and the Claimant had suffered a loss.  Denning sought to rely upon the authority of the Credit Lyonnais case to establish that the pensions adviser should have advised him that the earlier advice was flawed.

Decision

Giving judgment in the High Court, Mr Justice Green dismissed the claim.  Green J provided a helpful analysis of the type of situation in which a professional may be held to owe a client a duty of care beyond the strict terms of the retainer.  His principal observations were that for a duty of care to extend beyond the retainer:

  • The matter that should have been advised upon would need to be something for which the professional was being paid (and would not entail extra work);

 

  • There would have to be an obvious and close link between the matters the Claimant alleged should have been advised upon, and the actual terms of the retainer; and

 

  • All of the information required by the professional in order to give the advice would need to be before the professional.

 

The consequence of Green J’s judgment in Denning is to restrict the extent of a professional’s duty of care to matters that fall directly within the retainer.  However, it is still clear from the judgment that where a professional uncovers an obvious and direct risk to the client, then he should advise upon this and failure to do so would still constitute a breach of duty.  Nonetheless, a professional would not be expected to go out of his way to look for possible dangers that may be hidden in the paperwork.

Do you believe that you have been a victim of professional negligence?  If so, the experienced litigation team at Levi Solicitors can assist you.