This Week's Caselaw
John Youngs v Aviva
Fiduciary duties under an insurance claims handling agreement
http://www.bailii.org/ew/cases/EWHC/TCC/2011/1515.html
The claimant and the defendant insurance company entered into an agreement, whereby the claimant handled claims for the insurer and undertook building repair work where the damage was insured. Following a termination of the agreement, the claimant sought further payment and the insurer counterclaimed. Of issue in this case was whether the claimant owed a fiduciary duty to account and whether the insurer was entitled to an account and enquiry.
Ramsey J concluded as follows:
(1) A distinction had to be made between the different obligations imposed on the claimant under the agreement. Where the claimant acted as the insurer's agent in deciding whether a claim was valid, the insurer was trusting it to act loyally in the insurer's best interests and so a fiduciary relationship arose. However, in producing estimates of the work to be done, there was no fiduciary relationship - instead that was a commercial relationship. Similarly, the claimant was not acting as a fiduciary when it provided building repair services.
(2) This was not a case where the claimant controlled property or money belonging to the insurer. The claimant owed an equitable duty to account only when it validated or repudiated a claim. However, not all the information requested by the insurer related to this aspect of the claimant's activities.
(3) A duty to account did, however, arise separately under the agreement as well and, on the facts, this duty continued after the termination of the agreement.
Wright v Cambridge Medical Group
Medical negligence claim and causation where both GP and hospital were negligent
http://www.bailii.org/ew/cases/EWCA/Civ/2011/669.html
The defendant GP failed to examine the claimant. Had he done so, he would have realised that she ought to be transferred to hospital. Two days passed before she was referred. However, the hospital failed to give her the necessary medication for a further two days and by that time her injury was permanent. She sued the GP but the hospital was not joined to the proceedings. At first instance the judge dismissed the claim on the basis that even if she had been referred to hospital earlier, she would not have been treated properly and would have suffered permanent injury anyway.
By a majority of 2:1, the Court of Appeal has allowed the claimant's appeal.
Lord Neuberger MR held that "it seems to me that, in a case where a doctor has negligently failed to refer his patient to a hospital, and, as a consequence, she has lost the opportunity to be treated as she should have been by a hospital, the doctor cannot escape liability by establishing that the hospital would have negligently failed to treat the patient appropriately, even if he had promptly referred her...because, by negligently failing to refer the patient promptly, he deprived her of the opportunity to be treated properly by the hospital, and, if they had not treated her properly, that opportunity would be reflected by the fact that she would have been able to recover damages from them". He added that it would be appropriate for the Supreme Court to consider whether the loss of a chance doctrine should be expanded into the clinical negligence field (although he would have rejected the appeal had it been based on that argument alone). Dame Smith also allowed the appeal but on the basis that the GP's negligence shortened the period available to the hospital to provide effective treatment and so increased the risk of permanent harm.
Naylor v Monahan & Anor
Appealing against summary assessment of costs
http://www.bailii.org/ew/cases/EWHC/QB/2011/1412.html
The claimant sought permission to appeal on the basis that the trial judge had failed to undertake the summary assessment of costs in accordance with the CPR. In particular, it was argued that the judge had failed to give an explanation for reducing the number of hours recoverable by the claimant's solicitor from 27 to 15. After reviewing the relevant caselaw, Coulson J concluded that the judge had acted within the "broad-brush discretion" which he had, notwithstanding the absence of a more detailed explanation for why he considered the claimed hours to be excessive. There was no requirement for the judge to go through a box-ticking exercise which forced him to comment in detail upon each item of the draft bill. It was clear that he had considered the individual items, because he had asked a number of questions about the individual component parts of the bill. The judge had been entitled to come to the figure of 15 hours and "a degree of robustness is not only permitted by the CPR, it is positively encouraged".
D (A Child)
Unintentional waiver of legal advice privilege
http://www.bailii.org/ew/cases/EWCA/Civ/2011/684.html
In the course of care proceedings, a mother explained, in a witness statement, her change of position from an earlier statement by referring to conversations which she had had with her solicitor and barrister. The father then sought disclosure of the attendance notes made by her solicitors and counsel at various conferences and meetings leading up to the preparation of her witness statement, on the basis that she had waived privilege. The mother conceded waiver but sought to argue that her lawyers could not be deemed to have waived her privilege in circumstances where she had not been advised, either as to the nature of privilege or the potential consequences of its waiver. That argument was rejected by the Court of Appeal - it doesn't matter whether waiver is made by the solicitor or the client and it did not matter that the witness statement was drafted by the solicitor and that neither she (nor her advisers) appreciated the consequences which those words would have. To say no more than "I am acting on the advice of my solicitors and counsel" will not justify disclosure of that advice, but solicitors and counsel should be on guard to protect their client from revealing that advice either in written or oral evidence to the court. Judges, too, should be "astute to anticipate an unintentional observation which results in privilege being waived and must be ready to warn a witness of any such danger".
Shetty v Al Rushaid & Ors
Jurisdiction arguments where third party joined to the proceedings
http://www.bailii.org/ew/cases/EWHC/Ch/2011/1460.html
S commenced proceedings against the defendants for wrongful dismissal. A subsidiary of one of the defendants commenced separate proceedings against S and two other individuals, alleging fraud. Those two individuals were domiciled in Spain and Scotland. However, the subsidiary argued that it could establish jurisdiction over them because it was suing an individual (S) who was domiciled in England (pursuant to Article 6(1) of EU Regulation 44/2001). When S disputed that he was domiciled in England, the subsidiary applied to be joined to the the proceedings brought by S and to join the two individuals to those proceedings. That application was granted and S and the two individuals applied to set aside that order. Pymont J held as follows:
(1) The court's power to add a new party is not limited to the addition only of a defendant against whom the claimant would want to make a claim or whose joinder is necessary to complete the claimant's cause of action. There was no reason that the subsidiary could not be joined to the proceedings commenced by S.
(2) Article 6(2 of Regulation 44/2001 applied so that the two individuals could be sued in England. Article 6(2) provides that a person domiciled in a Member State may also be sued "as a third party ....in any other third party proceedings in the court seised of the original proceedings". The judge held that "third party proceedings" could include additional claims by the subsidiary against whom S was not seeking any relief: "I would read "third party proceedings" as simply meaning any proceedings involving a third party which are allowed to be brought as additional claims under national rules and which have a sufficient connection with the original proceedings to justify a single trial in the interests of justice and good administration".
Merchantbridge v Safron & Ors
Non-party costs orders and whether limit should be imposed
http://www.bailii.org/ew/cases/EWHC/Comm/2011/1524.html
Applying established principles, Mackie J held that the second to tenth defendants (costs only) in the action should pay the claimant's costs because they had funded the litigation for their own interests (ie they were not "pure" funders). That was the case notwithstanding that the day to day conduct of the proceedings was not in their hands. He also held that there was no rule that the defendants (as non-parties) should be held to be jointly and severally liable for the claimant's costs. Nevertheless, on the facts, there was no reason to apportion greater or lesser liability for costs between the defendants.
It had also been submitted that it would be unfair for the defendants to have to pay to the claimant an amount greater than they had paid towards the cost of the defence. In arguing this point, the defendants had sought to rely on the Court of Appeal decision in Arkin v Borchard Lines [2005]. Mackie J held that that case was based on a concern that professional funding for a discrete part of an impecunious claimant's expenses would cease to be available if that funder faced potential liability for the whole of the defendants' costs. However, no such policy considerations applied in this case and there was no need to limit the defendants' obligations.
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