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Court of Appeal clarifies duty of care owed for ‘unbundled’ legal services

No wider duty owed by solicitor who re-drafted consent order

The Court of Appeal has confirmed that a solicitor retained specifically, and only, to re-draft a consent order in financial remedies proceedings had no duty of care to advise on the merits of the underlying agreement. The judgment recognises the importance of solicitors being able to provide 'unbundled' legal services since the termination of legal aid in financial remedies.

In Minkin v Landsberg [2015] EWCA Civ 1152, the court had heard that following divorce the claimant, an experienced accountant, negotiated a settlement of all financial issues with her former husband.  She then had doubts about that settlement and instructed 'T' solicitors. T advised the claimant that the settlement may not be fair and that there were options available to her: mediation, negotiation through solicitors without disclosure, or a court application necessitating full and frank disclosure.

The claimant decided to pursue the settlement as agreed, and dis-instructed T solicitors. The claimant and her former husband then submitted a consent order drafted by them to the county court. The district judge refused to approve this order, seemingly for lack of precision in the drafting. The claimant then instructed the defendant solicitor to amend a draft consent order, so that it was in a form likely to be approved by the county court.  The defendant carried out those instructions and the amended draft consent order was approved.

The claimant subsequently had cause to regret the consent order and made a claim for professional negligence on the basis that the defendant failed to advise or warn her against entering into the consent order.  A district judge heard four days' evidence and dismissed the claimant's claim on the basis that the retainer was limited and the defendant was under no duty to give such advice or warnings. The claimant appealed to the Court of Appeal.

The Court of Appeal held unanimously that the defendant did not have a duty to give the broader advice or warnings for which the claimant contended.  Also, on the basis of the evidence at trial, the claimant could not succeed on causation.

Jackson LJ did note, however, that it would have been good practice for the defendant expressly to confirm in one of her two client care letters the limited nature of her retainer.  She did not do so and that was contrary to good practice.

King LJ further considered that circumstances in which matrimonial finance solicitors are instructed on limited retainers specifically to draft consent order for approval by the courts from agreements entered into by parties without legal advice are increasingly widespread since the termination of legal aid in financial remedies. King LJ considered that such services are important both to litigants and for the operation of district judges' lists, given that district judges cannot reasonably be expected either to approve poorly drafted orders or to draft these themselves. King LJ expressed a hope and expectation that the requisite wording for expressly limiting such retainers would become, with the passage of time, routinely applied formulas.

For the judgment and summary by Marlene Cayoun of 1 Garden Court which sets out the legal reasoning within the judgment, please click here.

23/11/15