Edward Grundy

The developers bought two neighbouring properties on the Fulham Road in London for a combined £42 million in 2012 with Withers acting for them. Two years after completion, the developers contacted Withers when they discovered three high voltage cables belonging to UK Power Networks (UKPN) running under both sites which they would need to move.

The developers alleged that Withers had failed to make adequate searches or enquires to identify the electrical cables prior to the purchase in 2012 (“the 2012 claim”) and that Withers had failed to properly investigate and advise them in 2014 as to their rights and remedies upon discovery of the electric cables (“the 2014 claim”).

In January 2021, the court of first instance found in favour of the developers on both claims. The 2012 claim was largely unsuccessful as the developers had not shown they could have negotiated a lower price had the cables been known about.

Withers LLP appealed solely in relation to the 2014 claim arguing they had no duty to provide extensive advice as to the developers’ remedies.

The court considered a string of emails exchanged between the developers and Withers in 2014, which defined the advice sought and indeed received. Against the background that the developers were clearly considering whether Withers had been at fault, the key email from the developers to Withers posed three questions relating to the existence of the electrical cables. Withers replied to those specific questions using identical numbering and ordering but did not go on to consider potential remedies including those which may have been available against UKPN.

Withers’ response kept the scope of the advice given very narrow and did not create a duty to advise on wider questions of potential rights and remedies.

Were those issues “reasonably incidental” to the questions they did address?

The court’s findings

Withers argued they had a duty of care relating to the specific questions asked but not beyond that to other surrounding issues. The developers argued the request for advice clearly required wider consideration than the narrow scope argued by the defender.

The court agreed with Withers but noted that their decision was fact specific.

In doing so the court confirmed the current law that “a retained solicitor owes no duty to go beyond the scope of their express instructions and give advice in relation to other matters” (paragraph 57 of the judgment).

Different considerations may arise where there is no retainer and assumed responsibility remains the foundation of tortious (delictual) liability.

The Court of Appeal considered that whether responsibility is assumed, and the extent of that, should be viewed objectively in context, without the benefit of hindsight. The primary focus must be on exchanges between the professional and the claimant that will obviously be fact sensitive in each case.

The court found that Withers had voluntarily assumed legal responsibility for responding to the specific questions but that this did not include advising on the developers’ wider remedies. The court analysed the small number of emails in the exchanges and noted that the questions were specific, as were the responses noting that Withers’ communication in 2014 was “guarded and restrictive rather than open and expansive”.

Also key in this case was whether Withers’ duty extended to giving advice that was “reasonably incidental”. The court held that advice on the wider remedies was not “reasonably incidental” to the specific questions which meant it did not need to decide on whether, in the absence of a retainer, such an extension of the scope of a solicitor’s assumed duty would be implied as it is when there is an agreed retainer. In an extra-contractual situation, the court noted the solicitor receives no remuneration and cannot limit their duties or exposure to damages.

Why is this outcome important for professionals?

This outcome allows solicitors and other professionals to respond to one-off requests for information and advice where they have no retainer without broad legal liability being created so long as they are careful in their response.

However, if advice is given outside a retainer, careful consideration must be given to the terms of the response to avoid suggesting they will look at more than they intend to.

In general terms, it is vital for professionals to identify the scope of their responsibility and instruction and address that if necessary if circumstances change. An accurate letter of engagement with thorough detail on scope of work and comprehensive terms and conditions is key to protecting the solicitor and clearly setting out to their client what they can expect to receive advice on.

Edward Grundy is an associate at Brodies LLP