Newey: Claimant did not prioritise claim against law firm
A claimant who received “significant financial assistance” from her solicitor boyfriend cannot claim that impecuniosity prevented her from suing her former law firm, the Court of Appeal has ruled.
Lord Justice Newey said [1] that Ellen Kay received the financial help from Richard Morgan, a solicitor whom she was not only involved with romantically but also instructed to act in the negligence claim.
She sued Martineau Johnson (now Shakespeare Martineau) for allegedly negligent advice it gave on her divorce in 2008, including that she should agree a clean break.
In 2009, she sought its advice on whether the settlement could be reopened over a lack of full financial disclosure; the firm said it could not.
She only issued the claim against Martineau Johnson in March 2023. Ms Kay argued at a preliminary issue hearing that she only became aware that she had a claim against the firm after receiving advice from specialist family counsel in May 2020.
As a result, she argued that she was within the limitation period as a result of section 14A of the Limitation Act 1980, which allows negligence claimants an additional period of three years to bring claims from the date they gained sufficient knowledge of the damage they had suffered.
Mr Morgan had been in a relationship with Ms Kay since the turn of 2018 and they began living together at his home in 2022. He was a partner and head of commercial litigation at national firm Harrison Clark Rickerbys (HCR) at the time of his retirement in March 2023.
Ms Kay formally instructed HCR in October 2021 and Mr Morgan was the partner with conduct of the case.
His Honour Judge Russen KC, sitting as a High Court judge, ruled in 2024 [2] that Ms Kay either had known of a potential negligence claim by the end of 2009 or “constructive trigger knowledge” by the end of 2018 due to informal help that Mr Morgan was giving her.
Saying Ms Kay should have sought counsel’s advice much earlier than she did, her ruled her claim was time-barred.
She appealed both findings, accepting that it would have been reasonable to obtain the advice from counsel sooner if she had not been short of money.
Newey LJ held that Ms Kay did not have knowledge by the end of 2009 – it had not been “incumbent” on her to seek further legal advice at the time.
But on the impecuniosity argument, he detailed several occasions when Mr Morgan had loaned Ms Kay money, including to get the counsel’s advice.
While there was “no reason to doubt that Ms Kay was short of money in 2018-2020”, she had failed to explain “quite what money she had, what her financial commitments were or what earning capacity she had”.
Further, she had pursued an unrelated claim in the Lands Tribunal in that period but did not expand on how she could do that and yet not obtain advice on the divorce settlement.
“It is also noteworthy that there is no suggestion that Ms Kay investigated other ways in which she might have been able to obtain advice. There is, for example, no reference to finding out whether a lawyer might have been prepared to act pro bono or on a conditional fee basis.”
The delay was caused by “a lack of prioritisation rather than shortage of money”, he concluded.
Newey LJ questioned whether a claimant’s impecuniosity “can ever matter” for the purposes of section 14A.
In this case Ms Kay had not “come close to establishing that this is one of those rare cases in which impecuniosity might possibly justify a claimant’s failure to obtain advice earlier”.
Lords Justice Males and Lewis agreed with HHJ Russen on Ms Kay’s constructive knowledge by June 2009 – namely that she knew enough to cause her to investigate the possibility that her inability to reopen the settlement was attributable to fault on the part of Martineau Johnson – meaning her claim was time-barred from then.
In any event, they agreed with Newey LJ that she had constructive knowledge by the end of 2018.