Rajah: KC made a judgement call
The High Court has granted summary judgment to a KC accused of negligence in the way he drafted the particulars of claim (PoC) against a law firm and a firm of property agents.
Mr Justice Rajah said the choice made by Benjamin Pilling KC in where the PoC focused was “plainly a judgement call and the course taken by Mr Pilling was one which many barristers would have chosen”.
The underlying negligence claim was brought by property investment company Powis Street Estates (No3) Ltd against central London law firm Wallace and property agents Cradick Retail over the sale of some properties in south London.
One of the terms agreed with the buyer concerned overage, which did not specify any time limit.
However, the contract drafted by Wallace limited the overage period of five years but not contain any provision requiring reasonable (or any) endeavours to be used to build out the development and sell the residential units within the overage period or a reasonable time.
The sales eventually took place after the five years were up, denying Powis £4.8m in overage payments.
Powis instructed the London office of US law firm Winston & Strawn and Mr Pilling to consider a negligence claim.
The claim was issued in August 2017. The case, as pleaded by Mr Pilling, was that Wallace had acted without instructions from Powis in including the time limit in the overage clause.
In November 2018, Winston & Strawn was replaced by Forsters. The new solicitor for Powis, Jonathan Ross – who, now at Keystone Law, still acts for Powis – told Mr Pilling that he was concerned they had not focused on the right claims.
His view was that Wallace’s real failure was to not include any obligation on the developer to carry out the works and use reasonable endeavours to complete sales within the five-year period.
Rajah J recounted: “At some point after that email, however, Powis instructed new leading counsel, Mr David Halpern KC. Privilege has not been waived in relation to the instructions given to and advice received from Mr Halpern, but in any event on 25 July 2019 Powis applied to amend the underlying PoC.”
Some, but not all, were granted and Powis argued that the amendments not allowed were the claims which Mr Pilling negligently failed to plead.
In April 2023, Powis settled the underlying claims, with Wallace paying £1.05m and Cradick £740,000 in addition to an earlier payment of £125,000.
Powis alleged that, if the claims pleaded by Mr Halpern had been in the original draft of the PoC, Cradick would have settled for at least £3.6m, together with a further £565,000 in its costs of the underlying claim.
It argued that any competent barrister would have realised that Powis must have given instructions to Wallace on the overage period.
The judge did not agree. At the time Mr Pilling drafted the PoC, Powis’ instructions, as well as its belief as verified by the statement of truth on the PoC, were that it had not authorised the inclusion of the overage period; Winston & Strawn’s analysis backed this up.
“There was ample material upon which a competent barrister could conclude that there was a good prospect of establishing at trial that Powis had not given instructions for the overage period and indeed Powis’ replacement legal team, including leading counsel, continued to maintain that case to a successful settlement.
“There is no realistic prospect of establishing that all other competent barristers of Mr Pilling’s seniority and experience would have concluded that, contrary to their instructions, Powis must have given instructions to Wallace via Cradick.
“It is likely that the reverse is true – that no competent barrister of Mr Pilling’s seniority and experience would have concluded that, contrary to their instructions, Powis must have given instructions to Wallace via Cradick – but Mr Pilling does not need to meet that threshold.”
Further, Mr Pilling was “clearly alive” to the potential claims against Wallace and Cradick relating to the failure to include a best endeavours clause, as they were included in the PoC. It was possible to include a concurrent claim against Cradick along the lines of that later made.
“Whether to plead such a concurrent case arises regularly in cases, and requires an exercise of judgment,” Rajah J said, observing that Mr Pilling had to weigh up a host of “strategic issues”.
“This is plainly a judgement call and the course taken by Mr Pilling was one which many barristers would have chosen. There is no realistic prospect of showing that no other competent barrister of his seniority and experience would have made a similar decision.”
Powis is also suing Winston & Strawn, which did not seek summary judgment.
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