The Claimants all bought properties which were marketed by the now defunct Ocean View Properties, “off-plan”.

They each retained English solicitors recommended by Ocean View Properties to advise them.

The Claimants contend the solicitors, in breach of contract and negligently, failed to warn them of various risks and failed to ensure their deposits were protected.

The total value of the claims runs into several million pounds.

We advised the Claimants on the setting up of an action group and how to pursue the claim as a group to spread the costs and risks of the action.  The case is now proceeding in the High Court.

The clients engaged an English solicitor to advise them in relation to the transaction.

The solicitor claimed specialist knowledge of Spanish property transactions but failed to warn the clients of serious risks in the transaction or to ensure that the substantial deposit which they paid was protected.

We advised the clients that they had good potential claims against the solicitor and after corresponding with his insurers were able to secure a satisfactory settlement without the need to issue Court proceedings.

The clients retained an English solicitor purporting to specialise in Egyptian property transactions to look after their interests and relying on this advice paid over substantial sums.

Sadly they never obtained ownership of the properties nor could they obtain repayment of their monies.

We advised the clients that they had good prospects of pursuing a claim against the English solicitor for breach of contract and negligence.

We were able to negotiate a settlement of these claims without the need for formal Court proceedings.

Our professional negligence team is correctly instructed in other similar claims involving properties in several countries.

Professional negligence client, December 2012

At present many clients pursue claims under a Conditional Fee Agreement (CFA).

Often referred to as a “no win – no fee” a CFA in its simple form provides that the solicitor will not be paid anything if the client does not win its case but if they do, the solicitor is entitled to his normal fee plus an “uplift” of up to 100% (known as a “success fee”).

In addition clients wishing to protect against the risk of paying their own disbursements (e.g. court fees, expert’s fees etc) and the opponent’s costs, if they lose, have been able to take out an After The Event (ATE) Insurance Policy.

A huge benefit of the current system is that if the client wins,  both the success fee and the ATE premium are recoverable from the opponent and if the client  loses the solicitors’ fees are not payable. The liabilities are paid for by the ATE insurer and the ATE premium (which is usually deferred to the end of the case) is not payable either.

In other words, if the claim fails a client acting under a CFA and ATE insurance will generally be free from liability.

The forthcoming changes to CFA’s and ATE

Following a review of Civil Litigation carried out by Lord Justice Jackson the government has legislated to change the current system.

Under the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO), new rules are expected to come into force on 1^st April 2013.

From that date claimants will no longer be able to recover the success fee nor the ATE premium from their opponent.

Whilst clients may still wish to enter into CFA’S and ATE policies in the future to (to protect against a losing case), the cost of the ATE premium and the success fee could mean a substantial reduction in the damages the client receives in a successful case.

The detailed rule changes under LASPO have not, at the time of writing, been finalised but the principles are clear and the government is committed to these coming into effect on 1^st April 2013.

Damages Based Agreements (DBA’S)

Until now English law has been firmly against lawyers acting in litigation on the basis of recovering a percentage of their clients’ damages if the claim is successful.  This is not the case in many other jurisdictions where the arrangement, usually known as Contingency Fee is both permissible and commonplace.

LASPO will permit lawyers to enter into DBA’s with their clients from 1^st April 2013.

Unfortunately the rules have not been agreed and, as yet, there is little information as to exactly how these DBA’s will operate.

Until the details are  known  it is unclear whether they will be attractive to lawyers or their clients.

Conclusion

If you are considering bringing a claim which you might wish to fund by means of a CFA you should act immediately;

• Often before we can make a decision as to whether we can agree to enter into a CFA there is a need to carry out at least some preliminary investigation and time to do so is limited.
• Also it may take some while to obtain a suitable offer of ATE insurance in cases where that is a consideration.
• To be able to have the prospect of recovering any success fee and/or ATE premium the arrangements must have been entered into before the new rules come into force i.e. by the end of March 2013.

Those who do not act speedily may not only lose this significant benefit but may find that it is no longer viable to pursue their claim in this way if the success fee and ATE premium will have to be paid out of their damages if they win.

If you have a claim you would like us to consider accepting under a CFA please contact us as soon as possible and we will be happy to consider this with you.

Sadly, the Architect let them down in a number of respects. The builder he recommended turned out to be incompetent and eventually left the site with the project incomplete despite the Architect having approved payment of substantial sums. A new Architect was appointed and it transpired that the previous Architect’s design and specification of the works was inadequate.

Eventually, a new contractor was employed and the extension was finally completed several years after originally planned, with great inconvenience to Mr and Mrs Y.

They consulted Colman Coyle who advised them to sue the Architect for breach of contract and professional negligence.  Colman Coyle was able to recommend expert surveyors and quantity surveyors to assist in the claim which ultimately settled with substantial damages being paid to Mr and Mrs Y.