Key Point
- Loss of chance is recoverable in cases of negligent professional advice where the possibility of loss resulting from the negligent advice depends the response of a third party
Facts
- D solicitors failed to advise on the deletion of a warranty in an agreement
- If C would have followed the advice, there was a chance that the C would have successfully renegotiated with the other contractual party and thus minimized its losses from breaching the warranty
Held (Court of Appeal)
- D was liable to C for damages equivalent to the loss of chance to avoid loss
Stuart Smith LJ
- Where whether C would have suffered loss depends on what C would have done in the absence of negligence, it must be proven that C would not have suffered loss on a balance of probabilities
- Where C’s loss depended on the hypothetical action of a third party he was entitled to succeed if he could show that there was a real or substantial, rather than a speculative, chance that the third party would have acted so as to confer the benefit or avoid the risk to C
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