BPE Solicitors v Hughes-Holland [2017] UKSC 21

Key points

  • The SAAMCO principle is applicable to legal advice from solicitors
  • The distinction between an adviser and a provider of information is that an adviser has a duty to consider all aspects of a prospective transaction whereas a provider of information only has a duty to provide advice on a limited aspect of the transaction
  • The fact that the material contributed by the defendant is known to be critical to the claimant’s decision whether to enter into the transaction does not itself turn it into an “advice” case


  • C agreed to loan money to his friend, who had fraudulently told him it was for the purpose of property development
  • D solicitors were instructed to craft a loan agreement
  • D negligently stated in the agreement C that the money was for development when it would in fact be used by the friend to discharge an existing loan on secured on the property
  • In SAAMCO v York Montague [1996] 3 All ER 365, the House of Lords laid down in the principle that while an adviser of a course of action is liable in negligence for all foreseeable consequential loss from a course of action being taken, a provider of information is liable only for the foreseeable loss attributable to incorrect information

Held (Supreme Court)

  • Applying the SAAMCO principle Solicitors were providers of information and thus not liable for any losses

Lord Sumption

Distinction providing “information” and “advice”

  • He acknowledged that may be difficult to distinguish between information and advice as ‘Information given by a professional man to his client is usually a specific form of advice, and most advice will involve conveying information.’: [39]
  • ‘In cases falling within Lord Hoffmann’s “advice” category, it is left to the adviser to consider what matters should be taken into account in deciding whether to enter into the transaction. His duty is to consider all relevant matters and not only specific factors in the decision. If one of those matters is negligently ignored or misjudged, and this proves to be critical to the decision, the client will in principle be entitled to recover all loss flowing from the transaction which he should have protected his client against’: [40]
  • ‘By comparison, in the “information” category, a professional adviser contributes a limited part of the material on which his client will rely in deciding whether to enter into a prospective transaction, but the process of identifying the other relevant considerations and the overall assessment of the commercial merits of the transaction are exclusively matters for the client (or possibly his other advisers).’: [41]
  • The mere fact that the defendant knows that the information provided is critical does not make him an adviser: ‘even if the material which the defendant supplied is known to be critical to the decision to enter into the transaction, he is liable only for the financial consequences of its being wrong and not for the financial consequences of the claimant entering into the transaction so far as these are greater. Otherwise the defendant would become the underwriter of the financial fortunes of the whole transaction by virtue of having assumed a duty of care in relation to just one element of someone else’s decision’: [41]

Current case

  • D clearly did not assume responsibility for C’s decision to enter the transaction since it was a provider of information – its responsibility was limited only to providing correct documentation for the loan
  • C’s loss ‘arose from commercial misjudgements which were no concern of [D]’s: [55]
  • No loss was caused by the incorrect information as the property value would not have been enhanced even if the information was correct


  • As stated by Lord Leggatt in Manchester Building Society v Grant Thornton LLP [2021] UKSC 20 at [93], the distinction drawn in this case is such that ‘advice’ cases will be very rare as ‘in a commercial context it is unusual for a professional adviser to be asked to advise on the overall merits of a transaction or left to decide on the matters to consider in formulating their advice. It will usually be clear that the adviser’s responsibility is limited to a particular area of expertise and that there will be other considerations relevant to the client’s decision which are not for the adviser to assess.’
  • The majority in Manchester Building Society v Grant Thornton LLP [2021] UKSC 20 rejected the rigid distinction between ‘advice’ and ‘information’ and held that the correct test should be whether the loss fell within the scope of the duty, which is judged on an objective basis by reference to the purpose for which the advice is being given