McEwan Fraser Legal and two of its former partners (“the defenders”) were sued by the pursuers, a married couple who instructed the defenders in 2017 to assist with their purchase of Northfield Farm. All communications were between the first pursuer (M) and a paralegal working for the firm (K).
One of M's non-negotiable requirements for the purchase was acquiring sole ownership of a private access road leading to the property. K initially advised that the sellers did indeed own the road, but the following day said the pursuers would only acquire a half share. M's understanding was they would be able to rectify this title problem on registering the property purchase. It is precisely this view that K should have corrected, but she instead endorsed it, failing to flag that registration would not provide the pursuers with sole ownership and thereby resolve the title problem. Although K raised the issue of right of access and ownership of the access again, she gave only "a vague and wholly inadequate explanation of the state of the title", this only exacerbating M misunderstanding that full ownership of the road might not be possible.
Missives were concluded under time pressure on 28 March and settlement followed on 3 April. The Land Register ultimately recorded ownership in common. The pursuers incurred costs of c. £24k obtaining a sheriff court declarator and faced further estimated costs of c. £54k for a Lands Tribunal application. They recovered £17.5k from the two former partners but continued their claim against the firm itself.
Decision
The court sided with the pursuers, finding the defender firm liable for professional negligence and breach of contract.
The court held that the firm had failed to clearly explain the title position or the risk that sole ownership of the access road might not be achievable or realistic. The court stated it was clear that M did not sufficiently understand the situation, or the risk that sole ownership might not be possible. It had not been explained to him in language appropriate to his knowledge and experience. The court was of the view that the firm had not put M in a position to make an informed decision to proceed and the firm's conduct fell below the standard expected of ordinarily competent solicitors.
In accordance with usual and normal practice, it was the firm's duty to investigate and report fully to the pursuers on the validity and marketability of the title in a manner that enabled them to fully understand the implications. The court held that the firm failed to investigate and report fully to the pursuers and said that no solicitors of ordinary skill would have so failed.
Damages were awarded to the pursuers for their losses.
Commentary
Although this case does not establish any new precedent, it is an important reminder to the legal profession that, when accepting instructions to act for a client, in any matter, it is important to bear in mind that they are unlikely to be legally qualified and therefore need to have a full and proper understanding of the matter in hand, and potential risks, so that they can make informed decisions. The advice tendered must be appropriate to the comprehension and experience of each individual client. Any risks, or potential risks, in transactions should be clearly explained. It is better to spell things out in layman's terms than to presume clients have a better understanding than they do, particularly when they are not well known to you.
In the instant case, there was a change in position and it is important to revisit any advice tendered or instructions given when that happens, particularly when there is a time pressure.
It is also sensible to provide advice in writing to allow clients time to review and consider it before providing instructions. Written advice also acts as a record of the advice tendered to clients should a dispute arise in the future.
