45. Negligence and Breach of Duty Claims - Lavelle Coleman

The same broad principles apply in relation
to the borrowers accountants, valuers, tax
advisers, surveyors and other parties on
whom the lender relies in advancing loan
monies as well as equivalent service
providers that the lender has itself engaged.
Where a solicitor provides services for a
client, there will generally be a contract or
retainer agreement setting out the terms
under which services are provided. Solicitors
must issue an engagement letter to clients
setting out the terms on which services are
provided.
circumstances where things go wrong
notwithstanding that the solicitor acted with
due care and skill. In these cases, there is
no liability.
A solicitor will generally be liable if he failed
to exercise the due care and skill that a
reasonably competent solicitor in that area
of work would have undertaken. However, a
solicitor can be liable in negligence, even if
he follows standard practice. If the standard
practice contains an obvious risk (even in
hindsight) then the solicitor may be held
liable.
The solicitors letter of engagement will
specify the scope of the solicitors
responsibilities. It may not specify the
standard of performance in which case, it
will be implied that the solicitor must perform
the services with due care and skill.
Even if there is no contract between a
solicitor and client, the solicitor may be liable
for negligent work or advice in accordance
with the above principles. A solicitor may be
liable to a person who is not a client, if he
knew or should have known that person was
likely to rely on his advice or on his work.
A solicitor is obliged to take due care in
relation to his services and advice. He is not
an insurer in this sense and does not have
absolute responsibility. There may be many
Other Duties
Some obligations undertaken by solicitor are
unconditional. This depends on how they
are worded. Certain parts of a certificate of
title and undertakings involve unconditional
obligations, rather than an obligation to use
due care and skill. In these cases the
solicitor guarantees a particular result or
position, rather than agreeing to use due
care and skill to do so. For example,
undertakings regarding handing of loan
monies etc. are unconditional.
A solicitor owes so-called fiduciary duties
to clients. This is a duty to act in good faith
and to disclose and avoid conflicts of
interest. A fiduciary duty involves stricter
duties than in the case of other professional