In 2016 Centenary 6 Limited (the "Pursuer") raised proceedings (the "section 212 Note") in the Court of Session against the Joint Liquidators of Centenary Holdings III Ltd seeking damages for breach of duty in connection with the joint liquidators' decision to enter into a compromise agreement. TLT LLP (the "Defender") acted as their solicitors.
The section 212 Note was refused due to the pursuers' failure to lodge caution (security for costs). The pursuer sued its former solicitors for loss of a chance of securing a favourable outcome. The pursuer sought payment of three sums of money:
- £35,169,133.90 being the amount which the pursuer sought from the Joint Liquidators in the section 212 Note plus interest;
- £228,435.31 (litigation costs relating to appeal);
- £253,358.47 (litigation costs relating to the section 212 Note).
The Defender admitted negligence by failing to give proper advice to the pursuer regarding an order for caution, leading to the dismissal of the section 212 Note. However, the defender argued that the pursuer had sustained no loss occasioned by the admitted negligence as the lost chance was either nil or negligible and asked the court to reject the pursuer's claim.
The case was highly complex and the judgement involved a detailed analysis of loss of a chance. The arguments advanced by the defender appeared to contradict the advice given to the pursuer when they acted for them in the section 212 Note. At [121], Lord Ericht provided that:
"In assessing the loss of a chance of succeeding in the section 212 Note, it must be borne in mind that the defender in this action is the solicitors firm which was acting for the pursuer in the section 212 note. There are obvious difficulties for a solicitors firm if having advised a client to proceed with litigation, it then seeks to defend a negligence claim relating to its conduct of the litigation by saying that that litigation would not have succeeded…"
Lord Ericht affirmed how to approach loss of chance when professional negligence was at play, and found that the pursuer had a 65% chance of success. This percentage was applied to each head of claim when determining quantum.
