A firm’s drafting mistake in a standstill agreement was a breach of its duty but caused no loss to the client, a judge has ruled.
Sitting as a deputy High Court judge in Kingsley Napley v Harris & Anor, Margaret Obi said the agreement drawn up by the London practice ‘lacked clarity’ but did not result in the client accepting a less beneficial settlement.
The court heard that Steven Harris and his company Danriss Group Holdings had brought negligence proceedings against Kingsley Napley over three matters, one of which was outlined in the public judgment. The proceedings arose from the firm’s claim against Harris and Danriss for non-payment of fees.
The litigation dates back to Harris bringing a claim in 2005 for negligence against a firm of architects over property redevelopment work. When that claim ran out of time, he began proceedings against his former solicitors, ingram Winter Green (IWG).
A settlement agreement between Harris and this firm was made in 2018 after an offer of £77,500 was accepted.
Harris’ claim against Kingsley Napley related to the firm’s handling of his action against IWG. The matter involved in the published ruling was a standstill agreement drawn up by Kingsley Napley in 2017 which suspended the limitation period initially for three months. The counterparty was named as ‘Ingram Winter Green LLP’, but this was the wrong name as the firm had changed to LLP status only after the retainer with Harris had ended. The agreement should have been made with or included the partners of IWG as parties.
Harris said that Kingsley Napley failed to ensure that the standstill agreement was entered into with the correct part and that this breach of duty weakened his negotiating position and deprived him of the opportunity to settle for a higher amount.
He argued that the ‘game-changer’ occurred when IWG’s representatives noticed the mistake and sought advice, and that without it he would have been able to settle for £110,000.
Kingsley Napley admitted a breach of duty in naming the wrong counterparty but argued that Harris would not have achieved any better result if the agreement had been correct.
The judge agreed, saying the ‘game was already up’ by the time the name became an issue. The claim failed because Harris had no chance of a better settlement and so suffered no loss.