The Court of Appeal has upheld a law firm’s case that a £125,000 professional negligence claim against a firm for its handling of a divorce was issued too late. In Holt v Holley & Steer Solicitors (a firm), judges held that any alleged cause of action happened in the lead-up to divorce proceedings being finalised, and this was the starting point for the six-year limitation period.
Former client Julia Holt had issued proceedings against Somerset firm Holley & Steer Solicitors claiming that it failed to obtain expert valuation evidence during her divorce proceedings. It was also submitted that the firm negligently failed to secure permission to admit such evidence at the financial remedies hearing.
The county court had ruled that Holt’s claim, so far as founded in contract, was time-barred after expiry of the six-year limitation period, but the court ruled her claim founded on tort was not so barred. The firm, on appeal, successfully argued that her claim founded on tort was also made too late.
The case came down to when Holt had suffered damage from any alleged negligence. Proceedings had been initiated by her husband in February 2011 and the first directions appointment (FDA) was in July 2011, with the financial dispute resolution hearing in October. At the FDA, the court ordered valuation of the family home, and of some adjoining land, by a joint expert and the report was available at the FDR.
The final hearing of the financial relief proceedings was fixed for February 2012, by which time valuations of the couple’s investment properties and jewellery had been made, with net assets found to be worth £483,000.
Giving lead judgment, Lord Justice McCombe ruled that both strands of the claim were time barred: the claimant was financially worse off by the end of the hearing in March 2012. The professional negligence claim was issued on 5 April 2018.
The judge said: ‘It is clear that after the FDR, or at latest after the husband’s solicitors made it clear in January 2012 that they would object to new valuation evidence, there was a real risk (indeed perhaps a near certainty on the present facts) that the base line value of Ms Holt’s assets would be taken at what she says was an inflated value for the purpose of the financial relief proceedings.
‘That inevitably meant that the value of her rights vis-à-vis the husband were diminished. If one postponed that inevitability to 16 March 2012 (the end of the hearing), it makes no difference to the outcome: damage was still suffered more than six years before the commencement of this action.’
Holt’s appeal was dismissed.