PROFESSIONAL negligence: conditions could apply to work between midnight and 6am

Concern was raised this week that some City law firms are attempting to restrict their liability for the potential professional negligence of solicitors in relation to work done between midnight and 6am.

A high-level source with close ties to the industry - who preferred not to be named - told the Gazette: 'There are a number of firms that have told clients that [such a restriction] is what they want from them.'

Richard Dedman, senior partner with City firm Barlow Lyde & Gilbert and a professional negligence specialist, commented: 'Solicitors have a wide ability to restrict liability for negligence on non-contentious instructions, so long as they do not breach the 1 million [Law Society] minimum requirement...

You can see how between those hours people are not going to be as fresh as they would otherwise, but there is no guarantee that such clauses will be reasonable.'

He said law firms using such clauses may be taking a chance if there is capacity for them to send in fresh teams to work on the instruction.

But he added: 'If your client says "I want to do a deal in an unrealistically short space of time", then it must be reasonable that the general standard of performance cannot be retained throughout that period.'

Mr Dedman said firms considering using such restrictions should be aware that they would be subject to the Unfair Contract Terms Act 1977.

He added that - as a matter of tactics - placing a defined cap on the potential financial liability for negligence could be a better option.

Anthony Armitage, chairman of the London branch of the Law Society's Commerce & Industry Group, said: 'It is up to individual clients to negotiate whatever they want with their law firms.

I would hope that none of our members would feel compelled to agree to something if they didn't want to do so.'

Anthony Newhouse, a partner in the commercial department of City firm Slaughter and May, said: 'I've seen this mooted but it is not something under consideration here.'

A spokesman for global giant Clifford Chance said: 'We don't use restrictions of this type.'

Jeremy Fleming