In two landmark judgments - one delivered by the Master of the Rolls, Lord Woolf - thousands of solicitors advising lenders will be protected from those who attempt to pass on unreasonable liabilities.In his judgment in Midland Bank v Cox McQueen last week (The Times, 2 February), Lord Woolf spoke directly to high street practitioners when he set out what institutions would have to do if they wished to impose absolute liabilities on solicitors.

He ruled that such liabilities should be expressed in clear terms so solicitors were able to 'appreciate the extent of the obligations they were undertaking'.Cox McQueen, a small Walsall firm, charged Midland bank #23 for obtaining signatures for a mortgage to pay off debts owed to the bank.

But when the bank came to rely on the charge, it found the signature was not genuine.Ruling that the firm owed no duty to verify the signatory's identity, Lord Woolf said: 'Frequently that sort of task was undertaken by small firms of solicitors who were already finding it difficult to remain viable.

That was partly because they were heavily burdened by the cost of insurance'.The second case involved 400 actions brought by the Nationwide Building Society against hundreds of solicitors following 'back-to-back' property sales in the late 1980s and early 1990s.The Nationwide argued that solicitors acting for lender and borrower were under a duty to pass on information regarding the buying and selling of the same property at almost the same time but for different values.

In other instances, money was being directly paid by the borrower to the vendor.

Mr Justice Blackburne found against the Nationwide in three of the 12 lead cases.

In a further six cases, the solicitors were found to be in breach of their contractual duty, but crucially the Nationwide was held to be contributory negligent.

In the remaining three cases, the judge ruled that the solicitors had consciously preferred the interests of their borrower client to those of the Nationwide and were liable for all losses arising.Welcoming the judgments, Jes Salt, assistant claims manager at the Solicitors Indemnity Fund said: 'Both cases confirm the courts' willingness to set realistic liabilities for solicitors' duties and to curb lenders' eagerness to widen solicitors responsible when anything goes wrong'.Fiona Hoyle, senior legal adviser to the Council of Mortgage Lenders, said: 'The lending industry will be looking very carefully at this at a time when lenders are revising instructions to solicitors in light of the changes to rule 6 of the solicitors practice rules and the development of the standardised instructions under the lenders' handbook initiative' (see [1999] Gazette, 27 January, 4).