Professional negligence claims against solicitors are soaring, with one City firm reporting a 158% surge in cases over the past 12 months. And experts are warning that worse may be to come in the downturn, as solicitors are moved to areas with which they are unfamiliar.
Nick Bird, a partner in the legal practices group at City firm Reynolds Porter Chamberlain, said his firm acted in 80 claims against solicitors in 2008 – up 158% from 31 in 2007: ‘But these are historical cases. It’s too soon to see claims arising from the current recession. They will come, though. [Some] firms have redeployed their best lawyers rather than make them redundant, moving them from transactions, say, to litigation or insolvency where they have never done much work before. Mistakes will be made – and so, inevitably, will claims.’
Sarah Clover, head of the professional and financial disputes team at City firm Barlow Lyde & Gilbert, said lawyers were ‘dabbling’ in areas of law that were not their speciality. ‘Corporate lawyers are becoming corporate recovery lawyers, for example – a recipe for disaster if they get it wrong.’
Edward Cooper, head of employment at national firm Russell Jones & Walker, said recessions tended to fuel claims against law firms. ‘Clients see their assets dropping in value and need someone to blame. Their professional advisers are tempting targets, particularly now that conditional fee arrangements and third-party funding are options. In previous recessions, claimants thought twice before risking liability for legal costs.’
Frank Maher, partner at Liverpool firm Legal Risk, said: ‘The real action will be the lending claim boom. The property market has crashed and now the mortgage lenders will go for the lawyers and exploit every little mistake they made in the conveyancing process.’
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