Solicitors granted reduced negligence exposure

Solicitors face a reduced period of exposure to professional negligence claims under plans to reform limitation laws unveiled this week by the government.

The Lord Chancellor's Department said it has accepted in principle Law Commission recommendations to repeal the 1980 Limitation Act and introduce a primary limitation period of three years.

This would run from the date on which a claimant knows (or ought reasonably to know) the facts giving rise to the cause of action, the identity of the defendant, and that any injury, loss, or damage (or benefit received by the defendant) was significant.

No claim could be brought after the expiry of a ten-year longstop which normally would run from the date on which the cause of action arose.

There is currently six-year limitation from the breach of contract or first accural of loss in tort; however, section 14A of the Latent Damages Act also gives claimants three years from their date of knowledge of the action.

The longstop is 15 years.

Helen Staines, a professional indemnity partner at City-based Beachcroft Wansboughs, said the move would reduce the period of exposure.

'There are lots of ordinary claims which people make a meal of and sit on,' she said.

'If you think your personal injury claim has been undersettled, you won't be able to sit around and sulk for six years.'

Stephen Reilly, a partner at indemnity specialists Reynolds Porter Chamberlain, highlighted the reduction in the longstop as the principal impact.

'It will encourage people to make their claims quicker and not hang around,' he said.

Miriam Barlett, an indemnity partner at Pinsent Curtis Biddle, said the decision was good news for insurers and solicitors, but predicted a rise in contingent claims as it may take more than three years for the extent of any loss to become apparent.

Neil Rose