Before : LORD JUSTICE MAURICE KAY LORD JUSTICE DAVIS and LORD JUSTICE FLOYD Between : - and -
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1 Neutral Citation Number: [2014] EWCA Civ 686 IN THE COURT OF APPEAL (CIVIL DIVISION) ON APPEAL FROM LEEDS COUNTY COURT HIS HONOUR JUDGE GOSNELL ILSO3193 Before : Case No: B2/2013/2536 Royal Courts of Justice Strand, London, WC2A 2LL Date: 21/05/2014 LORD JUSTICE MAURICE KAY LORD JUSTICE DAVIS and LORD JUSTICE FLOYD Between : Raleys Solicitors - and - Ronald Alan Barnaby Appellant Respondent Michael Pooles QC and Catherine Foster (instructed by Berrymans Lace Mawer LLP) for the Appellant Jonathan Watt-Pringle QC and Crispin Winser (instructed by Mellor Hargreaves Solicitors) for the Respondent Hearing dates : 1 May Approved Judgment
2 Lord Justice Maurice Kay: : 1. It is well known that coalminers were susceptible to Vibration White Finger (VWF), a form of Hand Arm Vibration Syndrome (HAVS) resulting from excessive use of vibratory tools. In July 1998, the Court of Appeal upheld a decision of the High Court finding British Coal negligent in exposing miners to such excessive vibration. The Department for Trade and Industry (DTI) set up a compensation scheme (the Scheme) to provide tariff-based compensation to miners who had been exposed to vibration and who suffered from VWF. Mr Barnaby made a claim under the Scheme. He had been employed by the National Coal Board and later British Coal from 6 October 1976 to 7 November 1992 and by Specialist Mining Services Ltd from 8 January 1993 to 28 March In order to pursue his claim, he instructed Raleys solicitors. On 6 December 2002 he agreed to settle his claim for a total of 10, plus interest. This sum embraced claims for general damages and handicap on the labour market. He had also indicated an intention to make a claim for services which were required as a consequence of his disability. However, he abandoned his services claim following advice by Raleys. He later commenced proceedings against Raleys for professional negligence in relation to that advice. 2. On 25 July 2013 in Leeds County Court His Honour Judge Gosnell (the Judge) found negligence on the part of Raleys and awarded Mr Barnaby damages of 5,925 on the basis of the loss of a chance of further recovery from the Scheme as to which he would have had a seventy five per cent prospect of success. On this appeal, Raleys contend that the judge was wrong to find a causal connection between the (now) admitted negligence and the failure of the services claim. The Scheme 3. The judgment below contains the following summary of the scheme and its operation in relation to services claims: 4. The Scheme was administered for the DTI by IRISC Claims Management ( IRISC ) in accordance with the terms of a Claims Handling Arrangement ( CHA ) dated 22nd January 1999 as amended from time to time. The CHA was an agreement between IRISC and firms of Solicitors who belonged to the VWF Litigation Solicitors Group ( VWFLSG ). After the agreement was executed there were continuing negotiations between VWFLSG and the DTI and other mining contractors like SMS in relation to the claims as a whole and services claims in particular. Where disputes arose they were either resolved by agreement or determined by the Court. The Defendants and other members of the VWFLSG were kept informed of developments by bulletins from the VWFLSG steering committee. In addition to the CHA there was a Services Agreement of 9th May 2000 which governed the management of services claims. 5. Claims were initially categorised according to whether or not proceedings had been issued and whether or not a medical report had been served. The Claimant s case was a category C
3 claim as neither of the above milestones had been reached. A claimant would first have to submit a questionnaire to IRISC about his occupation and he would be assessed into an occupational group depending on his likely exposure. If he was accepted into a relevant occupational group by IRISC arrangements would then be made for a medical examination in accordance with the Medical Assessment Process in the CHA. The medical report produced by this process became known as MAP1. The report was intended to ascertain whether the Claimant was suffering from VWF and if so his staging on the Stockholm Workshop scale. IRISC was then obliged to make an offer of compensation or to reject the claim with reasons. A claimant could challenge the findings of the MAP1 report but there was no provision in the CHA for IRISC to do so. The CHA agreement provided for compensation for general damages, handicap on the labour market and special damages. 6. The CHA made provision for interim payments where payments were for some reason delayed and initially amounted to 50% of IRISC s valuation of British Coal s liability to the Claimant. By February 2001 this had increased to 92.5% and by 20th November % although this latter increase was not put into effect until The CHA also provided for apportionment of claims between British Coal and other employers with IRISC agreeing to attempt get other employers to agree to the Scheme and if not making payments reflecting their own apportioned responsibility. 7. A further agreement was entered into on 9th May 2000 ( the Services Agreement ) which set out the agreed approach where services were claimed. The onus was initially on a claimant to establish as a matter of fact that prior to his injury he actually undertook the tasks for which services were claimed and that he no longer undertook those tasks due to his condition. He did this by completing a standard form questionnaire supported by those helpers who provided the services who themselves completed a different standard form questionnaire. It was agreed that once a claim reached a certain level it should be presumed that a claimant could no longer carry out certain tasks but the tasks to which this presumption applied varied according to his staging as determined in the MAP1 report. IRISC were not bound to accept the claim and did conduct telephone interviews with helpers to ensure that services were actually required and being provided. Dubious claims could be referred to the Securities Investigation Department. A further medical examination known as MAP2 would then be arranged which was purely to consider whether the claimant had any comorbid conditions which would have affected his ability to do the required tasks in any event, and if so, what effect those conditions would have had. A tariff based approach would then
4 be used to calculate the value of the claimant s services claim, depending on the claimant s stagings and any deduction to reflect co-morbid conditions after the MAP2 examination. Services claims were initially subject to a pilot scheme but offers of settlement began to be made after the pilot scheme ended from mid 2003 onwards. Many of the claims were not however resolved until 2005 or Mr Barnaby s claim 4. With the assistance of Raleys, Mr Barnaby submitted a claim in March On 27 October 1999 it was accepted by IRISC as a Group 1 claim which was for workers who used vibratory tools regularly in their work. On 4 May 2000 a MAP 1 report was produced by Dr Ryan. He assessed Mr Barnaby as suffering from VWF at staging 2V 2SN (early). It is common ground that that entitles him to recover compensation for general damages and handicap on the labour market. Raleys advised him that he might also be able to make a services claim and he was sent the appropriate questionnaire for completion by himself and a witness questionnaire for completion by anyone who provided services. What happened thereafter was described by the Judge in paragraphs 9, 10 and 11 of his judgment: 9.The Services Questionnaire contained a spreadsheet entitled Give details of what tasks, if any, you require assistance with because of your VWF. There were six tasks listed on the left of the form with seven cells for providing information about those tasks. The six tasks were: gardening; window cleaning; DIY; decorating; car washing; and car maintenance. To the question did you do this task prior to developing VWF Yes/No the Claimant entered yes to gardening, decorating and car maintenance. He entered details in the other cells in respect of each of these three tasks but made no entries at all in relation to the remaining three tasks. He indicated in each respect that he had needed assistance for the last five years. Mrs Barnaby completed her questionnaire referring only to gardening, decorating and car washing giving similar details to her husband. She was also provided with the same six tasks on the first page of the questionnaire and ticked only three tasks corresponding with those she gave details about. It would appear from a file note that these questionnaires were handed to a lawyer employed by the Defendants on 8th August A services claim based on the information in these questionnaires was subsequently submitted to IRISC on 22nd February 2002 but the Claimant was advised that his staging did not justify a presumption that he required assistance with decorating and so this aspect of the claim could not be successfully pursued. 10. On 16th March 2001 IRISC sent a cheque for to the Defendants which at the time represented approximately 97% of the value of British Coal s total liability towards
5 The Judge s approach general damages. On 10th July 2001 Norwich Union confirmed that they would contribute to the Claimant s claim on behalf of SMS under the terms of the CHA. On 19th June 2002 IRISC accepted the Claimant s claim for handicap on the labour market which was presumed to be valid if evidence of current employment could be produced. On 20th August 2002 Norwich Union sent the Defendants a cheque for representing SMS s proportion of the Claimant s claims for general damages and handicap on the labour market. On 30th October 2002 IRISC wrote to the Defendants offering the sum of plus interest in full and final settlement of the Claimants claims arising from his employment. The offer included 3,692 for handicap on the labour market. When the cheque from Norwich Union was included it represented a total offer of 10, for the two heads of claim but in full and final settlement of all claims. 11. The Defendants wrote to the Claimant informing him of the offer and on 6 th December 2002 a telephone conversation took place between the Claimant and Mr Swift of the Defendants. Shortly after this conversation the Claimant agreed to accept the offer and filled in a form to confirm this. He was aware that he could not pursue a services claim in the future if he accepted this offer but his claim is based on the fact that he did not receive competent and adequate advice before making the decision. 5. The Judge concluded at paragraph 12 of his judgment with this passage: The correct approach would therefore appear to be to firstly determine whether there has in fact been a breach of duty. Secondly, if there has, the Court must then ask whether the breach caused or materially contributed to the Claimant s alleged loss. Thirdly, the Court must decide if the Claimant has lost something of value in the sense that his prospects of success are more than negligible. Fourthly, if the Court decides that the claimant has lost a claim with more than negligible prospects of success it must make a realistic assessment of what those prospects of success were. Finally, the Court will need to make an assessment of what the likely value of the claim was having taken account of the prospects of success. On behalf of Raleys, Mr Michael Pooles QC (who did not appear below) and Ms Catherine Foster accept that that exposition is correct. Their complaint is that thereafter the Judge erred in his consideration of the second stage.
6 This appeal 6. The grounds of appeal and the skeleton argument in support of them point to this being essentially an appeal on fact. Indeed, when Lewison LJ granted permission to appeal, he plainly saw it as such. In this Court, however, Mr Pooles has sought to present it as embracing a legal issue and has applied for permission to amend the grounds of appeal if such an amendment is necessary to sustain his submissions. The legal point is said to derive from a misapplication by the Judge of an approach described by Rix LJ in Dixon v Clement Jones Solicitors [2004] EWCA Civ 1005 (at paragraph 27) in the following terms: There is no requirement in such a loss of a chance case to fight out a trial within a trial, indeed the authorities show as a whole that that is what should be avoided. It is the prospects and not the hypothetical decision in the lost trial that has to be investigated.the test is not to find out what the original decision of the underlying mitigation would have been as if that litigation had been fought out, but to assess what prospects were. The authorities to which Rix LJ was referring include, in particular, Mount v Barker Austin [1998] PNLR 493 and Sharif v Garrett & Co [2001] EWCA Civ 1269, in both of which Simon Brown LJ expounded the principles. Mr Pooles submits that, in all those cases, the context was an action against negligent solicitors where the claimant s previous claim had been struck out as a result of the negligence of their solicitors. There, he submits, that approach is necessary because, by definition, it is no longer possible for there to be a fair trial of the original cause of action against the original tortfeasor. In the present case, by contrast, it remained possible and necessary for the Judge to find the facts relating to Mr Barnaby s condition and, in particular, the causal link, if any, between that condition and the alleged need for services. It is submitted that the Judge failed to take into account aspects of the evidence which were inconsistent with Dr Ryan s MAP 1 assessment and thereby disabled himself from making appropriate findings. For example, emphasis is placed on this passage in the judgment (paragraph 25): My overall conclusion of the Claimant was that he did not appear to me to be putting forward a fraudulent claim but he was a very poor historian whose evidence had to be treated with caution. He was clearly exposed to vibration during the course of his work and I think it is likely he had some form of VWF. I would hesitate to rule on what the appropriate staging should be in the light of his conflicting history but I am not convinced that is a finding I need to make. This claim is not a rerun of the original claim although it appears the Defendants would like it to be. This, submits Mr Pooles, demonstrates the misapplication of the approach in Dickson v Clement Jones away from its intended context. Mr Pooles further submits that, having failed to take into account important evidence, thereby disabling himself from making sustainable findings of fact, the necessary if unfortunate consequence is that the Judge s order must set aside and for there to be a re-trial. On the face of it, it seems surprising
7 that this claim for 5,925 is attracting the talents of leading counsel on both sides and the risk of an expensive re-trial. However, Mr Pooles refers to other pending appeals which, together with this case, demonstrate extensive litigation against Claimants solicitors for this kind of negligence in relation to the administration of the Scheme. It is said that not all first instance judges are taking the same approach to such negligence claims. To put his submission in context, he informs us that Raleys alone advised over 12,000 coal miners on VWF claims against the Scheme. The negligence 7. There is no appeal against the finding of negligence but it is important to keep in mind its form. In December 2002 Mr Barnaby was advised that the settlement offer of 10, plus interest represented fair compensation for his general damages and handicap in the labour market claim. He was told that a services claim may well take some time to settle. He was also told that if he rejected the settlement offer he would not be entitled to a further interim payment. It was in this context that Mr Barnaby spoke to his solicitor on 6 December. The Judge said (at paragraph 23): The finding on causation I cannot see how he could reasonably make the decision [whether to accept the settlement offer] without knowing what he was giving up by abandoning the services claim. He needed to know roughly what it was worth and what his prospects of success were in very general terms. In my view it was negligent of the solicitor to fail to provide this information when he was capable of doing so with a little thought. If he had done so the client could then make a valued judgment about whether it was worth abandoning the services claim to obtain immediate full payment of the other two claims. It was also a clear breach of duty to advise the claimant that he was not entitled to a further interim payment when in fact he was entitled to an interim payment of at least 3,000 on any view. 8. The Judge recorded the case for Raleys on causation in the following passage (at paragraph 24): The defendants put their case very strongly on this issue. The defendant says that the claimant is not suffering from VWF and has never done so. If the court makes a factual finding to that effect then the court will find it easier to make a factual finding that the claimant abandoned his claim for services because he knew he had no real need for services not because he was negligently advised. The defendants rely on the fact that the original MAP1 medical assessment is not as robust as a normal medical legal assessment and cannot be relied on. The defendants also rely on the fact that the claimant at various times to various bodies (his own solicitors, Benefits Agency, doctors assessing his condition) has given conflicting information as to the commencement of his symptoms and the nature of his symptoms such that his claim is not believable.
8 We have been referred to numerous passages in the transcript of the crossexamination of Mr Barnaby at trial. There is no doubt that it was being put to him that he had been pursuing a fraudulent claim. 9. As I have related, the Judge concluded that Mr Barnaby was a poor historian and an unimpressive witness but that he was not fundamentally dishonest. He had had VWF since The Judge s conclusion on causation is to be found in the following passage (at paragraph 26): One piece of evidence that did emerge clearly was the Claimant s need for cash. He explained how his 25 th wedding anniversary was due to take place in June 2003 and he had planned a surprise holiday for him and his wife. This was not in his witness statement and ordinarily I would have regarded its emergence at trial with considerable suspicion. It was however recorded by one of the Defendant s lawyers in the file note on 15 August When asked why he decided to accept the offer in his evidence the Claimant replied because he needed the cash to pay for this holiday. He was unable to provide any other reason. The question is whether he would have accepted the offer if he was told that he could reject it, obtain an interim payment of 3,000 and then continue to pursue a claim that might be worth up to 7,900 although there were some potential problems which might reduce or extinguish this claim. Faced with an unsophisticated client who had already disclosed a need for ready cash, the solicitors advice should have been that he had very little to lose by rejecting the offer pursuing the services claim bearing in mind he would still receive 3,000 or so shortly. Faced with these figures no sensible person would have accepted the offer. It is not easy from the Claimant s evidence to reconstruct what he might have done but on balance, if properly advised, I find as a fact that he would probably have rejected the offer and pursued the services claim. As I have not found that at this time the Claimant was not suffering from VWF and knew it I do not need to consider this alternative. 10. In this Court, the case for Raleys has been put not so much on the basis that Mr Barnaby is not suffering from VWF and has never done so but on the basis that, at the material time, it had not reached the stage which justified the need for services. In effect, Mr Pooles is contending that the Judge ought to have discounted Dr Ryan s report on the basis of other evidence. The other evidence relied upon by Raleys 11. When Mr Barnaby completed the VWF questionnaire on 1 March 1999 he stated that he had first noticed problems on 1 June 1992 and described them as numbness and tingling in fingers. There was a question which provided a checklist of symptoms. He did not refer to having experienced blanching. On 19 April 1999 he applied for a state benefit and referred to symptoms having started in June 1994, in particular pins and needles, loss of grip, hands persistently cold. Bad circulation. There was no
9 express reference to blanching. He was examined by a doctor on behalf of the Department of Work and Pensions on 21 September 1999 and said that his symptoms had arisen in the early 1990 s, adding the finger tips of all the digits turn white a diagram indicated this. The claim for state benefit was rejected on the basis that the extent of blanching failed to satisfy the relevant criterion because it extended only to the distal and not to the proximal phalanges. In an appeal against this decision, Mr Barnaby contended that the symptoms extended to the second knuckle. (By this time he had made his claim for compensation under the Scheme and his examination by Dr Ryan in relation to MAP 1 was on 4 May 2000, when Mr Barnaby stated that blanching extended to the proximal phalanges and had done since onset). On 1 July 2000 Mr Barnaby made a further application for the state benefit, proving a copy of the MAP 1 report in support of his application. On 19 March 2001 he was examined again by a DWP doctor but did not refer to blanching. The doctor s note stated: the new changed history is not realistic. VWF does not follow this pattern. The original history of 1999 is more acceptable and I prefer his original description. He gave no history of blanching this time. Accordingly, the doctor accepted blanching only to the distal phalanges and the claim for the state benefit was again dismissed. 12. At trial, the Judge had the benefit of a report from Mr Tennant, a consultant vascular and general surgeon. He was acting as a joint expert. His initial report accepted the diagnosis of HAVS graded at 2V 1SN. This would have qualified Mr Barnaby for part but not the whole of his services claim because it would have excluded claims for decorating and DIY. Thereafter, Mr Tennant was shown Mr Barnaby s DWP records. In answer to questions posed by Raleys solicitors, he stated that: i) If as a matter of fact the Court found that Mr Barnaby had never had blanching, then there would be no basis for a diagnosis of the vascular component of HAVS; ii) If the extent of the blanching was to the distal joint only, then the grading would be 1V and not 2V, thereby disqualifying the services claim. Discussion 13. For my part, I would not grant Raleys permission to amend their grounds of appeal. A perusal of the transcript of the proceedings in the County Court suggests that counsel did not really engage with the point now advanced as legally erroneous. Her approach amounted to a full frontal attack on Mr Barnaby s credibility as a witness. Whilst I consider that Mr Pooles may be correct in his submission that the extract from the judgment of Rix LJ in Dixon v Clement Jones was and is more relevant to cases where the original action of the claimant has been struck out as a result of the negligence of his previous solicitors, I do not think that this point accrues to the benefit of Raleys in the present case. It is important to keep in mind facts which were found by the Judge. He found (at paragraph 18) that when Mr Barnaby and his wife completed the services questionnaires, ticking some but not all of the categories of assistance, they did so:
10 because these were the only tasks with which he needed help that he did before and could no longer do. For this reason the Judge accepted the claim in relation to the ticked categories but rejected Mr Barnaby s evidence that he also needed help with window cleaning and car maintenance because it was inconsistent with very compelling contemporaneous evidence of his instructions to his solicitors at the time. He added: I therefore find as a fact that if he had pursued his services claim he would have done so solely in relation to gardening and car washing. The Judge also attached importance to the fact that (1) the account of needing money in order to finance the holiday was corroborated by Raleys attendance note of August 2002 and (2) Mr Barnaby would have had very little to lose by rejecting the settlement offer and pursuing the services claim, bearing in mind that he would still have been able to receive a further interim payment, if he had been properly advised. As the Judge said: Faced with these figures no sensible person would have accepted the offer. Accordingly, Mr Barnaby would probably have rejected the offer and pursued the services claim. 14. Whilst it is true that Mr Barnaby was a poor historian and an unimpressive witness, the attack on his honesty, which was sustained and unequivocal, seems to me to have been misjudged. One has to keep in mind that his original claim was in relation to the Scheme and was not one made in the course of conventional civil litigation. His claim in respect of general damages and handicap on the labour market was accepted on the basis of the MAP 1 examination. Indeed, the same examination would have been the basis for the assessment of his services claim. A MAP 2 examination would have had the limited purpose of identifying co-morbid conditions, of which there were none. At no point during the processing of the Scheme claim would reference have been made to the claims for state benefit. In any event, it seems to me that the attempt to discount or undermine the MAP 1 examination is misconceived. Its purpose and scope was and was appreciated to be different from those of the DWP assessments. DWP publications now confirm this and describe the Scheme criteria as more lenient than the state benefit diagnostic criteria: see Hand-Arm Vibration Syndrome, Civ 6098, July 2004, paragraph 79. What is more, on its face the MAP 1 examination and report was a less limited process than is now suggested on behalf of Raleys. It is quite detailed and includes diagrammatic representation supportive of Mr Barnaby s case. It was also fortified by test results obtained by Elaine Garrett, a colleague of Dr Ryan. In my judgment, it does not justify the criticism now made of it. 15. Ultimately, there are two factors which dispose me to the conclusion that the Judge s findings on causation are unassailable. The first is the common sense one to which I have referred. If Mr Barnaby had been properly advised that to carry on with the services claim would not have deprived him of a further interim payment sufficient to pay for the planned holiday, there would have been no sensible reason for him not to continue to pursue the services claim. The evidence about needing the money to pay
11 for the holiday is underwritten by the August attendance note. Secondly, the alternative explanation proffered on behalf of Raleys, namely that Mr Barnaby gave up the services claim because he had come to realise that it was based on exaggeration at least verging on dishonesty, is inherently implausible. As Mr Watt-Pringle QC submits, it would have involved this unsophisticated claimant in abandoning a claim by reason of a sudden outburst of honesty but seeking to revive it by other means at a later date through a dishonest claim against his solicitors. 16. I am entirely satisfied that the Judge correctly assessed the reality behind this litigation. Solicitors who had encouraged and certainly not discouraged the presentation of a services claim are now seeking to characterise it as misconceived on the basis of material which was irrelevant to it and in the face of evidence which would probably have led to its success or at least the quantified prospect of success but for the intervention of negligent advice which caused Mr Barnaby to abandon it in circumstances in which neither he nor anyone else would otherwise have abandoned it. There would have been no credible reason for him to have done so. Conclusion 17. It follows from what I have said that, in my judgment, this is a completely unsustainable appeal against factual findings and I would dismiss it. The point of law for which Mr Pooles contends does not avail Raleys in view of factual findings which are unassailable. Lord Justice Davies 18. I agree. Lord Justice Floyd 19. I also agree.
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