The respondent firm acted on behalf of the claimant’s companies in land transactions. An option had been taken to purchase land, and he instructed the defendants to exercise it. The landowner claimed the notice to exercise the option was invalidly served. By the time the issue was resolved the land had again fallen in value. The respondents argued that the losses incurred by the claimant personally rather than by his company’s were the result of his business decisions. The respondents also argued that they owed any duties to their company client rather than the claimant in person. In this case because of the origin and nature of the original instructions such a duty did exist. However the claimant failed to establish that several heads of losses did flow from the negligence of the defendants.
The Honourable Mr Justice Hart
 EWHC 776 (Ch)
England and Wales
Cited – Caparo Industries Plc v Dickman and others HL 8-Feb-1990
Limitation of Loss from Negligent Mis-statement
The plaintiffs sought damages from accountants for negligence. They had acquired shares in a target company and, relying upon the published and audited accounts which overstated the company’s earnings, they purchased further shares.
Held: The . .
Cited – White and Another v Jones and Another HL 16-Feb-1995
Will Drafter liable in Negligence to Beneficiary
A solicitor drawing a will may be liable in negligence to a potential beneficiary, having unduly delayed in the drawing of the will. The Hedley Byrne principle was ‘founded upon an assumption of responsibility.’ Obligations may occasionally arise . .
Cited – Galoo Ltd and Others v Bright Grahame Murray CA 21-Dec-1993
It is for the Court to decide whether the breach of duty was the cause of a loss or simply the occasion for it by the application of common sense. A breach of contract, to found recovery, must be shown to have been ‘an ‘effective’ or ‘dominant’ . .
Cited – Prudential Assurance Co Ltd v Newman Industries Ltd (No 2) CA 1982
A plaintiff shareholder cannot recover damages merely because the company in which he has an interest has suffered damage. He cannot recover a sum equal to the diminution in the market value of his shares, or equal to the likely diminution in . .
Cited – Lee v Sheard CA 1956
The negligence of a car driver resulted in an injury to the plaintiff who was one of two directors and shareholders of a limited company and did outside work of buying and selling linen goods for it. As a consequence of the accident the plaintiff . .
See Also – Johnson v Gore Wood and Co (A Firm) QBD 20-Feb-2002
The claimant alleged negligence by the defendant solicitors. . .
See Also – Johnson v Gore Wood and Co HL 14-Dec-2000
Shareholder May Sue for Additional Personal Losses
A company brought a claim of negligence against its solicitors, and, after that claim was settled, the company’s owner brought a separate claim in respect of the same subject-matter.
Held: It need not be an abuse of the court for a shareholder . .
See Also – William John Henry Johnson v Gore Wood and Co CA 3-Dec-2003
See Also – William John Henry Johnson v Gore Wood and Co CA 27-Jan-2004
The defendant had made a substantial payment into court in protracted proceedings.
Held: The comparison between the payment in and the eventual amount of damages awarded should be assessed on the basis of the damages calculated as at the date . .
Lists of cited by and citing cases may be incomplete.
Updated: 06 June 2022; Ref: scu.171258