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27-10-2009, 18:33   #1
Wantobe
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Date of knowledge and the Statute- professional negligence?

Following on from the professional indemnity thread, I mentioned that I believed that even where run-off cover had expired that practitioners ran the risk of a negligence claim.

This is because of the date of knowledge defence to the statute of limitations.

Another poster thought this did not apply to negligence. I have a counsels opinion which indirectly states that it does ( the opinion relates mainly to a different issue but refers to the area of negligence, and the amendment to the statute of limitations relating to date of knowledge).

I wondered if other posters had an opinion. If it is the case that date of knowledge is a defence to the statute then it becomes more important that we try to have the relevant insurance cover operating not from the date of the claim but the insurance that was in existance when the negligence occurred.
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27-10-2009, 19:13   #2
Tom Young
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Yes, this is commonly known in professional negligence cases. I was not aware that the professional indemnity thread was using an example involving a profession where this would be immediately apparent e.g., engineering or architecture. It does depend though, e.g., building defects and other aspects of negligence which would not be apparent to the common man or indeed in many cases the eye.

It can be a defence, but the threshold is high to pass this as a Defence.
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27-10-2009, 21:56   #3
Jo King
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The date of knowledge is only relevant in personal injury cases.
S2 Statute of Limitations 1991
2.—(1) For the purposes of any provision of this Act whereby the time within which an action in respect of an injury may be brought depends on a person's date of knowledge (whether he is the person injured or a personal representative or dependant of the person injured) references to that person's date of knowledge are references to the date on which he first had knowledge of the following facts:


( a ) that the person alleged to have been injured had been injured,


( b ) that the injury in question was significant,


( c ) that the injury was attributable in whole or in part to the act or omission which is alleged to constitute negligence, nuisance or breach of duty,


( d ) the identity of the defendant, and


( e ) if it is alleged that the act or omission was that of a person other than the defendant, the identity of that person and the additional facts supporting the bringing of an action against the defendant;


and knowledge that any acts or omissions did or did not, as a matter of law, involve negligence, nuisance or breach of duty is irrelevant.

In non injury cases it is still the same as in Hegarty v Loughran.
Breach of contract or negligence 6 years from when the negligent event occurred.
professional indemnity cover works on the basis of the insurance in place when the insurer is notified of the claim.
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28-10-2009, 07:47   #4
Wantobe
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Luckily I've never been in the position of being sued by a former client, but I am aware of several cases where colleagues were sued after the expiry of 6 years successfully ( well, normally the insurance company settles).

As Tom Young said, it is quite common, and I had not previously questioned it.

For eg where a couple buys a property and the title is a lease about to expire, the solicitor is instructed to perfect the title and fails to do so. Some years later, say 10, the couple go to sell the house and discover the title was never perfected. Or for eg where a solicitor is instructed in a personal injury, never issued proceedings ( or did but did not serve) and some years later the client comes back with a new solicitor to take up the file, the lack of action is discovered and they sue. These are all common enough type scenarios where clients sue successfully.
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28-10-2009, 08:45   #5
Jo King
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There is not one single reported case where a solicitor has been successfully sued after the expiry of the 6 year period. As regards settlements, without sight of the pleadings it is impossible to say what other factors were at play. In some cases the client can allege fraud or concealment and thus extend the limitation period as provided by the statute. With insurers no longer covering fraud this is potentially very serious.
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28-10-2009, 11:16   #6
sh_o
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Quote:
Originally Posted by Jo King View Post
There is not one single reported case where a solicitor has been successfully sued after the expiry of the 6 year period. As regards settlements, without sight of the pleadings it is impossible to say what other factors were at play. In some cases the client can allege fraud or concealment and thus extend the limitation period as provided by the statute. With insurers no longer covering fraud this is potentially very serious.
Sec 72 and 71 cover fraud and mistake dio they not? Have they been commenced or repealed?
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28-10-2009, 14:01   #7
Wantobe
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Quote:
Originally Posted by Jo King View Post
There is not one single reported case where a solicitor has been successfully sued after the expiry of the 6 year period. As regards settlements, without sight of the pleadings it is impossible to say what other factors were at play. In some cases the client can allege fraud or concealment and thus extend the limitation period as provided by the statute. With insurers no longer covering fraud this is potentially very serious.
I have no idea if there are any reported cases but what percentage of professional negligence cases against solicitors settle before court? I would say a very, very high percentage. It is never in a solicitor's interest to let these type of cases go to court plus the insurance companies settle to avoid high costs. I am personally aware of any number of cases where settlements have been made in these types of cases against colleagues.
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28-10-2009, 19:14   #8
Jo King
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Quote:
Originally Posted by Wantobe View Post
I have no idea if there are any reported cases but what percentage of professional negligence cases against solicitors settle before court? I would say a very, very high percentage. It is never in a solicitor's interest to let these type of cases go to court plus the insurance companies settle to avoid high costs. I am personally aware of any number of cases where settlements have been made in these types of cases against colleagues.
The Statute of Limitations is a complete defence and insurance companies will run it if they can avoid liability. Most negligence cases settle before or at hearing, so solicitors professional negligence cases are no exception. If insurance companies are so anxious to avoid high costs, why do they wait until the case is called on for hearing before making any kind of an offer and they have already incurred the majority of the costs?
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28-10-2009, 19:34   #9
Wantobe
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Quote:
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The Statute of Limitations is a complete defence and insurance companies will run it if they can avoid liability. Most negligence cases settle before or at hearing, so solicitors professional negligence cases are no exception. If insurance companies are so anxious to avoid high costs, why do they wait until the case is called on for hearing before making any kind of an offer and they have already incurred the majority of the costs?
Unless it is an unusual case with a huge amount of discovery the majority of costs are NOT incurred pre-court hearing IMO.

I completely agree that if the Statute were a complete defence the insurance company would run the case, so why are they settling?
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