England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE CCRTI 98/1438/2

(HIS HONOUR JUDGE LLOYD )

Royal Courts of Justice

Strand

London WC2

Wednesday, 17 March 1999

B e f o r e:

LADY JUSTICE BUTLER-SLOSS

LORD JUSTICE SCHIEMANN

- - - - - -

PEARLESS DE ROUGEMONT & COMPANY

Plaintiff/Respondent

- v -

STUART JOHN PILBROW

Defendant/Appellant

- - - - - -

(Handed Down Transcript of

Smith Bernal Reporting Limited, 180 Fleet Street,

London EC4A 2HD

Tel: 0171 831 3183

Official Shorthand Writers to the Court)

- - - - - -

JOHN CRITCHLEY (Instructed by Hodkin & Company, West Sussex, RH19 2NS) appeared on behalf of the Appellant

RICHARD ROBINSON (Instructed by Pearless De Rougemont & Co., West Sussex, RH19 3BA) appeared on behalf of the Respondent

- - - - - -

J U D G M E N T

(As approved by the Court )

- - - - - -

©Crown Copyright

LORD JUSTICE SCHIEMANN:

This case concerns the duties of a firm of solicitors in relation to a client who asks to see a solicitor but is thereafter advised by someone who, unknown to him is not a solicitor. Must he pay the eventual bill?

This appeal is from H.H Judge Lloyd. He had dismissed an appeal from District Judge Robinson. That judge had held that the firm of solicitors were entitled to be paid. The defendant gave evidence that he had telephoned a firm of solicitors. He asked for an appointment to see a solicitor about a family matter. The person at the other end (who it appears was a receptionist) told him that she would arrange an appointment with Miss Lee-Haswell. At that time Miss Lee-Haswell was not a solicitor; nor had she been admitted as a member of the Institute of legal executives. At that time, and indeed till after the firm sent their bill, Mr Pilbrow believed that Miss Lee-Haswell was a solicitor. She for her part did not know that he had asked for a solicitor or that the receptionist, on hearing from him that he wanted to see a solicitor, had referred him to her. That being so, she had never told him that she was not a solicitor. Miss Lee-Haswell gave evidence that at the relevant time she was “responsible to Mrs. Deborah Richards - Head of Litigation and Partner”. She had regular meetings with Mrs. Richards and within the firm she was the person who dealt with family work. There is no reason to suppose that, in relation to Mr Pilbrow’s affairs, she ever consulted Mrs Richards. She said she had no idea about Client Care letters. She accepted that there was no way that the client could know that she was not a solicitor. On the other hand, what she did was up to the standard of a competent solicitor and equally a competent partner who had informed a client of the status of the person doing the work would, absent any specific instructions from a client to the contrary, have been justified in leaving the work which Miss Lee-Haswell did to a person of Miss Lee-Haswell’s standing in the firm. There is no very clear evidence as to whether the amount which Mr Pilbrow was charged was appropriate given that a solicitor was not in fact doing the work but someone with lesser paper qualifications was. We note that, when Mr Pilbrow queried the bill in short form sent by the solicitors in West Sussex, Miss Lee-Haswell sent him what they claimed was “a fully drawn bill prepared by a costs draughtsman which will give you a much more detailed breakdown of the work undertaken for you”. We note that this bill charged an hourly expense rate of £80 for “solicitor engaged”. This was inaccurate. She may not have spotted it. She was not asked about it.

It is easy to see how Mr Pilbrow could believe that she was a solicitor and how she could be in ignorance of that belief. She had a lot of practical experience of family work and indeed did 80% of the family work in the firm. So there was nothing unusual in her eyes in being asked to do that sort of work. No doubt because this sort of misunderstanding can arise easily, the Solicitors Practice Rules 1990 provide in Rule 15(2)(a)

Every Solicitor in private practice shall, unless it is inappropriate in the circumstances, ensure that clients know the name and status of the person responsible for the day to day conduct of the matter and the principal responsible for its overall supervision.

However, it seems that this firm of solicitors did not keep to that rule. Certainly no client care letter was sent to Mr Pilbrow. Had it been the misunderstanding would have been avoided. No-one suggests that the sending of such a letter in the present circumstances would have been inappropriate.

As it was, Miss Lee-Haswell advised Mr Pilbrow, prepared instructions for counsel and instructed counsel. In due course Mr Pilbrow lost his case. He felt that the quality of care which he had received fell below the appropriate standard. He was sent a bill. He had already paid £800 on account. He refused to pay any more. The firm sued in the county court for just over £1800. He drafted his own defence in which he stated that he had found out that Miss Lee-Haswell was not a solicitor, that he would not have employed her as an advisor had he known that she was not a solicitor, that she mishandled the case, that a misrepresentation had induced the contract and that the contract ought to be rescinded. He also made a counterclaim which in essence was intended to be for damages for the firm’s negligence.

The District Judge heard the case as an arbitration under CCR Order 19. He found against Mr Pilbrow. The latter then “appealed” to HH Judge Lloyd. In truth it was an application to set aside the arbitrator’s award on the ground that the arbitrator had made an error of law. HH Judge Lloyd refused to do so. Thereupon Mr Pilbrow obtained the leave of the full court to pursue an appeal to this court in relation to the dismissal of his defence. That is the appeal which we heard. There is no appeal in relation to the dismissal of his counterclaim. The amount at stake is small but the legal points which arise are of some general importance.

The District Judge said the following:

“Getting down to first principles there was a contract for legal services between the plaintiff firm and the defendant Mr. Pilbrow. The contract was not with the fee earner Miss Lee-Haswell. Was there to be an implied term in that contract that it will be performed by a solicitor? Ordinarily, the answer is very definitely no, but was there an implied term of that nature here? How is the Court to approach the issue of there being a misrepresentation about the status of Miss Lee-Haswell? The plaintiffs say there was no misrepresentation i.e. there was no false statement of fact which induced the defendant to enter into the contract. They say no representation that Miss Lee-Haswell was a solicitor and at most they are to be criticised for non-disclosure. There is a crucial distinction between representation and non-disclosure and, put simply, remedies for non-disclosure arise only in a contract of utmost good faith such as insurance that those solicitors should be in the position of acknowledging non-disclosure is very very regrettable. The defendant says there was an implied representation that the fee earner was a solicitor and as a result he is entitled to rescission of the contract. If I were to find there was such an implied representation that would go against normal practice of distributing work in a professional firm, be they lawyers, accountants, surveyors or engineers. I do not find any such implied misrepresentation. In fact, the defendant puts his case that there was an express representation from a secretary or an administrative member of the staff. I do not find that such individual had authority to bind the firm and such was open only to partners and fee earners. I find against the defendant on implied representation and express representation but in passing would add that had I found for the defendant I would not have rescinded the contract because of his delay, through ignoring letters and raising the point only after he was sued and further by his having received value, namely representation in Court. I have considerable sympathy for the defendant as to what he believed, namely that Miss Lee-Haswell was a solicitor”.

He went on to find that the plaintiffs had prepared the case including the choice of counsel to the standard of a competent solicitor and therefore there was no negligence. He gave judgment for the plaintiffs without costs.

His Honour Judge Lloyd quoted that passage and stated:

“I can find no error of law in the findings and application of the law made by District Judge Robinson in that judgment in relation to the passage I have just quoted”.

A little later on he said:

“I cannot look behind that finding, but I add the comment that, of course, if someone phones a firm of solicitors and asks for a solicitor..... then the point made by the solicitors.... is a perfectly valid one, that, to state the obvious, you would not phone a firm of solicitors and ask for an accountant. “I want a solicitor” is the normal sort of remark that anyone would make when phoning and a secretary would not be responsible or a telephonist or a receptionist would not be responsible for the distribution of work within the firm. That is for the decision of the partners in conjunction with the fee earners...... therefore, the contract was made, of course, with Pearless De Rougemont, not with any particular person within that firm and there was no misrepresentation or false holding out by the secretary and that was a clear finding of the District Judge.”.

We have been helped by Mr John Critchley and Mr Richard Robinson, who appeared for appellant and respondent respectively, and have been able to analyse the problems posed by the case rather more carefully. They both agreed that, given the amount at stake, they did not wish this court to send the case back for a retrial and asked us to do the best we could on the material and findings available. We agreed to adopt that course.

So far as the facts are concerned, I am persuaded that the summary of the facts given at the beginning of this judgment represents the findings of the district judge. Mr Robinson submitted that the District Judge had made no express finding that Mr Pilbrow had indeed asked for a solicitor and that all he had found was that, if Mr Pilbrow did say he wanted a solicitor, then sending him on to Miss Lee-Haswell would not have amounted to a representation which the receptionist was empowered to make. In my judgment the District Judge went beyond that. Had he disbelieved Mr Pilbrow then he should have said so instead of expressing, as he did, considerable sympathy for him. We must proceed on the basis that Mr Pilbrow expressly asked for a solicitor and was referred to Miss Lee-Haswell.

I accept entirely the point made by the Judge that a secretary is not responsible for the distribution of work in the firm. That however does not dispose of this case. In my judgment, the firm should have trained its receptionist, when faced with a request to see a solicitor, to do one of the following : (i) refer the client to a solicitor, (ii) refer the client to someone who was not a solicitor but tell the client that this person was not a solicitor, or perhaps, in some circumstances, (iii) refer the client to someone who the receptionist knows is not or may not be a solicitor, refrain from telling him that fact, and alert the referee to the fact that the client had asked for a solicitor. If the last course is adopted then it will be the duty of the referee straightaway to make clear to the client that she is not a solicitor if that be the fact. We have no evidence as to what training this firm gave to its receptionist. What is clear is that she did none of these things. In those circumstances, Mr Pilbrow was entitled to assume that the firm was putting Miss Lee-Haswell forward as a solicitor. It is not a defence for the firm to prove (i) that the receptionist thought that the referee would make her status clear and (ii) that the referee had no reason to suppose that the client wanted a solicitor.

I accept entirely the Judge’s point that you would not phone a form of solicitors and ask for an accountant. But this point tells against the Plaintiffs rather than in their favour. The very fact that a potential client has telephoned a solicitors’ firm reveals that he probably wants legal advice. The conversation starts on that unspoken premise. When he then says that he wishes to talk to a solicitor he is not to be taken as making clear that he does not want to talk to an accountant or a plumber. What he is making clear is that he wishes to talk to someone who is a solicitor as opposed to someone not qualified as a solicitor. He may, in the context of a particular firm, be making an unjustified assumption that a solicitor will give him better advice than the unqualified person. If that is so then this should be made clear to him by someone authorised to speak for the firm.

The crucial initial question is whether the contract between Mr Pilbrow and the firm under which the firm was suing for its fees was a contract to provide legal services or a contract to provide legal services by a solicitor. The fact that he was under the impression that Miss Lee-Haswell was a solicitor and that she did not know this is entirely attributable to the firm, the way it’s receptionist acted and the firm’s failure to send an appropriate client care letter. The firm must take responsibility for this. In my judgment, in the circumstances of the present case the initial contract was one to provide legal services by a solicitor. The firm did not perform that contract at all. No legal services were provided by any solicitor. Not until all the legal services had been performed did Mr Pilbrow know that the provider was not a solicitor.

Nothing in the foregoing should be seen as an adverse comment on the widespread practice of solicitors delegating work to others in the firm, be they typists, legal executives or whatever. The right to delegate that work will, depending on the nature of the work, often be implied. That right however is dependent upon the actual or implied consent of the client. Even a client who expressly asks that everything in his case is to be done by a solicitor would, I suspect, be taken to have agreed that letters dictated by a solicitor could be typed by a typist.

The District Judge was minded to refuse Mr Pilbrow relief on the basis of his delay in raising the point only after he was sued. That criticism is misplaced. Mr Pilbrow did not get to know that Miss Lee-Haswell was not a solicitor till about that time.

The problems in the present case arise from the fact that the firm did render services to its client. It seems probable that if a solicitor in the firm had seen Mr Pilbrow initially he would either have persuaded Mr Pilbrow that the sensible thing would be to pass the case to her or alternatively have done it himself, perhaps seeking advice from Miss Lee-Haswell. There is no reason to suppose that the end result would have been any more satisfactory for Mr Pilbrow. He has not, as things have turned out, been disadvantaged by what has happened. I entirely understand his wish at the time to be represented by a solicitor. At the time that is what he thought was happening. I entirely understand his fury at discovering that this was not the case and his feeling that if only he had been then perhaps the end result might have been different. I entirely understand that, although he now accepts that Miss Lee-Haswell was not negligent, it is possible that other non-negligent decisions would have been open to whoever was representing him which might have produced a different result in relation to the matter which understandably was troubling him - the change of name of his child. However, while all this is a remote possibility, it is improbable.

Although the matter was not clearly argued thus in the courts below, as it seems to me the present case presents once more the old problem of deciding whether what has happened is defective performance of a contract or non-performance of a contract. The courts have not evolved a conceptual tool which enables one to place every situation automatically in one category or the other. To a degree the point is one of impression. I am satisfied in the present case that the Plaintiffs have failed to perform their contract and the defendant is entitled to regard it as discharged by the Plaintiffs’ breach. This case is not properly to be analysed as a case of defective performance of a contract for legal services with a term that these should be performed by a solicitor. I categorise it as one of non-performance of a contract to provide legal services by a solicitor. In my judgment a firm of solicitors which is asked for a solicitor and, without telling the client that the advisor is not a solicitor, provides an advisor who is not a solicitor should not be entitled to recover anything. I would come to the same conclusion in relation to a case where a person goes into a doctor’s surgery, asks for a doctor and the receptionist refers him to a nurse who thereafter, perfectly competently, handles his problems. These situations are not to be equated with situations where a drinker asks for a pint of one make of bitter but is mistakenly provided with a pint of another make and does not discover the difference until he has drunk the glass dry.

On the basis that the contract has been discharged by the Plaintiff’s breach and that the Defendant has accepted this position, it is unnecessary to explore the situation in relation to misrepresentation and the Misrepresentation Act 1967 and I refrain from doing so.

The Defendant does not seek restitution of the £800 which he has already paid. This seems a realistic approach and relieves the court of the necessity of deciding whether or no such a claim for restitution could succeed.

I would allow this appeal and set aside the award of the District Judge.

LADY JUSTICE BUTLER-SLOSS: I agree.

Order: Appeal allowed; set aside the order of the District Judge; set aside the order of the Circuit Judge; the costs of the appeal before the Circuit Judge will be paid on a litigant in person basis to the appellant; the appellant's costs of the appeal. (This order does not form part of the approved judgment)