England and Wales Court of Appeal (Civil Division) Decisions

IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT
QUEEN'S BENCH DIVISION
(MR JUSTICE GRIFFITH WILLIAMS)

		Royal Courts of Justice Strand, London, WC2A 2LL
		10th March 2011

Lady Justice Smith:

1. This appeal arises in the context of a professional negligence claim brought by Lawrence Warner against Penningtons, the firm of solicitors that was representing him at the time of the settlement of his claim for personal injury damages against his former employer. In these proceedings he alleges that his claim was settled at an under value as the result of negligent advice by Penningtons. Penningtons deny negligence and, in the alternative, blame as third parties the three barristers instructed by them on whose advice they relied. They also blame, as the fourth-named third party, Jacqueline Webb & Co, the firm which provided an expert report on Mr Warner's care needs in the original litigation. Penningtons allege that the expert assigned to the case, Ms Gwen Watkins, had been negligent.
2. Jacqueline Webb & Co applied to the court to strike out the claim against it on the ground that it was immune from suit. That issue was stayed generally pending the decision of the Supreme Court in Jones v Kaney [2010] EWHC 61. In the alternative, Jacqueline Webb sought summary judgment on the ground that Penningtons had no prospect of showing that Ms Watkins had been negligent or in breach of duty. The application for summary judgment came before Griffith Williams J on 12 July 2010. He gave summary judgment in favour of Jacqueline Webb. Penningtons now appeal against that decision with the permission of Gross LJ.
3. Mr Warner suffered a severe head injury while at work in 1993 when he was struck by a heavy plank. He was 20 years old. He instructed a solicitor named Mr Mather to bring a claim. Liability to compensate him was soon admitted on behalf of the employer. Not long afterwards, Mr Mather began to work for Penningtons and this claim went with him.
4. The medical evidence assembled by Mr Mather showed that Mr Warner had made a remarkably good physical recovery from his injuries but, as is so often the case following head injury, he was left with residual changes of personality and loss of executive function. Although within about three years of the accident he was managing to live alone in a flat in London he was not coping well. He was receiving a good deal of support from friends and family but it was thought that some professional support might be required in the long term. Accordingly, in 1997, Mr Mather decided to instruct Jacqueline Webb & Co to prepare a report assessing and costing Mr Warner's care needs, past, present and future. Ms Watkins was assigned to the case.
5. Mr Mather sent Ms Watkins a bundle of medical reports and some witness statements dealing with many aspects of Mr Warner's day to day difficulties. Ms Watkins arranged to see Mr Warner. She also met his best friend, John Appleton, who was at that time Mr Warner's main source of practical support. She produced a draft report and also asked Mr Mather to arrange for her to meet Rachel Hall, Mr Warner's former girlfriend. However, Mr Mather was unable to arrange this and asked Ms Watkins to finalise her report on the information she then had. Ms Watkins did so in March 1998. I will describe that report in some detail in a while. Suffice it to say for the present that no criticism is now made as to the thoroughness of its preparation or as to Ms Watkins' general competence or care. One specific complaint is made about the report to which I will return in due course. On receipt of the report Mr Mather was plainly delighted. He wrote to thank Ms Watkins in glowing terms. He said that the report was admirable and explained the care needs very clearly.
6. Later, in October 1998, Mr Mather wrote to Ms Watkins to tell her that he had become concerned about Mr Warner's capacity to manage his own affairs. He appeared to be seeking her advice. She responded that this was outside her area of expertise. She had nothing to do with the subsequent decision to make Mr Warner a patient. She then had no further contact with Mr Mather until arrangements were made for her to attend court for a hearing which, at some time in the autumn of 1998, was fixed for May 1999.
7. A short time before the hearing, Mr Mather sent Ms Watkins a copy of a care report prepared by Ms Carole Fowler, the care expert instructed for the defence. She was asked to discuss the case with Ms Fowler and to prepare a statement summarising their agreement and disagreement.
8. On the day before the hearing was to begin, the two care experts had a telephone discussion and a joint schedule of figures, some agreed and some not agreed, was prepared. By that time Ms Watkins had not seen Mr Warner for about 16 months. At the top of the schedule the experts both noted that it was some time since they had seen Mr Warner him and that they had had to rely on their earlier assessments. The schedule reveals that there was some disagreement as to the amount of care which Mr Warner required. Ms Watkins thought he needed more than Ms Fowler thought.
9. At the court door, the claim was settled for £425,000 and the settlement was approved by the Court of Protection.
10. At some later stage, Mr Warner or his family came to the conclusion that his claim had been settled at an undervalue and the claim was begun against Penningtons. It was alleged that the claim had been undervalued by more than £1 million, a large proportion of which was said to arise from the undervaluation of Mr Warner's care needs. The new legal team had made contact with Ms Watkins and had shown her a number of medical reports and witness statements which she had not seen at the time of preparing her report. She had not been asked to review her opinion when some of these additional materials became available. She gave the new legal team a witness statement saying that, if she had seen these other materials, she would have assessed Mr Warner's care needs at a higher level. She also drew attention to a passage in her original report where she said that she had advised that a care regime should be established 'as a matter of priority'. She had recommended that this should comprise regular cleaning help, a support worker and a case manager. She had in mind that establishing a care regime immediately would reveal Mr Warner's true requirements more accurately and satisfactorily than her theoretical assessment could achieve. The argument to be advanced in the case against Penningtons was that, if the care regime had been set up before trial, the care needs would have been reconsidered in the light of experience and the claim would have been put forward at an increased level. So Ms Watkins was now a witness for Mr Warner in his claim against Penningtons.
11. In their defence to the claim, Penningtons denied negligence and denied that the claim had been settled at an undervalue. In the alternative, if it had been undersettled, that was due inter alia to Ms Watkins' negligence. Four allegations were made against her and were repeated in the Part 20 notice which followed. These all have been abandoned save one; that is that Ms Watkins had failed to advise that a support worker and case manager should be employed prior to the trial or settlement of the action. The response to that allegation was that Ms Watkins' report had so advised at paragraph 3.07.
12. I will set out that paragraph in due course but will first describe the format of the report. Section 1 dealt with introductory matters and set out the history of events. It listed all the documents which Ms Watkins had received. It described Mr Warner's difficulties as perceived by his friends and family and the support he received from them. It dealt with his living arrangements, the changes in his occupational status and his leisure activities. Section 2 provided an assessment of the psychological and physical restrictions caused by the injury and their practical implications. Section 3 dealt with the evaluation of past, present and future care needs. Within that section, paragraphs 3.01 to 3.06 described and evaluated in money terms the care provided by family and friends during six separate stages of recuperation and rehabilitation over the years since the accident. The last of those paragraphs related to the support provided by John Appleton between September 1997 and March 1998. Ms Watkins drew attention to the fact that Mr Appleton was no longer providing this support. At the end of each of those six paragraphs was a box in which the costing for that period was calculated.
13. I come now to the crucial sub sections. Paragraph 3.07 is headed in block capitals, "FUTURE CARE UNTIL FUNDS ARE AVAILABLE TO PURCHASE ADDITIONAL ASSISTANCE". Below that in ordinary type it says:

"Mr Warner's quality of life will have reduced without regular support and funds should be made available as a matter of priority to ensure that a new care regime can be established."

Below that was a costings box which had no evaluation of costings within it. It said: "Care provided by friends from 1 March 1998 until funds are available to purchase assistance." And on the right: "Not evaluated".

Paragraph 3.08 is headed in block capitals, "FUTURE CARE AFTER MONEY HAS BEEN MADE AVAILABLE TO EMPLOY HELP". Below that, in ordinary type:

"This should be in the form of practical help with looking after Mr Warner's home and social support. He will also need help to deal efficiently with correspondence and other business matters on a day to day basis. For these purposes I recommend the following:

• regular cleaning help, 2 hours per week.

• support worker, 3 hours twice-weekly to assist with domestic planning and budgeting, meal planning and cooking, exploring social activities and attending these with Mr Warner.

• case manager."

Below that:

"As previously stated, Mr Warner appears to be a normal and healthy young man whose easy social manner often masks his many difficulties. It is therefore very important that his support worker should be confident to deal with his complex problems and have the right working experience and skills."

The report then explains the basis on which the hourly rate has been assessed by relation to a social worker employed by a London borough, and in the costings box below, the annual cost of employing both a domestic assistant and a support worker is set out.

Below that box the paragraph continues:

"I do not believe that Mr Warner would be capable of recruiting staff or administering a payroll. For these and the following other purposes I recommend a case manager:

• to assess Mr Warner's functional abilities and needs;

• to provide training, support and ongoing advice to Mr Warner and his support workers;

• to deal with day-to-day finances and budges;

• to plan and organise a structured weekly programme of activities in co-operation with Mr Warner and his support worker, taking into consideration his needs;

• to act as a source of information regarding local facilities for education work and leisure"

Below that:

"As a general guide, the level of case management will be highest in the first 2 - 3 months of establishing a new care regime and the subsequent year following such changes"

In the case management requirements box, it said:

"First year of new regime:

First 2 months: 28 hours.

Subsequent 10 months: 30 hours.

Total First Year: 58 hours.

Number of anticipated visits in year 1: 12"

Below that: "Subsequent years: allow 3 hours per month -- "36 hours per annum. Total number of visits: 10"

Below that is a costings box in which the cost of the case manager both for the first year and subsequent years is set out.

14. Jacqueline Webb & Co's case before the judge below was that Ms Watkins' words, particularly those of paragraph 3.07, were clear. She had done all that could reasonably be expected of her in her capacity as a care expert to advise Mr Mather of the need for a care regime to be set up before the trial. She was entitled to assume that Mr Mather would realise that he ought to obtain an interim payment straight away and employ a case worker and support worker. It was not Ms Watkins' job to chase him up to see whether he had done it. For Penningtons, a number of points were taken which are no longer pursued, but in respect of the point now in issue it was argued that the words of paragraphs 3.07 and 3.08 were not such as to convey to the reader that Ms Watkins was advising that the care regime should be set up immediately. Any reasonable solicitor would have understood the words to mean only that a care regime would have to be set up after trial or settlement.
15. Griffiths Williams J first directed himself as to the law relating to summary judgment. After setting out CPR Part 24.2 he quoted the well known passage from the speech of Lord Hope of Craighead in Three Rivers District Council v Governor v Bank of England (No 3) [2001] UKHL 16 at paragraphs 94 and 95. He then summarised the position by saying within paragraph 7 of his judgment:

"And so, without conducting a mini-trial, the issue for the court is whether the Defendant's case has sufficient merit to proceed to trial. The Defendants need to show that their case is not only arguable but that there is some real prospect of success; to do that they must establish that there is some evidence that Ms Watkins failed to exercise all proper skill and care, diligence and competence when advising the Defendants."

No complaint is now made of that self direction.

16. The judge then dealt with a number of other matters but in respect of the point now in issue he said within paragraph 24:

"In construing the advice at paragraph 3.07 [that is of Ms Watkins report], it is important to bear in mind that the report was provided on 25 March 1998, in advance of trial and on the material provided to Ms Watkins - she did not know, and there is no evidence she had any grounds for believing that relevant material had not been disclosed to her. Her advice that the funds should be made available "as a matter of priority" indicates that she was advising as to the action to be taken then and in advance of the trial - for my part I find it impossible to construe it otherwise.

25. I consider it unarguable that Ms Watkins was entitled, with her experience of personal injury litigation to assume that the solicitors would take the appropriate action to appoint a case manager to address the Claimant's needs which she had identified and to expect that her recommendations would be implemented before trial so that by the time the trial took place, she, as the care expert, would have been in a position (if required) to assess the Claimant's support and case managements needs as they then were. She had offered to discuss any aspect of her Report with the relevant specialists."

Having expressed that opinion, he shortly afterwards granted summary judgment.

17. In his skeleton argument prepared for the appeal to this court, Mr Sampson for Penningtons advanced several propositions but today in oral argument he has helpfully narrowed his submissions. First, he says that this matter ought to be allowed to proceed to trial because the judge below was not able to construe or interpret the contentious sections of Ms Watkins' reports until he could see it in context. Context could only be provided by the hearing of evidence. Penningtons would wish to challenge Ms Watkins' assertion that, by paragraph 3.07, she had intended to convey to Mr Mather that he should set up a care regime before the trial. Also he believed that the barristers would give evidence that they had not understood paragraph 3.07 as amounting to advice that a care regime should be set up before trial. Second, he submitted that it was arguable that a reasonable solicitor would have understood Ms Watkins to be advising only that a care regime would be needed after trial. He pointed out that Ms Watkins had said nothing about her costings in paragraph 3.08 being provisional. By setting out costings which extended into the future, she had given the impression that this report was her last word on the subject. She now claims that that was not what she had intended to convey. It followed that it was arguable that she had been negligent and the matter should proceed to trial.
18. It seems to me that the only question to be decided is what a reasonable solicitor in the position of Mr Mather would have understood from the words used by Ms Watkins. That question must be decided objectively by a judge, whether on a Part 24 application or at trial or possibly by three judges in the Court of Appeal. As the judge below recognised, the exercise is that of construing a document. Accordingly it matters not how Mr Mather understood paragraph 3.07 it or how the three barristers understood it, the question of meaning is to be determined objectively and not by reference to the subjective opinions of those who read it at the time. Of course, Mr Sampson is right to say that context is important. The contentious words must be construed in the context of the whole document and against the factual background which includes the matters which both the writer and the reader of the report must be taken to have known.
19. In my view the context in which this report is to be read is clear and does not require evidence. An experienced judge such as Griffiths Williams J does not need evidence about context in this kind of matter. In argument, I outlined what I thought to be the salient features of the relevant context, and Mr Sampson did not dissent. These factors were, first, that Mr Mather was an experienced personal injury solicitor working for a firm of solicitors with expertise in that area; second, Ms Watkins was an experienced care expert. Mr Mather had instructed Ms Watkins in a completely typical or routine way. Both would be familiar with the process of preparation for trial of serious personal injury cases; for example, both would know that in a case where liability had been admitted it would be possible to obtain an interim payment before trial for the purposes of setting up accommodation or care arrangements. Both would know that some factual evidence would be required to support such an application. Both would have known, in March 1998 when the report was written, that the trial lay some time ahead. Mr Mather might well have known the position in greater detail than Ms Watkins, but she would at least have known that the trial date had not yet been fixed. She would be warned of the date so that she could attend, and she had not yet been given a date. Mr Sampson did not point to any other aspect of the context which evidence would elucidate.
20. Because the context is clear, the meaning of this paragraph of the report was, in my judgment, a suitable issue for summary determination. The judge below was in as good a position to decide what the report meant as the trial judge would be. What would the words of the report have conveyed to a reasonable solicitor in the position of Mr Mather? The judge found it impossible to construe paragraph 3.07 in any way other than that it was advising that funds should be made available to set up a care regime in advance of trial. I think he was right.
21. I recognise that there is some force in Mr Sampson's submission that there is no mention of the need to review the assessment or the costing before trial. It might have been better if there had been. Mr Sampson faintly suggested at one stage that Ms Watkins might have made some express mention of the need to obtain an interim payment but quickly accepted that that was entirely a matter for Mr Mather.
22. I am unimpressed by Mr Sampson's suggestion that, by providing costings for the future, Ms Watkins was giving the impression that this report was her last word on the subject and was obscuring the fact that she was expecting to review her assessment in the light of experience of the running of the care regime. There are two reasons why Ms Watkins would expect to provide future costings and would be expected to provide them. First, she had been asked to provide them and it would be normal practice for her to do so unless she did not have enough material to make an attempt. In addition, she would know that Mr Mather would need that material to support an application for an interim payment. In the eyes of an experienced personal injuries solicitor, those future costings would not be taken to detract from the clear words of advice in paragraph 3.07.
23. Mr Sampson also suggested that it was significant that, when Ms Watkins was asked to discuss the case with the defence care expert, she did not report back to Mr Mather her concern that the care regime had not been set up as she had advised. I think there is no force in that submission. It goes mainly to the question of whether Ms Watkins had in truth intended to advise that the care regime should be set up before trial. That in my view does not matter. The allegation against her is that she failed to advise that the care regime should be set up before trial. If she advised in words which would have conveyed that advice in that sense to a reasonable solicitor, she was not negligent. So all that matters is what her words would have conveyed to a reasonable solicitor. In my judgment, the words used by Ms Watkins conveyed with reasonable clarity the advice that the care regime should be set up in advance of trial. I do accept that she might have expressed herself with even greater clarity, for example by referring to the need for a further assessment in the light of experience. However, that is not to say that this report would not have conveyed to a reasonable solicitor who read it carefully that he was to make funds available without delay and to set up a care regime as soon as practicable and in any event before trial.
24. As her failure so to advise is the only outstanding allegation against Ms Watkins, and as that in my view has no prospect of success, I would dismiss this appeal.

Lord Justice Rix:

25. I agree.

Lord Justice Keene:

26. I also agree.

Order: Appeal dismissed