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Cite as: [2016] EWHC 2427 (QB)

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		Neutral Citation Number: [2016] EWHC 2427 (QB)
		Case No: HQ14X04358

IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION

Royal Courts of Justice
Strand, London, WC2A 2LL

11/10/2016

B e f o r e :

MR JUSTICE TURNER
____________________

Between:

	Cathal Anthony Lyons	Claimant
	- and -
	Fox Williams LLP	Defendant

____________________

John Wardell QC (instructed by SGH Martineau LLP) for the Claimant
Colin Edelman QC and Ben Lynch (instructed by DAC Beachcroft LLP) for the Defendant

Hearing dates: 24, 25, 26, 29 February 1, 2, 3 March 2016
____________________

HTML VERSION OF JUDGMENT APPROVED
____________________

Mr Justice Turner :

Introduction

On 17 June 2006, the claimant, Cathal Lyons, was riding his motorcycle in Moscow. He collided with another vehicle and suffered significant injuries to his right shoulder and right foot.

At the time, he was working as Chief Financial Officer and Managing Partner of Operations for Ernst and Young (CIS) BV, Moscow the global arm of which had taken out injury and health related insurance policies for the benefit of its employees.^[1] The claimant sought to make claims under these policies. There followed years of labyrinthine manoeuvrings and negotiations during the course of which he retained Mr Custance, a solicitor and partner in the defendant firm, to advise him.

This claim is based on the contention that Mr Custance acted negligently as a result of which the claimant has found himself to be very substantially out of pocket in his dealings both with his employers and the insurers.

A Preliminary Observation

The brevity of the introduction to this judgment belies the volume and complexity of the issues to which the claimant's accident has given rise. The industry of counsel has generated a total of 110 pages of skeleton arguments filed and served in advance of the hearing together with a list of no fewer than 36 issues for the court to decide. The trial bundle comprises over 40 lever arch files of documentation augmented by six lever arch files of authorities. Further written submissions presented after the hearing comprise an additional 130 pages of argument supported by two lever arch files of documentary analysis.

I should like to make it clear that I make no criticism of the way in which the case has been presented to this court. On the contrary, I have found the approach of both sides to have been of very considerable assistance to me. Nevertheless, I must heed the guidance given by Schiemann LJ in Customs and Excise Comrs v A [2003] Fam 55:

"82. A judge's task is not easy. One does often have to spend time absorbing arguments advanced by the parties which in the event turn out not to be central to the decision-making process.

83. However, judges should bear in mind that the primary function of a first instance judgment is to find facts and identify the crucial legal points and to advance reasons for deciding them in a particular way. The longer a judgment is and the more issues with which it deals the greater the likelihood that: (i) the losing party, the Court of Appeal and any future readers of the judgment will not be able to identify the crucial matters which swayed the judge; (ii) the judgment will contain something with which the unsuccessful party can legitimately take issue and attempt to launch an appeal; (iii) citation of the judgment in future cases will lengthen the hearing of those future cases because time will be taken sorting out the precise status of the judicial observation in question; (iv) reading the judgment will occupy a considerable amount of the time of legal advisers to other parties in future cases who again will have to sort out the status of the judicial observation in question. All this adds to the cost of obtaining legal advice".

To this list I would add the requirement, so far as is practicable, to allot to any given case an appropriate share of the court's resources while taking into account the need to allot resources to other cases. This is, of course, a factor to be taken into account during the process of applying the overriding objective pursuant to CPR 1.1 (2) (e). Judgment writing time is a resource no less scarce than sitting time.

Schiemann LJ went on to observe:

"84. Our system of full judgments has many advantages but one must also be conscious of the disadvantages".

I have tried to balance those advantages and disadvantages in what follows by giving reasoned decisions on those issues of fact and law which I consider to be central but without dealing with every peripheral issue the resolution of which would not in any event have impacted on my essential findings or on the outcome of the substantive claims. This judgment is long enough as it is.

The Policies

At the time of his accident, by virtue of his employment with EY, the claimant had the benefit of cover under both Accidental Death and Dismemberment ("AD&D") and Long Term Disability ("LTD") policies. Each was provided by both Colonial Medical Insurance Company Limited ("Colonial") and AGF insurers.

Thus, the fourfold cover provided comprised:

i) Colonial AD&D;

ii) Colonial LTD;

iii) AGF AD&D; and

iv) AGF LTD.

The Colonial Policies were governed by the law of Bermuda. The AGF Policies contained binding arbitration clauses determinable in Paris but subject to English law.

In general, although AD&D and LTD policies are both concerned with the consequences of serious injury, they are very different in the type of cover which they provide.

The Accidental Death and Dismemberment Claims

Normally, an AD&D policy provides for the payment of a one-off lump sum the value of which is assessed with reference to necessarily crude categorisations of disability which are set out in a table. The lump sum payable in any given case is calculated by applying a percentage to a set maximum benefit sum. The level of the percentage to be applied depends upon the category of injury sustained. For example, loss of sight in one eye might give rise to an entitlement to 50% of the maximum sum whereas loss of sight in both eyes might give rise to a 100% claim and so on. The amount of the benefit is independent of the impact, if any, which the injury has had on the earning capacity of any given beneficiary.

Mr Custance acted for the claimant in respect of his potential claim under the AD&D policies ("the AD&D claims") and gave pessimistic advice based on his interpretation of the Members' Booklet. He did not, however, look at the policies themselves. Unfortunately for him, the table in the policies, as it turned out, was more generous in its scope than the one in the booklet.

As a result it was not until years later when the claimant retained new solicitors, who read the policies and spotted the inconsistencies, that he was able to recover a substantial payment from the insurers under the AD&D policies. Unsurprisingly, the claimant thereafter pursued the defendant for damages for unrecovered costs incurred in pursuing those insurers with his new solicitors. This claim has been settled, without admission of liability, by the payment of £75,000.

Despite the fact that the AD&D claims have now been settled, their sinuous and pervasive history, as will appear, continues to be relevant to the determination of those issues which remain to be resolved in this case.

The Long Term Disability Claims

LTD policies serve to replace or to top up salaries which have been lost or reduced as a result of accident or illness. Often, as in this case, such policies provide for a waiting or elimination period during which no monies are payable. Such a period allows for time in which it can be seen how the relevant disability is affecting the employee's ability to earn. Thereafter, the employee may become eligible to receive payments for a limited period of, say, two years in the event that he is unable to follow his own occupation and is regarded as being totally disabled. This is called Short Term Disability ("STD"). If the employee is unable to follow any occupation after the STD period he becomes entitled to Long Term Disability payments. If he is able to work but only on a reduced basis he may become entitled to Partial Disability payments. The proper approach to the interpretation of the terms commonly to be found in LTD policies has been considered by the courts in many cases a considerable number of which have been relied upon by the parties and which I have read and taken into account.

The claimant's LTD claim against Colonial was ultimately rejected on the ground that he was continuing to earn his full salary during the waiting period when it was said to be a precondition of eligibility that he should be earning no more than 80% of his salary during this period.

The claimant contends that the Colonial basis for rejection was unfounded. Alternatively, even if it were not, then he ought to have been advised to reduce his salary in order to remain within the scope of the cover. In due course, the contractual time limits in respect each of the LTD claims expired and the claimant blames Mr Custance for the alleged loss of his rights under the LTD policies and claims damages of equivalent value to those rights.

The 2009 Agreement Claim

There came a time when, believing that some of those in authority at EY were determined to see the back of him, the claimant resolved to negotiate his exit from the organisation and, in April 2009, he entered into a settlement agreement with his employers setting out the terms of his departure. One of those terms provided for lifetime CIGNA insurance cover for the claimant and his family. Mr Custance played a part in advising on the terms of this agreement.

Subsequently, a dispute arose between the claimant and EY under the 2009 agreement which led to litigation between them which was eventually settled. The 2009 agreement did not contain an English law and jurisdiction clause. The claimant contends that there would have been no litigation or dispute if such a clause had been incorporated. He asserts that this omission was down to Mr Custance's negligence. He claims the difference between the sum he accepted in settlement of the EY claim and the value of the benefits he alleges he would have received if no such dispute had arisen ("the 2009 agreement claim").

Lines of Defence

The defendant resists both the LTD claim and the 2009 agreement claim on several grounds.

The LTD claim faces the following central lines of defence:

i) issues relating to LDT fell outside the scope of Mr Custance's retainer;

ii) the claimant was not disabled within the meaning of the LTD policies;

iii) the claimant was not, in any event, eligible to claim under the LTD policies.

The 2009 agreement claim faces the following central lines of defence:

i) Mr Custance's involvement in the steps leading up to the 2009 agreement was informal and gave rise to no duty with respect to the inclusion of an English law and jurisdiction clause;

ii) Mr Custance was not instructed to prepare a long form agreement;

iii) EY would not have agreed to an English law and jurisdiction clause in any event; and

iv) the outcome of the litigation between EY and the claimant over the terms of the 2009 agreement would have been the same whether or not an English law and jurisdiction clause had been incorporated.

In addition, the defendant raises arguments of contributory negligence and relies upon the limitation of liability clauses in its standard terms of retainer.

The Background

Despite the catalogue of factual disputes which have arisen between the parties, it remains possible to make out a sufficiently clear picture of the uncontroversial background circumstances to the retainer of Mr Custance to justify an attempt to set out an introductory narrative without venturing prematurely into contentious territory.

The Claimant

At the time of his accident, the claimant was the head of EY's administration and finance departments in the Commonwealth of Independent States or Russian Commonwealth. Such a role clearly called for robust leadership qualities combined with a strong commercial instinct. Although not himself legally qualified, the claimant was used to dealing with lawyers and with the financial aspects of insurance. On the detail of insurance matters he would turn to Jim Mandel, general counsel of EY, who was destined to play an important role in the events giving rise to the claims now brought before this court.

The Immediate Aftermath of the Accident

It was clear from the outset that the claimant's injuries were serious. Within two days, Svetlana Kondakova, EY's Partner Matters Secretary, was writing to Kevin Grigson of EY's brokers, Sherwood Solutions ("Sherwood"), asking for advice in the event that claims were to be made under the relevant policies. By 12 July 2006, the claimant, himself, was emailing Ms Kondakova asking for information relating to his disability claims and insurance position.

Very shortly thereafter, on 14 July 2006, EY signed a new LTD policy to succeed those in respect of which cover had previously been provided by Colonial and AGF. This new policy was with Generali Worldwide Insurance Company Limited ("Generali"). This post-accident policy was subsequently to assume a disproportionate significance in the saga of the claimant's claims for LTD benefits.

On 17 July 2006, Ms Kondakova responded to the claimant's email telling him that EY had moved to a new plan and asking for a medical report confirming the extent of his injuries. The claimant replied on the same day inquiring "more out of curiosity" which insurer would cover him but leaving it to "you guys" as long as he was to have full coverage. She told him that the relevant plan would be the "former plan" which covered the period until 30 June 2006. Notwithstanding this, it was Generali who had asked for the medical report.

On the same day, Ms Kondakova forwarded the claimant's description of his injuries to Mr Grigson asking him "what do we need to do in order to proceed with the claim?"

Meanwhile, it was not only the mantle of LTD coverage which had been taken on by other insurers. Coverage under the Colonial and AGF AD&D policies came to an end on 30 June 2006. The new AD&D insurer was a Russian company, Ingosstrakh LMT Limited Liability Insurance Company ("Ingosstrakh"). As was to be the case with the Generali policy, the Ingosstrakh cover was also to exert a baleful retrospective influence over the progress of the claimant's claims.

The claimant's potential Colonial LTD claim was duly presented to and acknowledged by Melanie Mathews, underwriting case manager. She asked to be provided with further documentation and information. One John Misa from Sherwood emailed Ms Kondakova passing on these requests and she, in turn, communicated them to the claimant. Thereafter, the claimant and his treating doctor, Philippe Clavert, filled out a Colonial disability claim form in which it was predicted that the claimant would be fit enough to return to his duties within three to six months.

Mr Misa also forwarded an AGF LTD claim form to Ms Kondakova but told her that it was not to be completed until after a waiting period of 52 weeks had elapsed from the date of the accident.

On or about 4 September 2006, the claimant returned to work on a part time basis. About two weeks later on 19 September 2006, the claimant spoke directly to Mr Grigson asking him to help Ms Kondakova and him with his AD&D claim. Mr Grigson agreed and notified Ms Kondakova accordingly.

By October 2006, however, the claimant's AD&D claim appeared to be running into difficulties. Colonial were maintaining that, in order to qualify for a payment under the policy, the claimant would have to have lost the whole of his foot as a result of severance through the ankle joint. The claimant's injuries, although severe, did not fall within this category.

With respect to the LTD policy, Colonial were pointing out that no benefit would be payable for the waiting period of 52 weeks and that such benefits as might become payable thereafter would be limited to a maximum of $15,000 ^[2] per month.

It was upon this basis that, in the same month, Sherwood issued an interim report advising upon the status of the claimant's potential claims.

With respect to the LTD cover they confirmed that Colonial was the primary insurer potentially liable to pay an annual sum of up to $180,000 with an additional sum of up to $120,000 to be covered by AGF. Under both policies, there was a waiting period of 52 months. During this period no benefits due thereunder would be determined. If, after this period had elapsed, the claimant were to be unable to perform his own occupation, benefits would become payable for a two year period by way of STD. They warned that if the claimant were to work during the waiting period, although this would not necessarily preclude him from claiming benefits later, it could have an impact on the insurers' case review and "at a minimum complicate his request when it is made".

With respect to AD&D cover the report concluded that "it does not appear that Cathal will qualify for any AD&D benefits from either AGF or Colonial and any disability benefits he might possibly be due will not be determined until after the 52 week waiting period." Their pessimism as to the claimant's prospects of recovering anything under the AD&D policies was based on the assumption that his injuries did not fall within the relevant "loss of a foot" category referred to in the relevant Members' Booklet. They had failed, however, to have regard to the terms of the policies themselves. This was an error which, as I have already observed, was to remain undiscovered for many years thereafter.

When the claimant saw the report he was not happy and he took up an offer to discuss the matter further with Mr Grigson. He accepted in cross examination that his particular concerns at this stage related to the AD&D issue.

On 9 December 2006, Colonial wrote to the claimant concerning the LTD claim. They pointed out that regulations allowed them 45 days in which to render an initial liability decision but that it would be open to them to request up to two 30 day extensions if they were unable to do so because of circumstances beyond their control. Accordingly, they were asking for up to date evidence including medical records to assist them. Although the letter referred to time limits applying to Colonial rather than to the claimant, he emailed Ms Kondakova upon receipt to say "I thought I did everything. Urgently spell out for me what I need." This was later followed up by Mr Misa who told the claimant that Colonial would close their file in 30 days if he did not provide the information.

It did not take the claimant long to begin to toy with the idea that, even if he were precluded from making a claim under the terms of the AD & D policies, he might still have an alternative remedy against EY on the basis that they had misled him into believing that the extent of his cover was greater than it had actually turned out to be. To this end, he sent an email to Ms Kondakova dated 13 December 2006 asking for details of the presentations shown to partners over the years "about insurance – life and disability." These were to be the seeds of what may conveniently be referred to as "the misrepresentation claim".

Two days later, Ms Kondakova distributed to all the EY partners details of the benefits recoverable under the new policies making specific reference to maximum potential levels of claim of $2,000,000 under the AD&D policy and $300,000 per year under the LTD policy.

On 18 December 2006, the claimant's then girlfriend, Kerry Irwin, emailed Mr Misa attaching a copy of a medical report in response to the Colonial request for information. She asked that, in future, all correspondence should be addressed to the claimant and her. There followed a series of emails during the course of which Ms Irwin expressed concern that Ms Kondakova was not properly representing the extent of the claimant's working limitations to Colonial. In particular, she was critical of the fact that Colonial might have been led to believe that the claimant had gone back to work full time when he was then only actually working part time. This point was subsequently clarified in a letter to Colonial from Philipp Turowski, Chief Operating Officer of EY. I note, in passing, that Mr Turowski was later to go on to play a significant role in the train of events giving rise to the present litigation.

Subsequently, the claimant spoke directly to Ms Matthews of Colonial about both his AD&D and LTD claims. The contents of this call were subsequently recorded in an email from Ms Matthews dated 21 December 2006. Attached was a copy of the members' booklet for both policies. The AD&D booklet set out a schedule of injuries which, on the face of it, did not entitle the claimant to make a claim thereunder. In respect of the LTD claim, Ms Matthews pointed out that her role was simply to collect the relevant information and then send it on to reinsurers to consider and adjudicate upon.

The claimant forwarded this email to Ms Kondakova expressing concern about the limits of the AD&D policy concluding: "I am really starting to stress." He suggested that if he had been told that he was not fully covered he could have taken out insurance on his own behalf. He made no mention of the LTD position in this email and agreed in cross examination that, at this stage, he had assumed that everything necessary had been done in respect of that claim.

In an email to Ms Kondakova dated 23 January 2007, Ms Irwin suggested an alternative way forward. She raised the possibility that surgery which the claimant had undergone after the new Ingosstrakh policy had been incepted might allow him to bring his AD&D claim within the apparently more generous cover provided under that policy.

In summary, the position at this stage was that the claimant saw three potential ways in which to obtain compensation for dismemberment:

i) by establishing that the injuries he had sustained fell within the scope of the policies in force at the time of his accident; or

ii) by showing that he was entitled to claim under the new Ingosstrakh policy which appeared to provide more generous cover; or

iii) by proving that he was entitled to claim against EY for misrepresenting to him that the cover he enjoyed was materially more generous than it had turned out to be.

Meanwhile, the relevant medical evidence having been forwarded, the position in respect of the LTD claims awaited the consideration of reinsurers.

Mr Custance's Retainer

The history of the progress of the claimant's claims now becomes more controversial and it will therefore be necessary for me hereafter to resolve certain disputes of primary fact during the course of my continuing narrative of events.

The claimant and Mr Custance, a solicitor in the defendant firm to whom he had been recommended, first spoke and exchanged contact details on 14 February 2007. On the following day, Mr Custance sent out an engagement letter which provided:

"Re: insurance cover arranged for you by Ernst & Young ("E&Y")

Following our telephone discussion earlier this week, I confirm that Fox Williams LLP will be very pleased to act for you in connection with the above matter.

The purpose of this letter is to set out the scope of our role …

Scope

You have explained that, following your accident in June 2006, it has become apparent that the insurance cover arranged on your behalf by E&Y does not provide the type or level of 'accidental death and dismemberment' ("ADD") cover which E&Y had previously represented to you was in place. I understand that the shortcomings in the cover in fact in place at the time of your accident can be demonstrated by comparing it with the cover which was arranged by E&Y when the insurance provider was changed with effect from 1 July 2006.

I have suggested that the areas to be considered further are as follows: (1) to check the extent of the cover in fact provided by the insurance in place at the time of your accident to ensure there are no arguments available which E&Y have failed to take up with insurers on your behalf; (2) to compare that cover with the insurance put in place with effect from 1 July 2006; and (3) to obtain further details of the representations made to you by E&Y as to the 'ADD' cover supposedly in place at the time of your accident.

In order to advise on these points, I will need to see the following: (a) copies of the relevant insurance policies; (b) all correspondence or emails between you and E&Y or insurers/brokers relating to the extent of the cover available for your accident, including in particular any emails/correspondence dealing with the meaning/interpretation of that cover; and (c) anything from E&Y which refers to the insurance benefits available to you in the event of death or serious accident. In relation to (c) you have explained that you were not provided with a copy of the presentation given to you by E&Y. However, you may have received at some stage at least a summary of the health / insurance benefits available to you.

Depending on the outcome of my review of this material, the intention would then be to draft a letter to be sent to you to E&Y, in order to put some pressure on them either to extract the fullest cover to which you are entitled under the insurance in place at the time of your accident, and/or to compensate you for the disparity between that cover and the insurance which they represented to you as being in place. …".

The letter also referred to and enclosed a document containing the defendant's standard terms of business and the limitations of liability to be found therein.

The claimant contends that he expected Mr Custance to advise him from the outset on his position under the LTD policies as well as under the AD&D policies. He argues that had he done so competently then he would not have lost valuable rights under those policies. Mr Custance denies that such advice ever fell within the scope of his retainer over the relevant period.

The claimant asserts that he had several conversations with Mr Custance regarding the LTD cover and is supported in this by Ms Irwin. My attention has also been drawn to the documentary evidence, primarily email traffic, as confirmation that LTD cover fell within scope of the retainer. Mr Custance in response denies that he was a party to any discussions about LTD cover at this stage. It is asserted on his behalf that the claimant has "cherry picked" passages from the documentation out of context in order to build up a misleading picture.

The resolution of this issue has been bedevilled by a number of problems:

i) The dispute over the scope of Mr Custance's retainer did not arise until years after the events to which it relates. Consequently, for the most part, the independent recollections of the parties and witnesses on a considerable number of issues have either been extinguished or, at least, substantially diminished by the passage of time.^[3]

ii) Mr Custance took very few attendance notes. Those which he did take tended to be both frugally drafted and Delphic.

iii) Such attendance notes as have been disclosed were unearthed by Mr Custance in or about March or April 2015 following an unrelated spring clean of his office and well after proceedings had been commenced. As a result the parties' respective contentions had, at least in part, already been crystallised in ignorance of their contents.

iv) It is common ground that the scope of Mr Custance's retainer was expanded in some respects after he sent his initial letter of retainer but the extent of such expansion is disputed and was never formally recorded in writing.

v) There is a very considerable volume of relevant email traffic but the evidential value of this is degraded by the fact that, for the most part, it has been drafted in a conversational and informal way.^[4] Some of this material is clearly and reliably relevant to the issues which have arisen between the parties. Some is equally obviously not. Yet there remains an extensive and evidentially impressionistic hinterland in which it is not always immediately clear what issues are being referred to without giving careful consideration to the context in which any given email was sent.

In consequence, the materials upon which this court must base its conclusions are plentiful but, nevertheless, rich in potential ambiguity.

The Law

In Minkin v Landsberg [2016] Fam Law 167, Jackson LJ summarised the relevant legal principles relating to the determination of the scope of a solicitor's retainer at paragraph 38:

"(i) A solicitor's contractual duty is to carry out the tasks which the client has instructed and the solicitor has agreed to undertake.

(ii) It is implicit in the solicitor's retainer that he/she will proffer advice which is reasonably incidental to the work that he/she is carrying out.

(iii) In determining what advice is reasonably incidental, it is necessary to have regard to all the circumstances of the case, including the character and experience of the client.

(iv) In relation to (iii), it is not possible to give definitive guidance, but one can give fairly bland illustrations. An experienced businessman will not wish to pay for being told that which he/she already knows. An impoverished client will not wish to pay for advice which he/she cannot afford. An inexperienced client will expect to be warned of risks which are (or should be) apparent to the solicitor but not to the client.

(v) The solicitor and client may, by agreement, limit the duties which would otherwise form part of the solicitor's retainer. As a matter of good practice the solicitor should confirm such agreement in writing. If the solicitor does not do so, the court may not accept that any such restriction was agreed".

The Scope of the Retainer

Mr Custance's engagement letter clearly identifies the scope of his retainer to include advice on the AD&D claim. The claimant seeks now to invite me to infer that LTD was also included. However, I am in no doubt that if that had been the intention of the parties the letter would have been unambiguous on the point. It is to be noted that, having identified the AD&D and misrepresentation issues, the letter goes on to say: "In order to advise on these points…". This clearly indicates that what follows is to be interpreted as being directed towards these issues and not towards LTD cover. Further, the claimant expressly agreed to the terms of the retainer letter in an email sent by way of response four days later. The claimant is an astute businessman and I am satisfied that if he had expected to be advised on LTD issues he would have expressed immediate written concern that Mr Custance's letter did not make specific reference to them. I thus reject his suggestion that there was any conversation between them suggesting that LTD formed part of Mr Custance's brief at this stage.

Shortly after he had retained Mr Custance, the Claimant, himself, chased Ms Kondakova to see if there were any matters outstanding under the LTD claim. She replied offering to check with Colonial if there was any further information required from him or his doctors. This offer was not followed up. The defendant contends that if Mr Custance had been retained to advise on the LTD cover it would be expected that the claimant would have asked him about the issue at this stage and that this would have been evidenced in the email traffic between them. I agree.

On 19 February 2007, the claimant emailed Mr Custance:

"Firstly, thank you for your engagement letters. I am traveling at the moment so I will sign and fax to you on Wednesday. … With regard to the documentation requested I will be sending you the following:

1. Communication between our Partnership secretary & Kerry/Myself.

2. Communication between Colonial & either EY or me.

3. Communication between Sherwood and EY. Sherwood acted as broker and it would appear facilitator for EY?

4. The original AD&D policy sent to me by our Partnership secretary. It should be noted that the first time I received this was after my accident.

5. Our new AD&D Policy.

6. My local employment contract … I will also send you any other partnership type documentation that I have.

I believe that is everything you require so far, if not please just let me know.

As I mentioned I am hoping for some form of amicable settlement and best case scenario is from Insurance provider but I do not believe this is likely. Although the second operation on my foot was done while the new policy was active. That operation did amputate toes and metatarsal. We also believe that the amputation of shoulder and top of the humerus also constitutes compensation. But this is where I do not see any action from my Employer/Partnership. I have informed them (verbally) that they should get a lawyer so they can put pressure on the Insurance company. As EY represented to me that I was covered I have been very clear with them that I expect compensation and if Insurance does not provide then I will.

Initially, I am looking for a very clear communication from me to EY, I take whatever counsel you give me and will follow but I would like to be clear to EY on following;

I believe I was covered per their representation in form of presentations to partners.

I believe they do not seem to be taking any pro-active actions, for example in October it was when I suggested they needed a lawyer.

I still then there is a good opportunity to get insurance company to pay – as EY is significant client of insurer & it also a good and valid claim.

I intend to get my compensation if not from insurer then from EY.

Normally I use my yahoo email but I was on a plane when I did this. I am on my mobile if you need me. …".

Under cross-examination, the claimant persisted in the assertion that the reference to Colonial in this email was in respect of LTD cover. I am satisfied that he was wrong so to do. The context of the letter shows that it is directed to the AD&D and misrepresentation claims. The only policies which the claimant indicates that he will send are the AD&D policies. There is no reference to LTD policies. The claimant's explanation for his interpretation was that he already knew that there was no claim under the Colonial AD&D policy and so this must have referred to LTD. This contention is unsustainable. It is clear from the terms of the retainer letter that the claimant had instructed Mr Custance to check the extent of the AD&D cover provided at the time of the accident and so this issue was still a live one. It also follows that the claimant's eager enthusiasm to read into this and other emails references to LTD issues where, on any realistic interpretation, there are none, betrays a serious lack of objectivity. Defendants in professional negligence claims do not necessarily enjoy a monopoly of happy hindsight.

On the same day, Ms Irwin emailed Mr Custance saying that she had about 75 emails:

"Please advise me if you would like me to simply forward on all of these emails so you can go through them or what you would prefer.

As Cathal states below, the information we received in France included a sliding scale of percentages of what the insurance covered in terms of ADD (eg if you lost 1 toe you receive 5% of total, etc.), so we were always under the assumption that he was well covered. His transmetatarsal amputation operation was done in late July, which, technically, is under the new insurance policy. Also, in correspondence we have from December, it is clear that EY was not responding to the insurance company's requests for information and none of that was passed on to us. In fact, in mid-December they sent a final notice that was then forwarded to us that their 45-day claim timeframe had expired and we had not provided them with the information they requested. Of course, we knew nothing about this, so they extended the timeframe for another 30 days. We provided the info and since that time have heard nothing from EY or the insurance company, despite several requests for a response. We believe that nothing was done and the claim timeframe has simply expired. EY has simply not provided us with any further information. …".

It is obvious that the second part of the final paragraph must, in fact, be a reference to the LTD policy. However, Mr Custance did not at this stage have any of the relevant documents and I accept his evidence that he would, at the time, have assumed that the whole of the email referred to AD&D. Furthermore, Ms Irwin accepted that she had not been involved in the discussion between the claimant and Mr Custance concerning the scope of the latter's retainer and she could not recollect having read the retainer letter. She would not, therefore, have been aware of the extent of Mr Custance's retainer when drafting her email. Indeed the terms of the email do not suggest that Ms Irwin, herself, had understood that the delays in providing evidence were unrelated to the AD&D claims.

Mr Custance asked Ms Irwin to send him all the emails she had:

"Yes, do you mind sending me all of the emails – I suspect only a proportion will in fact be important, but it will be helpful for me to have the entire picture".

The claimant relies on the fact that some of this material was relevant only to LTD and not AD&D. However, this email shows that Mr Custance was asking Ms Irwin to send him everything in the expectation that only a proportion of the material he was to receive might be important. Thus, Mr Custance was performing a sifting exercise which did not involve any consideration of the LTD material save to the very limited extent of characterising it as being irrelevant to his consideration of the AD&D issue. The material relating to the Colonial LTD policy was not such as to raise any sufficient concern on its face as to mandate Mr Custance to seek to extend his retainer or give any warning.

On 25 February 2007, the claimant forwarded further emails relating to the history of the earlier negotiations.

By 13 March 2007, Mr Custance had been through all the material which he had been sent and he emailed the claimant to that effect. On the following day they had a telephone conversation of which Mr Custance made a brief note. The note refers to the "Application for Long Term Disability" but does not elaborate any further on the topic. I am satisfied from what followed that Mr Custance was simply identifying the LTD cover as context and not as a topic upon which he had been expected to advise. I do not consider that Mr Custance could be criticised for not reverting to the email from Ms Irwin and concluding therefrom that he was expected to advise on LTD.

Thereafter, Mr Custance drafted an email for the claimant which the latter adopted and sent to EY on 18 March 2007. It related entirely to the AD&D issue. I am satisfied that had the claimant retained Mr Custance to progress the LTD claim on his behalf then the draft would, at least, have referred to it as an outstanding issue which EY had been slow in progressing. It is to be noted that when the claimant adopted the content of the draft and sent it on to EY he inserted the subject matter as: "AD&D claim".

Regrettably, what would otherwise have been a relatively straightforward exercise was rendered avoidably more complex by Mr Custance's failure to call for and read a copy of the AD&D Colonial and AGF policies. As I have already observed, he relied instead on the contents of the members' booklet. One can understand but not excuse his omission. He was undoubtedly right when he said in evidence that he would expect the contents of the booklet accurately to reflect the terms of the policies. Doubtless, in the vast majority of cases they will. However, this was a potentially very valuable claim the validity of which would stand or fall on the scope of cover provided for in the terms of the policies which would inevitably take contractual precedence over the contents of the booklet. A perusal of the terms of the policies themselves would, in all likelihood, have resulted in a swift and successful conclusion to the AD&D issue. I have no hesitation in concluding that, in failing to take this step, Mr Custance fell short of the standard reasonably to be expected of the competent solicitor. Although the claimant's AD&D claim against the defendant was settled without admission of liability, I am satisfied that if the matter had come to trial the court would have found him to have acted negligently in this regard. Nevertheless, I am not persuaded that this, together with all of the other respects in which the claimant is critical of Mr Custance's handling of his affairs, should be given decisive weight when I come to assess whether or not Mr Custance acted negligently in respect of those issues which lie at the centre of this case. In particular, the shortcomings relied upon by the claimant for the most part relate to matters not directly connected to these central issues and were not, in my judgment, sufficiently egregious to establish a general propensity to act carelessly as opposed, that is, to a susceptibility to occasional episodes of fallibility. Accordingly, I do not disregard the fact that Mr Custance did not always fully measure up to the standards required of him but it would be wrong to default to a presumption that any doubt as to the level of service he was providing is, without more, to be resolved against him.

Thus on the AD&D issue, releasing the bird in his hand, Mr Custance decided, instead, to aim for two in the bush. These latter were "the Ingosstrakh claim" and "the misrepresentation claim". Their respective merits were uncertain from the outset but, worse still, their pursuit was to prove to be a substantial and time consuming distraction for all concerned.

As appears from the preceding narrative, the Ingosstrakh claim fell to be considered because very shortly after the claimant's accident the AD&D policies then in place were succeeded by a new policy under which Ingosstrakh was the insurer. The first argument, which had already been articulated by Ms Irwin in her first email to Mr Custance, was that further procedures involving, as they did, a level of surgical amputation which had been performed after the new policy had been incepted may have fallen to be considered under the more generous Ingosstrakh terms. Alternatively, it was speculated that there was a run-in period for the Ingosstrakh policy which thus applied retrospectively so as to provide cover on the date of the accident.

Not only was the potential involvement of Ingosstrakh forensically challenging but it gave rise to political problems too. Ingosstrakh was an audit client of EY at the relevant time and EY were not keen to be seen openly to press the claimant's case in this direction. Instead, they offered to pay someone else to do it for him. Thus it was that EY agreed to fund external legal support from Mr Custance with respect to the Ingosstrakh claim. In the meantime, Mr Mandel, in his capacity as EY's general counsel to their CIS practice, was to try to use the influence of his employers to secure an offer of payment from Ingosstrakh under their policy.

On 20 March 2007, the claimant emailed Mr Mandel:

"With regard to Colonial & AGF you… should contact the senior global people for them to put pressure on colonial/AGF. If needed or necessary then you can see if it is better for global/CIS to get lawyer involved. The personal lawyer required by me is only in relations to Ingostrakh as Philipp obviously wants to ensure we/EY do not get in a legal battle with a client".

If the Ingosstrakh claim were to flounder then Plan B was for the claimant to bring a misrepresentation claim against EY. This, as I have said, would be on the basis that, assuming the Colonial and AGF AD&D policies did not apply, then EY should be held responsible because they had led the claimant to believe that AD&D polices were in place which would have covered his injuries.

In furtherance of the Ingosstrakh claim, Mr Mandel was recruited to approach Ingosstrakh to advance the claimant's cause. His efforts on this front were protracted but were eventually to come to nothing.

Predictably enough, when Mr Mandel approached Ingosstrakh they said that they wanted EY to press for settlement under the Colonial and AGF AD&D policies before looking in their direction. Since the whole point of pursuing Ingosstrakh in the first place was because the Colonial and AGF claim was thought by all concerned to have little merit, it was never going to be likely that this diversion of effort would yield any substantial rewards. Nevertheless, Mr Mandel gave every appearance of being as relaxed about marching his troops back to the bottom of the hill as he had previously been when marching them up to the top.

Meanwhile, the claimant, in contrast, was not relaxed.

The Gathering Storm

In an email of 22 March 2007 to Mr Custance, the claimant first raised his concern that the EY CIS Country Managing Partner, one Karl Johansson, wanted him out of the organisation. Thereafter, Mr Custance became involved not only in matters relating to insurance but in the far broader issue of the terms upon which the claimant would be prepared to negotiate his departure from EY. No new retainer letter was sent identifying the scope of this new brief.

On the following day, there was a telephone conversation between the claimant and Mr Custance which lasted 18 minutes. In his witness statement the claimant asserted that he thought "it likely that we would have discussed the LTD Policies." Under cross examination, however, he struggled to explain what aspect of the LTD Policies would warrant any such discussion at that time. Eventually, he resorted to saying "I'm a chatty person" and "I like to cover my bases...and I do a lot of extra talking." The combination of what the claimant said and his demeanour when saying it simply did not ring true. I am satisfied that his suggestion that there would have been a discussion of the LTD Policies during this conversation amounted to no more than an opportunistic attempt to make the facts fit his case.

The claimant made further reference to his concern about his future at EY in an email to Mr Custance of 25 April 2007. He said that if he were "dumped out of the firm as an invalid" he would have difficulty finding a new job and if he were not up to the job "then they should also be able to get me $300,000 per annum under our insurance".

On the following day there was a telephone discussion between the claimant and Mr Custance which the latter recorded in bullet point form which included a reference to: "earning [?] ca. 700k USD a year." The claimant's evidence was to the effect that he had asked Mr Custance to advise him on the $300,000 per annum claim but he was unable to give any detail as to what specific advice was asked for or when, if at all, it was given. On this issue, I accept Mr Custance's evidence that he had not been asked to advise on this point. It had merely been identified as part of the claimant's negotiating strategy. I find that even if Mr Custance had made specific enquiry of the claimant as to the extent of the advice he was expected to give this is what he would have been told.

Meanwhile, having been pointed by Ingosstrakh in the direction of Colonial and AGF, Mr Mandel enlisted the help of EY's global broker, Aon, to present the case. In an email to Aon dated 13 April 2007, Mr Mandel said:

"… I contacted you several weeks ago … As I mentioned the indications he has received from the companies insuring EY employees for Long Term Disability and AD&D is that they may not honor his claim …".

I am satisfied that this reference to "the companies insuring EY employees for Long Term Disability and AD&D" was merely a way of identifying the insurers and did not carry with it the implication that there had been a rejection of the LTD claims as well as the AD&D claim. As Mr Mandel conceded in cross examination: "I agree that I had not seen anything that said that they would deny his LTD claim…" Furthermore, if Mr Mandel had intended to assert that claims had been rejected under both categories of policy he would be expected to have referred to claims in the plural.

On 15 May 2007, the claimant emailed Mr Custance forwarding to him four emails which he had received from Mr Mandel. He said: "I was just about to ask Jim for an update, when I received the message below. 4 in total. Is there anything else I should do?"

Perusal of the four emails from Mr Mandel reveals that they are focussed on the AD&D claim. In this context, I am satisfied that the claimant's query was not intended at the time to prompt Mr Custance to consider his LTD claim nor did Mr Custance interpret it thus. I conclude that this is another example of the claimant's tendentious efforts to support his case.

Aon asked Mr Mandel for information relating not only to the AD&D claim but also to the LTD claim.

Mr Mandel sent the relevant documentation and copied in the claimant who, in turn, forwarded the material to Mr Custance. I am satisfied that this material was sent to Mr Custance for the purposes of informing him of the context in which the AD&D claim was being advanced and not by way of request for advice on the LTD claim.

In an email dated 16 May 2007, the claimant identified his "minimum expectations" in the event that he were to agree to leave EY. These included:

"2. Insurance ADD – Including

a. $1.5 Million for dismemberment

b. $300K per annum from insurance as according to EY I must not be physically or mentally able to perform my job (see insurance policies)

c. Repayment of non covered injury expenses".

In furtherance of the claimant's ambition to secure the AD&D payment to which he considered himself to be entitled, Mr Custance drafted a letter to Mr Turowski at EY insisting that EY should pay up the outstanding sum to the claimant and then the claimant, in turn, would assign his rights against the insurers to EY. The draft was sent to the claimant in an email of 18 May 2007 which stated: "I have not looked in any detail yet at the emails you have sent through to me today. … I assume this doesn't alter the plan to get something signed off by Philipp in relation to the AD&D claim as soon as possible. As we discussed yesterday, other matters are probably best dealt with separately as part of some form of overall 'deal' with E&Y".

My interpretation of this email is that the claimant and Mr Custance had spoken earlier about the best strategy for achieving the claimant's "minimum expectations". Mr Custance's time records refer to a 30 minute telephone call which took place between him and the claimant on the previous day and it is very likely that the email of 18 May 2007 was intended to reflect what they had then agreed. Indeed, the email makes specific reference to what had been discussed. In effect, the AD&D/misrepresentation claim was to be presented first as a standalone demand. The claimant's other demands in the event of his leaving EY were be presented in due course as part of an overall deal. This approach would have had its attractions. The claimant was frustrated by the time it was taking EY to advance his AD&D claim and wanted a speedy resolution. If the AD&D/ misrepresentation claim had been presented as part of a comprehensive leaving package then any payments thereunder might be delayed. Since any AD&D/misrepresentation claim was not dependent on the claimant's departure it could be progressed promptly and discretely.

Ms Irwin asserted that she had spoken to Mr Custance about LTD and that he had suggested that it should be left for another day. I am satisfied that Mr Custance did indeed agree that presentation of the LTD claim should be postponed together with all of the other "minimum expectations" other than the AD&D/misrepresentation claim. However, I do not accept that this strategy carried with it the implication that Mr Custance had agreed to extend his retainer so as to advise on the substantive merits of the LTD claim. It would, of course, have been open to Mr Custance to volunteer to provide advice on the LTD claim but that does not make it negligent of him to have omitted so to do and I am not satisfied, in any event, that the claimant would have agreed that such advice was to be given or paid for.

At about 3.30 pm on 21 May 2007, the claimant attended the defendant's offices and met Mr Custance face to face for the first time. It is likely that the central purpose of this meeting was to discuss further the contents of the letter to be sent to EY. Indeed, the letter in final form was sent by Mr Custance to Mr Turowski as an attachment to an email sent at 6.54 pm on the same day. The letter ends "…the other insurance claims arising from his accident will need to be addressed separately". I do not consider that this passage indicates that it was expected that it would be Mr Custance who would be addressing the claims, hence the use of the passive voice. Mr Mandel in cross examination conceded that he did not know what Mr Custance's instructions with respect to the potential LTD claims had been at this stage. I note, however, that in paragraph 28 of his witness statement he expressly stated his understanding to be that the defendant had been instructed in matters other than just AD&D. Nevertheless, when challenged on this he admitted that this understanding was founded entirely on his interpretation of this letter. In this regard, as in others, I consider that he was doing his best, for reasons upon which I will expand later in this judgment, to advance the claimant's case rather than to provide neutral objective assistance to the court.

On the same day, Mr Custance sent two invoices to the claimant providing a brief summary of the work he had carried out. The summary makes no specific reference to LTD cover.

On the following day, Ms Irwin forwarded by email to Mr Custance a text she had received from the claimant which included the following:

"… Karl can sign a legally binding letter saying that if I resign as partner he will pay 6 million dollars".

The claimant contends that the reference to $6,000,000 is to his LTD claim. I am satisfied that it is not. The claimant had emailed Mr Custance late on the previous evening a calculation of his profit distribution claim. It came to a total of $5,926,564. The clear inference is that this is the figure which the claimant had simply rounded up and referred to in his next email. Under the LTD policy, in contrast, the claimant's potential claim would have been for $300,000 for every year until his retirement which, subject to any discount for early receipt (as to which no calculations appear at that stage to have been made), would have amounted to $7,200,000.

On the information presented to him, Mr Custance went on to formulate draft terms of the claimant's resignation from EY. They included an English law and jurisdiction clause. The claims in relation to the loss of those payments which he would have received had he remained in partnership were precisely quantified. No such calculation was presented in respect of LTD payments. Paragraph 3 of the draft provided:

"E&Y will maintain or cause to be maintained (at E&Y's expense) life, AD&D, and disability insurances for Mr Lyons until he is 65 years of age, such insurances to be provided on no less favourable terms than those applying to equity partners of E&Y…".

There was no mention in this regard of a figure of $6,000,000 or, indeed, any other figure.

I find that the reason that the claimant was content to present his LTD claim in this way was that, at this stage, he did not want baldly to assert that he was unable to do his job lest this could be seized upon by EY as a point to its advantage in the negotiations for his departure. Indeed, the claimant appeared to have made a relatively good recovery at this time. Thus he was prepared to leave the LTD cover as a contingent issue in the event that the negotiations were to flounder whereupon he would then, and only then, contend that the only justification for removing him would be his disability and so he would be entitled to cover under the LTD policies. I am satisfied that if the claimant had asked Mr Custance to advise on the scope and operation of the LTD policy then at least some more specific reference to this would have appeared from the documentation. Indeed the point can properly be made that if Mr Custance had given early advice on the LTD policies, albeit not referred to in the email traffic, then the suggestion that later email exchanges and documents forwarded amounted to a request for such advice is undermined by the fact that any such request would have been redundant because substantive advice had already been given. On the other hand, if no such advice had been promptly given then there would be clear evidence that it had been expressly chased - of which there is none.

I am fortified in this view by the casual way in which the claimant appears to have responded to a letter dated 13 April 2007 from Colonial rejecting his LTD claim. The letter included the following passage:

"Based on the email received from your employer, although you are working part-time, you are receiving full pay. In order to be eligible for benefits, you need to earn less than 80% of your pre-disability earnings throughout the 360-day Elimination Period. Since you are not experiencing this earnings loss, no benefits will be paid and your claim is now closed".

The claimant forwarded the letter to Mr Custance under cover of an email of 24 May 2007 stating simply:

"I received this by post today".

As is evidenced in many other emails, the claimant is not a man, either by instinct or inclination, given to the suppression of any feelings of surprise, disappointment or frustration. The matter of fact way in which he passed on and presented the Colonial LTD rejection letter demonstrates that he considered the contents to be uncontroversial and unworthy of tactical or legal consideration. The proper inference from this is that the claimant, at this stage, did not regard his level of disability to be one which was likely to engage the LTD policies and that his paramount concern in this context was simply to preserve his future LTD cover as part of any deal under which he might leave EY in the future. I do not accept the assertion of the claimant and Ms Irwin that they heard that the Colonial LTD claim was going to be rejected before they received the letter and discussed this with Mr Custance. Again, I would have expected that at least some reference to such a discussion would have appeared in the contemporaneous email traffic. I consider that the allegation that the news that the claim was being rejected had broken before the letter arrived was an attempt, in a way now consistent with the claimant's case, to rationalise the otherwise baffling insouciance with which he greeted its receipt.

I reject the claimant's case, and the evidence of Ms Irwin, that at this stage he asked Mr Custance to advise on the LTD policies. It is not simply that no such advice appears in the contemporaneous documentation (indeed, no such advice is documented relating to the Colonial/AGF AD&D or misrepresentation claims) but, more importantly, there is no clear and unambiguous reference in the emails passing between Mr Custance and the claimant to any such advice having been requested or given. I am further satisfied that the absence of any email from the claimant chasing advice on the LTD claim is not because such advice had been given orally but because it was neither requested nor given in the first place. I accept that the reference to "2 hours per day physio…Insurance…won't get a job – 300k dollars a year" in Mr Custance's note of a conversation with the claimant at about this time evidences only that the claimant was outlining his intended strategy and not that he was asking for advice on LTD policy interpretation.

It must follow that I reject the claimant's evidence on this point. His counsel seeks to persuade me that he was an honest witness doing his best to assist the court. The defendant, in contrast, invites me to treat him as one who was trying his best only to do whatever he could to further his case. I find the truth to lie somewhere in between these two extremes but tending, within that spectrum, more towards the defendant's assessment. In short, I found that the claimant was generally discursive in his responses to questions in cross examination and all too ready to promote irrelevant detail above focussed clarity. In part, this may have been attributable to his natural style but not, in my view, entirely. His obfuscation, I find, was to an extent linked to an unwillingness to be pinned down to specific answers which he feared might have exposed him to unhelpfully stark inconsistencies in his evidence whether in the form of discrepancies between his oral evidence and the contemporaneous documentation or otherwise. He is clearly an intelligent, astute and articulate man from which I conclude that his overblown answers were, to a significant degree, tactical in intent. On many occasions, he took an egregiously long time to read often quite short passages from documents to which his attention had been drawn in cross-examination. Of course, some people read more quickly than others but I am satisfied from a combination of his demeanour and the inordinate length of the delays in so many of his responses that he was taking his time to engineer his replies to suit his case rather than to provide open and spontaneous assistance to the court.

I also found the claimant to be forceful and assertive in cross examination. He gave every appearance of being well accustomed to getting his own way. In this respect, his presentation in the witness box, although laboured, was entirely consistent with the generally emphatic tenor of his emails. I do not doubt that his dissatisfaction with Mr Custance is genuine but I am equally satisfied that, as the years have progressed, his perspective on the case has become inexorably channelled away from objective recollection towards a state of mind which more closely fits the template of his claim. Thus it was that the wish fulfilment of reconstruction repeatedly contaminated clear and accurate recollection.

Moreover, I do not accept the evidence of Ms Irwin that she and the claimant were looking for assistance from Mr Custance on both AD&D and LTD cover and, in particular, her evidence about a conversation with Mr Custance about what the alternatives were in the event that Colonial rejected the LTD claim. She said that Mr Custance's advice on this issue was that the claimant could pursue another option under the later policy issued by Generali.

This assertion is seriously inconsistent with the contemporaneous documentation. Nothing is recorded in emails or otherwise relating to any such advice. This is despite the fact that there were several email exchanges between the claimant and Mr Custance in the aftermath of the LTD rejection letter in the course of which either would have had an obvious opportunity, at the very least, to have touched on the issue. Ms Irwin conceded in cross examination that the dearth of any relevant reference to advice in the email traffic was "very odd". Ms Irwin's ability to distinguish AD&D and LTD issues at the relevant time was impaired on her own admission: "…our understanding of the AD&D and LTD was so mixed together that we were looking for an insurance legal professional to guide us through it." Moreover, at the relevant time, the claimant was able to work and there was no suggestion that his condition would deteriorate to the extent that the time would come when he was unfit to continue and so it is entirely understandable he would have supposed that such advice would not then have been thought to have been either necessary or useful.

I do not, for one moment, seek to underestimate the seriousness of the injuries which the claimant sustained but I do not accept that his mental agility was thereby impaired to the extent that his commercial shrewdness had been chronically blunted so as materially to increase his reliance on Mr Custance.

Even more tellingly, when the claimant's condition did eventually deteriorate he made a claim under the Generali policy which was rejected. The grounds of rejection were emphatic, unambiguous and straightforward. Cover under the Generali policy commenced on 29 June 2006 which was after the claimant's accident. If Mr Custance had earlier given positive advice that there was a potential claim under the Generali policy I am in no doubt that the claimant would have lost no time after such a claim had been roundly rejected in demanding an explanation from him in forthright terms. In fact, he did not. His emails in the immediate aftermath of the Generali refusal amply demonstrate his annoyance and frustration but his spleen was being directed against EY and not against Mr Custance.

Furthermore, an email of 10 September 2011 from Mr Custance to the claimant states:

"What is completely unclear to me – and I have no documents which shed any light on this – is why EY continued to tell you that your claim would be covered by Generali".

If it really had been the case that Mr Custance had earlier advised that Generali could be pursued then this email would be expected to have been met with a robustly worded demand from the claimant for an explanation. It was not.

I am thus satisfied that the evidence of Ms Irwin, based as it is upon her recollection so long after the event, has also been contaminated by reconstruction. I take into account that the personal relationship between the claimant and Ms Irwin has long since ended, and not necessarily on the most amicable terms, but this factor does not weigh sufficiently heavily in the scales to persuade me that she must therefore be taken to be an accurate historian. It is to be noted that, as cross examination progressed, Ms Irwin realised that her recollection was, in part, inconsistent with the contents of her witness statement and she became more guarded in her responses by qualifying them with phrases such as "as far as I remember".

Later exchanges of emails do not cause me to change my view that, generally, where the evidence of the claimant, Ms Irwin and Mr Mandel (of whom, more later) is in conflict with that of Mr Custance I prefer that of Mr Custance. In reaching this conclusion, I bear in mind that Mr Custance's recollection has been shown to be inaccurate in respect of more than one issue. For example, he had reached the conclusion in the early stages of the litigation that there was no Colonial AD&D policy and that he had not received a copy of the Colonial LTD policy. I am satisfied that these were genuine failures of recollection brought about by the passage of time and not examples of evidential topiary seeking either unconsciously or otherwise to shape his memory to suit his case. His oral evidence at trial was given thoughtfully and with a credible fluency which stood in stark contrast to the effortful procrastinations of the claimant.

I found Mr Mandel, in general, to be an elusive and protean witness. His independent recollection was, understandably, considerably diminished by the passage of time, as he realistically admitted, with respect to a number of issues. Notwithstanding this, he repeatedly fell into the temptation of adding a gloss to the documentary evidence with reference to speculation as to what might have been said but not recorded. In one exchange during cross examination he was asked, in the absence of any independent recollection on his part, if he accepted that the best that could be done would be to follow what the documents revealed. He replied: "I would say that's the best we can do. Unfortunately, it may not be the most accurate." In my judgment, this response went beyond an expression of natural caution but amounted to a wistful recognition that he had, in supporting the claimant's case, exposed himself too far beyond a position which could be defended on the strength of the contemporaneous documentation. On more than one occasion he was shown to have made assertions in his witness statement which were unsustainable. The following exchange provides an example:

"Q. But you say, you see, in paragraph 35 of your witness statement:

"If the letter was not sent, I can be reasonably confident that I would have discussed its contents with Mr Custance the next time I spoke to him."

You are trying, through your witness statement, to imply that you would have had a discussion about LTD with Mr Custance. Is that really your reconstruction of all this, Mr Mandel?

A. As I say, I don't recollect the details of the conversation. It's possible I could have mentioned it in passing or I may not have mentioned it. I just don't know.

Q. So what you say in your witness statement is simply wrong, isn't it?

A. That I believed that Fox Williams was advising –

Q. No. "I can be reasonably confident that I would have discussed its contents ..."

What you have done in the previous paragraph, you see -- or someone has done it for you -- is to highlight in bold the bits that relate to LTD.

A. Right.

Q. You can see what this is trying to imply, isn't it? It's plucking a passage out of the letter which wasn't even sent, putting it in bold, and saying, "Well, although it wasn't sent, I'm reasonably confident I would have discussed it". That's just simply not your reconstruction of events, is it, Mr Mandel? It doesn't fit with the documents.

A. As I say, I don't recall the conversation. Since my discussions with AON or my correspondence with AON covered both LTD and AD&D and since we were concerned about generally lowering the temperature and making people aware that we were aware of all the policies and the situation -- I may have mentioned it, but I do not remember the conversation specifically.

Q. So what you said in your witness statement is wrong, isn't it? You are not reasonably confident that you would have mentioned LTD, are you?

A. I guess I'm not reasonably confident, that's correct".

On 1 August 2007, Mr Custance emailed Mr Mandel saying:

"Following our conversation on Friday and a subsequent conversation I had with Cathal yesterday:

Cathal is now working on the Ingosstrakh claim form, and he and I will discuss this later this week.

Could you arrange to send me a complete copy of your file re the claims on the Colonial/AGF policies. If I am to advise on further arguments potentially available against those insurers, then I need to make sure that I have a complete picture of all the communications there have been with them so far…".

This email was sent against the background of conversations between Mr Custance and Mr Mandel and the claimant relating to AD&D. The claimant was unable to point to any further advice from Mr Custance referring to the LTD policies and speculated that they may have had a conversation about it a week or two weeks later. I accept Mr Custance's evidence that he wanted to consider with the assistance of the documents in Mr Mandel's possession whether there were any arguable points on the AD&D claim worth considering even though he remained pessimistic as to their potential merit.

Mr Mandel responded to Mr Custance's request by sending his complete file. This comprised 238 pages of material. He had not removed the documentation relevant to LTD claims. However, Mr Mandel was obviously a busy man and it would have saved him time simply to send everything he had rather than to attempt to sort out the wheat from the chaff. I am satisfied that the inclusion of the LTD material was not because Mr Mandel considered that to be relevant but, as with Ms Irwin before him, it was more convenient to send everything and let Mr Custance decide what did or did not help him within the scope of his retainer.

On 6 September 2007, the claimant's secretary sent an email to Mr Custance and Mr Mandel attaching the Colonial rejection letter "at Cathal's request". The email does not state why the rejection letter was sent. No advice on the letter was asked for and there is no documentary reference to any such advice having been either given or chased. The next email of substance is dated 12 September 2007 from Mr Mandel to the claimant. Mr Custance was copied in. It refers to a conversation between Mr Mandel and Mr Custance directed entirely towards the presentation of the Ingosstrakh AD&D claim.

The claimant speculated in cross examination that Mr Custance may have been going through the material he had been sent by Mr Mandel and had asked for another copy of the rejection letter. However, the letter was already in the documents which Mr Mandel had sent so it is difficult to understand why, if this were the case, Mr Custance would want another copy. Whether the attachment was sent either in error or merely by way of unsolicited background information is not necessary to resolve. I am satisfied, however, that Mr Custance was not expected to analyse or advise on the contents and, on an objective reading, it would be a counsel of perfection to suggest that either he should have interpreted it to be a request for advice or that he should have called for an explanation as to why it had been sent.

Furthermore, when, on 1 October 2007, Mr Custance emailed his substantive advice he made no mention of the LTD policies and the claimant did not chase him for any. On 10 December 2007, Mr Custance sent the claimant invoices for work done from April 2007. They make no reference to work on or advice concerning the LTD policies.

The Parting of the Ways

In the early weeks of 2008, Mr Mandel continued his efforts to pursue the Ingosstrakh claim. At the same time, the claimant was becoming increasingly concerned about his future at EY. He emailed Mr Custance on 20 February 2008 in the following terms:

"I pointed out to Philipp that everyday I walk about with my settlement in my pocket and if EY signs I am more than happy to leave. I did add that they should say that I am physically and mentally not capable of working. That as far as I am concerned is what they are saying & then as this is true according to my employer I should be able to claim $350,000 per annum from my insurance. Should work? While Philipp like the $350,000 paid by insurance company he was taken aback by my $10 million claim".

I do not interpret this as a request for advice on the LTD claim. The claimant was referring back to his "minimum expectations" as the cornerstone of his negotiating stance in the event that he and EY were to part company. It is to be noted that he mistakenly refers to the potential value of the LTD claim as being $350,000. There is no documentary evidence that Mr Custance pointed out this error or, indeed, made any other assessment of the substantive merits of this aspect of the package. I am satisfied that, at this stage, the claimant still did not believe that he was disabled to the extent that he would be unable to work for EY. The LTD claim was the claimant's contingent negotiation threat to be deployed so as to secure a generous package in the event of his exit from EY. I accept Mr Custance's evidence that this was the claimant's invitation to engage him in a consideration of the tactical merits of his approach and not upon a formal legal appraisal of the merits of the LTD claim. Indeed, I find that even if Mr Custance had, at any stage material to this aspect of the claim, expressly invited the claimant to clarify the scope of his retainer, he would not have been told to spend time analysing the detail of the LTD policies.

As the months went by, the claimant became more and more frustrated with Mr Mandel's lack of progress on the Ingosstrakh claim. By 7 May 2008, he was pulling no punches in rapidly successive emails to Mr Custance:

"Tick tock".

And:

"Jim treats my claim as a joke, he does nothing".

The claimant's opinion of Mr Mandel's performance did not improve when he discovered that Ingosstrakh had actually rejected the claim but that Mr Mandel had told neither him nor Mr Custance. In an email to Mr Custance of 14 May 2008 he said:

"So you are not going to believe it but Jim did get a response but did not have to balls to let us know".

This observation betrays something of the relationship between the claimant and Mr Mandel. The claimant plainly thought that Mr Mandel was not brave enough to disappoint him with unwelcome news. Having had the opportunity to see both men give evidence, I am satisfied that, of the two of them, the claimant has the dominant personality. I am in no doubt that a reluctance to cross or to disappoint the claimant played its part in rendering Mr Mandel so pliable and favourably disposed towards the claimant both in the wording of his witness statement and the evidence which he gave at the trial.

On 11 June 2008, there was a conference call between the claimant, Mr Custance and Mr Mandel. I am in no doubt that it related solely to the fallout from the rejection of the Ingosstrakh claim. Later that month, the claimant sent a further tranche of documents to Mr Custance which included documents relating to both AD&D claims and LTD claims. There was no contemporaneous request identifying the scope of the work which the claimant expected Mr Custance to perform with respect to these documents and I accept Mr Custance's evidence that, with Mr Mandel's efforts having come to naught, responsibility for pursuing Ingosstrakh was now being passed over to him and he wanted to make sure that he had every document relevant to suing Ingosstrakh.

There followed a hiatus over the summer months at the conclusion of which the claimant resumed his pressure on Mr Custance and Mr Mandel to advance his interests. On 22 December 2008, Mr Custance emailed the claimant suggesting that they should have a meeting about the inter-relationship between the Ingosstrakh and the misrepresentation claims. Tellingly, in my view, no mention is made of LTD claims and the claimant did not ask about them.

As time went by, the claimant became more concerned about his state of health and, in January 2009, he emailed Mr Custance a list of bullet points with a view to the latter providing strategic advice on the drafting of a letter to EY to progress matters. They did not refer to LTD. I find that the claimant was not asking for advice on the LTD claims in this context or with respect to the amendments which he later proposed to make to the initial draft.

By 19 March 2009, Mr Custance had drafted heads of terms and sent them for the claimant to peruse. These heads of terms included:

i) an obligation on EY to maintain the claimant's insurance with CIGNA until the date of his death, such insurance to be maintained on terms no less advantageous than those which currently apply;

ii) an English law and jurisdiction clause; but

iii) no reference to LTD.

On 19 March 2009, the claimant had a short meeting with Karl Johansson and Philipp Turowski of EY. The claimant regarded Mr Turowski, within limits, as an ally. Neither had any affection for Mr Johansson.

Under cover of an email dated 21 March 2009, Mr Custance sent the claimant two invoices in respect of work done between May 2008 and January 2009. The total charged related to less than three hours' work. There is a reference to Ingosstrakh and Colonial in one of the invoices relating to a telephone call with the claimant and Mr Mandel. However, I interpret this to be a generic reference to the AD&D claim and not to the Colonial LTD cover. The covering email makes no reference to LTD.

By this time, the claimant was strongly motivated to leave EY. The relevant factors included the following:

i) the claimant was concerned that his allies in EY, Mr Mandel and Mr Turowski, were likely to move on shortly and leave him more exposed to the vindictiveness of Mr Johansson;

ii) the claimant believed that EY CIS was going through serious financial difficulties; and

iii) his medical condition was getting worse.

The Negotiations

The claimant contends that at a meeting between him, Mr Mandel and Mr Turowski on or after 23 March 2009, Mr Turowski verbally agreed that there should be an English law and jurisdiction clause in the agreement for the claimant's exit from EY.

I am not satisfied that this meeting took place. Mr Mandel was very vague about the timing of his involvement and appeared to agree in cross examination that it probably began after 10 April 2009. There is no reference to any such meeting in the contemporaneous emails between the claimant and Mr Custance.

On 27 March 2009, the claimant sent an email to Mr Custance stating:

"… I have had the 3rd Doctor now admit that I am unable to work so I know we need to thread carefully but maybe we have a good angle to also get that $300K per annum until I am 65. What do you think? We should talk.

Enjoy your holidays, I will not rattle any cages until you get back".

I am satisfied that the claimant was not asking Mr Custance for advice on the substantive merits of his LTD claim in this email. The references to "thread (sic.) carefully" and "good angle" fully support the evidence of Mr Custance that it was the tactical issue as to how to deploy the LTD claim in the negotiations which was being referred to. This interpretation is consistent with the fact that Mr Custance did not respond to it because he was on holiday and by the time he had arrived back the claimant had already reached a deal on the commercial aspects of his package. The claimant's assertion that this was a request for LTD advice at such a very late stage is also difficult to reconcile with his case that he had been asking for, and receiving, advice on the LTD policies all along.

On 6 April 2009, the claimant emailed Mr Custance to say that "it looks like I have come to an agreement with EY." Attached was a letter of intent containing heads of terms. They did not contain an English law and jurisdiction clause. The package was expressed to be: "Subject to further negotiations of details – this is – in principle – agreed between parties".

The claimant's commercial hard-headedness is amply demonstrated by what followed. On the same day, he emailed Mr Custance asking "can you email back an email that is almost directed to Philipp so I can forward?" His expressed intention was to get Mr Custance's "help on ensuring I get a bucket load of cash from the swines with no strings".

Mr Custance duly sent an email to the claimant for this purpose in which he expressed doubts about the proposed agreement. The claimant, as he had planned all along, forwarded it to Mr Turowski.

On 8 April 2009, Mr Turowski made it clear in an email to the claimant that he did not welcome Mr Custance's involvement in their ongoing dialogue:

"Tom's way of writing emails and acting is the typical antagonizing lawyer language and I really do not want to react to that. I hope you understand my view as I want to settle this amicably among friends…".

In response, the claimant passed off his decision to forward Mr Custance's email as if it had been casual and spontaneous rather than, as was the case, the implementation of a deliberate negotiating strategy:

"Sure I understand, I want to keep moving and popped it onto you after only glancing, thought it was easier. & yep he is a lawyer. You and I know where we are trying to get to…".

This is further illustrated by an email which the claimant subsequently sent to Mr Custance on the topic:

"Anyway you will be glad to know your email pissed Philipp off so he only wanted to deal with me. …".

I am satisfied from an email sent by the claimant to Mr Turowski on 10 April 2009 that, contrary to the claimant's evidence in his witness statement, this was the first occasion upon which he had involved Mr Mandel in the exit discussions:

"I can start with Jim (I met him today but no details) we briefly spoke about consulting idea etc".

The only reasonable interpretation of this email is that Mr Mandel was not yet fully in the picture even following the meeting on that day. Hence the reference to "no details". Furthermore, on 13 April 2009 the claimant forwarded an email chain between him and Mr Turowski to Mr Mandel in which he says that he has Mr Turowski's consent to disclose the same. If Mr Mandel had been privy to the negotiations then it is difficult to see why such consent would have been needed. On the same day, he forwarded the letter of intent to Mr Mandel. Again, one would be entitled to expect that if Mr Mandel had been involved in the negotiations he would already have had a copy.

In cross examination, Mr Mandel agreed that he saw his function as putting the agreement between the claimant and Mr Turowski into a document. In an email to Mr Custance of 7 April 2009, the claimant said: "jim to write deal and you to review, so you and jim I think we will be able to deal 1 to 1 which is good as jim now hates EY. He is next…im helping him with his deal".

Mr Custance responded on the same day: "Looks like a good deal – only thing which you don't mention specifically is what Philipp has committed to/said about the 2 million being paid as tax efficiently as possible? Anyway, am happy to review the detail once I hear from Jim and hopefully sort it all out with Jim".

The first email from Mr Mandel relating to the exit terms was sent to the claimant on 14 April 2009 attaching his draft terms. The email refers to one term sheet of EMEIA ^[5] and a "labor contract which may have some elements not of concern to EMEIA".

In an email of the same date to Mr Turowski, Mr Mandel said:

"I think that we may want to divide the term sheet into two parts: one part that EMEIA has an interest in and a second part that is of purely local interest reflects matters solely between Cathal and the local practice".

The email did not suggest that another reason for splitting the sheet into two parts related to the need to apply a different law and jurisdiction clause to each part.

The heads of terms did not include an English law and jurisdiction clause. I do not accept that the claimant who had been so closely involved in the negotiations and had received an earlier crib sheet from Mr Custance had merely forgotten about such a clause. I am satisfied that Mr Turowski had simply declined to agree to such a clause and the claimant had accepted this.

On 14 April 2009, the claimant sent an email to Mr Custance attaching Mr Mandel's draft and saying: "think it is ok? You? You can reply to here thanks".

On 16 April 2009, Mr Custance emailed Mr Mandel to arrange to discuss over the telephone some changes to the draft heads on the understanding that the claimant would be meeting with Mr Turowski on the following day to finalise them. Shortly before that call took place, Mr Custance emailed Mr Mandel attaching some proposed track changes to the term sheets and observing that he did not see the need for separate term sheets.

After the conversation, Mr Custance emailed Mr Mandel with "a couple of other changes". Neither related to law or jurisdiction.

Shortly thereafter Mr Mandel emailed the proposed draft to the claimant and Mr Turowski explaining:

"The terms sheet is divided into two parts. The first part is the true summary of terms. The second part relates to the terms of a future employment agreement. The reason for the second part is that there may be issues not of interest to EMEIA that are best left for local resolution and might be stated in a separate agreement… Secondly, I wanted to repeat the provisions in our existing employment contract that the employer has an obligation to provide support for work permit and visa. Thirdly, I wanted to indicate the basis for termination that exists under Russian law. Please note that the first of these in the attached term sheet, incapacity, is not in accordance with Russian law and should be deleted".

On the following day, after further amendments had been made to the terms of the agreement, the deal was done. It was only after this that a copy was forwarded to Mr Custance.

After all the evidence in the trial had been heard, and by way of informal application in his written submissions of 18 March 2016, the claimant sought to adduce evidence of telephone calls and text messages to Mr Custance extracted from his mobile phone records. Unsurprisingly, the defendant takes procedural objection to the lateness of this disclosure and the material upon which it is based. Had the probative value of this evidence been potentially significant then the decision on admissibility may not have been entirely straightforward. Ultimately, however, the records provide very little assistance and their weight is inevitably reduced by the lack of any proper opportunity for the defendant to challenge their significance through cross examination or otherwise. The records start from November 2008 and many of the calls are of such short duration that they are likely to have comprised no more than the leaving of brief messages or missed calls. Where there is evidence that a conversation is likely to have taken place there is no specific evidence as to what was said. I am prepared to accept that such information as has been disclosed goes some way to establishing that, over the period covered, there was more telephone and text traffic than Mr Custance could recall but this does not justify my taking a leap of faith as to the significance of the contents of any of these communications. In particular, the records now relied upon by the claimant relating to the date of the signing of the agreement, 17 April 2009, amount to about six minutes in total which broadly corresponds to Mr Custance's own time records. This is too short a period in which it is likely that Mr Custance could have given useful substantive advice on the amended form of agreement. Accordingly, although I have indulged the claimant by admitting this late evidence, I do not find that the weight to be attached to it advances his case to any significant degree.

I accept Mr Custance's evidence that if he had seen the proposed amendments before the deal had been struck he would have made comments on them.

It was thus that the April 2009 agreement was concluded in accordance with which the claimant resigned as a partner with effect from close of business on 30 June 2009 and became a part-time consultant.

Ingosstrakh Postscript

In the aftermath of the April 2009 agreement, the third anniversary of the claimant's accident was fast approaching. Mr Custance sought advice on the issue of limitation in Russian law from a Russian lawyer, Mr Dorokhin. He was advised that the relevant limitation period was one of three years from the date when a formal claim had first been made in February 2008. Thus there was no urgent need to bring proceedings within three years of the accident.

After Mr Custance had communicated this advice to the claimant there was no further contact between them until 2011. Matters between the claimant and EY did not, however, stand still in the meantime.

2010

By email dated 22 September 2010, the claimant asked Ms Kondakova to forward to him disability forms to fill out. He said that he had not worked for over a year and did not have sufficient mobility to work again. He chased her for a response on 3 November 2010 asking for her to help him with the forms.

It is to be noted that the claimant did not at this stage seek to involve Mr Custance in the presentation of his LTD claim and was to record in a witness statement which he later made for the purposes of pursuing EY under the 2009 Agreement: "Ernst & Young had been actively leading the claim on the LTD insurance, albeit too slowly for me." Although, in his witness statement served for the purposes of this action, he attempted to row back from this position, I am satisfied that his first witness statement was accurate on this issue.

Ms Kondakova duly contacted Generali about the claimant's LTD claim. Generali raised issues including one which concerned possible late notification. Preparations for the presentation of the claimant's LTD claims progressed into the following year whereupon, by chance, on 10 January 2011 Mr Custance emailed the claimant chasing outstanding unpaid fees.

The Return of Mr Custance

In response to Mr Custance's email, the claimant said that he was now trying to "work on his disability" and predicted that he was about "to face a huge battle." He did not ask for Mr Custance's advice or assistance.

Mr Custance did not respond to this email but, on 16 February 2011, the claimant emailed to point out that EY had just contacted him to say they wanted to cancel his medical insurance and give him $200,000 in lieu but that this was not enough. Minutes later, the claimant emailed Mr Custance again to say that he had been called by one Herve Labaude, EY general counsel:

"I THINK he is saying the contract is not legal and they want to cancel insurance!!!! As you know this was the most important part of the deal as nobody else will insure me…. In fact first this lawyer said he was reviewing contracts for cost effectiveness!! What the bloody hell do I do! …".

Four days later, the claimant sent a further email to Mr Custance attaching a copy of the agreement and expressing concern "that there is no jurisdiction".

On 21 February 2011, the claimant emailed Mr Custance detailing a conversation he had had with Mr Labaude in which he again refers to the issue of Russian jurisdiction "in which case I am screwed as decisions go to the highest payer to the judge (that will be EY)." It is to be noted, however, that the claimant does not refer to any agreement with Mr Turowski to the effect that English law and jurisdiction had been agreed. On the following day, the claimant emailed Mr Custance again to say he had spoken to Mr Mandel who by that time had left EY. He said Mr Mandel "recollects UK law but is not 100% sure".

On 25 February 2011, Mr Custance spoke with Mr Labaude over the telephone and made a short note of what was said. On 2 March 2011, the claimant emailed Mr Custance saying: "There is no jurisdiction stated and if they file in Russia I am doomed thanks to their relationship with the courts." On the following day he sent on the relevant CIGNA documents.

On 9 March 2011, Mr Custance issued a claim form on behalf of the claimant against no fewer than nine companies in the EY group in the Chancery Division of the High Court. The claim contended that, in breach of the 2009 agreement, EY were refusing to continue to include the claimant in the CIGNA cover. The claim was for, inter alia, a declaration and specific performance.

On 4 April 2011, the claimant emailed Mr Custance asking "how on earth the jurisdiction was taken out". This and later emails show that the claimant was losing patience with Mr Custance and feeling that his case was being deprioritised. By 25 April 2011, the claimant was emailing another solicitor, Mr Tony Brown, of Bivonas, saying "we were supposed to have England + Wales as jurisdiction but it dot [sic.] dropped in error…".

Mr Custance engaged with Mr Labaude over the telephone and recorded that Mr Labaude was coming under pressure from the head of EMIEA and other senior management to terminate the claimant's contract of employment. On 26 April 2011, EY purported to terminate the claimant's CIGNA coverage.

Meanwhile, the claimant filled out and submitted an LTD claim form to Generali. He did not consult Mr Custance about this and did not send him a copy of the completed form at the time. He also sent documents to Generali in support of his claim without informing Mr Custance. The first reference to this claim in a document drawn to the attention of Mr Custance appears in a list sent by the claimant to Mr Custance on 2 May 2011 which contains a number of bullet points one of which comprises "Guarantee on EY getting my Disability from Generali." He asks for no advice in this context. On the next day, however, he told Mr Custance that Generali had asked him to hold back on forwarding any original documentation because they were seeking further advice on his claim.

On 17 May 2011, Generali emailed Ms Kondakova to say that their policy did not cover the claimant because his accident had occurred before the policy had been incepted. Ms Kondakova did not pass on this information promptly to the claimant who approached Generali directly on 31 May 2011 only to be told that he should revert to EY for the information.

On 8 June 2011, the claimant complained to Mr Custance that the matter was dragging on far too long and criticised him for leaving out "UK jurisdiction" from the 2009 agreement. Mr Custance served the claim form on EY on 14 June 2011. Following exchanges between the claimant and Mr Custance on drafting, the Particulars of Claim were served on 1 July 2011. Thereafter, they were concentrating both on trying to persuade EY to preserve the CIGNA cover and on pursuing such rights as the claimant may have had under the Generali LTD policy. In the meantime, the claimant was in the process of arranging alternative medical cover with Medicare as a contingency in the event that the CIGNA cover were lost.

On 31 August 2011, over three months since it had informed EY, Generali emailed the claimant to say that he did not have an "eligible claim" under the LTD policy. Upon receipt, the claimant forwarded it to Mr Custance remarking that "This is a total disaster." The claimant asked Generali for an explanation. It responded saying that the accident had occurred before the inception of the policy.

As I have observed earlier in this judgment, if Mr Custance had previously advised the claimant that he should look to Generali for payment of his LTD claims, I am in no doubt that the claimant would immediately have demanded an explanation. Instead, the claimant emailed Mr Custance in the following terms:

"Tom, this is unbelievable. EY and Stephen have confirmed that a claim was lodged with them as far back as 2007 maybe even 2006. EY has been in continuous contact with them. Is this some bad joke,

The payment calculated by EY years ago indicated I would be entitled to a yearly payment of $300,000

EY must have had insurance before this, in fact I am sure there are documents where they had ADD cover for us. So did they claim of incorrect policy, if they did it's their fault.… Jim Mandel and Svetlana Kondakova were looking after this and did claims, in fact Jim only gave me some of the paperwork back sometime in 2010. They were working under the supervision of Philip Turowski. Also at the beginning the HR director Anne Ramsay was also assisting. Se has since left and is now working for kelloggs. I will call her.

But please you need to call the EY lawyers and inform me about their error and they need to sort this. Under the rules I should have been paid since may/June 2010 at the latest".

I do not accept the claimant's evidence that he had at this stage simply forgotten that Mr Custance had advised him to pursue Generali. Faced with the potential loss of a very considerable amount of money, the claimant would have taken careful stock of who might have been responsible and it is not credible that if Mr Custance had given him bad advice on the matter he would have overlooked this.

This email was followed up by another very detailed email of the same date from the claimant suggesting that EY had deliberately blocked his claim or had been "totally incompetent". Again, there is no suggestion that Mr Custance had been in any way to blame.

Having perused the relevant documents, Mr Custance emailed the claimant setting out his advice on the LTD claims. Even this document did not at the time trigger any recollection on the part of the claimant that Mr Custance had advised earlier on the same topic. I reject the claimant's suggestion that it was only after he came into contact with Ms Irwin some time later that his memory on the matter was rekindled. On my analysis of the sequence of events prior to September 2011, I am satisfied that before Generali rejected the claimant's LTD claim there had been no express or implied retainer under which Mr Custance was under a duty to advise on LTD issues.

On 16 September 2011, EY applied to the court for a stay pending determination of the claimant's claim in breach of contract in Russia. One of the witness statements served in support was from Mr Turowski dated 16 September 2011. In it he said: "It was therefore obvious to me that the Agreement would be governed by Russian law and under the jurisdiction of the Russian courts…It was never my intention…that the Agreement…would include an English law and jurisdiction clause".

On 28 October 2011, the claimant emailed Mr Custance informing him that he had spoken to Mr Mandel and stating:

"1/ He thinks he recalls some discussion about UK law or at least he thinks he remembers something. But hes not fully sure…

2/ IF it came up would Philipp have agreed to UK jurisdiction – he said absolutely Phillipp would have agreed as Philipp thought deal was done and nothing else was to be agreed or could be changed. ….. At least something like this!!! I think it is good".

The suggestion that Mr Turowski would have agreed to the UK jurisdiction is not easy to square with the claimant's later case that Mr Turowski did in fact agree to it. This provides another example of the claimant trying to re-write history to suit his case. His further efforts in this regard are to be found in an email to Mr Custance of 8 December 2011:

"I hope you have in your files discussing jurisdiction with Jim! He says he will say yes uk was agreed IF our confirm from your notes. But no matter what he says he's pretty sure and he will say so. He also says that no matter what Philipp would have agreed as he was fully sure deal was done! Please look into this and confirm".

The tone of this email strongly suggests that the claimant was putting at least some level of pressure on Mr Mandel to support his jurisdiction claim to the extent that Mr Mandel's recollection was expressed to be, at least in part, contingent upon the evidence of Mr Custance. At trial, Mr Mandel's evidence on this issue was vague. He relied heavily on the contention that all Russian contracts of employment for someone working in Russia had to be subject to Russian law and a separate agreement would be necessary to deal with the terms of the claimant's departure. Thus, he said, the issue of English law was discussed and agreed. A difficulty for the claimant on this issue is that his evidence was that Mr Turowski agreed to English law and jurisdiction "either on 23 March or late March/early April". As I have already noted, the contemporaneous documents, however, point strongly to the conclusion that this was before Mr Mandel became involved in the process. Indeed, on a number of issues Mr Mandel's oral evidence fell considerably short of the level of emphatic confidence with which his witness statement had been drafted.

When, on 12 March 2012, Mr Mandel signed his witness statement to be deployed in the claimant's litigation against EY he had every reason to feel aggrieved against his former employers. In short, he had been investigating an allegation that EY had made an illegal payment of €120,000 as a bribe to secure a good result in a tax case in Russia. This, it was alleged, had been camouflaged in the accounts as a payment for legal fees. The CIS Managing Partner alleged to have authorised this payment was none other than Mr Johansson, the man whom the claimant substantially blamed for seeking to expel him from EY. Mr Mandel reached the provisional conclusion that the allegation was made out but his investigation was closed pre-emptively by Mr Labaude. The claimant, as "whistle-blower", subsequently attempted to resurrect the allegation in a meeting with one Mr Krupski of EY's global finance department. When Mr Labaude heard about this he turned on Mr Mandel. Mr Mandel, in turn, explained that it was the claimant who had initiated the attempt to re-open the enquiry. Mr Labaude told Mr Mandel that he would "crush" him (Mr Mandel) for what he had done. Mr Mandel said the reprisals which followed led to him being given no further assignments. Against this background, it is unsurprising that Mr Mandel would not scruple to back the claimant's case against EY on the issue of English law and jurisdiction. I do not conclude that he told bare-faced lies but I am satisfied that his recollection was significantly distorted by a serious loss of objectivity which went on to permeate and contaminate his evidence in this case. My assessment is that he was trying to do his best for the claimant and that he felt that he owed him a degree of residual loyalty which seriously coloured his recollection. I was fortified in this view by not only the content of his responses to cross examination but the manner in which he gave them. His cognitive dissonance when shown documents tending to contradict his evidence was manifest. I had the strong impression that he was doing his best to pitch his evidence so as to be as helpful as possible to the claimant but at the same time not trespassing beyond the parameters of plausibility as defined in the contemporaneous documentary evidence. His attempts to fit the square peg of the claimant's case into the round hole of the contemporaneous email traffic caused him evident discomfort. Where the evidence of Mr Mandel conflicted with that of Mr Custance I preferred that of the latter.

In an email of 5^th January 2012, the claimant continued to put pressure on Mr Custance to give a favourable response on the UK jurisdiction issue:

"I need you to be able to confirm that you and Jim spoke about UK jurisdiction, we know you both did so it's important that you say so. As Jim has confirmed he vaguely remembers that you did discuss it and is will to say so. Also he will say that philipp turowski would have agreed to this as he assumed that 1 the deal was done and 2 would have given me practically anything. It's hugely important you confirm, will you?"

In a further email of the same date, the claimant expressed deep concern over the jurisdiction issue. I am satisfied from the contents of this email and those which preceded it that the claimant did not have any personal recollection of an agreement that UK jurisdiction would apply and that he was desperately hoping that Mr Mandel and Mr Custance might come to his rescue and assert that they had discussed the topic at the time. If the claimant had direct knowledge of any such agreement he would have alluded to it.

In his response the following day, Mr Custance said he had no independent recollection of discussing English law and jurisdiction with Mr Mandel. Mr Mandel, in cross examination having initially suggested that he did discuss jurisdiction with Mr Custance later admitted that he could not remember such a conversation.

The claimant's dissatisfaction with Mr Custance was set out in a letter which was later attached to an email of 23 November 2011. He blamed Mr Custance for the omission of the English jurisdiction clause and pressed him to deal with the claim against EY pro bono or on a no win no fee basis. He went on to say that he had sought advice as to whether to continue his claim against EY or to pursue the defendant. It was obvious from the tone and content of this letter that the defendant could no longer act for the claimant. Mr Custance faced the prospect of being a witness in a case which, if lost, would likely lead to a claim against his firm based on his own alleged negligence. Eventually, Mr Custance, having referred the matter to his professional indemnity insurers, wrote to the claimant on 3 January 2012 to terminate the retainer.

Nevertheless, Mr Custance agreed to instruct counsel on the jurisdiction issue before ceasing altogether to act for the claimant. The advice, from Nicholas Craig, unequivocally concluded that "…there is no need for the questions relating to the validity of the Agreement and whether or not it was breached to be determined in Russia." Mr Custance sent the advice on to the claimant describing it as "clearly encouraging".

The claimant's claim against EY was thereafter advanced by his new solicitors, SGH Martineau LLP ("SGH"). On 11 April 2012, EY withdrew their application for a stay on grounds of jurisdiction and the opinion of Mr Craig was thereby vindicated. The claimant later brought a claim against the defendant for the irrecoverable costs arising from EY's challenge to the jurisdiction. This has been settled in the sum of £75,000. The issue of the application of Russian law remained but the salient point in the defence was directed towards the assertion that the contract was not binding because it was not between legal persons and that it was not sufficiently clear in its terms which, at least broadly speaking, are principles not entirely unfamiliar to English law.

On the sixth day of trial, the claimant disclosed for the first time a transcript of a telephone conversation he had had with Mr Turowski on 13 April 2011 and had secretly recorded. The purpose of adducing this evidence was to refute the suggestion that he had colluded with Mr Mandel to assert inaccurately that English law and jurisdiction were agreed with Mr Turowski. The transcript revealed that the claimant was persistently trying to persuade Mr Turowski to change his "statement slightly just to say, I mean as I said, you and I we did talk about English law." His repeated, importunate attempts to get Mr Turowski to change his statement reveal just how determined the claimant can be when trying to recruit a witness to his cause. To this court, he attempted to make a virtue of the fact that throughout the conversation he was asserting he wanted Mr Turowski to tell the truth. However, there would have been no point in his recording the conversation unless he kept open the option of deploying it at some later stage in the EY litigation. To extract a concession from Mr Turowski in the context of a conversation in which the claimant himself was not heard to be asserting the accuracy of his account would render the evidence tactically unusable. He could hardly have made much subsequent forensic use of a recording in which he had been heard to ask Mr Turowski to tell lies and I am satisfied that his protestations were aimed at a future potential audience. Mr Turowski's responses to the claimant in the transcript reveal that he was finding the pressure under which he was being put to be distinctly uncomfortable. Despite the fact that he had been, in broad terms, an ally of the claimant in his dealings with EY and that he was unaware that his comments were being recorded, he did not make any concession to the effect that the contents of his statement were inaccurate.

Eventually, the claim against EY was settled in the sum of £1,300,000 plus costs in full and final settlement of all claims including that relating to LTD cover. The full terms were set out in a Tomlin Order dated 28 November 2012.

LTD claims, scope of retainer and the duty to warn

It follows from my analysis of the history of the professional relationship between the claimant and Mr Custance that Mr Custance was not retained to advise on the substantive merits of his LTD claim until after Generali had declined to respond to the claim made under its policy.

The claimant argues in the alternative that even if there were no express retainer then Mr Custance, at least, came under a duty to warn him to have regard to the scope and validity of the LTD policies.

Circumstances may indeed arise in which a solicitor comes under a duty to warn his client of particular risks which may not necessarily fall squarely within his retainer. The position is summarised in Jackson and Powell at para 11-173:

"There is generally a duty to point out any hazards of the kind which should be obvious to the solicitor but which the client, as a layman, may not appreciate. In Boyce v Rendells the Court of Appeal accepted the following as a general proposition:

"if, in the course of taking instructions, a professional man like a land agent or a solicitor learns of facts which reveal to him as a professional man the existence of obvious risks, then he should do more than merely advise within the strict limits of his retainer. He should call attention to and advise upon the risks".

To similar effect Bingham LJ stated in County Personnel (Employment Agency) v Pulver that: "If in the exercise of a reasonable professional judgment a solicitor is or should be alerted to risks which might elude even an intelligent layman, then plainly it is his duty to advise the client of these risks or explore the matter further"".

Further, in Credit Lyonnais SA v Russell Jones & Walker [2002] EWHC 1310 Laddie J observed at para 28:

"A solicitor is not a general insurer against his client's legal problems. His duties are defined by the terms of the agreed retainer. … [T]he solicitor only has to expend time and effort in what he has been engaged to do and for which the client has agreed to pay. He is under no general obligation to expend time and effort on issues outside the retainer. However if, in the course of doing that for which he is retained, he becomes aware of a risk or a potential risk to the client, it is his duty to inform the client. In doing that he is neither going beyond the scope of his instructions nor is he doing "extra" work for which he is not to be paid. He is simply reporting back to the client on issues of concern which he learns of as a result of, and in the course of, carrying out his express instructions. In relation to this I was struck by the analogy drawn by Mr Seitler. If a dentist is asked to treat a patient's tooth and, on looking into the latter's mouth, he notices that an adjacent tooth is in need of treatment, it is his duty to warn the patient accordingly. So too, if in the course of carrying out instructions within his area of competence a lawyer notices or ought to notice a problem or risk for the client of which it is reasonable to assume the client may not be aware, the lawyer must warn him".

In my view, Mr Custance did not become aware of a risk or potential risk to the claimant arising out of the LTD policies and it was not objectively unreasonable for him to omit to flag up any such risk to the claimant. I take into account the following factors:

i) the claimant was an astute, focussed and commercially minded business man;

ii) the claimant, particularly with Mr Mandel's assistance, was clearly using Mr Custance more as a targeted resource than as a general legal adviser. There was no legitimate expectation at the material times that he would undertake any sort of analysis of the LTD documentation falling outside the scope of his original express retainer;

iii) as the claimant himself went on to say in his witness statement made for the purposes of pursuing a claim against EY, that EY "had been actively leading the claim on the LTD insurance";

iv) the LTD policies were legally distinct from the AD&D policies. Perusal of and advice upon the latter did not require any knowledge of the scope or terms of the former;

v) mere knowledge of the existence of the LTD policies against the limited background context of which Mr Custance was aware would not have put him on the alert that there was a problem or risk which ought to have been pointed out.

In the circumstances, I am satisfied that, at the material time, Mr Custance was not in breach of any duty to warn the claimant.

The English law and jurisdiction clause

The first issue to be addressed is whether Mr Custance was negligent in the context of the omission of an English law and jurisdiction clause in the 2009 agreement. I find that he was.

The defendant takes the point that the claimant's pleaded case alleges inter alia that Mr Custance "failed to ensure" that the 2009 agreement or any subsequent long form agreement contained an English jurisdiction and law clause. It is alleged that it was never within Mr Custance's power to "ensure" any such inclusion. This is true and, strictly speaking, the use of the word "ensure" tends to cross-contaminate issues of breach and causation in the circumstances of this case. Nevertheless, I am satisfied that Mr Custance should have advised when reviewing the relevant documentation that it did not contain an English law and jurisdiction clause and that this would give rise to a risk that EY might contend that any claim in the event of a dispute should be brought in Russia and that he could not advise on the possible impact of the application of Russian law upon the proper interpretation of the terms of the agreement.

Mr Custance included English law and jurisdiction clauses in earlier drafts of the agreement. On the minimum expectations document he wrote "gov law". He was obviously right so to do. He was a solicitor with expertise in claims involving an international dimension. If he had failed to consider the issue of law and jurisdiction he would have failed in his duty. At the very least he ought to have advised that it would be strongly preferable for the agreement to contain an English law and jurisdiction clause. It is to be noted that Ms Meleagros, in her statement filed by the defendant in support of the claim against EY, was extremely critical of the Russian judiciary concluding that there was "a potential risk of an unfair trial (or indeed no trial) should the action be brought in Russia." There is no reason to suppose that Mr Custance was unfamiliar with this perception amongst practitioners in early 2009. In any event, Mr Custance was not an expert in Russian law and he could not properly advise upon the interpretation and enforceability of any agreement to which it applied. He ought to have put the claimant under express notice of these factors. He ought also to have raised the issue of the relevant law and jurisdiction in the context of following up the original intention that there should be a long form agreement. His failure to pursue this course also put him in breach of duty.

The question, however, arises as to what would have happened if Mr Custance had advised the claimant about the potential disadvantages of omitting an English law and jurisdiction clause from the agreement.

In my view it would have made no difference. I am satisfied that the claimant knew that there was no English law and jurisdiction clause and was well aware of the risk he was taking by accepting an agreement which did not contain one but went ahead regardless. I take the following features into account:

i) The claimant was, as I have already observed, an astute and hard-headed businessman alert to the commercial significance of where any dispute under a contract may fall to be litigated;

ii) The claimant would not need to be told by Mr Custance about the risk of litigating in Russia. He had worked there for many years and would have been fully aware of the prevailing perception of the hazards of resorting to the courts there;

iii) Mr Custance's earlier drafts had provided him with a written crib sheet which would further remind him of the desirability of an English law and jurisdiction clause and act as an aide memoire during negotiations;

iv) It is implausible that both the claimant and Mr Mandel would have failed to spot the omission of such a clause in the draft agreements;

v) The tone and content of the claimant's emails reveals that he is pleased with the deal and anxious to conclude it. Thus he could be expected to have been more ready to accept an agreement without an English law and jurisdiction clause rather than run the risk of putting a spanner in the works.

The fact that the case later pleaded against EY by the defendant on behalf of the claimant asserts that it was intended by the parties that the full agreement would contain an English law and jurisdiction clause falls far short of being determinative of the issue in favour of the claimant. The involvement of Mr Custance in the negotiations was very limited and in drafting the pleadings considerable reliance would have to have been placed on the claimant's account. It is that account which I have rejected.

I am also satisfied that, even if the claimant, contrary to my primary findings on the issue, would have acted differently had Mr Custance advised him to seek to negotiate an English law and jurisdiction clause (whether by pressing the matter more firmly in his negotiations or otherwise), this would not have made any difference to the outcome. On this point, I accept the contents of Mr Turowski's witness statement. I take into full account that this is a statement upon which the author has not been subject to cross-examination but this is a matter of weight rather than admissibility. This is despite the fact that the statement contains two errors relating to the date of the agreement and the issue as to whether it was envisaged that there would be a long-form agreement. Mr Turowski was sympathetic to the claimant. He knew how important the issue of law and jurisdiction had later become to the claimant as is evidenced in the secret recording. He no longer worked for EY Moscow at the time he made the statement. He had no compelling reason to misrepresent the position and I find that he did not. The fact that an English law and jurisdiction clause was included in a settlement with another employee on 21 December 2004 which was dealt with by EY's London counsel with the active involvement of London solicitors does not take the case of either side perceptably further. Accordingly, I find that there is no real or substantial chance that EY would have conceded the point even if pressed further by the claimant.

Causation and the LTD claims

For the sake of completeness, I will go on to consider whether, if Mr Custance had specifically considered the substantive merits of the LTD claim, he would have given the claimant advice which he would have followed and which would have given rise to a real and substantial chance of sustaining a claim thereunder.

The starting point for such an assessment must involve a closer analysis of the terms of the LTD policies.

The AGF policy provides for a waiting period of 52 weeks. Section 8 deals with assessment of the claim and validity. This provides:

"In order to assess the validity of any claim the Covered Person shall, upon request and at the expense of the Insurer, undergo a medical examination with a medical expert nominated by the Insurer.

As soon as the validity of claim is assessed, the benefits under this policy will be paid to the Covered Person in the currency of the policy.

Payment of any disability benefit will be subject to and depend upon the assessment of the medical expert so nominated…

The Insurer will ask any Covered Person receiving a pension under this policy to undergo medical examinations at intervals of not less than six months".

The claimant was never medically examined and so no disability benefits fell to be paid under this policy.

Section 5 provides for Short Term Disability:

"If a Covered Person is unable to perform his Own Occupation due to an accident or an illness prior to his 65th birthday, the Insurer will pay the Covered Person a temporary annuity after the Waiting Period. This annuity is paid monthly in arrears while the Covered Person is unable to perform his Own Occupation. This annuity is equal to 70% of a Covered Person's prior Annual Salary, after deduction of an offset equal to US$180,000, at the onset of the date of the Accident or Illness. It is decreased by any remuneration received by the Covered Person. The first and the last instalments are apportioned. It is subject to a maximum of US$120,000 per annum.

The payment of the Short Term Disability annuity stops:

- after the payment of the 25th monthly instalment

- on the attainment of the Covered Person's 65th birthday

- on the disappearance of the Covered Person

- when the Covered Person resumes full time employment in his Own Occupation

Whichever shall first occur".

Clause 4.1 of the Members' Booklet states:

"A full-time Member who is authorised to return to work on a part-time basis may continue to receive Short Term Disability payments from the Insurer, but they are reduced on a pro rata basis according to the number of hours work compared with a full-time work schedule. Benefits payable by the Insurer are reduced for Members who return to work so that the total income received by the Member (Insurer payments, salary, social security benefits, unemployment benefits etc) does not exceed 100% of the referenced salary".

Section 5 goes on to provide for Long Term Disability:

"If a Covered Person, after payment of the Short-Term Disability pension, is unable to perform any gainful occupation he receives a Long Term Disability pension equal to 70% of the Covered Persons prior Annual Salary after the deduction of an offset equal to US$180,000. It is decreased by any remuneration received by the Covered Person, the payment of Long-Term Disability pension stops:

- on the attainment of the Covered Person's 65th birthday

- on the disappearance of the Covered Person

- if due to natural recovery, surgical operation or medical treatment the Covered Person is able to resume a gainful activity.

whichever shall first occur".

The Members' Booklet at clause 4.3 expands upon gainful occupation as follows:

"If a Member, after payment of the Work Incapacitation Benefits by the Insurer, is still unable to resume any gainful occupation in relation to his education, skills, experience, the Insurer considers this state as a Long Term Disability, provided that it occurs before the 65th birthday and is accepted by the Insurers' consultant physician".

Clause 4.2 of the Members' Booklet also provides :

"In the event the Policy is cancelled Long Term Disability payments due to an Insured Event which occurred before the effective date of cancellation continue to be paid".

The Colonial LTD policy is expressed to be subject to the laws of Bermuda which, fortunately, are not for the purposes of this case materially different from those of England and Wales. Under section I of the policy, Colonial agrees to pay the benefits provided thereunder in accordance with its provisions.

In Section IV, under the heading "PROOF OF DISABILITY", the policy provides insofar as is material:

"When the Company receives proof that an insured is disabled due to…injury…the Company will pay the insured a monthly benefit after the end of the elimination period. The benefit will be paid for the period of disability…".

Under Section II of the policy, the elimination period is defined thus:

"Elimination period means a period of consecutive days of partial disability for which no benefit is payable. The elimination period is shown in the application and begins on the first day of partial disability".

There is no dispute that, under this policy, the length of the elimination period was 360 days as is set out in EY's application document for Group Long Term Disability Insurance of 2004.

Section IV of the policy states:

"PARTIAL DISABILITY or PARTIALLY DISABLED means as a result of the…injury which caused total disability, the insured is:

1 Able to perform one or more but not all, of the material and substantial duties of his own or any other occupation on a full-time or a part-time basis; or

2 Able to perform all of the material and substantial duties of his own or any other occupation on a part time basis.

To qualify for a partial disability benefit the insured must be earning less than 80% of his pre-disability earnings at the time partial disability employment begins".

From the wording of the definition of "partial disability" it will be seen that the injury in question must have satisfied the criterion of causing total disability. The policy defines the concept thus:

"TOTAL DISABILITY or TOTALLY DISABLED for an Extensive Own Occupation Benefit means during the elimination period and until the insured reached the end of the maximum benefit period he is:

1. Unable to perform all of the material and substantial duties of his occupation on a full-time basis because of a disability:

a. Caused by injury…;

b. That started while insured under this policy.

TOTAL DISABILITY or TOTALLY DISABLED means during the elimination period and the next 24 months of disability the insured is:

1. Unable to perform all of the material and substantial duties of his occupation on a full-time basis because of a disability:

a. caused by injury…;

b. that started while insured under this policy; and

2. After 24 months of benefits have been paid, the insured is unable to perform with reasonably continuity all of the material and substantial duties of his own or any other occupation for which he is or becomes reasonably fitted by training, education, experience, age and physical and mental capacity".

The application form provides for a 24 month Own Occupation Benefit and a maximum benefit period to age 65.

On the claimant's case, he would have been eligible for total disability payments after the expiration of the elimination period. However, the policy provides that:

"The monthly benefit will cease on…

4. The date the insured's current earnings exceed 80% of his pre-disability earnings".

In order to mitigate the potential harshness of this provision in certain circumstances, it is qualified by a note which provides:

"Because the insured's current earnings may fluctuate, the insurance company may average earnings over three (3) consecutive months rather than immediately terminating his/her benefit once 80% of pre-disability earnings has been reached".

The defendant raises no fewer than nine grounds upon which it asserts that the claimant had no real and substantial claim on the LTD policies.

First, it is contended that there is a factual unreality to the claimant's claim in that he himself did not make a LTD policy claim until November 2010. The court is asked to infer that the claimant did not believe that he had a good claim at an earlier stage. Reference is also made to the Generali Disability Claim (LTD) Form (Employee's Notification) completed by the claimant on 6 April 2011. In response to the section of the form requiring the claimant to identify the date when his disability first prevented him from carrying out his own occupation he recorded 4 June 2010. He expands on this in a footnote which states: "My work has dropped since 2006 and in 2009 dropped so I could not do job. I did part time 2009-10 but not anymore." He went on to record that he had "not done any work for ex-employer not any other" since 4 June 2010.

I do not find this to be a compelling argument. The claimant's opinion as to when it would be appropriate to advance his LTD claim is a relatively poor indicator of the time when such a claim could or ought to have been made. The relevant question is what the claimant would have done if he had followed proper legal advice and not what he did without such advice.

Second, the defendant points to the fact that the claimant returned to work in September 2006 and remained at work on full pay until approximately June 2009. It is asserted that the primary if not the only reason for the claimant entering into the 2009 Agreement was the animosity between him and Karl Johansson. The basis for the claimant's claim that he would have had an entitlement to benefits under the LTD policies must therefore be that he was entitled to bring such a claim although he was working and on full pay or that such a claim could be put on hold until approximately July 2009 when he chose to leave his then current employment. That, it is alleged, would be entirely contrary to (a) the proper construction of the LTD policies and the application of that construction to the facts and (b) the commercial purpose of such policies. The defendant claims that what neither LTD policy is designed to cover is the situation where an employee returns to work after an injury and is then paid their full remuneration package until they resign from their employment.

I accept that the claimant's problems with Karl Johansson played a significant part in driving him towards entering into the 2009 agreement. The email evidence fully supports this. Nevertheless, this does not mean that the claimant would not also have probably satisfied the respective medical thresholds laid down under the LTD policies in any event. I have carefully considered the various authorities to which reference has been made on the proper approach to the interpretation of such policies but remind myself that each case must be decided on its own facts. As to the level of the claimant's disability, reference should be made to the witness statements of Dr Calvert, Dr Churlikova and Dr Feeney. In particular:

i) the initial injuries sustained to the shoulder and foot were serious and likely candidates for significant long term disability. As early as August 2006 Dr Clavert considered that it would be three to six months before the claimant might be able to return to work part-time;

ii) the claimant continued to have unremitting problems with his shoulder and foot;

iii) in 2007 he was continuing to undergo physiotherapy treatment from Dr Churilova involving no fewer than 115 sessions;

iv) the physiotherapy sessions continued in 2008 with the same level of frequency despite which he began to develop adhesive capsulitis of sufficient severity to warrant a further surgical operation. It was not a success;

v) the level of symptoms continued unabated after the 2009 agreement.

Third, the defendant argues that work that the claimant was able to perform meant that he did not qualify under the "qualification period" for either LTD Policy or for any benefits payable thereunder. The defendant understandably relies on the fact that the claimant was able to travel extensively for business and pleasure after his return to work and there were times when his work commitments were sufficiently demanding to interrupt his communications with Mr Custance and others. I take this into account when assessing the claimant's chances of satisfying the terms of the LTD policies but I am not satisfied that these features indicate that his disabilities were materially less serious than appears from the medical evidence. The claimant was a well-remunerated, focussed and driven businessman and not the sort of employee who would readily succumb to even quite serious disabilities where willpower and determination could see him through. I am less persuaded by the claimant's argument that it is particularly significant that Colonial in its rejection letter had accepted that the claimant was disabled. It may well be that the confidence that Colonial had in rejecting the claim on the basis that the claimant had remained on full pay meant that they felt that there was no need to focus on the issue of disability and that if the claim had been pressed more formally they may have chosen to extend the grounds of rejection accordingly. It follows that, although this point is of some assistance to the claimant, it is not, of itself, determinative of the issue.

Fourth, whilst not disputing the contents of the statements of the doctors, the defendant contends that there is a gap in Dr Clavert's evidence from December 2006 to late 2008 and that Dr Churilova's evidence does not directly address the period from September 2006 to early 2009. The defendant asserts that having to attend physiotherapy sessions does not mean that the claimant was only physically able to work part-time in the sense required by the definitions in the LTD policies. It is alleged that the Claimant did not qualify for benefits under the LTD policies, properly construing and applying the definitions and requirements of those policies. On the face of it, the claimant was doing his normal job albeit attending physiotherapy sessions on a regular basis and neither LTD policy was designed to provide benefits in that kind of situation.

In my view, the gap in Dr Clavert's evidence relied on by the defendant is more apparent than real. His prognosis in 2006 was that the claimant would be limited to returning to work on a part time basis. The claimant continued to receive physiotherapy treatments at an unabated rate in the following two years. In the absence of evidence to the contrary, and taking the medical evidence as a whole, the clear inference is that the claimant remained significantly disabled over the relevant period before his condition deteriorated still further in 2008.

The question of whether or not the claimant would have been able to satisfy the insurers that the level of his disability over the relevant period fell within the terms of the LTD policies may have given rise to an issue but it is not one the answer to which is so obviously adverse to the claimant that it could be said that he had no real or substantial chance of prevailing on the argument.

The recurrent disability provisions of the Colonial policy provide insofar as is material:

"RECURRENT DISABILITY means a disability which is related or due to the same cause(s) as a prior disability for which a monthly benefit was payable.

A recurrent disability will be treated as part of the prior disability if, after receiving disability benefits under this policy, an insured:

1. Returns to his regular occupation on a full-time basis for less than [six] months; and

2. Performs all the material duties of his occupation.

To qualify for a recurrent disability benefit, the insured must experience more than 20% loss of pre-disability earnings.

Benefit payments will be subject to the terms of this policy for the prior disability.

If an insured returns to his regular occupation on a full time basis for [six] months or more, a recurrent disability will be treated as a new period of disability. The insured must complete another elimination period".

I am not satisfied that this provision is relevant to the circumstances of the claimant's disability. He received no benefits under the policy in respect of a "prior disability". He did not return to his regular occupation on a full time basis.

Fifth, the defendant contends that under both LTD Policies, it would have been a complete answer to the claimant's claim that he was on full pay and that the Colonial rejection letter was soundly based.

With respect to the Colonial policy, the defendant relies upon the fact that, under section IV thereof, partial disability benefits are expressed to be payable (subject to other contingencies) only following a period of total disability for which benefits were payable. The policy further provides that to qualify for a partial disability benefit the insured must be earning less than 80% of his pre-disability earnings at the time partial disability employment begins. The claimant continued to earn 100% of his pre-disability earning up to 30 June 2009 and therefore did not qualify for partial disability benefits.

Against this the claimant contends that the Colonial policy provides that the partial disability benefit will never be less than the minimum monthly benefit shown in the application which in this instance was $50. Accordingly, since the claimant would qualify to receive at least this sum then benefits were payable in respect of a period of total disability following which partial disability payments would become due.

I reject the claimant's argument on this point. On a proper interpretation of the terms of the policy the entitlement to any partial disability benefit was contingent upon fulfilling the 80% criterion. Once this and all other relevant contingencies were fulfilled then, and only then, would a partial disability benefit be payable in a sum no less than $50 per month. Putting it another way, the minimum monthly benefit was relevant only to the calculation of the quantum of payments and not liability to make them.

The claimant further argues that the Colonial rejection was premature. The 80% earnings provision applied only at the time partial disability employment began. By definition, this was after the expiry of the elimination period and the period of total disability which would not have occurred until June 2009. In response, the defendant points to the provision of the policy which provide that:

"The monthly benefit will cease on…

4. The date the insured's current earnings exceed 80% of his pre-disability earnings".

However, this term can only take the defendant so far. During the eligibility period the claimant was not entitled to claim monthly benefits. The Colonial rejection letter was sent within the eligibility period and purported to assert that in order to be eligible the claimant would have to have earned less than 80% of his pre-disability earnings throughout the 360 day elimination period. This is simply wrong. A monthly benefit cannot cease even before an entitlement to claim arises.

The position once the eligibility period expired would have been much less straightforward. Colonial would then have been in a strong position to argue that, by the application of the termination of disability benefits provisions, where the claimant's earnings exceeded 80% of his pre-disability earnings his entitlement to benefits would be extinguished.

If, therefore, Mr Custance had been asked to advise the claimant on the Colonial LTD policy at the time the rejection letter had been received he would probably have raised the option of a reduction in the claimant's salary to less than 80%. The defendant argues, however, that this would not have worked. Colonial, it is said, would have seen the move as being artificial and could have resisted the claims for benefit as a deliberate and legally impermissible attempt to bring about the circumstances to trigger the entitlement to benefits. I take the view that this was a relatively remote risk. The extent of the claimant's injuries and the impact which they had upon him and his work could very probably have been presented both plausibly and legitimately as a justification for reducing his salary. The fact that EY continued to pay his full salary does not prove that it would have been improper for them to have chosen not to.

More likely, however, is that even with proper advice on the Colonial LTD claim, the claimant would have decided not to take a cut in his salary before the end of the elimination period. Assuming that he was earning in the region of $700,000 per annum he would have had to have accepted a reduction in salary of at least $140,000. The benefits to which he would then be entitled would be no more than $50 because the "other income benefits" would have exceeded the maximum monthly benefit of $15,000 under the policy. The elimination period also coincided with a time over which the claimant was relatively optimistic about his medical condition the serious deterioration in which began in late 2008. The Colonial rejection letter put the claimant on notice that they considered that his earnings levels were a ground for rejecting his LTD claim. I consider that it is more likely than not that, if the claimant would have been hypothetically willing to reduce his earnings level, then he would have asked Mr Custance whether it was still too late so to do, but he did not.

On the other hand, by early 2009 and before the 2009 agreement had been entered into I find that it is more likely than not that the claimant would, if properly advised, have attempted to preserve his position under the policies by taking a reduction in salary. The value of such a potential claim must be reduced by the chance that Colonial would have argued successfully that the claimant's omission to claim total disability benefits upon the expiration of the eligibility period would, by 2009, have disqualified him from making a valid claim in respect of either total or partial disability benefits subsequently.

By the application of the principles laid down in Allied Maples Group Ltd. v Simmons & Simmons [1995] 1 WLR 1602 ^[6], the claimant would be precluded from recovering for loss of a chance prior to early 2009 because I have found that on balance he would not have agreed to a reduction in his salary. From 2009, however, he would probably have agreed to take a reduction and the calculation of damages depends on the loss of a chance based on third party contingencies.

Under the AGF policy, upon compliance with the notification terms a medical examiner would probably (not definitely) have reached the conclusion that he qualified as short term disabled under the terms of the policy. If the claimant continued to receive full pay then his benefits would be reduced to zero but this would not preclude him from making a subsequent LTD claim. It is also to be noted that the arbitration clause in section 9 of the AGF policy would have been likely to result in a more flexible approach to adjudication in the event of a dispute between the claimant and the insurer which, in the circumstances of this case would, on balance, be of strategic advantage to the claimant.

Sixth, for the purposes of the relevant definitions in the LTD policies, the defendant argues that the claimant ceased to be an "employee" and therefore an "insured" when he ceased his employment and entered into the 2009 agreement. Under the 2009 agreement, the claimant was a part-time consultant. It is claimed that the claimant's employment status in that role and work provided under that service agreement did not meet the requirements of the definitions under the LTD policies.

I reject this argument. I accept the claimant's contention as to the relevant date for the determination of whether the claimant was an "employee" in "active employment" and an "insured". To hold otherwise would lead to absurd results under which a totally disabled employee would have to be maintained in employment to be eligible and remain eligible to receive benefits under the policy. The defendant's interpretation is unsustainable and would lead to consequences which would be liable to defeat the whole purpose of the scheme with those most severely disabled being the most likely to lose out.

Seventh, under the Colonial LTD Policy it was a requirement that the Claimant had "regular attendance of a physician". The defendant contends that the physiotherapy sessions with Dr Churilova did not meet this test.

I regard this argument, too, as unsustainable. The definition of a "physician" in the Colonial LTD Policy is "a person who: is licensed to practise medicine and prescribe and administer drugs…" At paragraph 3.2 of her statement, Dr Churilova states "I am licensed by the Russian Government to practice medicine and prescribe and administer drugs". That evidence is uncontested. Furthermore, the claimant paid numerous visits to surgeons, specialists and other doctors, and underwent repeated surgery. Any challenge to a claim on this basis would have been doomed to fail.

Eighth, under both LTD policies, the continued benefits (the Partial Disability benefits under the Colonial LTD Policy and the Long Term Disability pension under the AGF Policy) were only payable if the initial benefits were payable or paid, which they were not. I have already addressed this contention above.

Ninth, the defendant asserts that it is necessary to apply the appropriate "loss of a chance" principles under which the claimant must demonstrate a "real and substantial chance" and, if so, the appropriate percentage reduction must be applied. The claimant does not dispute this approach but contends that any discount should be modest.

It will be appreciated that there arise many speculative permutations of what may or may not have been the outcome of Mr Custance's advice on the LTD policies if he had given them proper and careful consideration. I am of the view that, despite the hurdles I have identified, there would have remained a real and substantial chance of the claimant recovering payments under the policies. I do not think that it is appropriate or necessary to apply different discount rates to the two policies. The likelihood is that despite differences in wording the outcome in respect of claims against each would be similar and reflect the fact that they were broadly intended to provide a package of coverage.

The joint expert report of Mr Drewe assesses the full value quantum of the LTD claims discounted for early receipt and mortality in the sum of $5,530,190. I take this as my starting point, rejecting the alternative contentions raised by the defendant and based on the application of the Ogden Tables. In particular, the latter approach takes into account "contingencies other than mortality" which are not material to the assessment of damages reflecting the value of the LTD policies.

Bearing in mind my findings and the evidence as a whole, I would apply a discount to reflect the loss of a chance at the level of 50% which would have resulted in an award of $2,765,095 in this case in the event that the claimant had succeeded on the issue of liability. This is a result which would have been the same regardless of whether an overall view were taken or the chances of success were rated for each contingency separately.

RUSSIAN LAW AND JURISDICTION - HYPOTHETICAL CAUSATION ISSUES

My finding that there was no real or substantial chance, even if Mr Custance had advised that an English law and jurisdiction should be incorporated into the agreement, that such a clause would have therein been incorporated renders further consideration of the remaining hurdles he would have to surmount on this issue hypothetical. Nevertheless, and again for the sake of completeness having heard all the evidence, I will make findings on these issues.

I am satisfied that even if an English law and jurisdiction clause had been included then EY would still have sought to extricate itself from the deal and litigation would have followed. The motivation behind EY's action was first identified by the claimant in his email to Mr Custance of 16 February 2011 in the immediate aftermath of a conversation with Mr Labaude in which he records: "…first this lawyer said he was reviewing contracts for cost effectiveness." The object of the exercise from the point of view of EY was to get the claimant to accept the sum of $200,000 in lieu of the medical insurance cover which they were funding with CIGNA. Historic ill feeling between the claimant and those remaining with EY would doubtless have sharpened the appetite of EY to press the matter to a conclusion.

When the claimant commenced proceedings against EY, their defence included a contention that, on a proper construction of the contract, the claimant no longer qualified for CIGNA coverage and so there was no contractual requirement on EY to provide for its continuation. Alternatively, it was alleged that under the agreement the parties had expressly valued the coverage to be in the sum of $200,000 and that any claim in excess of this was too remote to be recoverable.

Issues of Russian law and jurisdiction were, indeed, relied upon by EY in their Defence but I am satisfied that they were not the issues which made the difference between litigating and not litigating. I am also satisfied that an application for summary judgment on the Defence would have failed even in the absence of any law and jurisdiction issue. Whatever the chances of eventual success at trial, the issues raised on the pleadings were too complex to be susceptible to summary judgment.

Accordingly, I am satisfied that the claimant and EY would inevitably have found themselves round the table discussing settlement terms. The remaining issue is as to whether the absence of an English law and jurisdiction clause gave rise to a real and substantial loss of a chance for the claimant to achieve a more generous settlement. In this regard, it is significant that EY had abandoned its claim to Russian jurisdiction before the claim was settled.

It would have been open to the claimant to waive privilege on any advice which he had been given by his legal team relating to the basis upon which his eventual settlement with EY should be calculated. Such advice would have been expected to deal with the impact, if any, the Russian law issue would be likely to have. However, the claimant has elected not to waive privilege. That is his right and it would be entirely inappropriate for this court to draw any adverse inferences from that choice. However, this does inevitably mean that the material upon which I have to base my decision is limited as a result of this omission.

The issues of Russian law which EY's defence sought to raise related in broad terms to contentions that only natural persons and legal entities can enter into contracts and that a written agreement must be sufficiently certain and clear to be enforceable. The claimant's Reply was drafted by Nicholas Craig who it may be recalled was the author of the positive advice to the claimant on the issue of jurisdiction. This pleading contained a very full response on the topic of Russian law (if it were held to apply) which included the following averments:

i) Article 181(2) of the Russian Civil Code provides that a party loses the right to challenge the validity of any transaction after the expiry of one year from its conclusion;

ii) Mr Turowski had a power of attorney binding on all relevant legal entities in the EY group;

iii) the terms of the contract were sufficiently clear by the operation of Article 431 of the Russian Civil Code;

iv) even if the agreement were invalid, the consequence of Article 167 of the Russian Civil Code would be to put the claimant in the same position as he would have been in if the agreement had not been concluded thus entitling him to the benefits of CIGNA healthcare for him and his family.

The claimant relies on the following:

i) in an email to Mr Custance dated 21 February 2011, the claimant said that Herve Labaude had told him over the telephone that he had received advice from outside Russian lawyers to the effect that they did not believe that the agreement was enforceable under Russian law;

ii) EY's Russian lawyers must have provided sufficiently positive advice to enable the point to have been taken in the Defence;

iii) his wife had taken the agreement to an in-house Russian lawyer at the firm at which she worked and had been advised that it would be unenforceable.

I find that these contentions lack force for the following reasons:

i) Mr Labaude was a deeply unreliable source of second hand information as to what legal advice he had received. He was partisan and hardly likely to be trusted to give either an accurate or an objective account of any such advice. On the claimant's own case, Mr Labaude was a scheming and unscrupulous man responsible for threatening to "crush" Mr Mandel for daring to reopen allegations that EY had been involved in bribing the Russian courts. The claimant's email is conspicuously lacking in any detail as to the basis upon which Mr Labaude was asserting that the Russian lawyers had reached the conclusion he claimed that they had. Indeed the only specific point was that "coverage for life" under Russian law is probably not enforceable. This is a contention conspicuous by its absence from EY's eventual pleaded defence. No written copy of any such advice was ever deployed by EY. I conclude that this evidence is worthless.

ii) The fact that matters purporting to raise issues of Russian law feature in EY's defence fall far short of establishing that these points had any prospect of success. They were pleaded assertions and no more. Furthermore, it is unclear whether and to what extent Russian law would have been any more (or less) favourable to EY than English law.

iii) Finally, the claimant's second hand anonymous hearsay assertion of what his wife's colleague is said to have told her is also devoid of weight. There is no indication of what specific expertise this lawyer had in contractual matters. There is no evidence as to what information, if any, she was given as to the circumstances leading up to the agreement under challenge. There is no particularisation of the basis upon which the lawyer purportedly reached her conclusion. There is no indication as to the level of formality or confidence with which this conclusion was reached. No written note was made of the substance of the advice. Neither the lawyer nor the claimant's wife have given evidence on the point.

It follows that the claimant's protestations of concern over the law and jurisdiction issue are signally lacking in concrete and reliable support.

Furthermore, there were strong incentives for the claimant to settle the EY litigation which were unrelated to the issue of the application of Russian law. It had impacted adversely on the health of him and his wife. The costs of litigation were mounting. The claimant's leading counsel became seriously ill at a crucial moment during the process. If a settlement were not reached then there would be an eight month delay until the matter came to trial. The litigation was interfering with the claimant's plans to move to live in Miami.

Accordingly, I am not satisfied that the claimant has discharged the burden upon him to show that the absence of an English law and jurisdiction clause made any material difference to the outcome of his claim against EY. This finding, however, does not impact on the settlement already entered into by the parties relating to the irrecoverable costs incurred by the claimant in resisting EY's jurisdiction challenge.

Furthermore, the hypothetical quantification of the value of the 2009 agreement claim as a whole was blown off course when the joint expert, Ms Buckle, produced late in the day a valuation which far exceeded the best expectations of the claimant and the worst nightmares of the defendant. This prompted a call from the defendant for the opportunity to put further questions to her to test, in particular, the legal sustainability of her conclusions. In the light of my findings on liability and causation, I do not propose to say anything further on this issue.

CONTRIBUTORY NEGLIGENCE

The defendant argues that if it had lost on the issues of breach of duty and causation then the level of the claimant's damages should have been reduced to reflect a level of contributory negligence on his part. I am not inclined to adjudicate on this hypothetical issue. I have found that the claimant took a deliberate and calculated risk when entering into the agreement without an English law and jurisdiction clause. This was a commercial decision which he was perfectly entitled to make. In order to resolve the issue of contributory negligence I would therefore have to hypothesise that this omission was down to no more than careless oversight. Although I have tried to resolve some of the more salient, albeit counterfactual, issues in this case, there must be a limit to the extent of the conjecture proportionate to the task in hand. On this issue, that limit has been reached.

LIMITATION OF LIABILITY

The defendant raises the issue of the application and efficacy of the limitation of liability terms referred to in Mr Custance's original retainer letter. In the light of my other findings in this case, it is unnecessary for me to resolve this question. I would note in passing, however, that it would have been a considerable challenge for the defendant to discharge the burden to prove reasonableness imposed by the provisions of the Unfair Contract Terms Act 1977 in the absence of evidence relating to how far it was open to it to cover itself by insurance.

CONCLUSIONS

In summary, I have found as follows:

i) although the AD&D claim did not come to trial, Mr Custance's advice on the cover provided under the AD&D policies was negligent. He ought to have considered the terms of the policies themselves and he should not have relied exclusively on the contents of the Members' Booklet;

ii) Mr Custance's original retainer did not extend to advising the claimant on issues relating to LTD cover;

iii) subsequent references to LTD in exchanges between the claimant and those acting on his behalf and Mr Custance, were by way of setting the background context and, latterly, to define an element in the claimant's broad negotiating objectives. Mr Custance was not expected to analyse the scope and contents of the LTD policies;

iv) no duty to warn arose on the facts of this case;

v) if, contrary to my primary findings, the claimant had established liability in respect of his LDT claims then the quantum of his loss would have been $2,765,095;

vi) Mr Custance was negligent in failing to point out and strongly recommend to the claimant that the terms of the agreement negotiated with EY should include an English law and jurisdiction clause;

vii) the claimant knew that the 2009 agreement did not contain an English law and jurisdiction clause and chose to proceed in any event;

viii) EY would not have agreed to the inclusion of an English law and jurisdiction clause;

ix) the claimant has not proved that the potential application of Russian law reduced the level of his settlement with EY following the dispute over the 2009 agreement;

x) the assessment of the quantum of the 2009 agreement claim had it been made out; the level, if any, of contributory negligence; and the operation of the defendant's limitation of liability terms do not, in the light of my other findings, fall to be resolved.

Note 1   Where nothing turns on it I will, for the sake of convenience, generically refer in this judgment to any and all companies in the Ernst and Young group as “EY”.    [Back]

Note 2   All references to dollars in this judgment are, for the avoidance of doubt, to US dollars.    [Back]

Note 3   By way of salient example, in Mr Custance’s case, by the time he approved the response to the claimant’s letter of claim he had forgotten that he had ever received the Colonial LTD policy and wrongly denied even the existence of the Colonial AD&D policy. He realistically accepted in cross examination that a closer and more thorough examination of the contemporaneous documentation would have shown that his recollection was wrong.    [Back]

Note 4   Where I have quoted passages from the emails, I have tended not to qualify any substantive inaccuracies or spelling and grammar lapses with “sic”. This is to avoid making this judgment appear to be even more cluttered and pedantic than it already is.    [Back]

Note 5   Europe, Middle East, India and Africa.    [Back]

Note 6   As summarised in Jackson and Powell “Professional Liability” 7th Ed at 3-007: “(i)Where the question is what the claimant would have done, if the defendant had given competent advice or had otherwise acted competently, this is determined by the court on the balance of probabilities. Damages are then assessed on that hypothesis without any discount to reflect the possibility that the claimant might have acted differently. (ii)Where the question is what some third party would have done, if the defendant had performed competently, damages are assessed on a “loss of a chance” basis. The court must consider what are the chances that the insurers would have paid out; or that the “other side” would have yielded; or that the judge in the original action would have found for the claimant on liability; and so forth. The damages must then reflect the value of this chance which has been lost.”     [Back]