AN CHÚIRT UACHTARACH
THE SUPREME COURT
LK Shields (a Firm)
Judgment of O’Donnell J delivered the 18th of April 2018
1 This case raises, in a neat way, a difficult issue as to the calculation of damages for professional negligence occurring in the context of a property market that experienced considerable fluctuations in value. The case also illustrates a truth about litigation that is not always apparent from the reported decisions of appellate courts. It is not always the case that the issue upon which the case is ultimately decided is present and recognised as central at the outset of the case or during the trial. On the contrary other issues, often factual, may loom larger in the trial and engage the focus and energies of the parties and the court. It is important therefore when addressing the important issues of law in any case, to have an appreciation of the range of other issues which were agitated at the trial and which shaped the evidence before the court, and the approach of the court to the case.
2 The claim here is one of professional negligence brought by a client against its former solicitors. Nothing, for present purposes, turns on whether it is viewed as a claim for breach of a contractual duty or a parallel duty in tort arising out of the parties’ professional relationship. It is not, and was not in dispute at the trial, that the defendant firm was clearly negligent and in breach of its duty in carrying out an important though routine task on behalf of its client, the plaintiff company, which was itself blameless.
3 The facts are set out very succinctly in the judgment of the High Court (Peart J). In February 1994 the plaintiff company had agreed to buy property known as Unit 520 Western Industrial Estate, Naas Road, Dublin 12, for a sum of £765,000 from a company called Packaging Resources Limited (“PRL”). The defendant firm acted as solicitors for the plaintiff company in the conveyancing transaction. The property was bought with a loan from AIB, and it was accordingly necessary to complete the conveyancing of the property from PRL to the plaintiff and to deliver title to AIB as security. There was nothing unusual about this. The purchase price was paid and the transaction closed on the 6th of May 1994. There remained some outstanding matters to be completed, which were covered by undertakings provided by the vendor’s (PRL) solicitors. Again, this was unexceptional. In the event however, some of these subsequent steps were not completed by the defendant firm, and that has given rise to these proceedings.
4 The title to Unit 520 comprised five lots which were made of five separate titles. Lot 1 was registered title, Lots 2 and 4 were unregistered title, Lot 5 was possessory title and Lot 3, which was the source of the difficulty in this case, was partly registered and partly unregistered. It was never in dispute that the vendor, PRL owned and had title to all the property and had agreed to sell it to the plaintiff company.
5 The registered portion of Lot 3 was itself a part of the property contained in Folio 23011F County Dublin. Accordingly, it was necessary to register the purchasing company, the plaintiff herein, as the owner of that portion. That involved opening a new folio in respect of that portion of the property purchased by the plaintiff and leaving the balance in Folio 23011F in the ownership of PRL. Given the fact that the transaction had been effected, the registration of the plaintiff’s title to the portion of Folio 23011F ought to have involved little more than the lodging of the deed of transfer and a clear map with the Land Registry, and this the defendant firm set about doing. PRL’s solicitors had given an undertaking to facilitate Land Registry queries and assist in that process. It appears that papers were indeed lodged by the defendant firm with the Land Registry in 1996. As it happens, a prior deed of transfer from an earlier owner, Pension Nominees to PRL, had itself not been registered at this time, and accordingly the defendant firm undertook the registration of that transaction as a necessary part of the registration of the plaintiff’s title.
6 However, an issue arose because the Land Registry rejected the map submitted. The defendant firm wrote to PRL’s solicitors asking them to furnish another map, which, of course, that firm was obliged to do, since it had undertaken to deal with Land Registry queries. Again, this sequence is not unusual. However, the process dragged on with the defendant firm pursuing the issue sporadically over the next few years. I infer, perhaps wrongly, that the very routine nature of the task, and the fact that the transaction had closed, the purchase money had been paid, and that there was no dispute that the plaintiff company was the owner and occupier of the entire property, meant that the completion of these matters was not a matter of priority for the vendor company, its solicitors, and increasingly for the defendant firm. This is not however an excuse. Professional firms are retained, and paid, to carry out just those formal, tedious, routine, but important, tasks. Part of the service which a client is entitled to expect from a solicitor is attention to those tedious, technical, but important, issues of detail. After further fitful, but in the event, unavailing, attempts to obtain action from the vendor’s solicitors, the defendant’s firm file fell silent in or about the year 2000. During this same time period there had been correspondence by the defendant firm with the plaintiff’s bankers AIB, forwarding all the existing documentation and informing the bank that the matter of registration was being dealt with by the Land Registry and once the plaintiff company was registered, the appropriate documentation would be forwarded to the bank. That correspondence too petered out.
7 This then was the position in 2007 when the events giving rise to these proceedings occurred, with one additional complicating element. As already observed, the position at all times was that there was never any doubt but that the plaintiff company was the owner, and in occupation, of Unit 520. It had however not been registered as the owner of that portion of Folio 23011F contained in Lot 3. It was not, and never was in doubt, that it was entitled to be so registered. However, in 2005 PRL sold the balance of the lands in Folio 23011F to Bank of Ireland Trust Services. This transaction was effected by a simple transfer of that folio. Accordingly the documentary title purported to show Bank of Ireland Trustees as the owner of the entirety of the land in the folio. Once again it should be said that this was an issue of paper title only. Bank of Ireland trustees did not assert any entitlement to the land in Folio 23011F occupied by the plaintiff company and in relation to which the application for registration had been made but not completed by the defendant firm. As already observed, clearly the defendant firm was in breach of its duty to Rosbeg, but so long as nothing was done in relation to the transfer of ownership of the land, there was no necessary impact on Rosbeg, or indeed, as it happened, any awareness on the plaintiff’s part of the issue, since it was not contemplating sale and because it was not under pressure to complete the details of the conveyancing. However, around 2007 as the market climbed to new heights, the plaintiff began to consider selling what it had purchased in 1994, that is, Unit 520.
8 It is not disputed that the defendant was negligent in failing to secure the registration of the plaintiff’s title. There was therefore, in colloquial terms, a title problem. It is important however to identify clearly the problem, such as it was. There are many cases of solicitors’ negligence in conveyancing transactions which can result in a permanent title defect which is not capable of being remedied. In such a case, a client may have expended monies and obtained a title which is effectively worthless. This can lead to substantial damages, particularly if the market is rising. That however is not the case here. It was common case that the problem here was a failure to take certain steps in any reasonable time scale. But the transactional steps which were left undone, were always capable of being carried out and were eventually completed (by other solicitors retained by the plaintiff) when the problem came to light. Indeed it was agreed by the conveyancing experts who gave evidence that the state of the documentary title as of 2007 did not prevent Unit 520 from being sold. It would have been possible to offer a contract with a special condition covering that portion of the title and addressing the question of the registration of the portion of Folio 23011F, providing perhaps that such a registration would be effected by the closing date. The problem, though real, was curable, and even while it existed was not such as to preclude the possibility of selling the property to a willing purchaser, and in a rapidly rising market in particular it is not difficult to imagine such a transaction. This after all was what had occurred in effect, on the sale from PRL to Rosbeg.
9 It is important to recall that 2007 marked what in retrospect can be recognised as the zenith in the property boom in Ireland. Property had been increasing in value at dizzying pace, and this land was no exception. The plaintiff company had borrowed €5.9 million from AIB in 2005, and as a term of that borrowing had agreed that there would be a reduction in borrowings of €8 million by January 2007 from the proposed sale of Unit 520. There is no sense however that the plaintiff was being pressurised to sell by that date, which indeed passed without any such sale. It may be that both Rosbeg and the bank were comfortable with the fact that the plaintiff was the owner of an asset which at that time was extremely valuable and appreciating. Nevertheless, it is clear that by this stage a sale was being actively considered, and architects were retained to advise on the manner in which the site’s development potential, and therefore value, could be maximised.
10 The principal of the plaintiff company was a Mr Bob Stewart, an experienced businessman. The plaintiff company was represented in property matters by Mr Ben Pearson, an agent who was very familiar with this property. The property immediately adjoining Unit 520 had recently been sold at a very good price to the late Mr Pino Harris, a well known businessman who had substantial property interests in the area. Mr Harris was an obvious potential purchaser, and indeed given his ownership of the adjoining land and desire to engage in development, quite possibly a special purchaser who would pay the best price for the site. Mr Harris for his part was represented by Mr William Harvey, a property agent. Mr Harvey and Mr Pearson knew each other, and indeed were very familiar with the land. They had acted for the respective parties, Mr Harvey for PRL and Mr Pearson for Rosbeg, when PRL had sold Unit 520 to the plaintiff company. Mr Harris had a right hand man, Mr John Burns, whose function it was to engage with, and deal with, the detail of transactions. For its part the plaintiff company had a financial controller Mr McConvey who was also involved in discussions within the company, and with the bank. Much of the factual dispute which occupied so much of the hearing of the High Court, was concerned with the dealings between these six people and the evidence which they gave.
11 In 2006 a verbal offer of €6.5 million was received by Mr Pearson from Mr Harvey on behalf of Pino Harris. The plaintiff company did not accept that offer or pursue it as Mr Stewart felt that the value was increasing and he was prepared to wait. The plaintiff company had a valuation from DNG of €10 million and Mr Stewart apparently believed that the property could achieve a price of €15 million. The High Court found that Mr Stewart subsequently told Mr Pearson that he would like to get €12 million but the backstop figure was €10 million.
12 In September 2007 Mr Harvey contacted Mr Pearson with a formal offer of €10 million. This was put in writing in an email from John Burns to Ben Pearson on Friday 21st of September 2007:
13 A number of things may be observed about this communication. Most importantly it was “subject to contract” and therefore even if accepted would not have constituted a binding and enforceable contract. It did not itself raise any question of title and although it referred to a specific site area, all that was required in this regard was confirmation of the area. On the other hand the letter is clear evidence that the property was actively on the market and could have been sold, speedily indeed, all other things being equal. The offer was discussed within the plaintiff company. The trial judge found that Mr McConvey was deputed to get a map from the defendant firm and Mr Pearson gave evidence that he recollected that he had been told that Mr Stewart wanted to proceed. Mr Pearson gave evidence that he rang Mr Harvey and informed him that he had instructions to accept the offer, but wanted more time. The deadline for acceptance was extended by a week to the 5th October 2007.
14 There was considerable debate in the High Court as to whether there was ever any agreement, even subject to contract, at a price of €10 million. As it happens, the Harris side were prepared to give evidence on behalf of the defendant firm. The thrust of their evidence was that the plaintiff company had never reached the point of even tentative agreement on a price, let alone an agreement to sell. However the trial judge did not consider it was necessary to go so far as to find there had been a communicated agreement. He was satisfied that a decision had been made by the plaintiff company to sell Unit 520 for €10 million at this time, and he was also satisfied, that other things being equal, and if the problem with the title had not emerged, a contract would have been entered into and the property sold at that price, relatively soon thereafter. Accordingly, this fixed a value for the property which the court considered could realistically have been achieved but for the admitted negligence of the defendant. It is necessary now to turn to consider the impact the defendant’s negligence in failing to secure the registration of Rosbeg in respect of that portion of registered land contained in Lot 3 was found to have had upon this state of affairs, as found by the trial judge
15 The problem with the title to Lot 3 emerged in a curious way. While completing the purchase of adjoining lands, the Harris side became aware of the fact that Folio 23011F had been transferred to Bank of Ireland Trustees, and therefore purported to include a portion of the land included in Lot 3, and which was occupied by the plaintiff company and under negotiation between Rosbeg and Harris. The Harris side brought this to the attention of Rosbeg and told them to come back, “when they had sorted out the problem”. As the trial judge observed, this may simply have been a negotiating tactic, (and it certainly has that flavour) but whatever the motivation, the fact was that Rosbeg was stalled in its desire (as the judge found) to sell the property just at a time when the property market was at a high but would soon start to soften and then go into a precipitous decline.
16 The trial judge considered that the plaintiff had lost the opportunity to follow through on its own decision and sell the property to Mr Harris. The plaintiff company did set about regularising the documentary title and did keep in touch with the Harris side. At some point in 2008 at least, it was clear that the plaintiff would be able to have itself registered as the owner of the relevant portion of Folio 23011F. The latest possible date for this is October 2008 when the registration was actually effected, but it seems probable that the plaintiff would have been in a position to at least demonstrate its ability to do so earlier, and as we shall see the plaintiff said so as of July 2008. It is not however necessary to attempt an estimate of the precise date. Given that the defendant had failed to secure the plaintiff’s registration over a 14 year period the court was entitled to take the October 2008 date as the point at which, at least definitively, the defendant’s negligence had been cured. However by that time the plaintiff said, and the High Court agreed, that a course had been set which caused the plaintiff to suffer further substantial losses because of the fall in the value of the property.
17 There are at least two other important events in particular which require to be noted, and which were hotly debated between the parties. Mr Pearson contacted Mr Harris in January 2008. It was clear from the discussion, and hardly surprising given the dramatic events in the financial world with a significant impact on the Irish property market (the collapse of Lehman Brothers that led to a paralysis in the bank lending which up until them had fuelled the Irish property market) that Mr Harris was no longer willing to offer €10 million. But in February 2008 Mr Harvey reverted to Mr Pearson with a verbal offer of €8 million. Rosbeg’s response however was to ask that this offer be put in writing. Mr Harvey replied that Mr Harris was still interested in purchasing because he (Mr Harvey) had been asked if there was any response to the offer, but he (Mr Harvey) did not think it was a good idea to ask Mr Harris for written confirmation, as Mr Harris might take that as a suggestion that his word was not to be trusted. Mr Stewart for his part considered that response to be “risible” and did not respond to the offer at that point. The following month however Mr Pearson responded with Mr Stewart’s instructions that the plaintiff would not accept the €8 million figure but was prepared to negotiate on the €10 million figure that had been on the table in September 2007. There was no response to this. In April 2008 Mr Pearson was instructed to ask for €9 million, and perhaps unsurprisingly that overture produced no response. Mr Stewart’s evidence was that he accepted the market had softened, but not to the extent that the property was now worth €8 million. The parties by this stage clearly had different views as to the progress of values in the market.
18 In July 2008 Mr Stewart was becoming more anxious to dispose of the property and AIB was now becoming more urgent in exerting pressure, seeking a sale which again was perhaps a reflection of the deterioration of the market. Again, an effort was made to reopen negotiations and a letter was written at this stage (July 2008) informing Mr Harvey that the title issue was resolved and that the plaintiff was in a position now to deal with Mr Harris if he was still interested. In August, whether in direct response or otherwise, Mr Harvey made a verbal offer to Mr Pearson of €6 million. The plaintiff company refused this offer as it did not believe it represented the state of the market. On the 28th of August Mr Harvey responded by a letter that Mr Harris was still interested, and by that stage was one of the very few individuals who could conclude a purchase speedily, since in the current climate, Mr Harris was not dependent on bank funding. Accordingly, Mr Harvey asked for the plaintiff’s minimum price. The plaintiff responded almost a month later on the 23rd September 2008 and after some introductory paragraphs indicated a willingness to sell at €8.5 million. A further month later, on the 22nd October 2008, Mr Harvey replied that Mr Harris took a pessimistic view of the possibility of development in the immediate future, and unfortunately therefore the price he was willing to pay had not changed since the last conversation between Mr Pearson and Mr Harvey (presumably the August conversation with the offer of €6 million). Mr Harvey expressed his disappointment that they had not been able to do business.
19 By the time the action was heard in the High Court in 2013, it was agreed that the value of the property had dropped even further. On the plaintiff’s evidence it was worth only €1 million, and on the defendant’s €1.5 million. The judge accepted the higher figure and concluded therefore that Rosbeg had suffered direct loss of €8.5 million being the difference between the figure at which he considered the plaintiff intended to sell and could have sold in September/October 2007, and the value at the time of the High Court hearing almost 6 years later. In addition he accepted that if the sale had been achieved in September/October 2007 the AIB loan would have been discharged. It was not discharged and interest continued to accrue on the loan. Furthermore, had the transaction been concluded in 2007 the Capital Gains Tax chargeable would have been calculated at a rate of 20%. However, the plaintiff would now it seemed, incur CGT at a higher rate of 33%. In addition therefore to the figure of the €8.5 million for the loss in value of the property, there was a figure of additional interest of €1,452,961, and a figure in respect of additional tax of €1,124,248. The total sum awarded was therefore €11,077,000. The plaintiff company also retained the property and has, it appears, been in occupation throughout the period.
20 There is no dispute that €11 million represents a very substantial award of damages, and a decision that demands close scrutiny. It is unsurprising that the defendant firm appealed the decision. After all, the plaintiff company did not have an agreement, still less, a binding contract to sell in 2007, and did not sell thereafter. There were many parties who owned property in Ireland, and commercial property in particular, who saw its value plummet between 2008 and 2013, and many of those may have been tantalisingly close to a sale just before the market peaked. Such parties saw the value of the property decline precipitously and sometimes with devastating consequences for their own solvency. The plaintiff however, if the High Court judgment is correct, not only avoided that, but has substantially profited, since it retained the land and the potential that an upturn would increase its value.
21 A key factor in the court’s determination was the conclusion that not only had the plaintiff company intended to sell to Mr Harris in 2007 at the price of €10 million, but that it would have done so. In circumstances where the defendant had available to it the evidence of Mr Harris’ side, who maintained stoutly that no such deal was done or in the circumstances was likely to have been done, it was unsurprising that the defendant contested that assertion both in the High Court and on appeal. The evidence of the negotiations showed that the plaintiff company through Mr Stewart, was at a minimum always optimistic about the price. In the admittedly unforgiving glare of hindsight, it seems clear that the plaintiff was probably unrealistic about the market both as it advanced and declined. If however this was the case, the plaintiff would not have been alone. The Harris side’s view, for its part, was that the plaintiff was not serious about getting a deal, and was always vacillating, in the hope of getting a better price. It is difficult to form a clear view about negotiations between a small group of business people, which left very little in the way of a written record, particularly when it is inevitably viewed in hindsight through a lens significantly distorted by the enormous impact of the property collapse in Ireland. It is also more difficult to analyse the reasoning on the factual issues because the judgment rarely refers to direct evidence and instead provides a narrative at a more general level. It is for example difficult to analyse the key conclusion that a contract would have been concluded between Rosbeg and Harris, when it is not clear what primary facts were found in this regard, what evidence accepted or discounted, and what inferences were drawn if any, from facts established by evidence.
22 It is important to remind ourselves that courts should approach claims such as this not simply on the basis of the genuineness or plausibility of witnesses, but by applying common sense and some degree of scepticism. Litigation inevitably shines a very bright light on the events the subject matter of a claim, but it is also a distorting process in at least two ways. First, there is an inevitable tendency to highlight and focus only upon the issues which are particularly relevant to the claim. Second, the light is being shone in retrospect, when we know the outcome of the events. Inevitably, there is a tendency to recall events and attribute to them a significance in the light of what is known to have occurred subsequently. This is not a reflection on the honesty of witnesses, rather it is human nature. Persons involved in routine car accidents will regularly tend to recall events in a way which discounts or avoids their own culpability. It is not unusual to give ourselves the benefit of the doubt, in any field, and all the more so when the stakes are high. The hearing of some contested cases may sometimes involve a direct conflict of evidence in which the only conclusion is that one of the parties must be giving evidence which is deliberately false. However, that is relatively rare. In many cases courts must sift through differing accounts at some remove in time from the facts, and do their best to allow for human error and the tendency for memories and consequently accounts to become subtly and unwittingly adjusted under the focus of a case, and in the light of the consequences of failure. When dealing with calculations of loss, it is also important for courts to recognise that it is a lot easier to make profits on paper than in real life, and particularly when the exercise is being carried out in retrospect, when all the imponderables which make business so difficult to plan in advance, are known and fixed. Just as there are many more ambitious, though plausible, plans advanced in board rooms and financial institutions seeking financial support than are brought to success in real life, so too it is easier to produce the narrative of commercial success in a court room, than it is perhaps to achieve that success in reality. Courts must, and do, try to bring an appropriate scepticism therefore to their task at each stage of litigation. Given the views expressed by the Harris side, the very substantial award made, the apparent over optimism of Rosbeg, and particularly when viewed in retrospect, it is perhaps not surprising that the defendant appealed.
23 The Court of Appeal, while acknowledging the force of the defendant’s arguments nevertheless considered that on a faithful application of the well known principles of Hay v O’Grady  1 IR 210, that on balance, and not without some doubt, there was sufficient evidence before the High Court to justify the conclusions of that court in fact. I respectfully agree. The division of functions between appellate courts and trial courts means that appellate courts must respect and give due deference to a trial court’s fact finding function. The corollary of this of course, which is perhaps less often adverted to, is the importance of the trial court approaching that task rigorously, conscientiously, and testing its preliminary conclusions, with an appropriate degree of scepticism, and thereafter setting out the facts found and the inferences drawn in a way which permits review. However, in this case, I agree that the conclusions on issues of fact made in the High Court judgment are beyond challenge at an appellate level. There was evidence upon which the trial judge could arrive at the critical conclusion that Rosbeg intended to sell at a price of €10 million in late 2007, and some evidence, that it would have been able to do so. The question however remains whether on such facts the defendant’s admitted negligence gave rise to a loss in excess of €11 million.
Motion to admit fresh evidence
24 The appellant sought to adduce fresh evidence on this appeal. As the proposed evidence related to matters which occurred after the High Court hearing, leave of the court was not required, but since the admission of such evidence is within the discretion of the court, it was appropriate to bring a motion setting out the proposed evidence and seeking its admission.
25 The appellant had become aware that the lands in question had recently been sold and moreover to a company in the Harris group of companies. It appears that Rosbeg’s bankers, AIB, had appointed receivers to the business of Rosbeg. It emerged in correspondence between the parties that there had been litigation between Mr Stewart and the receivers which had been settled on terms which involved a transfer of the lands in Unit 520 to Mr Stewart. The company maintained however that the settlement between Rosbeg and Mr Stewart was confidential and that the details could not be revealed, but stated that a “desktop valuation” valued the property at €1 million. Mr Stewart had then sold the company to the Harris company and remained a director of the company. However the plaintiff company also maintained that it was not in a position to ascertain the sale price achieved by Mr Stewart. The defendant firm was understandably suspicious about these transactions and sought to have the evidence admitted because as it was put in the grounding affidavit of their solicitor “it shows that if damages are assessed by reference to a figure, said to represent the value at the date of trial of property (ownership and possession of which is still enjoyed by Rosbeg) in a rapidly declining market, the result is an arbitrary, excessive and unjust measure of damages which excessively compensate for what is a mere loss of opportunity. Here it transpires that the land in question was, after the award of damages in the High Court, sold on to the original interested purchaser at a price which the plaintiff says need not be disclosed because of the intervention of a director of the plaintiff/respondent by way of a settlement of some asserted claim”. Rosbeg resisted the application to adduce the evidence maintaining the position set out in correspondence namely that there had been a transaction between Rosbeg (in receivership) and Mr Stewart in settlement of his proceedings, and that Mr Stewart’s subsequent sale of the property was not something within the control or knowledge of the company.
26 Although I have said that the defendant company wished to have “the evidence” admitted, there was some lack of clarity as to what precise evidence was sought to be admitted, and furthermore what any such evidence might prove. It appears that the defendant firm wanted to adduce the correspondence exhibited in the application, and possibly the grounding affidavit, but if so, it was not clear what these matters proved. The affidavit was a vehicle to exhibit documents, and the documents themselves (even assuming they could be proved by the deponent) were not proof of the truth of their contents. Even if these difficulties are ignored and the documents treated as proved and as evidence of their contents they did not establish either the sale price to Mr Stewart, or the price sold on to the Harris company. The exciting of suspicion is not the same as adducing evidence. Other than suggesting, rather than proving, something which the court might have inferred in any event, namely that the value of the property had increased since the date of the High Court hearing, it is not clear how this was relevant to the matters advanced on this appeal. Accordingly, I would not admit it in evidence. This illustrates the fact that parties should be clear about the evidence that is sought to be adduced as fresh evidence, and the distinction between the application to be permitted to adduce such evidence and the evidence itself. It might have been different if direct evidence was adduced of value, which itself showed a substantial increase in value in the hands of Rosbeg. Indeed such evidence is not dependent on an actual sale or transfer. Experts may give evidence of market movement and of the value of individual properties at different times. If therefore there had been a substantial increase in the value of the property from the date of the High Court judgment, it might have been a relevant matter which could have satisfied the test in Fitzgerald v Kenny  2 IR 383, and MD v ND  IESC 18. However, it is not necessary to decide that issue here. No such evidence was adduced, and on the view I take of this case, it would in any event not necessarily have been relevant to the issues in the appeal.
27 The award here was on any view substantial. Looked at again from the point of view merely of market value, it might be possible to trace the movement in value of Unit 520 over time. Such a graph of that value might have shown a steady rise, then a sharper increase to a peak in 2007/2008, followed by a steep dizzying decline to a nadir around the time of the High Court hearing. The negligence of the solicitor’s firm could have come to light and interfered with a possible sale and then been remedied, at any two points along that graph. In this case the plaintiff’s case is that the period during which the negligence had effect ran from virtually the highest point to the lowest. It is of course possible for such a circumstance to occur and the plaintiff might reasonably point out that if the relevant events had occurred at other stages, the defendants might well have been fortunate enough to avoid substantial award. However the fact that the loss claimed here appears to be close to the maximum that could ever conceivably have occurred or been claimed, does call for scrutiny.
28 Rosbeg put their case on damages with an attractive simplicity, which in the event was accepted by the trial judge. It is set out succinctly at the outset of the written submissions in the following way:
It is perhaps noteworthy however that these apparently lucid statements of principle are not supported by reference to authority.
29 The only authority referred to in the High Court judgment is the decision of Clarke J in Kelleher & anor v O’Connor  IEHC 313, and it is observed that the case is to be treated as a completed transaction case. However, I do not think that that case is directly relevant to this case. It distinguishes between different situations where solicitors are negligent in conveyancing matters. The court must consider the position which would arise if the solicitor had not been negligent. In some cases a transaction would not have gone ahead and is therefore a “no transaction case”, and in others, the transaction would have gone ahead, but without the consequences of the negligence. These are so called “completed transaction cases”. Again, as the judgment recognised there can be intermediate cases. However, in my view hat analysis does not however advance the issue here, where it is alleged that a consequence of the solicitors’ negligence was that the client failed to secure a transaction it desired. However, as the cases which are discussed in terms of no transaction or completed transaction illustrate, one of the most difficult issues in the assessment of damages arises when there is professional negligence as a result of which a party enters a transaction which they may contend they would not have done, and where a loss ensues because of the catastrophic fall in property values which was experienced in many countries over the past decade.
30 Here Rosbeg argue that the sale to Harris was lost in October 2000 due to the negligence of the defendant firm and that the claimed loss flowed from that fact. Such negligence was therefore it was said the legal cause of the plaintiff’s loss and was not remote, but rather direct and foreseeable. The only question then was mitigation. While it might be argued that in hindsight, the plaintiff company ought to have accepted the subsequent offers from Harris, that was not the proper question to ask when considering mitigation of loss. That issue was to be approached on the basis that the plaintiff had suffered loss by reason of the wrongdoing, and the question was whether in any given case a plaintiff had acted reasonably in taking the steps that he did. Courts, it is argued, should be and are generally slow to find that a wronged plaintiff who took acts in good faith, in circumstances created by the defendant’s wrongdoing, should nevertheless be found to have failed to mitigate loss. In this case the trial judge found that Mr Stewart was an experienced business man and was entitled to have maintained the optimistic view he did of the market. Certainly he was not to be stigmatised as unreasonable in rejecting offers which were decreasing. After all the market at that time contained many reasonable people who expected a less dramatic collapse. It might also be said that these findings of the trial judge are difficult if not impossible to challenge in the light of the jurisprudence in Hay v O’Grady.
31 Once the plaintiff’s premise is accepted, that the plaintiff suffered loss, and that the defendant’s negligence caused the loss, it follows almost ineluctably the defendant must be responsible for that loss and that the rejection of the two subsequent offers was not sufficient to amount to a failure to mitigate that loss. But I cannot accept that this is the correct premise. It may be true that the loss of the plaintiff followed from the defendant’s negligence, but that does not mean that it was caused by it, in fact, or more importantly in law. The butterfly may beat its wings and cause an earthquake on the other side of the world, but this is not the principle on which loss is to be recoverable in law.
32 It is not in my view correct to say that the defendant’s negligence was the “direct” or “factual” cause of the plaintiff’s loss whatever that is intended to mean, other than in the sense that “but for” the defendants negligence the plaintiff would not have suffered the loss, and while that is a necessary step to recovery of damages it has never been considered sufficient. There are other “but for” causes which can be identified in this case, most obviously the collapse in the property market, but also the plaintiff’s decisions not to sell. The fact that the defendant’s negligence is not the direct cause of a loss (in the sense for example that the negligent advice to pay a substantial purchase price for property to which the vendor has no title is the direct and proximate cause of loss) can be illustrated in the following way. If property values were static, the plaintiff’s loss caused by the failure to register the title would be the cost of effecting the registration. It must follow, it seems to me, that the loss of value of which the plaintiff complains here was caused by the steep fall in the value of property, and that in turn was caused by market forces. Normally this is something of which a property owner cannot complain. It may also be said that a contributing cause to the loss of which the plaintiff complains, was the decision of the plaintiff not to sell. This case raises therefore the much more complex question whether the negligence of the defendant firm makes it responsible for some or all of the losses suffered by the plaintiff by reason of the decline of the property market (and if so for what period) and its own market decisions.
33 Since this case was heard, I have had the opportunity of considering the judgment of the UK Supreme Court in Hughes-Holland v BPE  3 All ER 969,  UKSC 21. Similar issues are touched upon there. I refer to a passage in the judgment of Lord Sumption, not for the purposes of relying upon it in deciding this case, but because I consider it expresses neatly, the same general approach I have attempted to set out above. At paragraph 20 of the judgment he said as follows:
“Courts of law, said Lord Asquith in Stapley v Gypsum Mines Ltd  2 All ER 478, 489, ‘must accept the fact that the philosophic doctrine of causation and the juridical doctrine of responsibility for the consequences of a negligent act are not congruent’. What Lord Asquith meant by the philosophic doctrine of causation, as he went on to explain, was the proposition that any event that would have not have occurred but for the act of the defendant must be regarded as the consequence of that act. In the law of damages, this has never been enough. It is generally a necessary condition for the recovery of a loss that it would not have been suffered but for the breach of duty. But it is not always a sufficient condition. The reason, as Lord Asquith pointed out, is that the law is concerned with assigning responsibility for the consequences of the breach, and a defendant is not necessarily responsible in law for everything that follows from his act, even if it is wrongful. A variety of legal concepts serves to limit the matters for which a wrongdoer is legally responsible. Thus the law distinguishes between a mere precondition or occasion for a loss and an act which gives rise to a liability to make it good by way of damages: Galoo Ltd (in liquidation) v Bright Grahame Murray (a firm)  1 All ER 16. Effective or substantial causation is a familiar example of a legal filter which serves to eliminate certain losses from the scope of a defendant’s responsibility. It is an aspect of legal causation. So too is the rule that the defendant cannot be held liable for losses that the claimant could reasonably have been expected to avoid: Koch Marine Inc v d’Amica Societa di Navigazione arL (“The Elena d’Amico”)  1 Lloyd’s Rep 75. But the relevant filters are not limited to those which can be analysed in terms of causation. Ultimately, all of them depend on a developed judicial instinct about the nature or extent of the duty which the wrongdoer has broken.”
34 It is necessary to return to the starting point and observe that the nature of the negligence here was a failure to do something which could be done and was eventually, done. If the defendant’s negligence had been to advise the plaintiff to accept a defective title, then the damage would be the difference between the price paid, and the market value with the defective title (and in some cases the property may be worthless if the title problem is fatal). But where the negligence is in failing to do something which can yet be done, then, at least prima facie, the measure of damages, is first, the cost of substitute performance of the duty, and second, any foreseeable loss in value caused by the delay in doing so. If the market is static or rising, it may be that the defendant escapes without any liability for damages under this latter heading, but where as here the market is falling, then the plaintiff is entitled to recover the difference in value of the property between the date at which the works ought to have been done, which would have allowed for a sale, and the point at which that problem could reasonably have been remedied, (assuming that it can be established that the plaintiff intended to sell, and was deprived of a sale by the defect). At that later point, the innocent plaintiff has been put back in the position they ought to have been in had the defendant performed its duty. It may often be appropriate in such circumstances to take into account any difficulties in obtaining a value at that later point, and in some cases it may be permissible to take into account that the plaintiff may have lost a special purchaser, if indeed that was the case.
35 There is a paucity of valuation evidence in this case. One measure of the damages could have been the difference between the price Harris was found to be willing to pay in October 2007, and the price a purchaser might have paid who was willing to accept the title as it stood with an undertaking to assist in the registration if there was sufficient evidence of such a purchaser. Here however, the evidence of value concentrated on the Harris transactions and dealings as establishing the value of the property for the purpose of the proceedings. This is perhaps a consequence of the fact that the main focus of the evidential contest at trial was whether the point had been reached where a sale to the Harris interests was probable.
36 As already noted, the plaintiff maintained in correspondence of July 2008, that it was in a position to offer clear title and had resolved the issue of registration. By October 2008 Rosbeg had obtained actual registration. That must form the backstop to the period during which it can be said the solicitor’s negligence prevented, or at least interfered with, a sale. The reasonable measure of damage is at least prima facie the difference in value between the two dates, that is October 2007 when a sale was, on the High Court’s findings, probable, and October 2008 when the impact on the title of the solicitors’ failure had been definitively removed, making any allowances for a more difficult market at that point. After October 2008, Rosbeg may have continued to experience a drop in the value of its property, but that can no longer be laid at the door of the defendant’s negligence, at least without very particular evidence and argument. In that regard, Rosbeg like all other property owners, were experiencing a loss of value, albeit uncrystallised, due to market conditions.
37 I now turn to a consideration of the application of these principles to the facts of this case. By July 2008, the plaintiff company informed Mr Harvey that the title issue was resolved and in August 2008 a verbal offer was made in the sum of €6 million. On the 23rd of September 2008, the plaintiffs rejected that offer and sought €8.5 million. On the 22nd of October 2008 Mr Harvey on behalf of Mr Harris responded that his position had not changed on the price that he was willing to pay for the property “since our last conversation”. In my view, this establishes that on a reasonably generous and sympathetic view of the facts from the plaintiff’s point of view, that there was an attributable loss of €4 million. There were however additional figures for damages. At paragraph 59 of the judgment a sum was allowed in respect of the increased rate of CGT that, it was said, would be payable on the damages in contrast to the rate of 20% that would have been applicable in 2007 (or the 30th of January 2008 being the date estimated at paragraph 58 of the judgment of the point that the sale would likely have been finalised “had it proceeded”). I think the plaintiff is entitled to the increased CGT payable on the award of €4million as additional damages, which I calculate as €520,000 On the other hand the court also awarded interest as damages on the basis that the plaintiff would have reduced its borrowings with AIB with a promised €8 million on the 30th of January 2008. The figure ultimately awarded in this regard was €1,452,961. That appears to have been calculated on a principal sum of €8 million or €8.5 million. Since I have concluded that the plaintiff’s damages ought to have been assessed at a figure of €4 million it will be sufficient to award 50% of the total figure which is roughly €726,500. In theory the plaintiff would also have been entitled to the cost incurred in having itself registered as the owner of Unit 520. On the other hand, an allowance ought logically to be made for the fact that the plaintiff had the use and occupation of the lands in question since the January 2000 date of the assumed sale to Mr Harris, up to the date of judgment in 2013. However, since neither of these matters were addressed in evidence it is not necessary to consider them. Nor is it necessary to consider if there are other issues which may have arisen in this case, or may yet arise in any similar cases such as the question whether the plaintiff’s loss is properly to be assessed as a precise loss of a particular sale, or rather a loss of opportunity, and furthermore whether it is appropriate to take the valuation of the property as of the date of the hearing when the plaintiff remained owner of the property and had not crystallised any loss by a sale. In mentioning these matters I do not wish to suggest necessarily that they would have resulted in a different conclusion either of law or of application of law to the facts of this case. On the facts of this case, and given the manner in which the case proceeded, I am satisfied however, that the appropriate course is to allow the appeal and set aside the judgment of the High Court, and substitute for it a judgment in the sum of €5,246,500. I would however give the parties liberty to apply on the question of the calculation of interest and CGT should that be necessary.