This guidance may also be relevant to the initial pre-retainer discussions solicitors regularly have with potential clients.
The background facts
This case started in Turkey, where Mrs Miller, both the claimant and appellant, was on holiday with her husband in May 2014. While on holiday, Mrs Miller slipped and fell down a set of stairs in the hotel which resulted in a badly fractured leg that was subsequently amputated in November 2015.
Following the amputation, in 2016 Mrs Miller retained Irwin Mitchell to advise and represent her in connection with a claim against the travel operator who Mrs Miller and her husband had purchased their holiday through, Lowcost.
Although, Lowcost did not own or operate the hotel itself, it had booked it through an intermediary, and by the terms of the holiday contract, it accepted responsibility to the Millers for any personal injuries which they sustained from the negligence of its suppliers.
Irwin Mitchell sent a letter of claim to Lowcost on 22 February 2016 requesting that it notify its insurers (HCC) immediately, following which, on 11 March 2016, HCC responded to Irwin Mitchell, reserving its position. Shortly afterwards, on 28 April 2016, HCC wrote again to Lowcost, this time declining cover for the claim on the basis that Lowcost had failed to comply with the notification provisions in the policy of insurance.
The HCC policy contained a condition precedent requiring Lowcost to “give written notice to insurers of the occurrence of any Bodily Injury … or of any circumstances that might give rise to a claim against the insured, and for which there may be liability under this insurance.”
It was clear from the facts of the case that the individual responsible for dealing with insurance matters on behalf of Lowcost was not informed of Mrs Miller’s injury, and as such, HCC was not notified until March 2016, 21 months after the accident.
Lowcost, then went into administration in July 2016, following which, Irwin Mitchell sought advice from counsel and concluded there was no prospect of recovery from HCC under the Third Party (Rights Against Insurers) Act 1930. As a result, Mrs Miller had no prospect of receiving damages in the event her personal injury claim succeeded.
After facing this “deeply unpalatable” prospect, Mrs Miller brought proceedings against Irwin Mitchell.
The claim against Irwin Mitchell
Mrs Miller’s case against Irwin Mitchell was that she had actually entered into an express retainer with Irwin Mitchell in 2014 and/or that it owed her a duty of care at common law. After returning home from holiday, she saw a television advert from Irwin Mitchell which encouraged her to call their legal helpline. After seeing the advert, she had a telephone conversation with one of the operatives of its legal helpline on 19 May 2014 who provided some limited and high level generic legal advice but did not advise Mrs Miller to inform Lowcost of the accident immediately.
In particular, the adviser told Mrs Miller that her claim attracted a three-year limitation period but did not ask whether she had complained to Lowcost, filled in a complaints or accident report form, or sent any letter to or received any letter from Lowcost. These questions were on an internal proforma which was used by the helpline advisors "as a means of helping them to drive the call”.
Mrs Miller claimed that during the legal helpline conversation, Irwin Mitchell should have advised her to notify Lowcost of the accident immediately and had a duty of care to do so.
The linchpin of this argument was the fact that the advisor had told Mrs Miller that the limitation period for making a claim for damages for personal injury was three years, and by doing so, she assumed a duty to advise Mrs Miller to take reasonable steps that were open to her to protect her position.
The decision
Both the High Court and Court of Appeal found that Irwin Mitchell had no duty to advise Mrs Miller to notify Lowcost of her potential claim immediately as Irwin Mitchell’s assumption of responsibility to Mrs Miller was confined to the limited advice, which it had in fact provided. Notably, Irwin Mitchell had not provided advice in regard to notifying the accident.
Although, the advisor had not asked Mrs Miller certain questions on the proforma in regard to informing Lowcost of her injury, the judge found they were not mandatory, and the relevant part of the proforma would have been completed if Mrs Miller had volunteered that information.
In making its decision, the Court of Appeal confirmed that solicitors may owe potential clients a duty of care when providing free advice through a helpline. In providing guidance on this issue, the court noted that whether a duty of care is owed, and the extent of the duty will depend on whether:
- It was reasonable for the third party to have relied on advice provided by the firm; and
- The firm should reasonably have foreseen that the third party would do so.
In this case, the Court of Appeal held it was not reasonable for Mrs Miller to have relied on Irwin Mitchell to provide advice on how to protect her position generally and/or for Irwin Mitchell to expect that she would do so.
Summary
In a competitive market, helplines are being used increasingly by a wide range of law firms as a valuable tool to attract and retain new clients. However, the Court of Appeal decision in Miller v Irwin Mitchell LLP should be a reminder that firms need to be aware of the risks of using helplines and ensure they are staffed with suitably qualified fee earners, and that well thought out policies and training are put in place which clearly set out the limits and extent of the advice to be offered.
Law firms should also be aware that the implications of the Court of Appeal decision will not just apply to helpline cases. The guidance provided in relation to establishing a duty of care can also apply to the initial pre-retainer discussions solicitors regularly have with potential clients. As such, solicitors should be careful of the advice provided in these initial discussions so that they do not, unwittingly, assume a broader responsibility to third party non-clients.