FAQs on professional negligence
What is professional negligence?
Professional negligence means that professional advisers such as solicitors, accountants, financial advisors, surveyors or estate agents have made mistakes or given a client bad advice and consequently the client has suffered a loss. For example, if a solicitor missed an important employment tribunal deadline, or if a surveyor missed a case of subsidence, before the client bought a house. The missed deadline may mean that an employee cannot proceed with an unfair dismissal case, and the subsidence might mean that the home-owner has to spend a considerable amount of money to fix the subsidence.
When should a claim for professional negligence be made?
Professionals owe a duty of care to their clients, where they are acting in the course of their profession for that client. Therefore, if the professional’s actions have not met the standard required of them then they will have been negligent. If the professional’s negligence has resulted in a loss for the client, for example, a monetary loss or even the loss of an opportunity then the client may sue. On the other hand, if both parties agree to mediation it is possible that court action can be avoided.
Can compensation be awarded for professional negligence?
If a claimant wins their professional negligence claim they will be awarded compensation to recompense for the loss they have undergone. For example, if a solicitor under-investigated a personal injury claim and this meant their client was not awarded the amount of damages they should have received, the damages awarded in a subsequent successful professional negligence case will take this into account. Court action can be expensive, but a client wishing to pursue a professional negligence claim may be offered a no-win, no-fee agreement by their solicitor if the solicitor assesses that the case has a good chance of success.
Are professionals insured against professional negligence?
Most professionals will have professional indemnity insurance (PI). This means that there are funds to pay out if a claim against the professional succeeds. However, most PI insurance carries a substantial excess which may be lost to the holder, whether they win or lose against the claim. Also, claims may adversely affect the professional’s renewal premium. Therefore there may be financial pressure on the professional to settle the claim before court action has gone too far, at least within the amount of the excess.
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