THE CHANGING COASTLINE OF LIABILITY
John L. Powell Q.C.
Even the briefest acquaintance with the world’s major financial centres, and especially Hong Kong, London or New York, immediately confirms that we live in world dominated by professionals. The magnificent multi-storey edifices adorning the shores of this and similar cities are the castles and palaces of the present age, proclaiming the influence and power of professionals.
“Professional" is an acquisitive concept, acquisitive of aspirations and expectations - but also of liabilities. Claims for professional negligence are now common. Indeed they will become more so. This will be a product of increasing demand for their services, specialisation, higher standards and intolerance of bad performance by highly educated societies.
In a claim for negligent design against an architect arising from the collapse of a concrete roof, Erle J. in 1853 said:
"... if you employ [an architect] about a novel thing, about which he has little experience, if it has not had the test of experience, failure may be consistent with skill. The history of all great improvements show failure of those who embark in them".
The claim failed.
Contrast this with Lord Edmund Davies's observation in 1980 in a negligent design case arising from the collapse of a television transmitter mast, reflective of a more consumer orientated society:
"The law requires even pioneers to be prudent".
The claim succeeded.
In that contrast of statements, over a century apart, is summated the sea change in the attitude of society and indeed the courts towards professionals when things go wrong. Professionals and their insurers will need to adapt accordingly. Nevertheless, the landscape of the law is far from bleak. The coastline of liability continues to change, but with erosion on some shores made up by accretions on others. The object of this paper is to pick out some features of that landscape, including some which are ripe for climatic change.
Given my experience, my main focus will be English law (though from a Welshman’s perspective - like many of those present, English is my second language). Nevertheless, this is an area of the law which has been, and will continue to be, considerably enriched by case law from other jurisdictions, including this jurisdiction. Indeed, I have no doubt the sense of common principles and values in this, as in other areas, will lead soon to a body of case law which will be increasingly recognised as an international common law. The practice here of inviting judges of the highest distinction from other jurisdictions to sit in your Court of Final Appeal is one which I hope will soon become general elsewhere, including Britain.
The duty of care
Let me start with basic principles. A professional person is under a duty to exercise reasonable care and skill. The required standard of care and skill is that of the ordinary skilled person of the same discipline. It is often referred to as the Bolam principle after McNair J.'s eloquent expression of it in a direction to the jury in a medical negligence case of that name, but its roots may be traced back to the nineteenth century and earlier.
The duty arises not only as an implied (if not express) term of the contract between the professional man and his client. It may also arise in tort. So a professional may owe a duty of care to his client running concurrently with the like duty in contract. He may also owe a duty of care in tort to a third party. Breach of the tortious duty gives rise to liability in the tort of negligence.
The duty is usually invoked in support of the proposition that a professional does not impliedly agree to produce a particular result. He will be taken as having done so only if he has expressly so agreed. Otherwise the client's bargain is rather the product of the care...