Lawyers Covered - May 2025

It can be tough for busy lawyers to find enough time to service clients, make it safely through the regulation obstacle course, win new work and keep up-to-date with developments, but we've got you covered! Welcome to our Lawyers Liability & Regulatory Update, in which we highlight the last month's key developments affecting lawyers and the professional risks they face.

Supreme Court Rules on Landmark Building Safety case in BDW v URS

This week, the Supreme Court handed down its eagerly anticipated decision in the case of URS v BDW Trading. Whilst the Court declined to grasp the nettle of whether the case of Pirelli v Oscar Faber (the leading case in limitation for construction claims) should be overturned, the judgment is of huge significance for the construction industry and has implications for professional negligence claims against solicitors, and we will be sharing a fuller note on the case shortly.  Watch this space.

A fine is fine for lawyer dishonesty, High Court says

The recent case of Taylor v BSB [2025] EWHC 1029 (Admin) serves as a reminder that not all dishonesty offences lead to lawyers being struck off, disbarred or even suspended.  The claim involves dishonesty on the part of a barrister who fibbed about the whereabouts of mislaid client files, but it is equally applicable to solicitors who might find themselves in similar circumstances.  We set out below a brief summary of the decision and key takeaways.

Facts

Stephen Taylor is a barrister practising in Nottingham.  In August 2022, following receipt of advice from Mr Taylor that the case was unarguable, Mr Taylor's client asked for the return of the papers.  When Mr Taylor looked in his pigeonhole in the clerks' room, the papers were missing.  In an attempt to avoid embarrassment, Mr Taylor told the client that they were likely to be at home and would be returned in due course.  He later admitted that at the time he said that he knew it was not true.  It took Mr Taylor three months to inform his client that the papers had been lost.

In April 2024, Mr Taylor was handed a six-month suspension from practice.  The Disciplinary Panel found that exceptional circumstances existed such that disbarment was not necessary, however the Panel felt that Mr Taylor had not understood the seriousness of his actions and therefore a period of suspension was warranted.

Appeal of the sanction

Mr Taylor appealed to the High Court who held that the suspension was "clearly inappropriate" and disproportionate.  The fact that the dishonesty was "momentary, isolated and occurred on the spur of the moment" rightly meant disbarment was excessive, but the High Court felt that the Disciplinary Tribunal ought to have also moved away from suspension and considered whether a financial penalty coupled with further professional training would have sufficed to protect the public interest.  Given the fact that the lie was not told for personal gain, it was not a lie about the case, and it was clearly spontaneous, the High Court imposed a fine of £25,000.  Against Mr Taylor's annual income of £200,000, it was a fairly lenient outcome.

Key takeaways

A lie is a lie is a lie.  Well, not quite.  Taylor v BSB serves as a reminder that disciplinary boards and judges are willing to consider the nuances between instances of dishonesty.  The Sanctions Guidance applied by the High Court concerns barristers' conduct but is equally applicable to solicitors (relying on cases such as Bolton v Law Society; SRA v Sharma; and SRA v James, Naylor & MacGregor).

Breaches of the SRA rules leads to suspension

In a recently published judgment, the SDT ordered a six-month suspension from the roll and the application of stringent and indefinite conditions on the practising certificate of Tahla Jamil Ahmad, a former sole practitioner at the firm of A&T Legal Ltd.

The SDT found Mr Ahmad had committed multiple breaches of the SRA's Codes for Solicitors (Solicitors Code) and Firms (Firms Code) and the SRA Principles.  These included his and his firm's failure to comply with a wasted costs order; to co-operate with the SRA's investigation into the complaint against him; or to pay various fines and fixed penalties imposed by the SRA.

Mr Ahmad failed to submit any evidence to the Tribunal or attend the hearing. In his absence, the SDT held failure to ensure the wasted costs order was complied with constituted breaches of:

•           Paragraph 2.5 of the Solicitors Code not to place themselves in contempt of court, and to comply with court orders which place obligations on them.

•           Paragraph 8.1 of the SRA Firms Code 2019: placing responsibility for compliance with the Code on "managers" of firms.

•           SRA Principle 1: to act in a way that upholds the constitutional principle of the rule of law, and the proper administration of justice.

•           SRA Principle 2: to act in a way that upholds public trust and confidence in the profession and in legal services provided by authorised persons.

•           SRA Principle 5: to act with integrity.

The facts of this case are extreme and egregious. As such there is little in the SDT's decision that is surprising, save perhaps the absence of any significant financial penalty. Mr Ahmad was ordered to pay the SRA's costs of £24,735, a stark contrast to level of fines currently being imposed by the SRA for breaches of money laundering regulations.

Will a Court deal with deliberate concealment as part of a summary judgment application?

The underlying claim related to undeveloped Green Belt Land (the Land) which was owned by a trust (the Trustees). The claimant (DLA Piper LLP) acted for the Trustees in 2008 in relation to the sale of the Land. Mr Henshaw (H) entered into negotiations with the Trustees to purchase the Land, but after an incident occurred the Trustees decided not to sell to H. Silk Park Developments LLP (the 1st LLP) was incorporated as the corporate vehicle to purchase the Land using funds advanced by H; however, H's interest in the 1st LLP was not disclosed to the Trustees. The Land was purchased for the sum of £250,000 and the transfer included an overage agreement which would be payable to the Trustees in specified circumstances, including the granting of planning permission and the further sale of part of the Land (not to sold without the Trustees approval) (the Overage). It was agreed that the Overage was to be protected by way of a Restriction on the title register; however, the Restriction was not registered.

Following the transfer of the Land, the 1st LLP entered into an option agreement to sell the Land to Bovis Homes, the Trustees were not informed of this agreement nor the negotiations leading up to it. Shortly after, Henshaw Farming LLP (the 2nd LLP) was incorporated and purchased the Land from the 1st LLP for £1 (the 2015 Transfer); the Trustees were not informed. The purpose of the 2015 Transfer was to defeat the Trustees' entitlement to the Overage. Outline planning permission was granted, and the 2nd LLP sold the Land to Bovis Homes for £10million.

The claimant (under an Assignment from the Trustees) brought a claim against the defendants (including the 1st LLP and 2nd LLP) on 8 November 2023. The claimant alleged that the defendants conspired to injure the trustees by unlawful means resulting in losses exceeding £5million. The defendants made a strikeout / summary judgment application on the basis the claim was barred by limitation. The claimant relied upon Section 32 (deliberate concealment) of the Limitation Act 1980 as postponing the commencement of the limitation period to the date when the Trustees first knew of the 2015 Transfer.

The defendants argued that the claimant could not rely on deliberate concealment as the 2015 Transfer was registered with the Land Registry, a public register, which meant (i) the 2015 Transfer was not deliberately concealed and (ii) the Claimant could have checked the position at any time.

The Court refused to strike out or grant summary judgment. The Court took the view that the claimant's response to the application required the Court to undertake an intensely fact-sensitive investigation to determine whether there had been deliberate concealment, which was inappropriate for summary judgment and required, at the very least, a mini-trial. The Court went further, stating that putting something on a public register does not amount to informing or disclosing a fact and that deliberate concealment will generally be highly fact specific, preventing the Court from reaching a decision in the context of a summary judgment application.

DLA Piper UK LLP v Henshaws Farming LLP & Ors [2025] EWHC 542 (Ch)

Exciting (no) development in valuer negligence claims

The key takeaway in the recent Court of Appeal decision in Bratt v Jones is that the test to establish valuer negligence remains unchanged.

In short, a claimant must both prove that the valuation falls outside a reasonable margin of error, and that the valuer was negligent in carrying out its valuation, by falling below the standard of the reasonably competent valuer (the test established in Bolam).  The margin of error is a pre-condition to liability meaning the Court will only consider the Bolam test if the valuation falls outside a reasonable margin of error.

The claimant in this case, argued that it was enough for him to show that the defendant's valuation fell outside a reasonable margin of error, which he said was 10%, to establish the defendant's negligence.  The claimant's position was that the burden of proof was then reversed, and that the defendant had to disprove his negligence.

The Court of Appeal disagreed with all of these points.

This will be of interest to solicitors who find themselves named as codefendants with valuers in lenders' claims.

Read our full article here.

Hong Kong - "Mind your language?" Duty on lawyers to ensure clients understand sworn statements

The opening paragraph of the judgment in Lai v Wang & Ors [2025] HKCFI 1095 was not a particularly promising start for the principal respondents: "This case is ultimately a simple one, but has raised a troubling issue of what to do when a party files an affirmation made in a language which the purported deponent may not understand at all."

The proceedings arose out of a dispute between two shareholders of a company. The plaintiff challenged an allotment of shares in the company and sought a declaration that the allotment was invalid, and ultimately succeeded. In opposing the plaintiff's evidence, the principal respondents relied on several affirmations (sworn statements) written in English. However, it was not clear whether the deponents understood English. The affirmations made no mention of whether they had been translated or interpreted for the benefit of the deponents, although they appear to have been signed before a notary public in Mainland China.

At the first hearing, the judge enquired as the contents of the affirmations and adjourned matters for further directions. The judge directed that the deponents be questioned at the adjourned hearing as to whether they properly understood their affirmations. The respondents' lawyers had not prepared the affirmations and had taken over the defence from another law firm.  At the adjourned hearing, the respondents (in effect) abandoned the affirmations and, therefore, their defence.

The judge made several observations relating to matters of professional conduct, including:

•           solicitors have a duty to ensure that clients understand the contents of their sworn statements;

•           solicitors have a duty not to mislead the court – which includes not putting forward evidence that is false or misleading;

•           barristers (advocates) are under a similar duty. As the judgment states: "Barristers should not think themselves immune. While they do not file affirmations for clients, they often help draft affirmations. The risks of being caught up in telling lies are possibly higher."; and

an affirmation carries a representation that the deponent understands its contents and affirms the same.  The judgment goes on to state: "If a lawyer drafts, settles or files an affirmation for a deponent or a party in a language which he has (or must have) reasons to doubt whether the deponent understands, he risks being implicated in a wrongdoing."