Tort
The economic crisis has triggered a surge in professional negligence court cases.
In just one year, professional negligence court cases have increased by 137%, to reach 147 cases in 2008, up from 62 cases in 2007, according to research by City law firm Reynolds Porter Chamberlain (RPC).
Claims against solicitors have risen by 158%, from 31 claims in 2007 to 80 in 2008.
Tim Bull, partner at RPC, says: “As economic pressures increase, so generally does the number of professional negligence claims, as those nursing losses caused by the downturn try to lay the blame at the door of their professional advisers.
“Losses are felt more keenly in a falling market and the temptation to try to recover the fall in value of assets by suing those perceived to have deep pockets, such as solicitors or accountants, grows.”
He points out that, in previous recessions, “no win, no fee” agreements and
third party funding were not available, which made claims against professional advisers risky since the claimant could be left liable for costs and that this time round, however, businesses and individuals may be willing to “take a gamble” on claims in an attempt to recoup some of their losses. “Some claimants may also try to launch a claim under the misconception that professional services firms will settle claims before they go to court in order to protect their reputation,” he says.
