Professional negligence claims against solicitors, strike-out and failure to prove loss (Afan Valley (in administration) v Lupton Fawcett (a firm))

Article summary

Dispute Resolution analysis: 43 companies in liquidation brought professional negligence claims against their solicitors, Lupton Fawcett. The companies alleged that the firm had failed to advise them that the investment schemes operated by the companies were unauthorised collective investment schemes. The investment agreements were therefore unenforceable because the companies were not authorised persons. Accordingly, the investors were entitled to recover the sums invested. The sum claimed was £68m, made up as to sums received in cash and secured loans for the purposes of the investment. The solicitors’ firm applied for the claims to be struck out on the grounds that: (i) the companies had suffered no loss and/or there was no causal nexus; (ii) there was an absence of factual causation; and (iii) the ex turpi causa doctrine applied. There were also limitation issues in relation to some of the elements of the claims. The court held that the claims should...