Professional Negligence and Liability

Edited by Mark Simpson KC

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Chapter 1 THE NATURE OF PROFESSIONAL LIABILITY

Authored by CHARLES DOUGHERTY KC AND ISABEL BARTER

I. INTRODUCTION

1.1 Professional liability derives primarily from the common law principles of tort and contract. Indeed, over the last 30 years litigation concerning professionals has been a major driving force in the development of the common law of negligence. Although the principles are general, much of the focus has concerned their impact on professionals. This chapter explains that impact. It does not attempt to explain the principles in any broader context; that is left for other standard works.1 Later chapters detail the application of the principles to professional groupings. The objective of this chapter is both to provide a clear explanation of the principles and, by considering the way in which they apply across different professional contexts, to enable analogies to be drawn from one context to another. The chapter is divided into seven parts:

Part I provides an introduction to the role of professionals;2
Part II deals with duties to the client in both contract and tort;3
Part III with duties to third parties;4
Part IV with scope of duty;5
Part V with the meaning of negligence;6
Part VI with limiting liability7; and
Part VII with vicarious liability.8

1.2 Professional liability is a meeting place for many branches of the law; not only of contract and tort, but others such as equity and agency. The mixture of different possible grounds of liability can lead equally to the Vice-Chancellor describing himself as “a mere Chancery judge adrift on the limitless sea of the common law”9 or to a Queen’s Bench Division judge having to determine a problem of equitable limitation. One fundamental point is that the topic of professional liability is concerned with the supply of services rather than with the supply of products. In the common law, embodied where appropriate in statute, the obligations of the providers of products and those providing services were different: the starting point in a contract for the sale of goods is an absolute obligation that the goods supplied shall conform to the required standards10 rather than a mere duty to be careful to comply with such standards; whereas in a contract for the supply of services, the starting point is an obligation “to carry out the service with reasonable care and skill”.11 1.3 It may also be said that the topic of professional liability has no clear-cut boundary as to what constitutes a profession. The Monopolies Commission was not troubled by this in its 1970 report “on the general effect on the public interest of certain restrictive practices so far as they prevail in relation to the supply of professional services”. The Commission found that there was no definition which would enable it to draw a clear line between professional and non-professional occupations nor, for its purposes, was it necessary to do this. The Commission’s discussion of what might constitute a profession is nonetheless instructive. It identified seven characteristics and considered that no occupation could be regarded as falling within the ambit of the inquiry unless it had some of those characteristics, of which the two most important were that:

“(i) Practitioners apply a specialised skill enabling them to offer a specialised service, and
(vii) Practitioners are organised in bodies which, with or without State intervention, are concerned to provide machinery for testing competence and regulating standards of competence and conduct.”

The other five characteristics12 are also worth rehearsing:

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