Supreme Court dismisses negligence appeal as plaintiff would not have acted differently despite flawed advice.

Hardiman J.

Geoghegan J.

Kearns J.

THE SUPREME COURT

[354/2002]

BETWEEN

MARIE O’CARROLL

PLAINTIFF/APPELLANT

AND

PAUL F. DIAMOND (PRACTISING AS PAUL F. DIAMOND AND COMPANY SOLICITORS)

DEFENDNAT/RESPONDANT

JUDGMENT of Mr. Justice Kearns delivered the 12th day of April, 2005

1. I have read the judgment about to be delivered by Hardiman J on the issue of negligence in this case and agree with his reasoning

and conclusion. I would also be of opinion that this appeal must fail on causation grounds.

2. In cases such as the present one, a claimant will only recover damages if the court is satisfied on the balance of probabilities that

the claimant would have acted on such advice had it been given and, if so, in a particular way which would have avoided the loss. In

opening the appeal Mr. Dwyer, counsel on behalf of the appellant, accepts that proof of causation is a necessary prerequisite to the

recovery of compensation.

3. The point is illustrated in this context by the case of Sykes v. Midland Bank Execular and Trustee Company Ltd, [1971] 1 Q.B. 113

in which a solicitor negligently failed to advise the client that the terms of a lease he was proposing to take prohibited him from sub-

letting with the lessor’s consent. The client took the lease and subsequently wished to sub-let the property. The lessor refused to

give consent and the client claimed from the solicitor for the loss of rental income. The Court of Appeal considered in the light of the

evidence that the client had taken other leases with similar provisions and that, the balance of probabilities, he would have taken the

lease in question even if correctly advised as to its terms.

4. In that case, the evidence was unusually unequivocal in that the plaintiff’s evidence was that he would have executed the

underlease in any event. Lord Salmon stated (at 127 G-H):-

“… Mr. Sykes was a remarkably candid witness. He, no doubt disappointingly, would not say that it would have made any

difference had the proper advice been given… at the end of his evidence it certainly appeared that in his view it was as likely

as not that the plaintiffs would have acted just as they did even if they had had proper advice about the effect of clause 2

(XI) of the underleases.”

5. In most cases, however, the question of whether advice would have made a difference to a claimant’s conduct involves a fairly

sophisticated exercise on the part of the trial judge to determine what a particular person would have done in the specific

circumstances obtaining in the case before him.

6. Inevitably, the trial judge will depend to a large extent upon the evidence and demeanour of the claimant when giving that

evidence. The court in discharging this obligation must exercise considerable care having regard to the fact that a plaintiff’s evidence

about what he or she would have done if properly advised is bound to be coloured by the fact that an adverse outcome did in fact

eventuate. There is an inevitable risk that evidence given by a plaintiff in these circumstances will be coloured (whether consciously

or unconsciously) with the benefit of hindsight.

7. This difficulty has led to widespread discussion in other common law jurisdictions, particularly with regard to advice given in the

context of the doctor/patient relationship, as to how courts should go about this task. While the present context is that of

solicitor/client, the underlying requirements of proof are not dissimilar. Indeed, authors Dugdale & Stanton (Professional Negligence,

Butterworths; 1998 ed. Chap 18, p 397) treat the themes interchangeably. The briefest review of some of the medical cases is thus

helpful, not least to decide whether the assessment of a claimant be made by reference to an objective or subjective test as to what

he/she would probably have done if appropriate advice had been given.

8. In the United States the objective test was preferred in Canterbury v. Spence [1972] 464 F. 2d 772 and a similar approach was

taken in Canada in Reibl v. Hughes [1980] 1 14 D.L.R. (3d) 1.

9. In Canterbury v Spence, Robinson J, in delivering the opinion of the Court, explained the preference for an objective test at

p.790:-

“No more than breach of any other legal duty does nonfulfilment of the physician’s obligation to disclose alone establish liability

to the patient. An unrevealed risk that should have been made known must materialise, for otherwise the omission, however

unpardonable, is legally without consequence. Occurrence of the risk must be harmful to the patient, for negligence unrelated

to injury is nonactionable. And, as in malpractice actions generally, there must be a causal relationship between the

physician’s failure to adequately divulge and damage to the patient.

A causal connection exists when, but only when, disclosure of significant risks incidental to treatment would have resulted in a

decision against it. The patient obviously has no complaint if he would have submitted to the therapy notwithstanding

awareness that the risk was one of its perils. On the other hand, the very purpose of the disclosure rule is to protect the

patient against consequences which, if known, he would have avoided by foregoing the treatment. The more difficult question

is whether the factual issue on causality calls for an objective or a subjective determination.

It has been assumed that the issue is to be resolved according to whether the fact finder believes the patients testimony that

he would not have agreed to the treatment if he had known of the danger which later ripened into injury. We think a technique

which ties the factual conclusion on causation simply to the assessment of the patient’s credibility is unsatisfactory. To be

sure, the objective of risk disclosure is preservation of the patient’s interest in intelligent self - choice on proposed treatment,

a matter that the patient is free to decide for any reason that appeals to him. When, prior to commencement of therapy, the

patient is sufficiently informed on risks and he exercises his choice, it may truly be said that he did exactly what he wanted to

do. But when causality is explored at a post injury trial with a professedly uninformed patient, the question whether he

actually would have turned the treatment down if he had known the risks is purely hypothetical; ‘viewed from the point at

which he had to decide, would the patient have decidedly differently had he known something he did not know?’ and the

answer which the patient supplies hardly represents more than a guess, perhaps tinged by the circumstances that the un-

communicated hazard has in fact materialised.

In our view, this matter of dealing with the issue on causation comes in second best. It places the physician in jeopardy of the

patient’s hindsight and bitterness. It places the fact finder in the position of deciding whether a speculative answer to a

hypothetical question is to be credited. It calls for a subjective determination solelyon testimony of a patient/witness

shadowed by the occurrence of the undisclosed risk.

Better it is, we believe, to resolve the causality issue on an objective basis: in terms of what a prudent person in the patient’s

position would have decided if suitably informed of all perils bearing significance. If adequate disclosure could reasonably be

expected to have caused that person to decline the treatment because of the revelation of the kind of risk or danger that

resulted in harm, causation is shown, but otherwise not. The patient’s testimony is relevant on that score of course but it

would not threaten to dominate the findings. And since that testimony would probably be appraised congruently with the fact

finder’s belief in its reasonableness, the case for a wholly objective standard for passing on causation is strengthened. Such a

standard would in any event ease the fact finding process and better assure the truth as its product.”

10. A similar approach was adopted in Reibl v. Hughes [1980] 1 14 D.L.R. (3d) where Laskin C.J.C. delivering the judgment of the

Canadian Supreme Court disapproved the subjective test, stating as follows at p.15:-

“It could hardly be expected that the patient who is suing would admit that he would have agreed to have the surgery, even

knowing of the accompanying risks. His suit would indicate that, having suffered serious disablement because of the surgery,

he is convinced that he would not have permitted it if there had been proper disclosure of the risks, balanced by the risks of

refusing the surgery. Yet, to apply a subjective test to causation would, correlatively, put a premium on hindsight, even more

of a premium than would be put on medical evidence in assessing causation by an objective standard.”

11. However, a subjective approach has been adopted in Australia in Ellis v. Wallsend District Hospital [1990] 2 Med L.R. 103, Bustos

v. Hair Transplant PTY. Ltd (unreported, New South Wales Court of Appeal, 15th April, 1997) and O’Brien v. Wheeler (unreported,

Supreme Court of New South Wales, 23rd May, 1997).

12. A subjective approach has also been preferred in the United Kingdom in Chatterton v. Gerson[1981] Q.B. 432, Hills v. Potter

[1984] 1 W.L.R. 641 and Smyth v. Barking H.A. [1994] 5 Med L.R. 285.

13. Many of these authorities were opened to me in very helpful submissions lodged in the case of Geoghegan v. Haris [2000] 3 I.R.

536, in which I ultimately concluded that a pragmatic approach to what a claimant would have decided was the preferred course to

follow. This I took as meaning that the court could be guided, and might in certain cases be compelled, where there was a lack of

other evidence, to adopt an objective test, but in other instances, where there was reliable and cogent evidence of subjective

intent, then it was open to a court to take the view that the objective test could and should yield to a subjective one. I see no

reason for adopting a different approach in the instant case in trying to determine what this plaintiff would have done.

14. There is further guidance to be derived from the medical cases. In cases of elective surgery, the failure to warn must be regarded

as more likely to have caused the loss, given that a patient might well decided to forego surgery when he has a real choice in the

matter. Conversely, where the medical procedure is absolutely essential and there are no real alternatives, the failure to warn of an

inherent risk may be seen as making little or no contribution to the decision of the patient as to which course he or she will adopt.

15. This case falls four square into the latter category because of the crisis precipitated by the financial difficulties of the plaintiff’s

husband. They were of such a magnitude as to threaten not only the family home, but the very survival of the family itself.

16. While Mr. Dwyer argued that the plaintiff would have ‘abandoned’ her husband had she been properly advised, this is nowhere

apparent from the evidence given at the trial. Indeed, evidence was not led from the plaintiff to suggest that she would have

altogether severed her own interest in the family home from the requirement to rescue her husband from the predicament in which he

found himself. It was thus hardly surprising that the trial judge himself had to endeavour to clarify the position as follows:-

“Mr. Justice O’Neill: leaving aside that. Faced with the situation that you were faced with at the time that both you and your

husband were faced with, did you realise that there was a need to, as it were, protect your husband and the only way to do

that was by selling the family home available or was it a priority?

Witness: Well I would not have wanted to protect him, my Lord, because if I was let go to see the Haydens I had other

options at the time. I wanted to go and see the Haydens. I should have been let go and come back after a week. There was

no huge big rush to sell it on our side. I know the Haydens would want their money and I am sure their solicitor would have

wanted the money but I should have been given a chance to go and see them.

Q. What did you think you could achieve by seeing Mrs. Hayden?

A. I am sure she would have taken the money in instalments or God knows what I would have achieved. I would have achieved

something, particularly when it came when we were moving out of the house.”

17. This exchange suggests that the plaintiff’s primary concern arising out of the supposed failure to advise was the fact that it

deprived her of an opportunity of negotiating with the Haydens for an extension of time within which to vacate the family home. It

does not suggest that she would have adopted a radically different approach to this entire matter, and one which would have left her

husband to sink, rather than swim.

18. At the end of the day, the trial judge was, after hearing and observing the plaintiff for the lengthy period during which she gave

evidence, in the best possible position to assess the plaintiff’s credibility, either by reference to an objective or subjective standard or

that favoured in Geoghegan v Harris, and it would require something quite out of the ordinary to persuade me, deprived as I am of a

similar opportunity of evaluating the plaintiff, to invade in some unspecified way the function of the trial judge in that regard.

19. Towards the end of his judgment, the trial judge sets out his conclusions and the material upon which they are based in this

regard in the following manner:-

“In her own interest what she had to gain was the retention of half of the net proceeds on a sale of the family home, either at

the time of the sale to the O’Sullivans or later through a forced sale through the courts. If she opted to agree to the sale to

the O’Sullivans, she would have been entitled to close on £49,000. If she refused to cooperate and a sale took place through

the courts approximately 2 years later, she probably would have got less…

She would of course have had to consider the risks involved in non-cooperation and claiming her half share. Undoubtedly the

Haydens would have been very aggrieved if the plaintiff adopted that course and it is probable that they would have pursued

Mr. O’Carroll aggressively. This would have resulted in an application to the court to attach him for contempt for failing to

have filed an affidavit disclosing where the Hayden funds had gone. If, to avoid a contempt of court, he filed the affidavit in

question, he would have then have made admissions which would have placed him in jeopardy in a criminal investigation of the

matter. It is probable as well that a complaint would have been made to Gardaí and that a fraud investigation would have

ensued, with the likelihood of a criminal prosecution to follow.

I am mindful of the fact that the plaintiff in her evidence said that she was not interested in protecting her husband. At the

time when these events were occurring, I am satisfied that it was different. No doubt the plaintiff was extremely angry with

Mr. O’Carroll for getting them into an awful predicament. However, it would seem to me that it was very unlikely that she

would have left him exposed to the risk of criminal prosecution and a custodial sentence, with all the attendant consequences

of that for Mr. O’Carroll, but more particularly for the plaintiff herself and her children. It would seem to me that the salvaging

of her half share from the sale of the family home would not in all probability have outweighed the terrible consequences for

the family as a whole of criminal proceedings against Mr. O’Carroll. That is the choice she would have faced at that time.”

20. It seems to me that the foregoing passage clearly demonstrates that the learned trial judge put all the competing considerations

in the melting pot when deciding what the plaintiff would probably have done. While Mr. Dwyer suggests there was no evidence of a

pending criminal prosecution, it is undeniable that there was a risk of such a prosecution materialising, and indeed it appears that

some preliminary communication had been made with local Gardaí. Mr. O’Carroll was effectively unable to swear affidavits in the court

proceedings involving the Haydens because the admissions he would have been compelled to make were such as would, at the very

least, have terminated his professional career as an accountant. Furthermore, as noted by the learned trial judge, the Haydens would,

as a matter of probability, have pursued Mr. O’Carroll all the more aggressively if Mrs. O’Carroll had stood back from her husband’s

misfortunes. Finally, and perhaps most importantly, the plaintiff was extremely conscious of her own responsibility both to her husband

and her children, and indeed gave distressing testimony of the fact that her daughter had spoken to her when the news of this

calamity brook, beseeching her not to separate from her husband or to break up the family.

21. The court was informed that the family did not, in fact, break up, at least until 1996.

22. Furthermore, the eventual closing of the sale of the family home did not take place until July, 1992. Whatever her initial distress

and confusion, it is inconceivable that in all that intervening period the plaintiff would not herself have realised that she could, if

dissatisfied with Mr. Diamond’s advices or the lack thereof, have sought advice from some other solicitor in Naas, or indeed in Dublin.

23. For all these reasons, I am satisfied that the learned trial judge correctly decided the issue of causation in this case and would

therefore dismiss the appeal.