The High Court has refused an application to decide a limitation defence separately in a negligence action brought by Michael McPhilips against his former solicitors. It also refused the defendants’ alternative request for a modular trial, leaving the case to proceed to a unitary trial.
The action concerns a €2.5 million investment made in 2006. McPhilips alleges that his solicitors were to secure him a 25% unencumbered interest in a development property. He says that €1.925 million was sent by the defendant solicitors to solicitors acting for two of his former partners, but was not used to buy the property, and that he never received the promised interest. The defendants deny the allegations, dispute the alleged scope of their retainer and plead that the action is statute barred.
The defendants sought a preliminary determination of whether the action was barred under the Statute of Limitations 1957. For that application, they offered to accept McPhilips’s factual assertions at their highest, while reserving the right to contest them if the preliminary issue did not dispose of the case. They argued that he knew the essential facts of his claim and that not understanding their legal significance did not amount to fraudulent concealment under section 71.
McPhilips alleges that, after the investment was lost, the solicitors advised him around 2009 to pursue his former partners as the only parties responsible. He says they knew, or were reckless as to whether, that advice was wrong and concealed their own potential responsibility. He pleads that he did not discover, and could not reasonably have discovered, his claim against the solicitors until he instructed new solicitors around 2013. These are allegations, not findings on the merits.
Mr Justice Barr said discoverability depended on McPhilips’s state of knowledge over time and on what the solicitors told him while acting for him. The court held that the issue could be properly determined only after oral evidence from both sides and consideration of supporting documents. The allegations about advice to sue the former partners were not covered by the defendants’ proposed draft statement of facts. The judge also said the solicitor-client relationship and the potential conflict of interest made this case materially different from the authority relied on by the defendants, and that it was arguable the solicitors had a duty to advise McPhilips to consult another solicitor.
The judge refused both trial applications. He said the evidence needed for a preliminary issue would involve the evidence likely to be called at the substantive trial, so separating it would bring no benefit. With the full trial estimated to take five or six days, he found no real efficiency in dividing it into modules. The parties were permitted to make written submissions on the form of the final order, costs and any other matter within 14 days of receiving the judgment. The court did not decide the limitation defence or the underlying negligence claims.