The High Court has ordered solicitor Joseph Mallon to contribute €1.4 million towards a €2 million damages award that ACC Bank was previously granted against solicitor Brian Johnston. The contribution reflects the court’s apportionment of blame between Johnston and Mallon’s former partner, Joseph Traynor, whose conduct Mallon was held responsible for as a partner.
In a judgment delivered on 9 December 2011, Mr Justice Clarke said the only issue remaining was how much Mallon should contribute to the damages Johnston had to pay ACC. The court had already found Johnston negligent for closing four transactions on undertakings from Traynor and Mallon’s firm, despite ACC’s instructions. It had also found Mallon responsible for Traynor’s undertakings and their breach, after the partnership dissolved without appropriate public notice. The damages had previously been assessed at €2 million.
The court assessed fault by comparing blameworthiness, rather than trying to divide the causal effect of each party’s conduct. It placed Johnston’s negligence in the middle range: more than a minor error, but not gross negligence. Clarke noted that closing transactions on solicitors’ undertakings was common practice in some conveyancing transactions at the time.
Traynor’s breach was at the serious end of the scale, the judge said. Traynor had received the money and dispersed it while knowing he had not secured title to the property. The court found that he deliberately put himself in a position where he could not comply with his undertaking to produce an executed deed and use the money only to secure that outcome.
The judge declined to assess Traynor’s conduct as fraud for the contribution decision. Fraud had not been pleaded in the third-party proceedings, and Johnston had not amended his claim to include it. Clarke said it would be unfair to Mallon to assess blame on that basis after he had lacked the opportunity to respond to the allegation.
Mallon had also alleged that Johnston failed to carry out conveyancing tasks and searches. The judge said many of those alleged failures had no causal connection to the loss. He was not satisfied that matters such as a small judgment debt or the land’s planning history materially increased Johnston’s blameworthiness, given that assessing the borrower’s creditworthiness and the land’s planning status was not part of Johnston’s role.
The court apportioned blame 70% to Traynor and 30% to Johnston. It ordered Mallon, as the party vicariously responsible for Traynor’s actions, to contribute 70% of the award Johnston was required to meet: €1.4 million.