The Supreme Court has rejected Marie O’Carroll’s professional negligence claim against solicitor Paul Diamond over his role in an urgent 1988 settlement which ultimately led to the sale of her family home at Ballymore Eustace, County Wicklow.
Mrs O’Carroll’s husband, Frank O’Carroll, had faced High Court proceedings brought by Cecelia and Eugene Hayden concerning more than £100,000 entrusted to him for investment. The Supreme Court recorded that Mr O’Carroll had no defence to those proceedings and faced serious legal, professional and financial consequences.
A settlement required security over assets including the O’Carroll family home, which Mrs O’Carroll jointly owned, and land held through Cannamore Enterprises Limited. She signed the relevant documents in November 1988. The house and lands were later sold.
Mrs O’Carroll subsequently sued Mr Diamond, alleging negligence, breach of duty and breach of contract. The High Court found him negligent but dismissed the action because it found that his conduct had caused her no loss.
On appeal, the Supreme Court rejected the negligence finding itself.
Mr Justice Hardiman accepted the High Court’s factual finding that Mr Diamond had repeatedly advised Mrs O’Carroll to obtain independent legal advice and had made clear that, because of the conflict between her interests and her husband’s, he could not advise her whether she should sign the documents.
The court held that this was the correct approach. A solicitor acting for both sides of a transaction cannot provide truly independent advice where their interests conflict. In the unusually urgent circumstances, Mr Diamond could not properly advise Mrs O’Carroll on the merits while also continuing to act for her husband.
The Supreme Court found that Mrs O’Carroll’s losses arose from her husband’s misconduct and the resulting financial crisis, not from anything Mr Diamond did or failed to do.
The dismissal of her claim was therefore affirmed, while the High Court finding of negligence was overturned.