Thanks Matt! Also worth noting that the court referred to articles relying on the writing of Dr Dyson as “persuasive” at [104] in Henderson, though in the end decided the case against the appellant. But you gave them something to chew over!

The Australian lawyer immediately thinks of Hunter Area Health Service & v Presland [2005] NSWCA 33 with similar facts (patient negligently turned away by psychiatrist then went on to kill someone, suing for consequences of trial and detention, claim denied) but the key difference in that case was that the plaintiff had actually been found not guilty by reason of mental illness. But a majority of the CA still held no liability, though their reasons differed- some related to “scope of the duty of care” owed by the doctor, others saw a normative issue in the remoteness of causation area. Spigelman CJ gave a powerful dissent saying the plaintiff ought to have succeeded. Has there been a tort claim in the UK of this sort where there was a finding of “not guilty”? In NSW now s 54A of the Civil Liability Act 2002 would mean that a claim of this sort could clearly not succeed, if the conduct of the claimant “would have constituted a serious offence if the person had not been suffering from a mental illness at the time of the conduct”.

The result in Stoffel seems sensible. Last night (my time, while waiting to join one of Lionel’s excellent Zoom sessions) Rob Stevens suggested para [26] represents something of a “winding back” of the broad-based “policy” focus of Patel, which on a quick reading seems correct, though others will know more than I do about how Patel is being read:

“The essential question is whether to allow the claim would damage the integrity of the legal system. The answer will depend on whether it would be inconsistent with the policies to which the legal system gives effect. The court is not concerned here to evaluate the policies in play or to carry out a policy-based evaluation of the relevant laws.”

Regards

Neil

Dear All,

The UKSC has today handed down judgment in two cases hear in May of this
year: Stoffel, and Henderson.

The UKSC dismissed both appeals. The result was that the illegality
defence was not allowed in Stoffel but was used in Henderson. Patel v
Mirza was applied, and, at the least, clarified, and perhaps, widened.

1. "Stoffel"

https://www.supremecourt.uk/cases/docs/uksc-2018-0187-judgment.pdf

Heard by 5 justices, where a claim was not barred by illegality in
connection with a fraudulent mortgage transaction.

A property was privately sold for what might have been three times its
value, with money obtained from Birmingham Midshires by fraud to do so.
This was to benefit the seller, Mitchell. However, the negligence of the
appellant solicitors, Stoffel, meant that the lease was not transferred
to the respondent, Grondona. When the respondent stopped paying a few
years later, Birming Midshires sued Grondona for a money judgment.
Grondona claimed against Stoffel. In the end, Mitchell appears to have
died, and the property was sold. Birmingham Midshires sued and settled
against the mortgage company that had, by the error, retained its
charge, and against Stoffel. Birmingham Midshires then also obtained a
£70,000 judgment against Grondona. Grondona won £78,000 from Stoffel at
first instance, and appeals to the CA and UKSC were dismissed.

In short, while the underlying transaction was obtained fraudulently,
using another's name to help to raise capital finance, the negligence of
the solicitors in failing to convey the property to the person whose
name was used was still actionable by her (in tort, or in contract as a
breach of retainer).

2. "Henderson"

https://www.supremecourt.uk/cases/docs/uksc-2018-0200-judgment.pdf

Heard by 7 justices, where a claim for losses flowing from killing the
claimant's own mother while under diminished responsibility, when the
NHS Trust admitted negligence in failing to return the claimant to
psychiatric care, was denied on grounds of illegality. The appeal had
been framed around Gray not applying, Patel's balancing exercise not
permitting Gray's harder line, and if those two failed, that Patel's
test should be amended to prevent Gray. The appeal failed, and the court
restated Gray v Thames Trains somewhat. Small note, list member James
Goudkamp appeared as junior counsel for the respondent NHS.


Both cases saw an application of the approach to illegality in Patel v
Mirza. The key section is here:

At [100], Lord Toulson stated the underlying policy question to be:
“…whether allowing recovery for something which was illegal would
produce inconsistency and disharmony in the law, and so cause damage to
the integrity of the legal system.”

[101] He gave the considerations as: “(a) considering the underlying
purpose of the prohibition which has been transgressed, (b) considering
conversely any other relevant public policies which may be rendered
ineffective or less effective by denial of the claim, and (c) keeping in
mind the possibility of overkill unless the law is applied with a due
sense of proportionality.”

[107] for assessing proportionality he acknowledged the then Professor
Burrows' list of factors as helpful, but did not want to lay down a
definitive list.


It seems likely that the UKSC hopes this will be the last illegality
decision for a while, but who knows? We've had a handful of UKSC cases
in the last decade just on this topic. Henderson is arguably within the
recent trend to row back on or restate limitations to tort liability
somewhat too.

All best wishes,

Matt

--
Associate Professor, Faculty of Law, University of Oxford
matthew.dyson@law.ox.ac.uk