Allied Maples Group v Simmons & Simmons [1995] 4 All ER 907

• Defendant paid Plaintiff, solicitors, to take over a company for them. After completion, Defendant became aware of several claims that could be made against them as a result of the takeover agreement and sued Defendant.

• CA allowed the claim, saying that causality was a question of fact, to be determined on the balance of probability and that once this fact was established, Defendant was entitled to claim for damages in full.

• Where this question relates to a 3rd party and he can show that there was a substantial/real chance (NOT merely a speculative one) that a 3rd party would have conferred a benefit on him (or averted a detriment) he can claim for the value of the benefit foregone.

• The CA found (Millett LJ dissenting on purely factual grounds) that had it not been for Defendant’s negligence, Plaintiff would not be open to the aforementioned claims.

  • Thus loss of a chance to be indemnified against losses could be compensated where the loss was dependent on the acts of a third party (i.e. whether the target company would have agreed to such indemnities). 

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• Perry v Raleys Solicitors