The Pre-Action Protocol for Professional Negligence Claims sets out the required procedure to be followed by the parties in a professional negligence dispute, before court proceedings are issued.
It encourages the early exchange of information; and encourages the parties to consider resolving the dispute through other means, such as alternative dispute resolution or internal complaints procedures, before following the Protocol.
When does the Pre-Action Protocol for Professional Negligence Claims apply?
The Protocol applies to claims against a professional (except for construction professionals and healthcare providers). It applies to negligence claims, claims for breach of contract, and claims for breach of fiduciary duty.
If there is the risk the claim will be time-barred if the claimant follows the Protocol (ie. the limitation period will have expired), they can commence court proceedings straightaway. The court might then stay proceedings so that the Protocol can then be followed. Note that claimants must, where possible, give the other side 14 days’ notice before starting court proceedings.
What are the requirements of the Protocol?
The Protocol sets out the procedure that must be followed. The following are the key steps involved, in simple terms.
The preliminary notice
The claimant should notify the professional in writing, by way of preliminary notice, when they decide there is a reasonable chance that they will bring a claim. The Protocol sets out what the preliminary notice should contain.
Acknowledging the preliminary notice
On receiving the preliminary notice, the professional should acknowledge receipt within 21 days of receiving it. They are under no obligation to take any further action at that stage.
The letter of claim
The claimant should then send a detailed letter of claim to the professional as soon as they decide there are grounds for a claim against the professional. The Protocol sets out what the letter of claim should contain, and this will usually be an open letter, rather than ‘without prejudice’.
In the event of future court proceedings, any material difference between the letter of claim and the particulars of claim can be taken into account by the court when costs are being considered.
Acknowledging and responding to the letter of claim
The professional should acknowledge receipt of the letter of claim within 21 days of receiving it. They then have three months from the date of the letter of acknowledgment, to respond to claim. If longer than three months is necessary, they should explain their reasons to the claimant, and
when they expect to be able to respond – and the claimant should then agree to any reasonable request for an extension of time.
The professional can respond by sending a letter of response, or letter proposing a settlement – or both (a response and a settlement can be contained in a single letter). If the claim is rejected and there is no letter of settlement, the claimant can commence court proceedings.
Otherwise, the parties must then start negotiations to try to settle the matter within 6 months of the date of the letter of acknowledgment, though there is flexibility to extend the period if necessary if the parties are in agreement. They should then identify the issues in dispute and those that are agreed.
If a settlement is not reached, and no extension of time is agreed, the claimant can start proceedings (giving 14 days’ notice to the professional).
Letter of Response
The letter of response will normally be an open letter and should include certain information, including:
- If the claim is admitted, this should be made clear
- If only part of the claim is admitted, it should be made clear which parts of the claim are admitted and which are denied
- If the claim is denied in whole or in part, specific comments on the allegations against the professional should be made. If the claimant’s version of events is disputed, the professional should set out his own version of events
- Identifying any further information required if the claim is neither admitted or denied
- An estimate of the claimant’s financial loss if the claimant’s estimate is disputed (if they cannot at this point, they should explain why, and when they will be able to do so)
- Copies of any documents on which the profession is relying
Letters of Settlement
A letter of settlement is normally marked ‘without prejudice’, and should contain the following:
- The professional’s views so far on the claim, identifying any issues they believe are likely to remain in dispute (and those which are not)
- A settlement proposal, or the further information needed to enable the professional to put forward a proposed settlement
- If the professional relies on documentation, copies of these documents should accompany the letter of settlement
Requests for information and documentation
The parties are expected to promptly supply any relevant information or documentation that is reasonably requested.
Expert evidence will usually be needed. Where the claimant has obtained expert evidence before the letter of claim, the professional will have the right to obtain their own expert evidence before sending a letter of response and/or letter of settlement.
If the claimant has not obtained expert evidence, the Protocol encourages the parties to appoint a joint expert if they can agree this.
Alternative dispute resolution
The parties are expected to consider alternative dispute resolution instead of court proceedings, which are costly and time-consuming. Litigation should be a last resort, and the courts may ask the parties for evidence that they considered alternative means to resolving matters.
What happens if the Protocol is not complied with?
The court has a wide discretion when determining the issue of costs. It may take into account
the conduct of the parties – including whether the parties have complied with the Protocol in substance (as opposed to minor or technical shortcomings).
The court will also consider the proportionality of the steps taken, compared to the size and importance of the matter; and will look at the effect of non-compliance on the other party. If a party unreasonably refuses to consider mediation, for example, they may be penalised on costs.