In its recent decision (Jonathan Gough v Cannon's Law Practice [2025] CSOH 28), the Scottish Outer House has provided useful further guidance in relation to the complex issues involved in loss of chance cases.
Introduction
In this case two pilots were deprived of an opportunity to pursue claims against their airline employers for personal injuries said to have been caused by exposure to toxic fumes in the cockpit. Although breach of duty was clear, there were significant issues concerning the ultimate viability of the underlying claims leading to the court assessing these at having a 40% likelihood of success and reducing damages accordingly.
The case serves as a timely reminder as to how the court approaches loss of chance cases. Although the court will not conduct a mini-trial on liability but instead take a broad-brush approach to the prospects of the lost opportunity, in this case significant evidence was considered (nine factual and twelve expert witnesses), demonstrating that the court will still critically evaluate evidence that is available when determining the value of any alleged lost chance.
In this article we explain the approach taken in Gough, how this contrasts with other loss of chance cases and how this might be applied in future cases.
Background
The pilots (Mr Gough and Mr Montague-Trenchard) brought claims against a firm of solicitors for breach of contract and loss of chance to pursue personal injury claims against their former employers, Thomas Cook Airlines (for both pilots) and Etihad Airways (for Mr Montague-Trenchard only). The pilots alleged they suffered from aerotoxic syndrome (ATS) due to repeated exposure to toxic fumes during their time flying in the UK and UAE.
After consulting with a Scottish law firm in 2013, they were assured compensation claims would be pursued on their behalf. Negligently, no action was taken. In 2014, a separate collective claim in England began being formulated by a group of airline employees against various airlines. The pilots engaged an English law firm in 2015/2016, but did not join the collective proceedings because they were then too late on limitation grounds leaving them to have to pursue recovery against their Scottish solicitors (these proceedings) instead. The English collective proceedings are currently ongoing and are expected to go to trial in 2026.
The Scottish law firm admitted breaching its duty of care. It admitted that it ought to have begun gathering evidence within three months, advised that the likely jurisdiction was England where there was a risk of limitation expiring and ensured that English solicitors were instructed to advise as soon as possible.
Although breach of duty was clear – causation was not, with both sides contending for vastly different valuations of the opportunity lost. The pilots argued that they had excellent prospects on their underlying claims and that their loss of chance should be assessed at the top-end of the range (80%), while the law firm contended that the prospects were limited to no more than 20%.
The Judgment
In his 161-page judgment, Lord Richardson applied established loss of chance and causation principles, ultimately assessing the percentage chance of success in the claims at 40%.
Key principles
The judge followed several key principles from the leading loss of chance authorities of Allied Maples Group Ltd v Simmons and Simmons1 and the more recent Supreme Court decision in Perry v Raley Solicitors2.
The court must apply a two-stage test when assessing a loss of chance claim:
- The first stage involves a fairly conventional adversarial assessment of whether the claimants can prove on the balance of probabilities that if properly advised they would have pursued the lost opportunity (in this case pursuit of the airline claims).
- The second stage is more complex because the court is required to assess the claimant's hypothetical counterfactual involving third parties who are usually not available to give evidence on what they would have done (in this case the airlines and how they would have responded to the pilots' claims). Here the court assesses the value of the lost chance by determining the percentage probability of the chance occurring and then applies this percentage to the potential benefit that was lost. This often follows evidence and argument on a range of potential outcomes (as was the case here regarding the underlying prospects of the claims against the third-party airline(s) had they been pursued).
In determining the percentage to be applied to the lost chance, the various cases following Allied Maples have applied the principle that a court ought not to engage in a "trial within a trial" in respect of the underlying claims and that a "broad-brush" approach is needed. This stage is more speculative and involves a degree of estimation on how third parties would have acted. As the judge found in Gough, detailed analysis would result in significant unfairness relating to "difficulties caused by the passage of time, difficulties caused by the absence of the third party defender; and difficulties in relation to the recovery of documents or the tracing and/or memories of witnesses"3.
Decision
First stage of test
On account of the defendant's admissions the court only needed to determine on the balance of probabilities what steps the claimants would have taken but for the (admitted) negligence. The finding was that if they had received proper advice, the pilots would likely have connected in 2014 with the individuals in England who ultimately pursued the ATS group claim against various airlines. The judge was of the view that the pilots would have been an "attractive addition" to these collective proceedings. The judge also found it likely that the pilots would have instructed English solicitors and filed proceedings before the limitation period expired (i.e. the first stage of proving that they would have acted differently and pursued the lost opportunity was established).
Second stage of test
In assessing the hypothetical outcome based on what the third-party airlines would have done, the judge determined that the pilots had a real and substantial chance of success had their claims been pursued in a timely manner. However, the court applied a discount to the loss of chance calculation due to the litigation risks and scientific controversy surrounding ATS.
The judge also briefly touched on other issues including foreseeability and breach, finding that he was not prepared to dismiss the pilots' chances of success as fanciful or speculative (i.e. below 20%). He held, contrary to the defendant's case, that the exact identification of the chemical substances leading to the ATS is not essential. Expert evidence that there was a reasonable prospect of the ATS being attributed to the contaminated air in the planes was sufficient to lead to the judge concluding that a sufficiently valuable opportunity had been lost. Having considered the expert and factual evidence and the range of prospects contended for by the parties (20% for the defendant – 80% for claimant), the judge concluded that a 40% assessment was most appropriate.
Professional negligence and accountancy case law
There is now a plethora of loss of opportunity cases in the professional negligence field. Negligent solicitors can deprive their clients of opportunities in transactions and litigation, as can accountants in tax and audit and surveyors in the field of and valuation. By way of example in some of the decided cases:
- In Allied Maple Group, Simmons advised on a transaction in which a year after competition issues regarding contingent liabilities arose, with the finding that there was a "real and substantial chance" that Allied Maple would have negotiated protection against the claims had they been properly advised.
- Perry was another solicitors' negligence case involving an alleged loss of opportunity to pursue litigation, but here the Supreme Court upheld the lower court ruling that the claimant's only realistic prospect would have been pursuing a claim that was not honest (which the court could not countenance).
- In First Interstate Bank of California v Cohen Arnold & Company4, the defendant accountants negligently overstated its client’s assets and overall net worth leading to a delay in a property sale. The Court of Appeal found that, had the bank been properly advised, they would have gone ahead with the sale earlier and there was a 66% chance that they would have achieved a better sale price.
- In University of Keele v Price Waterhouse5, the accountancy firm caused a loss of savings in a profit-related pay scheme the university would have implemented had it received correct advice with the court finding that the chance of a successful scheme on correct advice would be 80%.
- In AssetCo Plc v Grant Thornton UK LLP6, the firm negligently performed audits of financial statements containing dishonest overstatement of assets supporting an inaccurate going concern assumption (the company was actually insolvent), said to have lost the company the opportunity to refinance and avoid losses of over £30 million. On appeal the loss of chance was reduced from 100% to upwards of 90%.
Future application
Whether through human error or the ever increasing use of AI, accountants and other professionals will continue to neglect to advise their clients on key deadlines and other issues that deprive them of opportunities that would have existed had they been properly advised. As Gough confirms, the court will not perform a "trial within a trial" when evaluating the lost chance. It will first decide in a fully adversarial trial manner on the balance of probabilities whether the claimants have established that they would have acted differently. Once this has been established, the court will still scrutinise the available evidence to determine the probability in percentage terms of the third-party outcome contended for by the claimants, but by necessity this will involve a broad-brush.
There will remain inherent uncertainty on the extent to which the court will probe in detail the available evidence. In Gough there was a detailed evaluation of the expert and other evidence (21 witnesses) – in other cases a more general assessment will be done. This will depend on the evidence produced by the parties and the approach of the judge on the day. Key strategic decisions are required for claimants and defendants on the extent to which they introduce detailed expert and factual evidence or whether their cases are better suited to the sweep of the broad-brush.
1 Allied Maples Group Ltd v Simmons & Simmons [1995] 1 WLR 1602
2 Perry v Railey Solicitors [2019] UKSC 5
3 Gough [347]
4 First Interstate Bank of California v Cohen Arnold & Company [1996] P.N.L.R. 17 CA
5 University of Keele v Price Waterhouse [2003] EWHC 1595 (Ch)
6 AssetCo Plc v Grant Thornton UK LLP [2020] EWCA Civ 1151
