Client: Solicitor, $1M turnover, 5 staff – claim against top-up PII policy

Claim: A solicitor acted for the heirs of an estate and rendered advice regarding the correct structure of trust assets. The ATO took the view that the trust structure triggered a muti-million-dollar tax liability to the heirs. The heirs sued the solicitor’s firm.

Bellrock’s claims team notified the valuer’s professional indemnity insurers including law cover and top-up insurers and advocated to obtain a grant of indemnity.

Result: Bellrock’s preferred panel firm was appointed to defend the litigation with instructions to defend the claim on the basis that there was no breach of duty as the tax issue was outside the solicitor’s retainer. The claim was ultimately settled for a sum that impacted the top-up professional indemnity layer, and Bellrock successfully engaged with the insurer to obtain consent and support for the settlement.

Client: Solicitor, $10M turnover, 30 staff – claim against top-up PII policy

Claim: A solicitor acted for a lender to draft a security arrangement for a loan. The security arrangement sought to encumber shares in a company listed on an Asian stock exchange. Due to a nuance in the Asian stock exchange listing rules, the security arrangement over the shares failed, resulting in the lender’s loan being under-secured by millions of dollars.

Bellrock’s claims team notified the valuer’s professional indemnity insurers including law cover and top-up insurers and advocated to obtain a grant of indemnity.

Result: Bellrock’s preferred panel firm was appointed to defend the litigation with instructions to defend the claim with an eye towards reducing the quantum of claim given the case on liability was certain to go against the solicitor. The claim was ultimately settled for a sum that impacted the first and second top-up professional indemnity layers, and Bellrock successfully engaged with the insurers to obtain consent and support for the settlement.

Client: Solicitor, $5M turnover, 20 staff – claim against top-up PII policy

Claim: A buyer was entering into a commercial sale agreement for the purchase of a business, relying on the solicitor to draft a legally sound contract to protect them against risks through warranty clauses. The solicitor mis-drafted and omitted key warranty clauses in the sale agreement. A warranty breach occurred, and the buyer sued the solicitor for negligence due to their inability to recover financial losses from the warranty breach due to the missing and defective clauses in the contract drafted by the solicitor.

Result: After liaising with insurers, the solicitor conceded that their drafting of the contract for their client was incorrect and negligent. The court found that the solicitor failed to exercise reasonable care in its advice and documentation, exposing the client to financial risk. Accordingly, insurers settled the claim for $1.5M settlement and $250,000 in legal costs incurred.

Client: Solicitor, $500,000 turnover, 2 partners firm with 2 staff – claim against top-up PII policy

Claim: A buyer purchased a property with the intention of operating a café from the premises. They had relied on their solicitor to conduct due diligence including reviewing title documents and identifying restrictive covenants. The solicitor overlooked a covenant prohibiting commercial use of the property despite knowing the buyer intended to run a business. They sued the solicitor for financial loss, wasted purchase costs, lost business opportunities, and diminished property value.

Result: The claim was dismissed. While the solicitor breached their duty of care, Bellrock was able to prove that the breach did not directly cause the buyer loss.

Client: Solicitor, $1.5M turnover, 7 staff – claim against top-up PII policy

Claim: A testator engaged a solicitor to update their will, intending to ensure that their assets were passed onto their spouse. The solicitor failed to update the will before the testator passed away and as a result, the spouse was excluded from the estate and received nothing. The spouse sued the solicitors for professional negligence.

Result: Even though the spouse was not a direct client of the solicitor, they were foreseeable victims of the solicitor’s negligence. Bellrock successfully engaged with the top-up professional indemnity insurer to obtain consent and support for the settlement and recovered damages equal to the inheritance of $3M.

Client: Solicitor, $8M turnover, 35 staff – claim against top-up PII policy

Claim: A solicitor incorrectly advised their property purchaser client that the land was freehold when it was in fact leasehold. The purchase price which the client paid was therefore not reflective of the property’s true value and long-term use. The client paid a purchase price appropriate for freehold land, which was substantially higher than the actual value of the leasehold interest and misrepresentation of tenure led the client to believe they were acquiring permanent ownership rights. The client suffered financial loss and sued the solicitor for damages to recover the difference in value.

Result: Bellrock worked closely with the insurer whereon it was concluded that the client was entitled to damages equal to the financial loss suffered namely, the difference between the price they paid (thinking it was freehold) and the actual leasehold value as the solicitor acknowledged they’d breached their duty of care directly causing the clients the financial loss. The full claim of $300k was paid within 28 days.