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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> McLoughlin v Grovers (A Firm) [2001] EWCA Civ 1743 (22 November 2001) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2001/1743.html Cite as: [2002] PNLR 21, [2002] QB 1312, [2002] PIQR P20, [2002] 2 WLR 1279, [2001] EWCA Civ 1743

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IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
Elias J

		Royal Courts of Justice Strand, London, WC2A 2LL
		22nd November 2001

Lord Justice Brooke :

1. This is an appeal by the claimant against a judgment of Elias J given at Manchester on 24th July 2000 when he ruled on the trial of a preliminary issue that the claimant's claim for damages for personal injury being psychiatric illness suffered by the claimant should be struck out because in tort it is not reasonably foreseeable and in contract it is too remote". In granting permission to appeal the judge commented that the case raised an issue of some importance. He also said that if he had been required to consider the operation of the Limitation Act he would have found that the action had been commenced outside the limitation period, but that he would have permitted it to continue pursuant to section 33 of that Act. We are not concerned with limitation issues on this appeal.
2. It is necessary to set out the facts in some detail. Mr McLoughlin was in his mid-forties when the events occurred which are at the centre of these proceedings. The history of his life which he gave to a psychiatrist, Dr Braude, was along these lines. He was born in Ireland in a family where money was scarce. His parents split up and, his mother contracted tuberculosis, and he came over to England to join his father in Manchester at the age of 13. He had no more schooling. He went into the building trade and over the years he built up a small property business with his brother and sister, buying and renting out properties. He carried on a similar business with his wife, and by 1992 he had become the owner or part owner of 20 tenanted properties. He had then been married for over 20 years, with two of his three children still at school.
3. Physically, he was a big, strong man. At one time he had boxed for the army. He had two minor convictions for acts of violence. Mr Jones, the senior partner in the defendant firm, first acted for him in 1987, and he saw him thereafter from time to time in the course of helping him to buy properties for himself or other members of his family. Mr Jones saw him as a man who always seemed tough and hard-nosed. He gained the impression that Mr McLoughlin was a hardworking businessman with a great deal of ambition, prepared to ride roughshod over rules and regulations to get what he wanted, and intolerant of bureaucracy.
4. Mr McLoughlin told Dr Braude that he had been proud of providing a secure financial footing for himself and his family through consistent hard work. He had wanted his children to have opportunities which had been denied to him when he was young. He said he was proud of his financial independence and devoted to his wife and family.
5. On 20th June 1992 he was arrested and detained at a police station for questioning. The police suspected that on the previous day he had seriously assaulted and robbed one of his tenants of sixty pounds at the tenant's home, the tenant being in arrears of rent at the time. Two weeks later he went back to the police station, where he was charged with robbery and causing grievous bodily harm with intent.
6. He retained the defendants as his solicitors on a paying client basis. They conduct criminal defence work in magistrates' courts and in the Crown Court in Manchester. Ms Lynne Rowley handled the case for him. His defence was that a fight had already taken place and the tenant had already been assaulted by the time he arrived at the house. The tenant, he said, willingly handed over to him the sixty pounds he owed him. This was in fact the cash float from a pub at which the tenant was a barman. He attended a conference with counsel on 22nd October, and five days later his trial was fixed to start on 4th January 1993.
7. His claim in these proceedings is based on contentions which were taken to be true for the purposes of the trial of the preliminary issue, although they are disputed by the defendants. He maintained that they had been negligent in the conduct of his defence. He said he had twice instructed Ms Rowley to place a public advertisement seeking witnesses of the incident, but she failed to carry out his instructions. He also told her to instruct an inquiry agent. He said she told him on 20th December that she expected that she would succeed in having the trial postponed, and that she would contact him again early in the New Year to tell him the revised trial date and the results of her investigations.
8. He was therefore taken by surprise when on 4th January 1993 he was summoned from his place of work to go straight to court to stand trial. There was no time to discuss the case with his solicitor or counsel before the trial started. Two days later he was unanimously convicted by a jury at the Manchester Crown Court on both the charges he faced. Sentencing was adjourned. The judge suggested that he should put his affairs in order because he would be going to prison for some time. His barrister advised him that he could only appeal against his conviction if there was fresh evidence. Otherwise there were no grounds for an appeal.
9. On 22nd January the defendants placed an advertisement in the Manchester Evening News. This led to a witness coming forward five days later who said he had seen a white man being seriously assaulted by two Asian men in the street outside the tenant's house shortly before Mr McLoughlin arrived there. On 8th February Mr McLoughlin was sentenced to four years' imprisonment. On 24th May the Court of Appeal quashed his conviction on being told about the new evidence and directed a retrial. On 4th August 1994 he was acquitted at the retrial on the robbery charge, and the jury failed to agree on the assault charge. The prosecution elected not to pursue the assault charge any further, and a verdict of "not guilty" was entered on both counts.
10. His claim for compensation for general damages was set out in his pleaded case in these terms:

"By reason of the Defendant's breach of contract and/or negligence, the Plaintiff was imprisoned from 8th February to 24th May 1993, suffered the indignity and loss of reputation of being convicted of serious criminal offences and being imprisoned as a consequence, the worry, indignity, trouble and inconvenience of appealing to the Court of Appeal and the preparing for and standing his trial for the re-trial. Further, the Plaintiff suffered the losses caused by the said loss of liberty, reputation and indignity, the losses of his property business and earnings from a building business. Further and additionally, the Plaintiff has suffered a psychiatric reaction to the said circumstances and claims in respect of the said condition and consequential losses."

11. Elias J commented that there seemed little doubt that what he called a mental breakdown did occur. He did not consider it necessary to rehearse the medical evidence in any detail, but he said that it showed that the claimant suffered from a major depressive disorder, which varied in intensity during the relevant period.
12. For the purposes of this appeal it is necessary to set out the history in rather more detail. Mr McLoughlin was understandably anxious when he knew he would be going to prison, and his GP records two visits on 18th January and 6th February, at both of which he prescribed tranquillisers. He saw him again on 15th June, following his release from prison, when he diagnosed a reactive depression and referred him to a clinical psychologist. Although his condition seemed to have improved over the next two months, on 1st September he appeared flat emotionally, with reduced concentration and a loss of confidence and drive.
13. His stay in prison between 8th February and 24th May was a traumatic experience. He was initially taken to HMP Risley, but spent most of his time at HMP Garth before being taken to HMP Brixton for the purposes of his appeal. He said he found the situation extremely stressful. Prisoners were being attacked by other prisoners on a daily basis. He was himself attacked on one occasion, when he did not suffer any physical illness, but a week later four prisoners set upon him, knocked him to the floor, and repeatedly hit him and kicked him. He was also bitten and scratched. From that time onwards he was scared for his safety. He felt he was picked on because he did not fit in. He was later to tell Dr Braude that he had found himself in prison amongst people whom he "couldn't dream of knowing or meeting".
14. Dr Saltmore, the clinical psychologist to whom Mr McLoughlin was referred by his GP, noted that he was not only suffering from stress arising from these matters but also from an unresolved grief reaction to his mother's death the previous October. Other complicating factors were the collapse of his business following his conviction, his worries about his wife and children, and the death on 28th April 1993 of the aunt who had cared for him in Ireland when his mother had tuberculosis. For the purposes of the present preliminary issue it is open to us to assume that he could prove at the trial that he suffered psychiatric illness in part because he believed that all his sufferings were attributable to the negligent way his solicitors had prepared, or not prepared, his defence for the original trial. The judge, who heard Mr McLoughlin give evidence, made the following finding in this context (at p 16):

"It is … plain that it was his clear belief that his conviction at the first trial was the result of the failings of his then solicitors. He said as much to Dr Saltmore … Her notes for the meeting held on 23rd December 1993 record the claimant as having said that 'he has been advised by his barrister that his original solicitors were responsible for the initial conviction as his case was prepared inadequately'."

15. It is unnecessary to set out the subsequent history of his depressive illness in any detail. The judge received written and/or oral evidence from Mr and Mrs McLoughlin, Dr Elliot, Dr Saltmore and Dr Braude, and his conclusion, namely that there was no doubt that the medical evidence showed that Mr McLoughlin suffered from a major depressive disorder, was not really in dispute for the purposes of the preliminary issue. The defendant's solicitor has made it clear (see paragraph 44 of her witness statement) that causation and quantum will be very much in dispute if this aspect of the claim goes forward to trial.
16. The American Psychiatric Association maintains a Diagnostic and Statistic Manual of Mental Disorders (the fourth edition of which is known as DSM-IV). Although Mr McLoughlin was not found to be suffering from significant clinical depression when Dr Braude saw him in January 1998, Dr Braude had little doubt from his account that during some of the time his symptoms had been in keeping with a major depressive disorder (as defined by DSM-IV). His current symptoms were more in keeping with a chronic adjustment disorder (as so defined). This latter disorder reflected the lack of a satisfactory resolution of his difficulties and the ongoing financial stress which appeared to be a direct result of his ongoing conviction and incarceration.
17. Dr Braude considered it unlikely that he would ever fully recover from his experience. He said:

"The effect of his experience has left an indelible psychological scar upon him, but also, its consequences are ongoing and unlikely to ever be satisfactorily resolved. These include not only the material hardship and insecurity, but as importantly, the impact that it has had on him as a man. He comes from humble beginnings and is a self-made man, previously with a sense of pride and achievement, dedicated to family values and providing security and opportunities for his family. These aspects have been undermined and this has severely undermined his sense of self-worth and confidence. His case is very much akin to the ethological concept of learned helplessness. This concept relates to psychological work with animals, whereby they battle to escape from an adversive situation by expressing strong emotion and determination to resolve their difficulties, however, when events are outside of their control and after a period of fighting against such circumstances, and when it becomes apparent to them that they are unable to materially affect their circumstances they lapse into a depressive posture. This concept is directly applicable to Mr McLoughlin's situation. Earlier on in his condition he experienced significant anxiety symptoms and anger, trying desperately to resolve his situation, seemingly with inadequate support from his advisers. With the subsequent turn of events, depressive symptoms, including demoralisation and hopelessness became apparent."

18. The judge held that the psychiatric illness from which Mr McLoughlin suffered was not a reasonably foreseeable consequence of the particular breaches of duty of which he made complaint. Because this was not a case in which physical illness was foreseeable, he directed himself that he should approach the question of foreseeability by asking himself what the hypothetical reasonable man, viewing the position after the event ("ex post facto"), would say it was proper to foresee. He added that in making this assessment it was necessary to judge whether it was foreseeable that a person of normally robust disposition would have suffered the illness in question. He derived the law from three House of Lords decisions: Bourhill v Young [1943] AC 92, 110 and 117; McLoughlin v O'Brian [1983] 1 AC 410, 420, 429 and 432: and Page v Smith [1996] AC 155, 167-169 and 193.
19. Against this background, he reached his conclusions in this part of the case in these terms (at pp 8-9):

"In my view, if we apply these principles of foreseeability to this case, the question is whether, with hindsight, it can be said that it was reasonably foreseeable that the failure to advertise and to engage an inquiry agent would lead a person of ordinary fortitude, in the circumstances of this case, to suffer an identifiable psychiatric illness.

In my view, taking into account the particular conduct which is criticised in this case, I do not think that the chain of causation was reasonably foreseeable. No doubt anger, anxiety and stress were all foreseeable, but in my judgment the breakdown of health which occurred in this case was not. I do not think that the breaches relied upon would have been expected, even with hindsight, to have such severe consequences. In reaching this conclusion I have borne in mind the evidence of Dr Braude who said that a psychiatric illness of this nature was in his view foreseeable if someone was wrongfully imprisoned. The question I have to ask, however, is whether it was reasonably foreseeable that the particular breaches would have that effect."

20. He added that if the defendants had been aware that the claimant was at risk of such a breakdown because of his past history, that might well create a duty that would not otherwise exist (see Cook v Swinfen [1967] 1 WLR 457, 461-2 and Dickinson v James Alexander and Co [1993] 2 FLR 521), but there was no indication in this case that the claimant was potentially susceptible to this kind of psychiatric illness.
21. The judge was placed in a difficulty because of the way in which the parties' advisers had framed the preliminary issue he had to decide. We were invited to assume that a district judge had rubber-stamped the draft consent order we were shown. This contained a direction that the questions of limitation and foreseeability should be tried as preliminary issues before a High Court judge. The parties were unable to show us any order to that effect and we do not know what, if any judicial consideration was given to the appropriateness of this direction. At all events this course of action resulted in the judge being invited to take for granted the proposition that by one route or another the defendants owed Mr McLoughlin a duty to protect him from any foreseeable psychiatric illness that might flow from the negligent acts or omissions of which he has made complaint. To make matters more complicated, the judge was then invited to apply tests of foreseeability which were inappropriate for the resolution of the issue he was asked to decide.
22. So far as the second of these matters is concerned, the problem only became apparent after the hearing of the appeal had been completed and we were considering our judgments. We did not reconvene the court because we had already decided that the appeal should be allowed, and since the true legal position was clear and this was in any event only a preliminary issue in the action, there appeared to be no value in exposing the parties to the expense of a further hearing.
23. I will take this matter first. In cases involving claims for damages for psychiatric illness, attention has mainly been focused on the cases which I described in Leach v Chief Constable of Gloucestershire Constabulary [1999] 1 WLR 1421, 1434 as being "concerned with situations in which a plaintiff suffers psychiatric illness as a result of his own imperilment … or reasonable fear of danger to himself, or as a result of the physical illness or imperilment of a third party (or parties) which has been caused by the defendant". It was the second of these types of situation with which Lord Bridge (like the other members of the House of Lords) was concerned in McLoughlin v O'Brian [1983] AC 410, 431 when he spoke of "the liability of a tortfeasor who has negligently killed or physically injured A to pay damages to B for a psychiatric illness resulting from A's death or illness".
24. It is now well established that English law has created special control and other mechanisms to determine the incidence of legal liability in that type of case. One of these is that the law supposes the claimant to be a person of ordinary phlegm or fortitude. This requirement was justified by Lord Porter in Bourhill v Young [1943] AC 92, 117 in these terms:

"The driver of a car or vehicle, even though careless, is entitled to assume that the ordinary frequenter of the streets has sufficient fortitude to endure such incidents as may from time to time be expected to occur in them, including the noise of a collision and the sight of illness to others, and is not to be considered negligent towards one who does not possess the customary phlegm."

25. Another, mentioned by Lord Wright in Bourhill v Young at p 110, is that the courts asks itself in such a case what the hypothetical reasonable man, viewing the position ex post facto, would say it was proper to foresee. Lord Lloyd of Berwick rationalised this test in Page v Smith [1996] 1 AC 155, 188 by saying:

"This makes sense … where the plaintiff is a secondary victim, For if you do not know the outcome of the accident or event, it is impossible to say whether the defendant should have foreseen illness by shock. It is necessary to take account of what happened in order to apply the test of reasonable foreseeability at all."

26. Neither of these rules is apposite when the relationship between the parties is founded on contract, whether the breach of duty relied upon is a breach of a contractual term, or a breach of a duty of care arising out of the parties' contractual relationship which sounds in damages in tort. In those cases the scope of the inquiry is different. In the present case, it appears to me that it is necessary to go back to first principles in order to identify whether and in what circumstances the defendants might have owed a duty to Mr McLoughlin to assist him in avoiding psychiatric illness before anything useful can be gained by determining whether his psychiatric illness was a foreseeable consequence of a breach of that duty. In other words, as things turned out, the separation of foreseeability issues as a discrete topic of investigation limited undesirably the appropriate field of judicial investigation.
27. In my judgment in Leach I identified (at pp 1434C-1435C) a number of different types of case involving a claim for compensation for psychiatric illness in which the defendant had neither imperilled nor caused physical illness to anyone. Since then a majority of the members of the House of Lords have held in Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455 (at pp 462, 464, 497-8 and 505-7) that the existence of a contract of employment cannot without more give rise to a duty on the part of an employer to avoid exposing his employees to the risk of psychiatric illness resulting from physical harm to others. Lord Hoffmann's speech, however, contained a reference (at p 506A), without disapproval, to the employment case of Walker v Northumberland County Council [1995] ICR 702. He said that Mr Walker's mental breakdown was caused by the strain of doing the work which his employer had required him to do, so that he should be regarded as a primary victim.
28. Against this background, how could a legally enforceable duty of care arise in the present case where, as in Frost, the parties' legal relations are ultimately founded on contract? To answer this question one must go once more to the battery of tests which the House of Lords has taught us to use (see my judgment in Parkinson v St James NHS Trust [2001] EWCA Civ 530 at [50], [2001] 3 WLR 376). I will refer, briefly, to four of them: the "purpose" test (Banques Bruxelles Lambert SA v Eagle Star Insurance Co Ltd [1997] AC 191, 211G-212F); the "assumption of responsibility" test (Henderson v Merrett Syndicates Ltd [1995] 2 AC 145, 180G-181F); the "principles of distributive justice" test (Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455, 503H-504C); and the "three-pronged" test (Caparo Industries plc v Dickinson [1990] 2 AC 605, 617H-618A). The fact that these tests are usually deployed in cases involving pure financial loss does not mean that they are inappropriate for use when the only damage in question is psychiatric illness. Leach itself is a case in which one of these tests was used, although the members of the court differed as to the effect of its application.
29. If I adopt the "purpose" test first, it is arguable that the purpose of the defendants' engagement was that they should use reasonable skill and care in preparing Mr McLoughlin's case for trial in such a way as to minimise the risk of his being wrongfully convicted, and to minimise the risk of his feeling anxiety or distress or even of suffering from psychiatric illness should he be convicted. If anxiety, distress or psychiatric illness are foreseeable consequences of a breach of duty in this regard, then on the "assumption of responsibility" test I have little difficulty in concluding that the defendants should be deemed to have assumed responsibility for those consequences. It has for a long time been recognised that negligent solicitors might be liable to pay their clients compensation for foreseeable consequences of this type (see the cases discussed in McGregor on Damages (16th Edition) paras 1279-1280), so that this is not a step into the unknown. The recent decision of the House of Lords in Farley v Skinner [2001] UKHL 49 will also have freed the courts of some of the inhibitions they used to have in relation to the award of damages for mental distress, let alone psychiatric illness, in an appropriate case.
30. I do not consider that recourse to principles of distributive justice affords much illumination in the present case. It was legitimate to use this approach in Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455 because the existence of the artificial controls originally introduced by the majority of the House of Lords in McLoughlin v O'Brian produced the obviously unfair result that many close relatives of those who died at the Hillsborough Football Stadium could not recover compensation for post-traumatic stress disorder, whereas if principles of corrective justice alone were deployed, the police on duty on the ground that day were prima facie able to recover if their right to recovery were shackled by no such controls. I have no very clear insight into what the ordinary person on the London Underground, or in a Glasgow public house, or in any other place where he or she may be found, would regard as fair in this case. I suspect that their view of the matter might be affected by their view of the seriousness of the defendants' proved negligence.
31. This, therefore, leaves the three-pronged test in Caparo Industries plc v Dickinson [1990] 2 AC 605. There is no difficulty about proximity, and no need to create an imaginary person of ordinary phlegm and fortitude. The duty is owed to Mr McLoughlin. Similarly, given the positive results of the "purpose" test and the "assumption of responsibility" test, if the "foreseeability" test is also passed, then I would consider it to be fair, just and reasonable for Mr McLoughlin to recover compensation (compare Henderson v Merrett Syndicates Ltd [1995] 2 AC 145, 181C-D). How then, should the relevant duty be identified, and was Mr McLoughlin's psychiatric illness a foreseeable consequence of the assumed breach, or breaches of duty? These are the questions at the heart of this inquiry.
32. Recent decisions of the House of Lords require the courts to identify more carefully than before the scope of the duty of care relied on, so that it may be possible to see without too much difficulty whether the damage claimed to be a consequence of the breach is properly recoverable. In the present case there was no such clarity. There was, unhappily, a dispute between counsel as to the way in which Mr Wilby QC put his client's case before Elias J. Paragraphs 9 and 10 of the Amended Statement of Claim set out the factual matters on which the claimant relied in relation to his instructions to the defendants and also the way in which he was summoned to the trial from his place of work, convicted and sentenced. Further information was then sought and given about the occasions on which he claimed that he gave Ms Rowley specific instructions about the inquiries and advertisements he wished her to put in train. These specific instructions, and Ms Rowley's failure to act on them, coupled with her failure to tell Mr McLoughlin that the case was still listed for 4th January 1993, were then picked up in sub-paragraphs (b) to (d) of the particulars of breach of contract and/or negligence. Sub-paragraphs (a), (e) and (f) of those particulars, however, were expressed in very general terms, and no attempt had been made to seek details of the scope of complaint they were intended to cover. Nothing was pleaded about any duty to protect Mr McLoughlin from any particular type of harm.
33. We have seen a transcript of counsel's submissions at the start of the hearing, but no recording was made of the final submissions. An exchange between counsel during Mr Brown's opening (see pp 15-16 of the transcript) shows that Mr Wilby was not withdrawing any part of his pleadings, whereas Mr Brown was concerned about the absence of any further particularisation of the claimant's case. Mr Wilby's closing submissions were completed at the end of the third day of the hearing, and Mr Brown made a note that evening, when preparing his own final speech: "General allegations re failure to prepare. Grateful concession. No other substantive allegations. Otherwise – would have to be dealt with as well".
34. Mr Wilby was adamant that he had not conceded that he was not now relying on any of the specific allegations contained in his pleading, and the judge did not refer to any such concession in his judgment. It appears to me that we should proceed on the basis that on the trial of the preliminary issue all the specific allegations of negligence remained outstanding, but that it was accepted that the very general allegations in paragraphs (a), (e) and (f) of the particulars took matters no further. This, indeed, is the basis on which the judge approached the matter (see transcript, p 3).
35. It follows that the case as presented to the judge on the assumed facts should have run along the following lines:

i) Mr McLoughlin was convicted of serious crime and sent to prison (for the first time in his life) for four years when he was not guilty of the offences alleged and when he had reasonable cause to believe that these misfortunes would not have befallen him if his solicitors had handled his case with proper care.

ii) The solicitors' lack of care consisted not only in failing to advertise for witnesses when the placing of such an advertisement would have ensured his acquittal at the first trial, and failing to engage an inquiry agent, but also in their failure to tell him that the trial remained listed for 4th January, so that he was catapulted into it with no notice from his place of work without having any opportunity of discussing matters with counsel and his solicitor before the trial began.

iii) Was it reasonably foreseeable as a matter of law that in all these circumstances Mr McLoughlin would suffer a psychiatric illness of some kind as a consequence of his solicitors' lack of care in these respects?

36. It is unfortunate that the manner in which the preliminary issue was framed did not require the judge to investigate the context in which it might matter whether the claimant's psychiatric illness was foreseeable, but the parties agreed that the matter should be dealt with in this way, and any elucidation will have to await the outcome of the full trial that is now bound to take place, given the unsatisfactory features of the trial of this preliminary issue to which I have referred in this judgment.
37. Because the judge wrongly used the "person of reasonable fortitude" test and wrongly used the "foreseeability with the benefit of hindsight" test he did not make the findings that were necessary in order that this issue could be decided on the correct lines. He was also not helped by the fact that Mr Wilby chose not to challenge any aspect of the defendants' three witnesses' perception of Mr McLoughlin's character, while Dr Braude's opinion that it was foreseeable that Mr McLoughlin might develop some psychological reaction to being falsely convicted and imprisoned also seems to have gone unexplored in cross-examination (so far as this court is aware). He also did not take into account, perhaps because the point was not developed properly until the appeal, the consideration that a material cause of Mr McLoughlin's illness was his belief that he would not have been convicted and imprisoned if his solicitors had handled his case with appropriate care.
38. On a number of occasions the House of Lords has considered the nature of the "foreseeability" test which should be used in actions in tort. In Glasgow Corporation v Muir [1943] AC 448 Lord Thankerton said at p 454:

"The court must be careful to place itself in the position of the person charged with the duty and to consider what he or she should have reasonably anticipated as a natural and probable consequence of neglect, and not give undue weight to the fact that a distressing accident has happened."

39. In Bolton v Stone [1951] AC 850 Lord Porter observed (at p 858):

"It is not enough that the event should be such as can reasonably be foreseen. The further result that illness is likely to follow must also be such as a reasonable man would contemplate before he can be convicted of actionable negligence. Nor is the remote possibility of illness occurring enough. There must be sufficient probability to lead a reasonable man to anticipate it. The existence of some risk is an ordinary incident of life, even when all due care has been, as it must be, taken."

40. Lord Bridge discussed this question at some length in McLoughlin v O'Brian [1983] 1 AC 410 at pp 432A-433C:

"Then, here comes the all-important question. Given the fact of the plaintiff's psychiatric illness caused by the defendant's negligence in killing or physically injuring another, was the chain of causation from the one event to the other, considered ex post facto in the light of all that has happened, 'reasonably foreseeable' by the 'reasonable man'? A moment's thought will show that the answer to that question depends on what knowledge is to be attributed to the hypothetical reasonable man of the operation of cause and effect in psychiatric medicine.

There are at least two theoretically possible approaches. The first is that the judge should receive the evidence of psychiatrists as to the degree of probability that the particular cause would produce the particular effect, and apply to that the appropriate legal test of reasonable foreseeability as the criterion of the defendant's duty of care.

The second is that the judge, relying on his own opinion of the operation of cause and effect in psychiatric medicine, as fairly representative of that of the educated layman, should treat himself as the reasonable man and form his own view from the primary facts as to whether the proven chain of cause and effect was reasonably foreseeable.

In principle, I think there is much to be said for the first approach. Foreseeability, in any given set of circumstances, is ultimately a question of fact. If a claim in negligence depends on whether some defect in a complicated piece of machinery was foreseeably a cause of illness, I apprehend that the judge will decide that question on the basis of the expert evidence of engineers. But the authorities give no support to this approach in relation to the foreseeability of psychiatric illness. The judges, in all the decisions we have been referred to, have assumed that it lay within their own competence to determine whether the plaintiff's 'nervous shock' (as lawyers quaintly persist in calling it) was in any given circumstances a sufficiently foreseeable consequence of the defendant's act or omission relied on as negligent to bring the plaintiff within the scope of those to whom the defendant owed a duty of care. To depart from this practice and treat the question of foreseeable causation in this field, and hence the scope of the defendant's duty, as a question of fact to be determined in the light of the expert evidence adduced in each case would, no doubt, be too large an innovation in the law to be regarded as properly within the competence, even since the liberating 1966 practice direction [Practice Statement: Judicial Precedent [1966] 1 WLR 1234] of your Lordships' House.

Moreover, psychiatric medicine is far from being an exact science. The opinions of its practitioners may differ widely. Clearly it is desirable in this, as in any other, field that the law should achieve such a measure of certainty as is consistent with the demands of justice. It would seem that the consensus of informed judicial opinion is probably the best yardstick available to determine whether, in any given circumstances, the emotional trauma resulting from the death or illness of third parties, or indeed the threat of such death or illness, ex hypothesi attributable to the defendant's negligence, was a foreseeable cause in law, as well as the actual cause in fact, of the plaintiff's psychiatric or psychosomatic illness.

But the word I would emphasise in the foregoing sentence is 'informed'. For too long earlier generations of judges have regarded psychiatry and psychiatrists with suspicion, if not hostility. Now, I venture to hope, that attitude has quite disappeared. No judge who has spent any length of time trying personal illness claims in recent years would doubt that physical injuries can give rise not only to organic but also to psychiatric disorders. The sufferings of the patient from the latter are no less real and frequently no less painful and disabling than from the former. Likewise, I would suppose that the legal profession well understands that an acute emotional trauma, like a physical trauma, can well cause a psychiatric illness in a wide range of circumstances and in a wide range of individuals whom it would be wrong to regard as having any abnormal psychological make-up. It is in comparatively recent times that these insights have come to be generally accepted by the judiciary. It is only by giving effect to these insights in the developing law of negligence that we can do justice to an important, though no doubt small, class of plaintiffs whose genuine psychiatric illnesses are caused by negligent defendants."

41. Three comments need to be made about this passage. The first is that it is concerned only with the type of case in which a secondary victim suffers psychiatric illness (most commonly post-traumatic stress disorder) in consequence of the imperilment of a third party caused by the negligent act of the defendant. It is not concerned with a claim founded ultimately on contract, in which the duty is owed to an identifiable person known to the defendant from the time when the contract was made. The second is that although psychiatric medicine will never be an exact science, our knowledge and understanding of the causes of psychiatric illness, which are still developing, have progressed in the 19 years since McLoughlin v O'Brian case was decided. Finally, it is relevant to note that Lord Bridge appreciated that in appropriate circumstances foreseeable psychiatric illness may be suffered by people whom it would be wrong to regard as having any abnormal psychological make-up.
42. It is well-settled law that it is the judge, and not the expert, who must decide whether psychiatric illness was reasonably foreseeable in any given case, and Lord Bridge's dicta remain established authority in the class of case with which he was concerned. Lord Bridge referred, however, to informed judicial opinion, and it appears to me that in the present type of case it would turn the administration of justice into too much of a lottery if the outcome of a claim had to depend on the knowledge (or lack of it) of the individual judge without any assistance from experienced psychiatrists at all, particularly as the number of judges likely to be invited to try a case like this has increased so much since 1982.
43. For example, it may be very well known to all psychiatrists and to many lay people that if a man like Mr McLoughlin is wrongly sent to prison for the first time with a burning sense of injustice because his solicitors have let him down, he is likely to suffer from some kind of psychiatric disorder. If this insight is denied to the individual judge (who is also to be denied, if Lord Bridge's words are to be taken literally, any assistance from expert evidence on the subject, even if that expert evidence is likely to be agreed) the claimant will lose merely because the judge, by chance, is not sufficiently well-informed.
44. For my part, I do not consider that we are bound by authority to hold that at any rate in a case where the parties' relationship stems ultimately from contract, appropriate experts may not give evidence about the statistical incidence of the occasions when people who are not immediately identifiable as vulnerable personalities suffer psychiatric illness of different kinds as a result of being exposed to events comparable to those experienced by the claimant in the case now before the court. Anyone who reads the newspapers is familiar with the distressing psychiatric disorders suffered by released prisoners in the well known "miscarriage of justice" cases, and I see no reason why a judge should not be assisted in his difficult task of determining what the defendant should have reasonably foreseen by receiving evidence of this kind.
45. Mr Gibson QC suggested that a judge in this type of case should bear the following matters in mind:

i) The requirement that damages can only be recovered if the illness which results is a foreseeable result of the specific act or omission upon which the claimant relies;

ii) The requirement that damages can only be recovered if there is a sufficient degree of likelihood that the type of loss in question, namely an actual breakdown in health, will occur;

iii) The requirement that damages can only be recovered if it is foreseeable that the illness would have been suffered by a person of a normally robust disposition;

iv) The fact that the standard by which the defendants are to be judged is the standard of the ordinary reasonable man in the circumstances of the defendants, namely, someone who is a solicitor practising in criminal law, and not someone who is a consultant psychiatrist.

46. I have no difficulty with the first and last of these propositions. As to the second, I would substitute the words "psychiatric illness" for the words "an actual breakdown in health" and refer, as I did in Arrowsmith v Beeston (CAT 18 June 1998) to Chapter 3 of the Law Commission's Report on Liability for Psychiatric Illness (1998) Law Com No 249 for a very helpful explanation of features of the illnesses with which courts are most frequently concerned. I have already explained why I disagree with Mr Gibson's third test, which I would rewrite in these terms: "the requirement that damages can only be recovered if it is foreseeable that psychiatric illness would have been suffered by the claimant, given all those features of his personal life and disposition of which the defendants were aware".
47. We were invited to consider a large number of cases, decided on different facts, and I have taken them into account when writing this judgment. Mr Gibson, for instance, drew our attention to Calveley v Chief Constable of Merseyside Police [1989] 1 AC 1228 where Lord Bridge said at p 1238C that it was not reasonably foreseeable that the negligent conduct of a criminal investigation would cause illness to the health of the suspect, whether in the form of a depressive illness or otherwise. It does not appear to me to be helpful to rely on dicta in other cases in this very difficult field unless they establish some general point of principle relevant to the actual case before the court, and I do not consider that this dictum of Lord Bridge affords that type of assistance. I would add that it was common ground between counsel that consideration of questions of remoteness in contract would add nothing useful to the test of foreseeability deployed in tort.
48. In all the circumstances I am satisfied that this judgment cannot stand. It must be set aside, and there should be a full trial of all the issues in the case, at any rate up to and including issues of causation. In view of the delays that have already occurred, it would be desirable that damages were also tried on the same occasion, but I would not wish to preclude the possibility that the assessment of damages is hived off, provided that it is timetabled to follow quite speedily if the claimant succeeds on liability.
49. I have had the opportunity of reading the judgment of Hale LJ. The interesting point she raises in paragraphs 57 to 59 of her judgment is clearly worthy of full argument on some other occasion. Indeed, it would be open to the claimant at the trial of this action, if he wished to raise it. Like almost everything else in this field of law, it opens up policy questions on which it would be wrong for us to express any view on the present appeal.

Lady Justice Hale:

50. I agree that the appeal must be allowed and that there should be a full trial of all the issues in the case, at least up to and including causation. I add some further words, not only because we are differing from the judge, but also because we are differing from the way in which the case was presented both to him and to us. The judge was simply asked to decide upon the question of 'foreseeability'. He approached this question on the basis of 'the principles recently summarised by Lords Keith and Jauncey', who gave the dissenting speeches in Page v Smith [1996] AC 155. Mr Wilby told us that there was 'nothing between the parties' on the law. However, as Brooke LJ has shown, the question is not quite as simple as that would suggest.
51. The law distinguishes between the understandable emotional responses to adverse events which people may have, such as distress, anxiety, rage, or grief, and recognised psychiatric illness, such as post traumatic stress disorder or clinical depression. The law is very reluctant to award damages for the former, although it will do so in certain still quite narrowly defined circumstances: see, most recently, Farley v Skinner [2001] UKHL 49. That, like this, was a claim in contract for professional negligence. It has been clear for some time that damages may be awarded in such cases for recognised psychiatric illness: see Cook v Swinfen [1967] 1 WLR 457. We now know a great deal more about the diagnosis and aetiology of mental disorders and recognise that they can be as real and as disabling as physical disorders. But the law is still reluctant to treat them in exactly the same way as any other personal injury. In Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455 (as the case entitled White v Chief Constable of South Yorkshire Police in the law reports is usually known), at pp 493 to 494, Lord Steyn gave four reasons for this: it is difficult to draw the line between acute grief and psychiatric illness; the unconscious effect upon potential claimants may be to exacerbate such harm; the class of people within the range of such harm is greatly increased; and the consequent burden upon defendants would be disproportionate. Not surprisingly, therefore, judicial attitudes have swung backwards and forwards in recent years and the present law has been described as a 'patchwork' rather than a coherent scheme. Most of those recent cases, however, have been pure tort actions, in which the identity of the claimant is not known to the defendant unless and until an accident happens.
52. As Lord Hoffman put it in Frost, the House of Lords in McLoughlin v O'Brian [1983] 1 AC 410 came 'within a hair's breadth' of treating psychiatric injury in the same way as physical injury. There were still, however, some differences: principally that psychiatric injury must have been reasonably foreseeable in a 'person of ordinary phlegm' in the events that have taken place. That is the approach summarised by Lords Jauncey and Keith in their dissenting speeches in Page v Smith [1996] AC 155. It is also reflected in dissenting speech of Lord Goff in Frost v Chief Constable of South Yorkshire [1999] 2 AC 455.
53. The majority, however, in both Page and Frost took a different approach. They have drawn a distinction between 'secondary' and 'primary' victims. McLoughlin v O'Brian [1983] 1 AC 410, like Bourhill v Young [1943] AC 92, which preceded it, and Alcock v Chief Constable of South Yorkshire Police [1992] 1 AC 310 and Frost v Chief Constable of South Yorkshire Police [1999] 2 AC 455, which followed it, concerned 'secondary' victims: people who were not themselves at risk of physical injury but suffered psychiatric injury through witnessing physical injury to others. In those cases, the law has developed a number of additional 'control mechanisms' to limit the scope of liability: the secondary victim must have a close personal relationship with the primary victim, must be close in space and time to the events in question, and must see them for himself rather than be told about them. The House held that those mechanisms apply just as much to police officers and others who witness such shocking events in the course of their duty as they do to relatives and friends.
54. Page v Smith [1996] AC 155, on the other hand, concerned a 'primary victim': someone involved in a road traffic accident of moderate severity who fortunately suffered no physical injury but whose previously variable myalgic encephalomyelitis became chronic and permanent, allegedly as a result. The dissenters held that it was not foreseeable that such an accident would bring on such a severe reaction. The majority agreed with Lord Lloyd, who held at p 187F, that

"since the defendant was admittedly under a duty of care not to cause the plaintiff foreseeable physical injury, it was unnecessary to ask whether he was under a separate duty of care not to cause foreseeable psychiatric injury."

The control mechanisms appropriate in secondary victim cases, specific proximity and foreseeability in a person of 'ordinary phlegm', did not apply.

55. In Frost v Chief Constable of South Yorkshire [1999] 2 AC 455, both Lord Steyn and Lord Hoffman confined the principle in Page to those who were within the range of foreseeable physical injury. However, it is clear from the speech of Lord Hoffman that the concept of a primary victim can go further than that: when discussing the employment case of Walker v Northumberland County Council [1995] 1 All ER 737, while emphasising that the employment relationship does not turn someone who would otherwise be regarded as a secondary victim into a primary victim, he described the employee in that case as 'in no sense a secondary victim'. His mental breakdown was caused by the strain of doing the work which his employer required him to do'. But that work in itself did not bring him within the range of foreseeable physical injury. Their lordships did not discuss, because it did not arise in that case, what the approach should be to claimants who were not within the range of foreseeable physical injury but were nonetheless to be regarded as primary victims.
56. It is quite clear that the claimant in this case should also be regarded as a primary victim. Indeed the judge said so:

"In my view it is clear on any common sense view that the claimant in this case would be described as a 'primary' victim and that the particular rules developed for secondary victims have no application to him."

The one consequence of that which is also quite clear is that the question of what might be foreseen in a person of "ordinary phlegm" does not arise. The question of foreseeability must be considered in relation to this particular claimant, and what the defendants knew or ought to have known about him.

57. There is an argument for going further than that and regarding this claimant as the same sort of primary victim as the claimant in Page v Smith [1996] AC 155. Loss of liberty is just as much an interference in bodily integrity as is loss of a limb. It is obviously foreseeable that negligence such as that pleaded in this case in the conduct of the defence of a person wrongly accused of serious criminal offences will result in their conviction and imprisonment. This is quite different from negligence in the conduct of matrimonial proceedings, as in Cook v Swinfen [1967] 1 WLR 457 and Dickenson v Jones, Alexander & Co [1993] 2 FLR 521: these do not (unless there is contempt of court) result in loss of liberty. Why should the person guilty of negligence in the conduct of proceedings which may lead to wrongful imprisonment not be liable for the consequential psychiatric injury? Why should this be any different from the person who suffers physical injury in a road accident with consequential psychiatric illness? No one has ever doubted (nor did the majority of the House of Lords in Frost) that psychiatric illness consequent on foreseeable physical injury is recoverable. If, in accordance with Page v Smith, physical and psychiatric injury are the same kind of injury, namely personal injury, why should this case be any different?
58. Psychiatric injury is different in kind from economic loss. The law has traditionally regarded both with some scepticism. It has restricted the scope of any duty to avoid causing purely economic loss: this is obviously right. The object of a great deal of economic activity is to succeed while others fail. Much economic loss is intentionally, let alone negligently, caused. Only, therefore, where unlawful means are used or the defendant has assumed some responsibility towards another to avoid such loss should there be liability. The considerations in relation to psychiatric injury are rather different: hardly anyone sets out to cause such injury to competitors or anyone else (if they do, the tort of intentionally inflicting harm under the principle in Wilkinson v Downton [1897] 2 QB 57 is committed). The law's scepticism has rather to do with the infinite scope of adverse psychiatric reactions and the other difficulties identified by Lord Steyn in Frost. This is much more akin to the kind of dilemma presented by cases such as McFarlane v Tayside Health Board [2000] 2 AC 59, where ordinary principles of corrective justice would lead to liability, at least for the consequential economic losses caused by the negligent infliction of unwanted pregnancy and childbirth, but the wider considerations of what is 'fair, just and reasonable' led to a contrary conclusion.
59. I agree with Brooke LJ that none of the battery of tests which have now to be applied to novel types of liability lead to the conclusion that it should be refused in cases such as this. On the contrary, they lead to the conclusion that it should not. There is no reason to apply any of the additional control mechanisms applicable to secondary victims. But if we cannot go so far as to hold that Page v Smith [1996] AC 155, rather than Cook v Swinfen [1967] 1 WLR 457, covers this case, then the ordinary principle in The Wagon Mound [1961] AC 388 should apply: psychiatric injury to this claimant should be the reasonably foreseeable result of the defendant's negligence. In deciding this issue, the context of loss of liberty and the character and personality of the claimant are of particular importance. Psychiatric evidence may be helpful, although of course not determinative.
60. I believe that this result is the same as that reached by Brooke LJ. We are concerned only with this type of case and not with others in which claimants who are not within the foreseeable scope of physical injury may nevertheless be regarded as primary victims.

Mr Justice David Steel: -

61. I also agree that this appeal must be allowed. This outcome is attributable in large part to the parties' failure to use the procedure for determining preliminary issues properly.
62. The claimants' pleaded case was highly fact sensitive, being both unusual and contentious. Yet no attempt seems to have been made to establish the factual premise for the issue of law on which the judge was invited to rule. In addition the parties then presented the judge with a joint view of the legal issues which was misconceived. An additional complication was the degree of confusion as to the scope of the oral evidence and the need or otherwise for cross-examination on matters pertaining to foreseeability as opposed to limitation. One outcome was the almost inevitable dispute between counsel as to the relevant scope of the claimants' case.
63. As Lord Scarman observed in Tilling v. Whiteman [1980] AC 1 at p. 25: "Preliminary points of law are too often treacherous short cuts." The dangers are all the greater where, as here, the preliminary issues are set in motion in a casual and unstructured way.
64. No formal order appears to have been drawn up. The parties apparently proceeded by reference to a draft consent order prepared in December 1999. The relevant part reads as follows:-

1. The questions of limitation and foreseeability shall be tried as preliminary issues before a High Court Judge.

2. Disclosure of any documents on which the party seeks to rely or any further documents relevant to the preliminary issues by 4.00pm on the 14^th January 2000;

3. Mutual exchange of witness statements by 4.00 pm on the 12th February 2000;

4. Mutual exchange of medical experts reports by 4.00 pm on the 10^th March 2000….

65. The ambiguities of this order are only too obvious. No attempt was made to distinguish between the factual investigation required for the purposes of the limitation plea as opposed to the issue of foreseeability. It was wholly impractical for there to have been a full trial of the factual issues pertinent to foreseeability. It was an issue that should have presented on agreed or assumed facts. If this was not a practical proposition, the issue of foreseeability should never have been taken separately.
66. In my judgment, the right approach to preliminary issues should be as follows:-

a. Only issues which are decisive or potentially decisive should be identified;

b. The questions should usually be questions of law.

c. They should be decided on the basis of a schedule of agreed or assumed facts;

d. They should be triable without significant delay, making full allowance for the implications of a possible appeal;

e. Any order should be made by the court following a case management conference.

67. I somewhat doubt whether, if this approach had been adopted in this case, an order would have been made. As it is, the outcome has been substantial delay and duplication of cost.
Order: appeal allowed; order made in the terms of agreed draft. (Order not part of approved judgment)