Loss of chance claims: a strategic tool in professional negligence disputes

When professional advice goes wrong, proving the resulting loss can be the biggest hurdle to recovery. Loss of chance claims offer a pragmatic solution, allowing claimants to recover damages even where outcomes remain uncertain.

What is loss of chance?

A ‘loss of chance’ claim is a form of damages claim most commonly arising in professional negligence disputes. The claimant argues that, but for the negligence of their professional adviser, they would have had the opportunity to secure a more favourable outcome – for example, settling litigation on better terms or completing a transaction on more advantageous conditions.

How loss of chance works

In professional negligence cases, claimants must typically prove that, but for the defendant’s breach, they would have achieved a better outcome. The loss of chance doctrine modifies this burden where the outcome depends on the actions of third parties or inherently uncertain events.

Rather than requiring proof on the balance of probabilities (that success was more likely than not), the court assesses the value of the lost opportunity and awards damages proportionate to the likelihood of success.

Ultimately, loss of chance allows recovery even where a claimant can’t prove that they would, more likely than not, have succeeded in the underlying matter.

For example, if negligent advice caused a business to lose the opportunity to pursue litigation with a 60% chance of success, damages could be assessed at 60% of the claim’s potential value.

There are several key questions to consider before bringing a loss of chance claim:

• Can you establish a breach of duty? Did the defendant fail to meet the standard expected of a reasonably competent professional in the circumstances?
• Does the lost opportunity depend on the actions of third parties? Loss of chance principles apply where the outcome turns on what a third party would have done. If it depends on the claimant’s own conduct, the claimant must prove what they would have done on the balance of probabilities, including that they would have acted honestly
• Was the lost chance real and substantial, and can you evidence its value? Courts will not compensate speculative losses. You must be able to assess the prospects of success in the underlying matter and quantify what would have been recovered
• Is the claim practical to pursue? Consider whether you’re within the limitation period (as defined by the Limitation Act 1980), whether sufficient evidence remains available and whether the defendant has the means (such as professional indemnity insurance) to satisfy any judgment.

Benefits for claimants

Loss of chance claims can enable recovery where traditional principles of causation would otherwise bar a remedy. They often provide a commercially realistic approach, recognising that business decisions rarely involve certainty.

Risks to consider

However, these claims carry inherent limitations and restrictions. The lost chance must be real and substantial, not merely speculative. Courts will scrutinise the underlying merits closely, and weak underlying claims are likely to lead to a proportionate reduction in recovery.

Practical takeaway

For commercial parties, loss of chance provides a valuable mechanism for holding professionals accountable without the often impossible task of proving hypothetical outcomes with certainty.