Allied Maples Group v Simmons & Simmons [1995] 4 All ER 907

Defendant paid Plaintiff, solicitors, to take over a company for them. After completion, Defendant became aware of several claims that could be made against them as a result of the takeover agreement and sued Defendant.

CA allowed the claim, saying that causality was a question of fact, to be determined on the balance of probability and that once this fact was established, Defendant was entitled to claim for damages in full.

Where this question relates to a 3rd party and he can show that there was a substantial/real chance (NOT merely a speculative one) that a 3rd party would have conferred a benefit on him (or averted a detriment) he can claim for the value of the benefit foregone.

The CA found (Millett LJ dissenting on purely factual grounds) that had it not been for Defendant’s negligence, Plaintiff would not be open to the aforementioned claims.

• Thus loss of a chance to be indemnified against losses could be compensated where the loss was dependent on the acts of a third party (i.e. whether the target company would have agreed to such indemnities).