Source: http://insurance.dwf.co.uk/news-updates/2019/01/the-professional-perils-of-genetic-testing-and-mountaineering/
Timestamp: 2019-04-26 11:41:38+00:00

Document:
Defendants in many areas of law can often feel that they are 3-0 down once breach of duty is conceded, but causation can give rise to significant opportunities to retrieve the situation, whether as a complete defence or as a means to substantially reduce quantum.
Therefore a recently decided case, Khan v. MNX  EWCA Civ 2609, should be of interest. While it highlights that negligence claims involving genetic testing can give rise to very large claims, after an appeal to the Court of Appeal the principles relating to scope of duty of care in negligence claims have been re-stated in a way that is helpful to professionals and their insurers.
How does this affect professionals and their insurers?
What about risk management for professionals?
The claimant's nephew suffered from haemophilia, so she wished to avoid having a child with that condition. She consulted a GP with a view to establishing whether she was a carrier of the haemophilia gene. Blood tests were arranged, but to establish whether the claimant herself had haemophilia, not whether she was a carrier. The claimant's GP (the defendant) informed her that the test results were normal, and the Claimant was led to believe that any child she had would not have haemophilia. The claimant subsequently became pregnant and gave birth to her son. Sadly, he was diagnosed as having haemophilia. At that point the claimant was referred for genetic testing which confirmed that she was indeed a carrier. Some years later, her son was also diagnosed with autism, which was congenital but unrelated to his haemophilia. It was accepted at trial that if the claimant had known she was a carrier of the haemophilia gene she would have obtained foetal testing for haemophilia which would have been positive, and she would have undergone a termination of that pregnancy.
The defendant GP admitted negligence. The question at trial was whether the claimant was entitled to damages only for the cost of raising a child with haemophilia, or whether the Claimant was also entitled to damages for the cost of raising a child with autism. The defendant argued that she should not be liable for damages in relation to the autism because the claimant had not been seeking advice about the risk of having a child with autism, only haemophilia. However, the High Court held that that recovery of damages associated with a disability not directly linked to the negligence is fair where the disabled child would not have been born but for the negligence and where the disability arises out of the normal incidents of conception, intra-uterine development and birth. The claimant was entitled to damages in respect of her son's haemophilia and his autism, assessed at £9million.
The defendant appealed, relying on South Australia Asset Management Co v. York Montague Limited  UKHL 10 ("SAAMCO"). The judgment gives us an opportunity not only to remind ourselves at the principles of scope of duty in a clinical negligence setting, but in relation to other areas of negligence.
Thedefendant succeeded, in short, because the costs of the care required by autism were outside the scope of duty imposed on the defendant, which were restricted to the condition of haemophilia.
"A mountaineer about to take a difficult climb is concerned about the fitness of his knee. He goes to the doctor who makes a superficial examination and pronounces the knee fit. The climber goes on the expedition, which he would not have undertaken if the doctor told him the true state of his knee. He suffers an injury which is an entirely foreseeable consequence of mountaineering but has nothing to do with his knee.
"On the Court of Appeal's [incorrect] principle, the doctor is responsible for the injury suffered by the mountaineer because it is damage which would not have occurred if he had been given correct information about his knee. He would not have gone of the expedition and would have suffered no injury. On what I have suggested is the usual principle, the doctor is not liable. The injury has not been caused by the doctor's bad advice because it would have occurred even if the advice had been correct."
In the example, the scope of the doctor's duty was to pronounce on whether the fitness of the knee would give rise to problems, knowing that the patient was contemplating a climbing trip. But as the injury was not related to the knee, he cannot be held liable for it. Similarly, the scope of the defendant's duty was to pronounce on the considered valuation of the properties in question, knowing that the plaintiff was contemplating lending in reliance on the valuation. The duty did not encompass any comment on, or guarantee that, the property would not fluctuate adversely in the future. Accordingly, the consequences of the transaction that fell outside the scope of that duty could not be visited on the defendant.
At first instance, Yip J relied on Chester v Afshar rather than SAAMCO. Chester v Afshar held that the defendant healthauthority was liable for failing to warn of the small risk (which transpired) associated with an operation. While this is a somewhat controversial decision, the aspect of Chester v Afshar that commentators find somewhat unsatisfactory is not one that is directly relevant here - namely that the court held that causation of injury is deemed to be proven if the claimant would have delayed the operation if properly advised of the risks such that the claimant does not have to make out a case that he or she would never have had the operation at all if properly advised.
The Court of Appeal in Khan criticised Yip J's reasoning, saying, "Central to the reasoning in Chester v Afshar was the fact that the misfortune which befell the claimant was the very misfortune that the defendant had a duty to warn against. A fundamental distinction with the facts of this case."
Q1.What was the purpose of the allegedly negligent procedure/information/advice?
A: To allow the insured to make an informed decision about her family planning in the light of her potential carrying of a haemophilia gene, and nothing to do with autism or any other conditions.
Q2. What was the appropriate apportionment of risk taking account of the nature of the advice, procedure, information?
A: The doctor would be liable for the risk of a mother giving birth to a child with haemophilia because there had been no foetal testing and consequent upon it no termination of the pregnancy. The mother would take the risks of all other potential difficulties of the pregnancy and birth.
Q3.What losses would in any event have occurred if the defendant’s advice/information was correct?
A: The child would have been born with autism.
Thus, following the same reasoning as SAAMCO, the manifestation of the son's autism was outside the scope of the doctor's duty, it being a loss that would have transpired even in the entirely hypothetical situation in which the doctor had correctly stated that the Claimant was not a carrier of haemophilia. Accordingly, the defendant's liability was restricted to losses relating to haemophilia only.
We understand that permission to appeal to the Supreme Court has been refused. However, the application of SAAMCO in a very different context (accountants' liability when giving specialist advice on interest rate swap schemes to institutional lenders) has just been examined by the Court of Appeal in Manchester Building Society v. Grant Thornton LLP  EWCA Civ 40. In that instance, the first instance judge held that the negligent advice regarding treatment of the swaps could not extend to the fact that they were devalued following the 2008 crash, despite the fact that the Society would not have held those swaps had the correct advice been given. The Court of Appeal found that the judge had reached the right ultimate conclusion, but for the wrong reasons. In coming to its decisions the Court of Appeal re-stated the well-established distinction between SAAMCO "information" cases and "advice" cases. Khan is an example of an "information" case.
The Khan and the Grant Thornton decisions should be good news to professionals and their insurers. The Court of Appeal has resisted the erosion of causation principles, and in the Khan case avoided upholding a decision based on "but for" causation reasoning. In doing so, the Court avoided a very significant expansion of the scope of a professional's potential liability with all the implications for larger claims and larger professional or medical indemnity insurance premiums that would have followed.
Defence lawyers acting for professionals and their indemnity insurers should be re-doubling their efforts to identify and rely on scope of duty and causation defences wherever available, and to correctly categorise "information" and "advice" cases where SAAMCO is relevant. Khan illustrates that claimant solicitors remain very willing to pursue "but for" causation arguments, and the attraction of those arguments to first instance judges should not be underestimated, especially in very sad and emotive cases such as Khan itself. Defendant vigilance will be especially important in the short term, as the decision in Kennedy v Frankel  EWHC 106 (QB) – by coincidence also before Yip J – illustrates that the Court of Appeal decision in Khancould in some cases give the opportunity to raise new defences even at a very late stage in the case.
In terms of wider implications for risk management, the Court of Appeal's decisions do reinforce the value of properly defining the scope of a professional's role. While in some situations the scope of a professional's role is decided entirely by the particular situation, in others the professional and the client/patient have a choice about how to delineate the professional's role. In those cases careful thought needs to be given at the time about whether the professional is to give "information" or "advice", and what both parties want the professional to take responsibility for. The decisions need to be recorded contemporaneously. The value of a 'scope of duty/causation' defence would be severely undermined if it was dependant on a preliminary finding of fact about what the scope of the professional's role actually was.

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