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The High Court has ruled that a failure by Hill Dickinson to obtain a guarantee over the condition of a yacht sold by property tycoon Christian Candy did not lead to its client’s losses.
Hill Dickinson partner James Lawson had assured his client Michael Hirtenstein post-purchase that the €4.5m yacht came with a personal guarantee from Candy for the condition of the boat, which broke down within an hour of its purchase.
However when Hill Dickinson proposed a claim for breach of warranty against Candy, it emerged that no such guarantee had been made.
Hirtenstein subsequently sued Hill Dickinson for professional negligence, claiming that had he been told there was no guarantee, he would not have bought the yacht and would not have suffered any loss.
Hill Dickinson admitted its breach of duty, but denied any causative effect.
Handing down judgment last week (1 August) Mr Justice Leggatt ruled that although the firm had admitted liability, Hirtenstein had failed to prove he had been caused a loss by the error.
Leggatt J found Candy would not have agreed to give a personal guarantee and further found that Hirtenstein would still have bought the yacht in any event as he obtained it for such a good price.
“Although the claimants have succeeded on liability, they have suffered no loss and are therefore entitled to judgment for only nominal damages,” said Leggatt J.
Hill Dickinson was represented by 4 Pump Court’s Nigel Tozzi QC and James Leabeater, instructed by Beale & Co partner Rhian Howell.
Hirtenstein engaged Hill Dickinson in 2010 to help him purchase the superyacht from Candy’s company Candyscape. Hirtenstein bought the yacht, originally advertised at €17m, through his Cayman Islands company Il Sole for €4.5m. However one hour after the purchase completed, the yacht’s starboard engine broke down.
In 2011 Candyscape went into liquidation, meaning Hirtenstein was unable to claim a breach of warranty against the company. The absence of a guarantee from Candy meant that suing him personally was also impossible.
In a statement Hill Dickinson said: “Hill Dickinson regrets that a mistake was made in this matter. The firm highlighted the error to the client as soon as it came to their attention and was satisfied that it had caused the client no loss. This position has subsequently been vindicated in the judgment.”
A costs hearing is expected in October.
The legal line-up
For the claimant (1) Michael Hirtenstein (2) Il Sole Ltd
Quadrant Chambers’ Matthew Reeve and Emily McCrea-Theaker instructed by Clyde & Co partner Andrew Preston
For the defendant Hill Dickinson
4 Pump Court Nigel Tozzi QC and James Leabeater instructed by Beale & Co partner Rhian Howell
This article has been amended from its original version to clarify that the claim failed on the issue of causation. We apologise for the errors in the earlier reporting of this story.