What Is Professional Negligence?

What Is Professional Negligence?

Professional negligence occurs when a professional fails to exercise the level of care, skill and diligence reasonably expected in their field, causing harm or loss to a client. A professional negligence claim may be brought against an individual or corporation that provides professional services and holds itself out as having specialised skills or expertise. Such claims may arise in negligence, contract, or both.

To establish professional negligence, the following elements must be proven:

• The existence of a duty of care
• A breach of that duty
• Causation
• Resulting loss or damage

Duty of Care

Professionals owe their clients a duty to exercise reasonable care, skill and diligence in performing the services for which they are engaged. The standard of care is informed by:

• The risks that were reasonably foreseeable at the time; and
• The precautions that a competent professional in the same field would have taken to minimise those risks.

This standard is not one of perfection, but of reasonable professional competence in the circumstances.

Breach of Duty

A breach of duty occurs where a professional acts, or fails to act, in a way that falls below the standard of care reasonably expected of a competent professional in the same position. However, a professional will not ordinarily be found to have breached their duty merely because an adverse outcome occurred. Where an inherent risk materialises and that risk could not have been avoided through the exercise of reasonable care and skill, liability will not usually arise.

Causation

Establishing liability requires proof that the breach of duty caused the client to suffer loss. This is addressed through the concept of causation.

Causation generally involves two key questions:

1. Whether the professional’s breach was a necessary condition of the loss (often assessed using the “but for” test); and
2. Whether the professional’s conduct materially contributed to the loss suffered.

Both elements must be satisfied for liability to be established.

Damages

If professional negligence is established, damages may be assessed by reference to:

• The value of opportunities lost as a result of the negligence;
• Costs incurred because of the negligent conduct; and
• The cost of rectifying problems caused by that conduct.

Damages aim to place the client, as far as possible, in the position they would have been in had the negligence not occurred.

The Role of Peer Professional Opinion

In New South Wales, professional negligence claims are governed by the Civil Liability Act 2002 (NSW). Of particular importance is section 50, which provides that a professional does not incur liability in negligence arising from the provision of professional services if it is established that their conduct was widely accepted in Australia by peer professional opinion as competent professional practice.

Key points include:

• Peer professional opinion does not need to be universally accepted to be regarded as “widely accepted”;
• The existence of differing, widely accepted peer opinions does not prevent reliance on one or more of those opinions.

As a result, a plaintiff must demonstrate that the professional acted contrary to widely accepted peer professional opinion and that this departure caused the loss or damage suffered. This typically requires expert evidence from a suitably qualified professional in the same field. Conversely, a professional may successfully defend a claim by establishing that their conduct was consistent with widely accepted peer professional opinion, even where loss has been suffered.

How We Can Assist

Professional negligence claims are complex and usually highly technical. They require careful analysis of the factual circumstances, the applicable standard of care and detailed expert evidence.

We advise and act for both plaintiffs and defendants in professional negligence matters, providing clear, strategic and practical advice at every stage of the process.

If you believe you have suffered loss as a result of professional negligence, or if you are facing a claim, we invite you to contact us for a confidential consultation.