This was a claim for professional negligence by a company incorporated to purchase a sea front hotel and adjacent land in Hunstanton, Norfolk, against the solicitors that acted for it on the purchase. The hotel had been purchased subject to three outstanding floating charges on the assets of the seller, another limited company. These charges continue to attach to an asset, instead of to the proceeds of sale, when the asset is sold by administrative receivers, as was the case here. But these charges could have been "overreached" if the seller's mortgage lender had instead taken possession of the property and sold the property itself. The charges only came to light when the Land Registry raised a requisition for releases from them before it would register the title. The claimant was as a result unable to proceed with its planned development of the hotel into flats, as the flats would have been unmarketable with a defective title and the claimant was not in funds to pay for release from the charges. The claimant ultimately had to sell the hotel at a loss to another development company.
A breach of duty was admitted by the solicitors, and the only issues at trial were 1) whether the company would not have completed the purchase but for the solicitors' negligence (causation), and 2) the appropriate measure of damages to compensate the company for its loss.