You can wait for ages for any case law on limitation of liability clauses in solicitors’ retainers, and then three judgments come along within the space of a few months.
In this article, Helen Evans KC has identified 10 key points for lawyers drafting such clauses, dealing with client engagements, or litigating disputes over limitation of liability. The points all arise from the three recent authorities of Convrgnt Value Engineering v Kennedys Dubai LLP [2026] EWHC 1754, Gordeno v Irwin Mitchell [2026] 4 WLR 49 and Siem v Womble Bond Dickinson [2026] EWHC 1168.
- Keep proper records from the start: it is easy at the outset of a solicitor/client relationship to proceed on the basis that a limitation of liability clause is a standard term, and that it generally goes through without debate. However if disputes subsequently emerge over reasonableness, Convrgnt (a case concerning UCTA) shows that there will be sustained focus on what happened at the outset of the retainer. It can be difficult to identify years after the event what the thinking was e.g. behind the size of any liability cap.
- Beware the “one size fits all” approach: when the assessing reasonableness of any cap, the courts will look at the likely size of any liability at the time the retainer was entered into. Convrgnt suggests that in a case involving litigation that exercise should involve an analysis of the likely reasonable size of the claim plus adverse costs liability. In Gordeno (a case under the Consumer Rights Act rather than UCTA), the court looked at the value of the property that was the subject of the transaction. Experience suggests that a detailed analysis of likely exposure is often not adequately carried out at the retainer stage- particularly if the figures are complex.
- How far should engagement letters go? In the Convrgnt case a dispute erupted over whether the engagement letter had implied that it was not necessary for the client to read the accompanying terms of business (which contained the limitation of liability) by suggesting that the firm did not “anticipate that there is any great likelihood of disagreement arising out of these terms and conditions”. Ultimately the court did not accept the claimant’s arguments on this front- not least because the engagement letter invited a discussion of the terms- but transparency about any cap is clearly important for reasons also explained at point 7 below. Note that the need for openness was also highlighted in Gordeno.
- Experienced clients can be expected to have some knowledge but it may not be enough: in Siem, the court observed that experienced business people will realise that professional retainers are likely to contain limitation of liability clauses and appreciate that some renegotiation may be possible. In Convrgnt however, the court balanced the client’s sophistication against the fact that there had been no separate negotiation of the cap.
- Who’s the client? Although the Siem case involved a dispute over the application of a limitation of liability clause with the firm’s named client, there was also a debate over whether there had been implied retainers and/or assumptions of responsibility by the defendant solicitors to other parties. How is a limitation of liability clause going to help if a defendant ends up liable through that type of route? Beware mission creep.
- What does the clause cover? Arguments frequently erupt over whether limitation clauses cover unusual causes of action against professional defendants (eg in restitution) or whether they otherwise apply to costs. In Convrgnt, the court held that the clause in question was wide enough to cover a restitutionary claim for repayment of solicitors’ fees. The judgment has some helpful observations on what aspects of the drafting pointed in this direction- for instance use of the broad terms “loss and damage” (rather than the narrower term “damages”). The case is therefore a helpful read for drafters. However, working out what the full picture of what the clause does and does not cover is also an important part of analysing who’s likely to show it was reasonable or not once a dispute has erupted.
- Keep on top of SRA or other relevant regulatory guidance In Gordeno, the court considered whether the limitation clause was in keeping with the SRA’s Guidance about adequate insurance levels. This not only prevents any cap below the SRA’s minimum insurance level but also refers to the Code of Conduct requirements preventing solicitors from taking unfair advantage of clients and requiring them to give clients information in a way that they can understand.
- What evidence will the court will need to have at its disposal and what inferences can it draw if that evidence isn’t there? The onus is on the party relying on a limitation clause to prove that it is reasonable. That usually requires evidence. Convrgnt emphasised that if that party does not lead such evidence, a court can draw inferences against them based on what information is available (eg as to the resources available to the defendant to meet a judgment and/or its insurance cover). In Convrgnt, the court observed that the contrast between the £3m cap and the limited evidence about likely insurance cover was “intuitively striking”. The court decided (albeit obiter) that the £3m cap would not have been reasonable on the facts.
- Does your DRD go far enough? If there is an evidential dispute over the reasonableness of a limitation clause, the disclosure review document (DRD) will need to cover it. In Siem, the court held that WBD had not been obliged to disclose its level of insurance cover under the DRD as drafted- although note that as set out in point 8 above, inferences can be drawn from a lack of evidence. Think through what evidence is involved in the analysis of reasonableness, and make sure the DRD covers it.
- Expect the unexpected: Convrgnt shows that arguments over limitation clauses may not just be confined to UCTA or the Consumer Rights Act. They may also involve more novel assertions that lawyers failed to be clear enough about the existence of the clause (in such a way as to constitute an alleged misrepresentation) or that lawyers are otherwise estopped from relying on it. Keeping abreast of what arguments are being run is not just a matter for litigators but for drafters of clauses and engagement letters as well.
For more in-depth insight into the Convrgnt case- which featured 4 members of 4 New Square- see the July 2026 article by Clare Dixon KC and Pippa Manby: UCTA ousted, but reasonableness nevertheless in the spotlight – 4 New Square Chambers
© Helen Evans, 4 New Square Chambers, August 2026
This article is not intended as a substitute for legal advice. Advice about a given set of facts should always be taken.
