What former Sandstone Legal clients need to know about mishandled claims

When a law firm collapses, the public focus tends to fall on the firm itself: the financial failure, the intervention, the regulatory consequences and the fallout for the wider market. For former clients, though, the question is usually much simpler and much more urgent: what has happened to my claim?

That is the position many former clients of Sandstone Legal now find themselves in. For some, the concern is not merely delay or poor communication. It is whether claims with real value were allowed to drift to the point where they were materially weakened, compromised or lost altogether.

We are advising former Sandstone clients who are concerned that the handling of their claims may have cost them the opportunity to pursue compensation. In broad terms, the issue is whether a valid underlying claim was mishandled through inaction, missed deadlines or a failure to progress matters properly, with the result that the claim can no longer be pursued in the ordinary way.

Many of the matters we are reviewing arise from financial mis-selling claims, including Plevin-related cases. These are exactly the sort of claims where clients often assume that, if the original case has stalled or fallen away, there is nothing more to be done. That is not always correct.

The law recognises that a client may suffer real loss, not only where a claim that would definitely have succeeded has been destroyed, but also where they have been deprived of a genuine and worthwhile opportunity to pursue it. In other words, the relevant question is not always whether the original claim would certainly have won. It may instead be whether the client lost a real chance of recovering compensation because their solicitors failed to act when they should have done.

That distinction matters. It means that where a claim has been lost because a firm failed to progress it properly, missed limitation, or allowed it to stagnate without adequate advice or action, there may still be a route to redress through a professional negligence claim.

The Sandstone position is also a reminder of how clients can become exposed when high-volume consumer claims practices run into serious operational or financial difficulty. Whatever the reasons for a firm’s collapse, clients are often left in the same place; uncertain about what has happened to their case, unclear whether the underlying claim still exists, and unaware that a secondary claim may now need to be investigated.

For those affected, the priority is to answer three questions as quickly as possible. First, did the original claim have real merit? Second, was it mishandled? Third, has that mishandling caused a measurable loss? Answering those questions requires a careful review of the file, the chronology and the decisions that were, or were not, taken at critical stages. Done properly, that exercise can bring much-needed clarity to what is often an opaque and frustrating situation.

These claims also require a particular combination of expertise. It is not enough to look at professional negligence in the abstract. It is equally important to understand the underlying claim that may have been lost, its prospects, its value and the practical significance of the opportunity that has disappeared. In financial mis-selling cases, that often means examining the original merits, limitation position and procedural history together.

For many former clients, the immediate assumption is that if the original claim has stalled or can no longer be pursued, that is simply the end of the matter. In some cases, it may not be. Where a viable claim has been lost because it was not handled properly, the law may still provide a route to compensation through a professional negligence claim. The important thing is to investigate that position promptly and properly.

The key message for former clients is a simple one. The fact that an original claim has not progressed, or can no longer be pursued in the usual way, does not automatically mean that all remedies have been lost. In the right case, there may still be a viable claim for the loss of that opportunity.

Read a recent article featuring Erich in Legal Futures.