Liability - but only nominal damages - in yacht purchase negligence

The law firm Hill Dickinson LLP avoided paying substantial damages, despite being liable for professional negligence.

Businessman Michael Hirtenstein purchased a £3.6m yacht, relying on an assurance as to the condition of the yacht from its previous owner.  Within an hour of its purchase, the yacht suffered a major engine failure 12 miles offshore, and Mr Hirtenstein subsequently spent £360,000 on repairs.  

Hill Dickinson, wrongly had advised Mr Hirtenstein that Christian Candy had personally guaranteed the condition of the yacht, when no such guarantee existed. As a result Hill Dickinson accepted they were negligent in advising Mr Hirtenstein that a personal guarantee had been obtained.  

However, Hill Dickinson avoided paying substantial damages to Mr Hirtenstein.  Mr Hirtenstein purchased the yacht for approximately £3.6m, when the initial asking price was  €17m.  The High Court held he would have gone ahead with the favourable purchase anyway, whether a personal guarantee as to the yacht’s condition existed or not. Hill Dickinson’s negligence had not caused loss to Mr Hirtenstein, and as such only nominal damages were awarded. 

Link to the full judgment (