Warranty of authority · PI

Breach of warranty of authority — UK PI

Reviewed by Apex Insurance Brokers · Published 15 July 2026

A solicitor or other agent who acts without authority faces personal liability for breach of warranty of authority. UK PI wordings vary in how they treat this exposure.

The legal principle

When a person acts as agent for another (typically a solicitor for a client), they implicitly warrant they have authority to act.

If they don't have authority — even if honestly believed — the third party can sue for breach of warranty.

Damages typically compensate the third party for what they would have received if the warranty were true.

The classic case: Yonge v Toynbee (1910) — solicitor continued to act after client died, sued by third party.

Common scenarios in UK practice

Solicitor acting for one party in property transaction where authority is limited.
Solicitor acting where client capacity has changed (dementia, bankruptcy, death).
Company law: acting for a company where director authority is contested.
Trust or estate work where trustee authority is unclear.
Insurance broker acting beyond binder authority.
Financial adviser acting on outdated instructions.

PI cover treatment

Most standard UK PI wordings include cover for breach of warranty of authority as part of civil liability cover.
Some wordings sub-limit it or require specific extension.
Fraudulent breach of warranty (deliberate acting without authority) is excluded.
Innocent breach (honest belief in authority) is usually covered.
Approach broker at placement to confirm the wording's treatment.

Practical prevention

Verify authority in writing at engagement.
Update authority verification at material milestones.
For company clients: verify board or director authority.
For trust or estate: verify trustee authority and capacity.
Flag capacity concerns — dementia, bankruptcy, mental capacity.
Document evidence of authority in the file.

If a claim arises

Notify insurer immediately.

Preserve the file completely.

Do not communicate directly with the third party claimant without insurer consent.

Prepare timeline of the authority evidence relied on.

Coordinate with panel solicitor on defence strategy.

Frequently asked

Is this cover standard in PI wordings?

Yes — standard UK PI wordings typically include it. Sub-limits or extensions may apply.

What happens if I innocently act without authority?

PI covers you where innocent. Fraudulent breach is not covered.

Yonge v Toynbee still applies?

Yes — foundational case still applied. Solicitors must verify continuing authority.

What about corporate authority questions?

Verify directors' authority for corporate clients — particularly in disputed situations.

Does the claimant sue me or my firm?

The individual agent (usually solicitor) faces primary liability. The firm may be jointly liable.

Is this different from negligence?

Yes — breach of warranty is a distinct cause of action. But it may arise alongside negligence.

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