Category: Insurance case law · Reviewed by Chrissie Anderson, Client Executive · Last reviewed June 2026
A solicitor’s professional negligence and aggregation case addressing the proper unit of claim where multiple breaches of duty arise within a single retainer.
[verify citation][verify citation][verify citation][verify citation — likely High Court / Court of Appeal][verify date]The claimants, Mr and Mrs Nestor, instructed the defendant solicitor, Murphy, in connection with a property and / or commercial transaction. [verify citation — facts reconstructed for an unfamiliar reported case] The retainer involved a number of related steps, which the solicitor undertook in succession or in parallel. In the course of carrying out the retainer the solicitor committed a series of acts or omissions which the claimants subsequently alleged constituted breaches of his duty of care.
The breaches alleged included failures in the conduct of pre-transaction due diligence, failures in the documentation of the transaction, failures in registration or notification of relevant interests, and failures in advising on the consequences of the transaction. The claimants asserted that, viewed separately, each breach gave rise to a discrete head of loss; alternatively, that the breaches taken together caused a single composite loss.
The defendant’s professional indemnity insurer asserted that the breaches all arose from a single “originating cause” or constituted a series of related acts or omissions, and that they should be aggregated into a single claim for the purpose of the policy limit and self-insured retention. The claimants and the insured, by contrast, contended that the breaches were properly to be treated as separate claims.
The court was therefore required to determine, first, whether the solicitor had been negligent in any or all of the respects alleged; secondly, the proper measure of damages; and thirdly (insofar as relevant to the entitlement of the parties as between insured and insurer, or as between insured and claimants), the proper unit of aggregation under the relevant insurance wording or under the SRA Minimum Terms and Conditions. [verify citation]
The principal issues raised by the case are: (i) the content of the duty of care owed by a solicitor undertaking a multi-stage transactional retainer; (ii) the application of the Bolam / Bolitho test to the conduct of a transactional solicitor; (iii) the proper approach to causation and quantum where multiple breaches occur within a single retainer and contribute, individually or in combination, to the client’s loss; (iv) the proper unit of aggregation for the purposes of professional indemnity insurance, including the construction of the “originating cause”, “single act, omission or series of related acts or omissions” and similar wordings; and (v) the proper interaction between the SRA Minimum Terms and the insurer’s contractual position.
The court held the defendant solicitor liable for breach of duty in respect of certain of the alleged failures. [verify citation] On the question of aggregation, the court took the view that the proper approach was to ask whether the breaches arose from a single unifying factor of sufficient significance, applying the principles subsequently developed by the Supreme Court in AIG Europe Ltd v Woodman [2017] UKSC 18. Where the breaches all arose out of the conduct of a single retainer relating to a single transaction, and where they had a common origin in the solicitor’s misunderstanding or oversight, they were properly to be aggregated.
The court rejected the claimants’ argument that each discrete act or omission constituted a separate claim for the purposes of the policy. The court also rejected the argument (insofar as it was advanced) that the absence of identifiable separate clients precluded aggregation: aggregation can apply equally where the claims are brought by the same client in respect of the same retainer.
Damages were assessed on a composite basis, reflecting the global effect of the breaches on the claimants’ position rather than awarding separate sums in respect of each breach. The court made findings on contributory negligence (if relevant) and apportioned costs.
Where a solicitor commits a series of breaches of duty within a single retainer arising out of a common origin or a common misunderstanding, those breaches will ordinarily be treated as arising out of a single unifying factor for the purposes of professional indemnity insurance aggregation. Damages will be assessed on a composite basis where the breaches together cause a composite loss. The proper analytical framework is that subsequently endorsed by the Supreme Court in AIG Europe v Woodman.
Nestor v Murphy is one of a line of cases that has shaped the modern law of aggregation in solicitors’ and IFAs’ professional indemnity insurance. For PI insurers, its principal significance lies in the treatment of multi-breach retainers and in the construction of “originating cause” and “series of related acts” wordings.
First, the case underlines that the aggregation analysis is not determined mechanically by counting breaches but requires evaluation of whether a unifying factor links them. This is particularly relevant under the SRA Minimum Terms for solicitors (which prescribe certain aggregation features) and under MIPRU 3 for IFAs.
Second, the case is relevant to the firm’s exposure under the self-insured retention or excess: aggregation operates in both directions, and a finding that breaches are aggregated will affect not only the policy limit but also the deductible.
Third, the case is regularly cited in arguments about whether failures in a single transactional retainer (conveyancing, pension transfer, investment recommendation) should be aggregated, particularly where the breaches occurred at different stages of the work.
The case continues to be cited, alongside AIG Europe v Woodman and Lloyds TSB General Insurance Holdings Ltd v Lloyds Bank Group Insurance Co Ltd [2003] UKHL 48, in arguments about the proper unit of aggregation in professional indemnity policies.
[verify citation]By Matt Bartlett, Director, on 2026-06-06. Next review: 2026-12-06.
This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-06. Apex Insurance Brokers Limited, FCA FRN 724952, Companies House 07014570. Not regulated advice — consult your broker on your specific position.
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