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Legal matters

Mumsnet has not checked the qualifications of anyone posting here. If you have any legal concerns we suggest you consult a solicitor.

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Original poster

I’m terrified of being sued

40 replies

BeeBeeSmoo · 26/11/2023 21:04

I’m an accountant, and in my role I misinterpreted a technical rule that I should know inside out. A client is now facing a much higher tax bill (and penalties). Understandably they are furious and are threatening to sue me personally, not just the company I used to work for. I left my job over a year ago and am now a SAHM.

We have no money, and live month to month on my husband’s salary. We have a loan on the car even. The house has a small amount of equity (about 20k). I own it jointly with DH. Will we be forced to sell the house?

OP posts:

Firsttimemum623 · 27/11/2023 00:04

Also an accountant, with some experience of this as the new accountant to a client whose previous accountant advised them wrongly. We contacted HMRC on their behalf & told them that our client had taken reasonable steps to ensure they paid the correct tax, by using a qualified accountant & HMRC cancelled the penalties. They were satisfied that the client had declared & paid their tax with the necessary care and therefore it was just the tax due & interest that they had to pay... which they should have paid in the first place, so essentially they just got a very cheap loan. HMRC's interest rates have been very low until the recent base rate increases.

In this instance I think they'd be hard pushed to sue anybody, but as others have said, I believe it falls to your ex employer's PI cover, not you personally. I'd give them the heads up & then tell this individual that they will need to contact the company & you won't be engaging with them on this matter again. The last thing you want to do is put your foot in it. Also you could contact ACCA/ICAEW/CIMA/AAT if you're (still) a member for some reassurance.

prh47bridge · 27/11/2023 00:06

As others have said, there is no such thing as the Consumer Duty Act. This is FCA regulatory guidelines, not the law. This individual had a contract with your employer, not with you. They may have a case against your former employer. They do not have a case against you. Do not allow them to bully you. Do not engage with them. If they contact you again, refer them to your ex-employer.

nameychanger5678 · 27/11/2023 00:07

GLC789 · 26/11/2023 22:27

Icohkdnt read and run here!! I am somewhat good at understanding FCA regulatory guidelines, particularly Consumer Duty as its so recent.

You are not liable under consumer duty. When you work for a company, they are liable. Especially if you were NOT the last person to check the information.

As an ex employee you were only accountable to act with integrity. Making a genuine mistake DOES NOT breach financial integrity. That's what liability insurance is for, which your former company should have. If they don't, that's their tough luck, not yours.

Please relax. Remind the ex client, that their business was with the company, not you. You are no longer in the company. Therfore, it is inappropriate and unwarranted for them to continue to contact you. Let them know you will seek your own legal advice if they do not cease all direct contact with you immediately. Then block contact.

Show quote history

Correct advice.

OP I am so sorry you are going through this. I work in professional services and used to act for clients in professional negligence claims. I HATED doing it - always just due to simple mistakes, made by human beings. However the claims are against the firm, via their professional indemnity insurer. The insurer deals with it.

Absolutely unacceptable for them to be contacting you directly. Block contact immediately and let your old firm's insurer deal.

SheilaFentiman · 27/11/2023 06:53

This smacks of someone lashing out at all
and sundry in anger. I bet they haven’t consulted a solicitor yet, or they would have been told to go after the company not you.

AllEars112232 · 27/11/2023 07:30

Do you have legal expense cover on your home insurance? They might be able to help. Alternatively speak to citizens advice, they often have solicitors who give brief legal advice.

Scautish · 27/11/2023 07:34

The man’s contract will be with company not you. Agree with others saying ignore. Did a partner sign off on the tax calculation?

out of interest does this relate to IR35?

Original poster

BeeBeeSmoo · 27/11/2023 17:21

Scautish · 27/11/2023 07:34

The man’s contract will be with company not you. Agree with others saying ignore. Did a partner sign off on the tax calculation?

out of interest does this relate to IR35?

It wasn’t checked by a partner. It was checked by someone senior to me though and by someone else at the same level as me. I also queried which course of action was correct for the client with the senior before preparing the advice. I am hoping both these factors save my bacon a bit.
I contacted my old employer today and they have said they’ll review the case and be in touch.

OP posts:

Brahumbug · 28/11/2023 06:18

I agree with the other posters that the company will be liable and you were their employee. Did you personally have indemnity insurance at the time of the mistake? If so you would be covered by it anyway, even if it has now lapsed.

tribpot · 28/11/2023 06:33

I contacted my old employer today and they have said they’ll review the case and be in touch.

Be in touch with you? Or with the disgruntled customer? This really has nothing to do with you. It sounds as if the disgruntled customer may not even have contacted them (you would assume if he/she had they would just tell you the matter was in hand with their solicitor) and is just harassing you as an easy mark.

I would refuse to discuss this any further with the disgruntled customer and direct them to the company if they contact you again. Keep a log of all contact in case you need to take action.

Autieangel · 28/11/2023 06:41

I'd block and ignore the customer. Keep communications to email and letter only. If they do get in touch direct them back to the firm you worked for.

I cannot see anyway they could sue you directly. Ultimately the company is responsible for the decisions you make under contract. If they suggest a pay off. Ignore them.

SheilaFentiman · 28/11/2023 06:50

The company may need to be in touch with op for a “statement” for their insurance but they should certainly take it from here with the customer.

ChristmasBarginShop · 28/11/2023 06:52

Please use common sense to calm your nerves.

The client gave your employer a task. Your employer passed this on to you.

Who wrote the invoice? I assume your employer.
Who got all the money from the invoice- I assume it went straight to your employers business account.

The transaction is clearly between your employer and the client.

You have no liability.

Just make sure you don't admit to anything verbally or in writing to your (soon to be ex) friend. You never know, they might be clutching at straws!

Thatswhy11 · 28/11/2023 06:55

How long ago did the client threaten to sue you? I would look for any type of work again.

lljkk · 28/11/2023 06:56

How do you know them personally, can you block their contact?

WYorkshireRose · 28/11/2023 07:19

Thatswhy11 · 28/11/2023 06:55

How long ago did the client threaten to sue you? I would look for any type of work again.

What?

OP, stop panicking. You were an agent of your employer when you completed the work. Therefore you would have been covered by your employer's insurance.

Tell this idiot that you won't be wasting your time or money on a solicitor, as they need to take their issue up with X firm, who their contract was with. End of story.

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