Beachcroft has seen a £3m negligence claim brought against the firm by Britannia Hotels Group founder Alex Langsam dismissed by the High Court.

Langsam had alleged that the firm failed to properly advise him on a professional negligence claim he lodged in 2002 against accountants and tax advisers Hacker Young, which led to a £1m settlement in January 2006.

He claimed that Beachcroft's advice, which was handled by commercial litigation partner Peter Southern, meant that he missed out on a settlement of as much as £3m.

Beachcroft counterclaimed for outstanding fees of £214,000 plus interest for the firm's work, which was based on a conditional fee arrangement (CFA).

Mr Justice Roth last week dismissed both claims, stating that he did not consider Beachcroft's advice to be negligent and that the claim for payment under the CFA contract was unenforceable.

Langsam was advised by Davies Arnold Cooper (DAC) partner David Bear, who instructed John Wardell QC and Rupert Reed of Wilberforce Chambers.

Reynolds Porter Chamberlain professional indemnity partner Katherine Rees advised Beachcroft and instructed Stephen Moriarty QC and Derrick Dale QC of Fountain Court.

Langsam, who founded Britannia Hotels in 1976, sued Hacker Young in 2002, alleging that the advisers had negligently failed to advise him that he was entitled to be treated as having non-domicile status. He alleged that if he had received such advice he would have withdrawn his equity from one venture and invested it offshore.

The news comes after it emerged this week that Beachcroft is in merger talks with DAC, in a deal that would create an insurance law firm with combined revenues of around £175m.