Whether you are buying your own home, doing a renovation, a property developer or commercial landlord, or at some stage you are likely to use a property professional. This includes architects, surveyors, conveyancing solicitors, planners, agents, valuers, and many more. But what happens if a professional makes a mistake, causing you problems with your property or business? This blog gives an overview of the area of professional negligence claims.
Duty of care
Any property professional owes their client a duty of care (called a duty in tort) to exercise all reasonable care and skill to be expected of an experienced skilled and competent professional. In addition to this duty, in the case of giving advice or providing some other professional service, the implied duty of reasonable care and skill is likely to apply (section 13, SGSA 1982).
If a professional makes a mistake, be it missing something in a survey, failing to report something on a Title of land, or getting designs or plans wrong, these may be breaches of one or both of the contract, and the duty of care.
What can I do about it?
Thankfully, most property professionals will have professional indemnity insurance in place, or at least they should have. After all, nobody is perfect. To bring a claim to put matters right, which might mean a payment of compensation, you should seek specialist legal advice.
Sometimes, a complaint can be made to the professional’s regulator. Regulators, or associations, sometimes have standards which might be higher than the tortious or contractual standard, and will vary as to what powers they have to award compensation. It might be a good first step to take, especially if the regulator identifies wrong-doing, and is unlikely to affect your ability to pursue damages as part of a civil claim.
If the issue cannot be resolved informally, or with any professional regulator, you may need to set out the complaint in a Letter of Claim.
There is a specific protocol which you should follow before issuing a claim at Court.
The Protocol sets out various steps, including what the ‘Letter of Claim’ needs to cover, notification to insurers, documents, the professional’s Letter of Reply, and the need for a meeting (on site usually). It also covers the need for ADR – alternative dispute resolution – which means attempting to find a solution without going to Court.
You may also require your own expert evidence. For example, you may need an expert in that particular profession to say what the standard of a competent professional is, and whether your property professional fell short of that standard. Secondly, you may need an expert to give an opinion on the losses sustained as a result of the error. Sometimes, this might be that the property is worth less as a result of the mistake. For example, if you relied on advice of a Planner who told you that planning permission for a 7-bedroom house with a swimming pool was a sure thing, only to be rejected by the local authority, your claim may be for the amount you overpaid for the site. It might be loss of profit in some cases, or lost rent whilst works are put right and meaning you cannot rent out the property in the meantime.
Settlement
Litigation is a time consuming and expensive exercise and often causes a lot of stress. There are lots of incentives, for both sides, to consider settlement. Once you have set out your case, it is expected that each party to the dispute will engage in settlement discussion. This could be in the form of telephone calls, emails, a roundtable meeting or even a mediation with an independent facilitator.
If settlement cannot be reached, then the court process can be used to take the matter to be resolved at a trial. However, you should be aware that this process is expensive, and with the risk of the losing party paying the winning party’s costs.
This article was written by Toby Walker, Head of Dispute Resolution Partner at Allan Janes LLP. Toby and his team deal with professional negligence cases. Allan Janes has a track record of helping people with their disputes with property professionals from all stages, right through to trial, and in settling cases with favourable outcomes at an early stage. Toby can be contacted by email or on 01494 893512.