What are property related professional negligence claims?

15/10/2019

If you hire a property professional, they have a duty to you to provide work of a sufficient standard. If that duty is breached and causes you loss, then you may well have a professional negligence claim. 

Typically, professional negligence in property matters relates to a property transaction and the professionals are solicitors, surveyors and accountants.

To summarise, a successful negligence claim requires:

  1. that you are owed a duty by the property professional
  2. that they have breached that duty
  3. as a direct result of that breach, you have suffered loss
  4. you can prove that your loss directly relates to the negligence 

Poor service or negligence

There may be many cases where service has been poor but it will not amount to negligence if the four factors mentioned above are not all present. So for example a surveyor who valued a property too low, would not result in a negligence claim if you realised their valuation was wrong, and obtained an alternate correct valuation. You would however have a claim against the surveyor for poor service.

Examples of property related professional negligence – Residential property

The Residential Property Litigation Team have acted for clients in the following situations:

  1. The solicitor who acted for our client when purchasing a property failed to identify that the property being purchased was a “flying freehold”.  This problem was not discovered until the client came to sell the property and potential purchasers’ solicitors picked up on the problem. This then caused problems in selling the property as potential purchasers could not get a mortgage on it. The result was the property being sold at a lower price – a quantifiable loss.
  2. During a property purchase, a client’s solicitor failed to advise the client that a staircase leading to the flat was not properly within the title being purchased. This problem was only discovered when the freeholder of the property restricted access to the staircase. This in turn restricted access to the first floor flat – a quantifiable loss.
  3. Our clients were not properly advised during the purchase of their property with regards to a septic tank restrictive covenant. In order to access a septic tank that serviced their property, they would need to gain access to their neighbours’ land which could only be done on certain conditions and at certain times. These restrictions were deemed to cause a quantifiable loss.
  4. Another common claim is the failure to define property boundaries correctly. One client was not notified that the physical description of the boundary did not reflect the land being purchased, resulting in loss of land as well as costs to rectify records.

There are many other types of negligence in residential conveyancing and often the failure to advise properly is discovered long after the transaction has been completed.   

Examples of property related professional negligence – Commercial property

The Commercial Property Litigation Team have recently advised clients on:

  1. The registration and discharge of mortgages in commercial property transactions. These are of crucial importance and if a loan against commercial property is discharged incorrectly and the lender is then left without security, that loan must be re-registered. However, in order to do so, strict compliance with Companies House regulations and company law will be required, in collaboration with our Company Commercial Law Team.
  2. Surveyors who have failed to adequately advise on the condition of large commercial buildings to the appropriate standard. There was one case where the owner’s original surveyor had failed to identify that a building suffered from a structural defect. When our client came to sell the commercial property, every other surveyor identified this immediately, hindering any sale and thus causing quantifiable loss.

Property law is a very technical area. The dates when leases commence and finish, the timing of notices, service of break clauses, notices, service of schedules of dilapidations are all time critical.  Missing a time limit will often give rise to a professional negligence claim. 

More information

Professional negligence claims are extremely difficult claims to pursue. It means that you have retained a professional for expert advice and assistance and that professional has failed to advise you to the standard that is required and so the advice that you have received is negligent. Our specialist Property Litigation team work with a number of financial and property experts to be able to provide such expert reports and are experienced in advising on a wide range of professional negligence claims.

The team work closely with our Residential Conveyancing department and Commercial Property department and so a combined practical approach is taken to resolve disputes when they arise.

Contact our Property Litigation Department for further information on both residential related claims and commercial property related claims. Professional negligence claims are never easy and our Property Litigation team have substantial experience in both seeking to correct the situation where things have already gone wrong, and in recovering damages for professional negligence from other property professionals.

The contents of this article are for the purposes of general awareness only. They do not purport to constitute legal or professional advice. The law may have changed since this article was published. Readers should not act on the basis of the information included and should take appropriate professional advice upon their own particular circumstances.

15/10/2019

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