The Court of Appeal has upheld a ruling ordering a surveyor to pay almost £400,000 in damages to a couple whose £1.2m dream home in Devon was plagued with leaks.
Giving judgment today, Lord Justice Coulson said the case was “unusual,” and, due to its specific set of circumstances, the High Court had been correct to use a different way to calculate damages than normal.
The case was brought by homeowners Chris and Kerry Hart who, in 2011, bought a recently remodelled “dream home” on a cliff in Devon. “The views are magnificent but the property could not have been more exposed to the elements,” the judge said.
But the house had so many leaks that the Harts claimed they feared leaving their home in case it rained while they were not there.
Before buying it, they had engaged now-retired surveyor Richard Large to carry out a Homebuyer Report, which highlights potential issues using a traffic light system. The only “red” item flagged in the report related to a problem with drainage.
They took Large to court, and last year won a High Court ruling that, if not for Large’s negligent advice, they wouldn’t have bought the property.
In his May ruling, deputy judge Roger ter Haar found that evidence in the trial showed there were large leaks before and after the Harts bought the property. He concluded that Large should have recommended obtaining a professional consultant’s certificate. As Large didn’t, the judge found he was negligent.
He said the Harts were entitled to £750,000 in compensation. However, they had also been suing their solicitors, Michelmores, and the architects who designed the refurbishment, Harrison Sutton. They had settled just before trial, paying the Harts £376,000. Therefore, the judge reduced the sum payable by Large to £374,000, and added an extra £15,000 “for inconvenience and distress”.
During the appeal, lawyers representing Large argued that a High Court judge departed from long-standing principles in ordering him to pay such a large sum. As a result, the outcome has been eagerly awaited by valuers, as it has potentially significant implications for the assessment of damages for surveyors’ negligence.
During the trial, Large’s barrister, Simon Wilton, argued the judge had departed from the well-established method of calculating damages, comparing the price paid with “what the property would have been worth if the surveyor had advised what he should have advised”.
However, the Court of Appeal disagreed, saying this was an “unusual situation.”
“Mr Wilton made much of the fact that, if his appeal was not allowed, the decision in this case might be taken to have radically altered the usual approach of the courts to damages in negligent surveyor cases,” Lord Justice Coulson said.
“I do not agree. The criticality here of obtaining a PCC [Professional Consultant’s Certificate], given the extensive rebuilding works that had been carried out at the property without any records of compliance or satisfactory completion, together with the suspicions that were beginning to creep into Mr Large’s mind (as well as those of the Harts), and the exceptionally exposed nature of the site, combined to give rise to an unusual situation which is markedly different to the vast majority of negligent surveyor cases.”
Jen Lemen, a partner at Property Elite, which trains surveyors, said the case shows how important it is for surveyors to fulfil their “duty of care” when dealing with clients, saying that if he had done so, the Harts probably wouldn’t have bought the property and this situation wouldn’t have arisen.
“Surveyors must ensure the most appropriate type of survey is recommended, followed by clearly explaining any limitations and advising of further action which should be taken to minimise risk relating to the transaction, eg a Professional Consultant’s Certificate. This goes further than just identifying and following the trail relating to defects that would be expected to be identified within a Homebuyer Report inspection, for example.”
“In this case, if the surveyor had have satisfied this duty then it is highly unlikely the client would have purchased the property in question.”
