Cluttons has paid £2m to settle an alleged negligent valuation claim.
The agent, which last year made profits of £2.7m on a turnover of £32m, paid the sum to Channel Islands-based investor Economic Lifestyle Property.
Economic Lifestyle was suing for loss and damages over the LLP’s valuation of St James’ Heights, a residential development site in Bexhill-on-Sea, East Sussex.
It claimed that in early June 2006 Cluttons valued the 51-flat block at £9.8m, with an additional freehold reversion of £210,000, giving a freehold value of just over £10m. It alleged that, based on that valuation, it agreed to pay £3.1m for the land and £5.4m to build the development – a total of £8.5m.
It said valuations later that year and in early 2007 valued the property at just £7.7m and £7.1m respectively and that Cluttons had breached its duties to act with reasonable skill and care.
Economic Lifestyle settled the claim because a court case was unlikely to be completed until October 2013. Cluttons declined to comment.
samantha.mcclary@estatesgazette.com
