Surveyors Negligence Claims
The Financial Claims Centre exists to assist in our clients in the preparation and pursuit of legal claims against property surveyors where those surveyors have been negligent in conducting property surveys. Most of our clients have bought properties in the last few years; most are property investors and most are new to property investment, most bought through property clubs and most were offered 'perceived' discounts.
In all cases our clients have suffered substantial losses following the purchase of property. You can do something about this. If your mortgage lenders surveyor overstated the value we can investigate and prepare your case for litigation.
Scullion v Bank of Scotland
Surveyors Negligence - Surveyors Negligence
Outline case:
Emmett Thomas Scullion, a buy to let investor purchased a flat in Cobham, Surrey. The purchase price of £352,950 was supported by a valuation from Colleys Surveyors (now part of Bank of Scotland). This valuation amounted to £353,000 with a rental assessment of £2000 per month. The developer offered a gifted deposit of 15% of the purchase price.
Once Mr Scullion realised that his self-funding investment was in fact making a loss due to the rental income amounting to nearly half the cited figure he decided to sell and take a loan to cover his loss.
Scullion subsequently took action against Bank of Scotland claiming that the surveyor owed him a duty of care. This 3rd party duty of care had previously been established in the case of Smith v Bush in 1990. This 3rd party duty of care was allowed on the basis that an average consumer in a relatively low value transaction (compared to commercial transactions) would rely on the lenders valuation report and that the surveyor would reasonably expect the purchaser to rely on his report.
In the case of Scullion v Bank of Scotland the purchaser bought his property via a buy to let mortgage. There could be a suggestion that this should be treated as a commercial transaction and therefore not benefitting from the 3rd party duty of care. Richard Snowden QC sitting as deputy High Court judge on 18th March 2010 said that a buy to let purchase is no different to a residential house purchase in that the duty of care that was owed by the surveyor applies to buy to let purchasers also. In fact, Richard Snowden QC went on to add that the purchaser is more likely to be reliant upon the valuation of the surveyor as the purchaser is likely to be dependent upon the rental income from the property.
This outcome is great news for the buy to let investor who has found themselves the victim of overvaluations by a surveyor.
http://www.lawreports.co.uk/WLRD/2010/CHAN/Scullion_v_BofS.htm
House of Lords Determine Compensation Basis
The basis of a surveyors negligence claim is established in law by a precedent known as "The Banque Bruxelles Principle" which has been established by the House of Lords. The basis of this principle is that a surveyor cannot be held liable for a fall in the market but can in fact only be held liable for the losses that can be attributed to the overvaluation.
The details of this can be found here:
http://www.publications.parliament.uk/pa/ld199899/ldjudgmt/jd990218/plat02.htm
Professional Negligence Claims
Professional negligence claims can be brought against any professional who can claim to have some level of expertise. in the case of surveyors they have substantial expertise in the field of surveying properties.
All RICS surveyors carry professional indemnity insurance to protect them against professional negligence claims and it is the insurers who would pay you in the event of a successful claim against the surveyors professional indemnity insurance.
Professional negligence claims are our speciality, in particular against surveyors.
If you have a property that was overvalued by a surveyor we would like to hear from you.