Surveyor Negligence – Can It Give Rise To a Professional Negligence Claim?
Property refurbishment and renovation has become increasingly common. Development is no longer just for the rich, as an increasing number of people see it as an opportunity to make a good investment. What’s more, the number of simple family home extensions have dramatically increased, and with the substantial increase in levels of stamp duty payable when moving, many families are simply opting to extend rather than move home.
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Developing, renovating or extending property requires professionally qualified people like architects and surveyors who will usually need to project manage or be involved in the building process from start to finish.
This means you are likely to be placing huge reliance on an architect, surveyor or valuer. It doesn’t take much imagination to see that if these professionals let you down and do not carry out their job correctly, the result can be catastrophic. Expense and emotional trauma will mean you could be severely impacted. So would this mean consulting a professional negligence claims lawyer?
Yes. Negligence claims against architects, surveyors and valuers have increased recently and a disaster as a result of poor professional standard needs careful handling. And to give you an idea of the scale of the market, there are over 10,000 firms of surveyors currently practising in the UK.
Negligence claims against surveyors tend to be affected heavily by the property market cycle. So, for example, it is estimated that the financial crisis in 2008 resulted in total negligence claims against surveyors way above £100m.
A specialist and experienced Professional Negligence Lawyer will probably have a track record of successful cases in dealing with surveyor negligence and other construction related professional negligence claims. Here at Bonallack and Bishop we have the specialist experience you need. We are members of the Professional Negligence Lawyers Association.
Click here to read more about disputes with builders
Incorrect valuations by surveyors
To a certain degree, valuations are in art not a science – and as a result it’s not unusual for two different surveyors to end providing two different values. Courts accept that.
So the test applied in law as to whether valuation is negligence or not is to compare the valuation with one that would have been produced by competent surveyor. In general terms the margin of error allowed by courts tends to be around 10% or even up to 15% for individual properties, and ais lower as 5% for more standard residential property.
When you are buying a property, it is advisable to have a survey carried out to ensure that you are aware of any potential problems with the property in advance.
The main types of surveys are as follows:
• Mortgage valuation – this is performed by your lender to establish what the property is worth. They will not usually go into the property. A valuation normally consists of a cursory look at the property by a valuer the lender knows and trusts. Often lenders will throw in a valuation for free. If not, you will be required to pay for it.
• Royal Institution of Chartered Surveyors (RICS) HomeBuyers Report – is the most popular type of building report. You can choose a HomeBuyers Report with or without a valuation. Although the person doing the HomeBuyers Report will not lift floorboards etc, they make a thorough check of the property and detail any immediate defects or problems which may affect its value. For example, the final report will specify if there is visible dampness, the condition of the woodwork or plaster and any incidents of rot, insulation problems, and any other visible issues.
• Building Survey – previously known as a Full Structural Survey – this is the most comprehensive type of residential property survey. The surveyor will examine all visible and accessible parts of the property and outbuildings, as well as looking into cupboards and manholes. However, enclosed parts of the building such as concealed roof or wall spaces will not usually be examined.
As a minimum, you should invest in a RICS HomeBuyer Survey. But if you are purchasing an old or listed property, or a building that has been significantly altered, it is highly advisable to get a Building Survey done.
How thorough should a Building Survey be?
The surveyor undertaking the Building Survey has a legal obligation to report on any matters which may affect the value of the property and/or need fixing. They will, therefore, be actively looking for problems and defects and write up a detailed report.
As much information about the history of the property and the materials used in its construction will be gathered. The loft, walls, garden, and roof will be checked for defects. When it comes to specialised matters such as the electrics and central heating, if the surveyor has any concerns or if the systems are old, further surveys may need to be carried out. This will be mentioned in the report.
What kind of mistakes give rise to surveyor negligence claims?
Among the more commonly found types of errors made by surveyors are the following:
- not carrying out a proper inspection
- not identifying obvious visible problems or defects with the property
- not making proper enquiries
- not warning of potential problems that need more investigation
- submitting an inadequate report
And in making these mistakes, amongst the most common property problems they miss are the following:
- drainage problems
- dry rot
- electrical issues
- leaky roof and faulty guttering
- rotten window frames
- subsidence or structural movement
- woodworm (or other wood boring insects) infestation
Recently, there’s been a significant rise in one particular type of negligence claim – in respect of surveyors failing to identify Japanese knotweed. We have dealt with a number of these cases – click here to read more about making a Japanese Knotweeed compensation claim.
What happens if the negligent advice only comes to light later on?
Negligence may not come to light during the renovation process itself, but it could occur where an insurance company refuses to pay repair costs for damage because a valuer failed to give a correct valuation.
Listed buildings are often bought in a run-down condition, and renovated as a useful investment. Perhaps, as a purchaser, you complete the renovation and redecorate. Later you discover fault or leakage. When investigations take place, it is discovered that the surveyor did not report a serious defect in the structure. You now have a huge repair bill.
These kind of compensation claims should normally be made within six years – and if you fail to make your claim within that period you are likely to lose the right to compensation entirely. However if the negligence comes to light only later, six years runs from the date you became aware of the negligence – not the actual building work.
Either way, our advice is the same. As soon as you become aware that you have been given the wrong advice, make sure that you consult a specialist solicitor to see if you have a potential claim.
Surveyor negligence – how our professional negligence solicitors can help
If you have been the victim of a negligent surveyor, then our professional negligence solicitors could help you claim the financial compensation you deserve. They will conduct investigations and analysis by consulting independent professionals.
When you have paid out a large sum of money for a building, or extension, and later find a defect that should have been pointed out earlier, architect or surveyor negligence can be extremely distressing, especially if the project has been a dream that you have worked hard to achieve.
Speak to one of our specialist lawyers and see how we can help you recover costs and move on by making a professional negligence claim against your surveyor.
Click here to read more about making a professional negligence claim.
What can I claim for?
Surveyors have a duty of care to their clients. Therefore, if their negligent acts or omissions result in you suffering loss, you may have a claim for damages.
You can claim for financial compensation (damages) to cover the loss of value in your property. The damages you receive are designed to return you to the position you would have been in had the surveyor not been negligent.
Funding my compensation claim
There are 3 ways of funding your legal expenses
- Paying privately – this can prove expensive, though it sometimes worth agreeing to spend a limited amount upfront on investigating your claim
- Legal expenses insurance. You may find that one of your existing insurance policies covers you for this kind of legal claim
- We regularly run negligence claims using no win no fee agreements. Click here to read more about No Win No Fee Claims.
What are the time limits around making a claim for negligence?
The Limitation Act 1980 provides that all professional negligence claims, including those against surveyors, must be brought within six years from when you suffer financial loss from the negligence. Failure to bring a claim within this period will mean you are barred from claiming for negligence.
However, you may be able to make a claim in negligence after six years has expired if you only discovered the negligence at a later point in time. The time you discovered the negligence is known as the Date of Knowledge. You have three years from the date you became aware, or ought to have become aware of the damage resulting from the negligence. It is crucial you talk to one of our team if you believe you have a claim, even if you think it may be time-barred. We can assess your situation and advise on whether an argument can be made that you did not have knowledge of the damage until a later date.
Remember, you may also have a claim for breach of contract, depending on what the agreement between you and the surveyor states. Claims for breach of contract must be brought six years from the date of the breach.
There is an overall time bar on professional negligence claims of 15 years. No claim brought after this period will be heard by a Court.
Making a complaint against your surveyor
To justify a negligence claim against your surveyor, you will need to have suffered some form of financial loss. And if you’re going to instruct a solicitor to conduct a claim on your behalf, then it’s likely that loss will need to be substantial – as the legal costs of these kind of compensation claims against professionals can be high.
The alternative to a compensation claim is a complaint. Like solicitors, RICS – the Royal Institution of Chartered Surveyors – require their members to follow strict Rules of Conduct which include a requirement that all RICS members have a Complaints Handling Procedure. That procedure should have been made clear in the Terms and Conditions you received when you appointed your surveyor in the first place.
The Property Ombudsman may also be able to help you. However, the Ombudsman’s powers are limited, so if you think you have lost a substantial sum through a surveyor’s error, you’d be best to check with a specialist solicitor first before applying to the Ombudsman to resolve your complaint.
Buy to let– surveyor negligence claim fails
A recent Court case shows how careful you have to be when purchasing a property with the intentions of letting it out. In the Scullion vs Bank of Scotland case, the buyer had relied solely on the valuation that had been carried out on behalf of the lender by their surveyor. This valuation stated that the property was of a certain value and that the rental income from the property would be £2,000 per month.
However, in reality this buy to let valuation turned out to be wildly inaccurate. The buyer only managed to receive a rental income of £1,050 per month, which was not enough even to cover the mortgage. The buyer then took the lender to Court for professional negligence, and the Court ruled in favour of the buyer; but the decision was then overturned in the Court of Appeal. In rejecting the professional negligence claim, the Court of Appeal said that the potential buyer of a property should not rely on the valuation provided to the lender, but should instead get their own valuation.
It is the opposite case when a person buys a home to live in themselves; they have a right to rely on the valuation that their lender has obtained. It’s all down to why you bought the property in the 1st place. If you are buying to let, then this is seen as a commercial decision and, as such, you will need to obtain your own independent valuation on the property if you want to rely on it. The principle appears to be “buyer beware” when it comes to buy to let.