The year’s first decision of the Technology & Construction Court provides a salutary lesson which will concern not just designers and architects, but all professionals and insurers.
In Burgess & Anor v Lejonvarn, Alexander Nissen QC, sitting as a Deputy High Court Judge decided a number of preliminary issues. These highlight the dangers common to any professional giving informal friendly advice.
Mrs Lejonvarn, a professional design consultant, had agreed as a favour to help out with her friend and neighbours’ ambitious landscape gardening project. In what the court described as a “cautionary tale”, The work did not go smoothly, the relationship broke down and the former friends Mr and Mrs Burgess claimed for the cost of remedial works.
As a result, Mrs Lejonvarn is defending a claim for £265,000 without any professional indemnity insurance cover. The trial was limited to preliminary issues:
Liability under the English Common Law is divided into claims under contract law, or the law of “tort”.
A contractual claim is based on a prior agreement including an offer, acceptance and each party receiving a benefit or ‘consideration’ as part of the bargain. The agreement is usually set out in writing, which gives clarity for the terms involved. However, a contract can be implied by conduct, even where there is no express written or verbal agreement.
A claim in tort is based on the principle that everyone owes a duty of care not to cause predictable loss or harm to others. That is whether or not they have any existing relationship.
The court decided that the professional consultant
The judge said
“…in law a duty of care extends to the protection against economic loss in respect of both advice and any service in which a special skill is exercised by a professional. The duty can extend to negligent omissions as well as the performance of negligent acts. For present purposes, the relevant ingredients giving rise to the duty are an assumption of responsibility by the provider of the service coupled with reliance by the recipient of the service, all in circumstances which make it appropriate for a remedy to apply in law…”
However, the court emphasised that “this was not a piece of brief ad hoc advice of the type occasionally proffered by professional people in a less formal context”. It was a significant project, approached in a professional way, with services provided over a relatively long period and involving considerable commitment on both sides. In addition, the professional consultant had hoped to receive payment for services that might be necessary later in the project.
In cases of negligent advice, the basic principle is to put the claimant in the position they would have been in if the professional had not breached the duty owed to the claimant. In other words, a claimant will usually be entitled to recover the amount by which they are out of pocket as a result of relying on the professional’s advice.
The fact that the advice was free, provided as a favour, and without any contract (written or implied) did not avoid the professional being liable for damages in negligence.
[i]  EWHC 40 (TCC), http://www.bailii.org/ew/cases/EWHC/TCC/2016/40.html
Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.