When a person is considering pursuing a professional negligence claim, the first thing that specialist lawyers will do is to consider the various hurdles that must be overcome to succeed in such a claim. The first of these hurdles is to prove that the professional owed a duty of care to the person making the claim.
In many cases, establishing a duty of care will be straightforward. If, for example, a person or company has instructed solicitors to advise them on the purchase of a property, it is well established that the solicitor will owe their client a duty of care to provide advice, which meets the standard of a reasonably competent solicitor.
Establishing a duty of care in negligence claims
BDW Trading Limited v Intergral Geotechnique (Wales) Limited [2018]
In the recent case of BDW Trading Limited v Intergral Geotechnique (Wales) Limited [2018], the High Court had to consider whether a firm, that carried out a survey for the seller of land, owed a duty of care to the eventual purchaser of that land.
The land was owned by the local council and was intended for development. The purchaser of the land was the Barratt Group, a national housebuilder, and they discovered after purchasing the land that there were significant quantities of material containing asbestos that had been buried on the site. There was a high cost in removing this material and they pursued the firm who had carried out the geotechnical survey (IWG). Barratt Group argued that IWG ought to have reported more clearly on the risk that such material would be buried on site.
IWG had been instructed by Bridgend County Borough Council to prepare a geotechnical report to be included in the sale pack for the land in question. IWG were, therefore, aware that the report would be seen by potential purchasers. In fact, the Barratt Group, subsequently dealt with IWG directly regarding aspects of the report, so IWG were aware that the Barratt Group were using the report in making their decision on whether to purchase the development land.
However, IWG’s report included a disclaimer stating that the report was for Bridgend’s use and was not to be passed to others without consent, but also that the benefit of the report could be assigned to the eventual purchaser in the future. Due to administrative errors on the part of the Barratt Group, the assignment never took place. In the absence of a clear contractual duty, this meant that the Barratt Group had to establish a duty of care in the tort of negligence.
The High Court considered all of the factors in favour of, and against, the duty of care and decided that IWG did not owe a duty of care to the Barratt Group in relation to the geotechnical survey. The fact that IWG had made it clear that the benefit of the report could be assigned to the eventual purchaser, showed that they did not intend to assume that responsibility unless a legal assignment took place.
Barratt Group effectively failed at the first hurdle and the remaining aspects of the claim, such as whether they had advised to a reasonable standard, and whether they could be said to have caused the loss, became effectively irrelevant (although the High Court did go on to express opinion on them in case of appeal).
This case highlights the importance of obtaining specialist advice from a professional negligence lawyer if you are considering such a claim. The legal requirements of such claims are complex but crucial to success.
How can Nelsons help?
For more information, please our Professional Negligence team in Derby, Leicester or Nottingham on 0800 024 1976 or via our online form, and we will be happy to assist.