When you instruct any professional to carry out work for your business or provide you with specialist advice, there’s always a risk that their services will fall short of the standard required and surveyors are no exception.
In this article, our business dispute solicitors cover some of the basic principles of professional negligence and discuss some of the key elements of bringing a claim against a surveyor if you’ve been let down.
Contents:
- What is professional negligence?
- What are some common grounds for a professional negligence claim against a surveyor?
- What is the burden of proof for professional negligence?
- How do you make a professional negligence claim against a surveyor?
- How long do you have to issue a professional negligence claim against a surveyor?
- What if you didn’t know you’d suffered a loss or all of the facts until after the six-year limitation period has expired?
- How long does a professional negligence claim take?
- What losses can you recover if you are successful in a professional negligence claim?
- What if the surveyors have limited assets or are insolvent?
- Summary
What is professional negligence?
‘Professional negligence’ is the phrase that’s used to describe work done, or advice given, by a professional person that turns out not to meet the required standard of a reasonably competent person within the context of their profession. This is because when you seek specialist advice or support from someone who’s a member of a professional body, they owe you a duty of care. Sometimes those individuals don’t fulfil their responsibilities to you with a high enough degree of care and skill and as a result, you suffer some kind of harm or loss – usually financial.
What are some common grounds for a professional negligence claim against a surveyor?
There are a few different grounds that our specialist professional negligence solicitors typically see as giving rise to professional negligence claims against a surveyor. These include, but aren’t limited to, situations such as those outlined below:
- Providing an incorrect valuation: If you instruct a surveyor to value a property and they get it wrong by either underestimating or overestimating its value, resulting in a financial loss to you, this might be grounds for a claim.
- Missing structural defects: Structural defects can take many forms and can include damp problems, issues with the foundations of the property and flaws with the roof or drainage. If you buy a property and your surveyor has missed or overlooked problems such as these then this may also form the basis of a negligence claim.
- Providing an inadequate report: If your surveyor fails to provide sufficient detail and you discover that there are serious issues with the property after you’ve purchased it that weren’t mentioned in the report then you could have grounds to bring a claim against them.
What is the burden of proof for professional negligence?
If you believe that your surveyor has failed to carry out the services you entrusted them with to a reasonable professional standard and you’ve suffered some form of loss as a result, then the onus – or burden of proof as it’s referred to in legal terms – is on you as the prospective claimant to prove that they were negligent. There are a few elements involved in this and essentially it means that you have to prove the following:
- That the surveyor owed a duty of care to you and to identify the scope of any duty they owed
- That they breached their duty of care because they either did or failed to do something they were meant to do to a competent standard, or demonstrated a lack of care
- You’ve suffered loss or harm as a direct consequence of this breach of duty
- The breach caused a loss to you that’s recoverable
How do you make a professional negligence claim against a surveyor?
It’s very important to take specialist legal advice if you’re thinking of making a professional negligence claim against a surveyor. This is because there’s a lot to think about and certain evidence you’ll need to gather, as well as steps that the court will expect you to take before you formally bring a claim against them. If you don’t do all of these things properly then it can potentially jeopardise your chances of being successful with the claim further along the line with any litigation, as well as possibly leaving you out of pocket if you’re penalised by the court for not doing everything you were meant to do before or during the lifetime of the litigation.
Following on from this, one of the main factors to be aware of before starting a professional negligence claim against a surveyor is the need to comply with the Pre-Action Protocol for Professional Negligence. This Protocol sets out a framework of what needs to happen before any possible court proceedings– including the conduct that’s expected of everyone involved – and is designed to encourage and facilitate a narrowing of the key issues and, ideally, a settlement wherever possible before court action is needed – for example, in the form of negotiated settlement or mediation.
If no settlement can be reached and litigation is required, then you’ll need to follow the below stages as prescribed by the Protocol before you formally issue proceedings against the surveyor:
- Send a preliminary notification letter – while not always necessary, it is encouraged. The purpose and benefit of this is that puts the surveyor on notice of a potential claim. This in turn requires them to notify their professional indemnity insurers. The sooner the insurers are notified the better. Insurers are not “on the hook” for any such claims until notified. A notification letter is usually very short and provides a very brief indication of the nature and value of the claim, with the intention that full details will follow in a Letter of Claim (see below) once fully investigated.
- Send a letter of claim: This is a very important document that has to contain specific details dictated by the Protocol. It is therefore advisable to seek help from a solicitor to draft it for you. In summary, the letter should include all of the key facts that support the allegation of professional negligence by way of a brief summary of the claim or claims, along with the key dates and estimated details of the loss you’ve suffered (including calculations and evidence attached where available, or an indication that the information about any financial losses will follow as soon as possible if there’s a good reason they can’t be finalised now). For claims against surveyors, you will usually have to obtain an expert surveyor report early on commenting on the areas of negligence and the losses that you seek to claim.
It's also worth mentioning here that the Letter of Claim should include a request for the surveyor to provide their professional indemnity insurers with a copy of it.
- Acknowledgement of the letter of claim: The Protocol states that the surveyor should acknowledge receipt of the letter in writing within 21 days.
- Letter of response: The surveyor will have up to a further 3 months to investigate and provide a full Letter of Response. They will likely instruct solicitors to investigate and respond on their behalf.
It is expected that there will be some further correspondence to narrow or clarify issues and to consider any potential settlement proposals. The claim remains disputed and no acceptable offer is put forward, formal litigation may then be required by issuing a pursuing a court claim.
- If litigation is necessary: The Protocol expects parties to agree on certain areas if it’s the case that no alternative resolution to litigation can be found. This includes agreeing where expert evidence might be necessary, the nature and extent of disclosure and how the litigation will be conducted.
The timelines suggested by the Protocol above can be varied by agreement if necessary.
How long do you have to issue a professional negligence claim against a surveyor?
It’s always advisable to issue a professional negligence claim as quickly as possible if your circumstances allow for that. You’ll need to take legal advice on when the clock started to run for the purposes of the limitation period because it will depend on your situation, but generally speaking, in an action for professional negligence, the cause of action accrues at the time the damage to you is suffered and you then have six years from that point to bring a claim. So, for example, if you instructed the surveyor to undertake a survey and they produced one that contains incorrect information and it causes you to suffer a loss, then the date you receive that survey would be taken to be the point that the cause of action accrues and time for limitation purposes would begin to run from then.
What if you didn’t know you’d suffered a loss or all of the facts until after the six-year limitation period has expired?
The situation with limitation can be more complicated than the example above, i.e., you might not realise that there’s a problem that’s caused you to suffer loss (for example a defect that is not immediately obvious) or have all of the relevant facts you’d need to bring a claim until after the six-year time period expired. If this happens, then the law says that the time limit will be three years from the earliest date on which you first had the knowledge to bring an action in respect of the damage. This is always arguable and so you will need to take legal advice on this point.
It's also worth knowing that there is a long-stop period of 15 years from the date of the negligent act (unless there are allegations of fraud or deliberate concealment), after which any claim will be statute barred – meaning that the law would prevent you at this stage from bringing a claim against the surveyor.
How long does a professional negligence claim take?
It’s impossible to say exactly how long a professional negligence claim will take because it will depend on many factors, all of which will be unique to your dispute and will consider the complexity of the claim, its financial value and the evidence available. If you and the surveyor can settle your claim within the framework of the Pre-Action Protocol period, then you may be looking at around 3-6 months from the date the Letter of Claim is sent out.
If the claim goes to court (because it is disputed, or a settlement cannot be reached) the litigation process may take 12 to 18 months from issuing a claim if a full trial is necessary to resolve the matter. Most claims settle before they go to trial (primarily because both parties acknowledge the large costs involved in a full trial).
What losses can you recover if you are successful in a professional negligence claim?
Financial damages are awarded by way of compensation if you’re successful in a professional negligence claim. This will turn upon what exactly you instructed the surveyor to do, with the aim of damages being to put you back into the position you would have been in if the surveyor had not been negligent. The traditional basis of loss for a surveyor's negligence will be the “diminution in value” ie the difference in value between the property with and without the identified problems. This remains an evolving area and is subject to the scope of the instruction and any other nuances.
What if the surveyors have limited assets or are insolvent?
Surveyors will usually have professional indemnity insurance against which you could make a claim. If the surveyor firm becomes insolvent or goes into liquidation, there is a risk it may no longer have effective insurance. For these reasons, as indicated earlier above, it is important to notify a claim as soon as possible.
Summary
If your business has suffered a loss as a result of receiving poor or inadequate professional services from a surveyor, it’s strongly recommended that you take advice from a professional negligence solicitor as soon as you can. Bringing a claim can be a potentially expensive and long-drawn-out process, so seeking out the right help and support at an early stage can minimise the disruption and cost implications faced by your company if you need to take legal action.
