Dear Claire – Autumn 2018
09 / 10 / 2018
Perplexed by property law? Relax, Solicitor Claire Haynes is here to answer your most pressing questions…
Q: I recently completed the purchase of a property which I intend to refurbish. The seller provided me with copies of the documents and reports for the property which it obtained during its period of ownership. One of the documents was a site investigation report prepared by a professional environmental consultant. The report states that the property “passed” the assessment carried out by the consultant. Following completion of the purchase I subsequently found out that asbestos is present at the property. The report did not disclose the presence of the asbestos. Do I have a claim against the consultant who prepared the report for my additional unbudgeted costs of removing the asbestos? If I had been aware of the presence of the asbestos I would have negotiated a reduction in the price of the property to reflect the costs of decontamination.
A: Sellers routinely disclose professional reports in tender and property information packs to enable buyers to carry out their own due diligence on a property. In order to bring a claim against the consultant who prepared the site investigation report you would need to establish that the consultant owed you a duty of care.
I have not seen a copy of the site investigation report in question, but I assume that it was not addressed to you. I expect the consultant to have excluded reliance on its report by parties other than those to which the report was addressed and so it is unlikely that you would benefit from a duty of care without taking further steps to establish such a duty.
In the case of an existing report prepared by a professional consultant it would be usual for the buyer to take a formal assignment of the report or the appointment, to obtain a deed of warranty from the consultant or for the consultant to issue a letter of reliance to create a duty of care. Sometimes the consultant will charge a fee for giving reliance on its report. You should check your paperwork for the property as documentation along these lines may have been obtained during the purchase process.
A recent High Court case brought in similar circumstances ruled that without documentation creating a formal contractual relationship between a consultant and a subsequent owner of a property, where the terms of the consultant’s appointment excluded reliance on its report by third parties the consultant did not owe the purchaser a duty of care. The subsequent owner could not recover the cost of remediation from the consultant (BTW Trading Ltd v Integral Geotechnique (Wales) Ltd).
I would advise you to take legal advice on the merits of bringing such a claim against the consultant as each case will turn on its individual facts.