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Construction Law: The Perils of Free Advice By Joseph Chiffers

Posted by Lynne on May 9th 2017
(Business, Commercial Litigation, commercial litigation and dispute resolution, Commercial Property, commercial property and real estate, commercial property and real estate services, Contract Law, dispute resolution, Litigation, Professional Negligence)

In Lejonvarn (Appellant/Defendant) vs Burgess (Respondent/Claimant), the Court of Appeal upheld the first instance decision and the principle that an architect providing free advice owes a duty in tort to recipients of their advice and may potentially be liable for pure economic loss; see here for the full judgment and see here for my blog on the first instance decision.

 

The Court held that the absence of a contractual relationship does not automatically preclude a finding, that there has been an assumption of responsibility creating a liability in tort.  In this case an email sent by the Defendant referring to the Claimants as ‘clients’ and to the importance of her expertise being provided for the project in question, was found to be particularly relevant.

 

The scenarios where a Defendant will have assumed responsibility are; where there is a fiduciary relationship, where the Defendant has voluntary tendered a skilled service, where the Defendant has voluntarily provided advise or answered a specific question requiring expertise to do so.  The Court distinguished between architect/project managers and builders, because unlike the latter the former would typically give advice, draw up accounts, prepare reports, produce plans and manage the project.  Presumably a builder who took on these obligations could be deemed to have assumed responsibility for the purposes of tort law.

 

The case does not in my view establish a new principle, although it is the first time that an architect as opposed to say a solicitor, has been liable in tort for providing negligent free advice.

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