Lorna Carter

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Court considers extent of duty of care owed by Professional Consultant

Construction / 20 July 2020

Valley Brook Investments Ltd and another v Huam Ltd [2020]


Background

Huam Limited, the Defendant, produced architectural drawings for its client, a Mr Ajay Magon, for the proposed conversion of an office building in Crewe into residential units. The Defendant architect knew that the second Claimant, Andrew Mines intended to purchase the property from Mr Magon using a company incorporated for that purpose.

The Defendant architect sent the drawings to Mr Magon on 17 February 2016, however the first Claimant, Valley Brook Investments Limited, wholly owned by the second Claimant, was not incorporated until a week later (on 24 February 2016).  Valley purchased the property on 10 October 2016.

The Defendant architect’s drawings exaggerated the footprint of the property by 30%.


Legal action

A negligence claim was brought against the architect by both Mr Mines and Valley.

The architect argued that it did not owe any duty of care towards the first Claimant Valley because the company had not been incorporated i.e. did not exist when the architect supplied the drawings to the second Claimant Mr Mines.


Court decision

HH Judge Eyre QC sitting in the Business and Property Court of the High Court in Manchester held that a professional consultant can owe a duty of care to persons whose identity the consultant does not know if reliance by such persons on the consultant’s advice is reasonable and is to be anticipated if the circumstances give rise to an assumption of responsibility.

The Judge decided that it is not necessary for the professional to know the actual identity of the person to whom responsibility is being assumed, providing they can be identified within a category as being owed a duty of care.

It was held that Valley was in the category of those whom it was reasonably to be anticipated might reasonably rely on the drawings for the purpose of the purchase of the office building, so a duty of care towards Valley by the architect would ordinarily arise. This was not prevented by the fact that Valley had not been incorporated when the Defendant architect the drawings to Mr Magon. Valley existed when the right to bring a claim arose and this date was the date of purchase of the office building by Valley.


Comment

This is a helpful decision from the Court on what would seem to be a highly technical argument and one which might have been avoided all together if the Defendant architect had supplied a collateral warranty to Valley as the purchaser of the office building or indeed had Mr Magon’s appointment of the architect been capable of being novated or assigned to Valley as the purchaser.

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