Surveyors and lawyers are each facing £100,000 bills after the High Court ruled that they were equally to blame for a debacle in which a residential property was valued at almost double the sum for which it had been sold just a few months earlier.
A mortgage company had advanced a substantial sum to the property’s owner on the basis of the surveyors’ £725,000 valuation. The particular surveyor who had inspected the property had been ‘led into error’ by the borrower and was unaware that he had bought it for just £390,000 less than six months earlier.
The surveyors had subsequently settled the mortgage company’s negligent over-valuation claim for £200,000 but sought a contribution to that sum from the law firm which had advised both borrower and lender during the transaction.
The Court found that the surveyor had been ‘careless’ in performing his task and that he ‘probably knew or suspected’ that his valuation was over-generous. However, the law firm had failed in its duty to carry out a Land Registry search that would have revealed the earlier sale price and alerted the lender to the over-valuation. In those circumstances, the Court found that the surveyors and the law firm bore equal responsibility and should each contribute half of the £200,000 bill.