The claimants had been found liable for mis-valuation of a property. They now sought a contribution from the solicitors acting uunder the mortgage saying that had they acted properly, they would have alerted the lender, and in turn the claimant of circumstances requiring extra care before a loan was made.
Held: It was not possible for the solicitors to say that the terms of the Lenders Handbook, read with the Practice Rules and the certificate of title, exclude, on their true construction, the Bowerman duty, and: ‘what the Lenders Handbook, read with the Practice Rules and the certificate of title, is intended to do is to identify and to delimit the precise scope of the specific activities which the solicitor is being retained to do, in circumstances where the solicitor is faced with the difficult position of acting for two parties with potentially conflicting interests. It is not intended to exclude the general obligation to exercise reasonable care and skill in the performance of such activities or, as part of such general obligation, the obligation to report to the lender as one of the clients where, through the performance of such obligations, the solicitor comes into possession of information which has a material bearing on the valuation of the lender’s security or some other ingredient of the lending decision.’
If informed of the discrepancy, the lenders would have queried the value with the valuers.
Stephen Davies HHJ
[2014] EWHC 1104 (Ch)
Bailii
Civil Liability (Contribution) Act 1978
Citing:
Cited – Mortgage Express Ltd v Bowerman and Partners (A Firm) CA 1-Aug-1995
A solicitor acting for both a lender and a borrower was under a duty to disclose relevant information to the lender client. An incident of their duty to exercise reasonable care and skill, solicitors are obliged to advise their lender client in . .
Cited – Nationwide Building Society v Balmore Radmore ChD 1999
Although the Bowerman duty is a species of obligation which the court will ordinarily imply where a solicitor acts for a lender, it will not imply such an obligation when to do so is inconsistent with the express terms of the retainer or with the . .
Lists of cited by and citing cases may be incomplete.
Professional Negligence, Legal Professions
Updated: 11 November 2021; Ref: scu.523659