In 1982 the surveyor failed to observe serious defects, including a leaking roof and a septic tank with an offensive smell. The plaintiff purchaser could not afford major repairs and executed only minor repairs himself. At the date of the trial the plaintiff was still occupying the house as his home. The judge awarded damages assessed in respect of repairing the defects as at the date of trial in 1981. Between the date of the trial and the hearing of the appeal the plaintiff sold the property for andpound;43,000. He had paid andpound;27,000 in 1976 in reliance upon the negligent report. It was acknowledged by the plaintiff that sale of the house without repairs having been executed made it difficult to support the award based upon the cost of repairs and his contention was that damages should be assessed on the basis of the difference in market value of the property as between its value taking into account the defects for which the judge found liability established and its value in the condition the defendants reported it to be either on the basis of values at the date of the report or at the date of judgment.
Held: When calculating the loss arising from a negligent survey, the loss is usually calculated as at the date of the purchase which followed. The decision in the Liesbosch must be confined to its facts.
Kerr LJ said: ‘If it is reasonably foreseeable that the plaintiff may be unable to mitigate or remedy the consequence of the other party’s breach as soon as he would have done if he had been provided with the necessary means to do so from the other party, then it seems to me that the principle of The Liesbosch [1933] AC 449 no longer applies in its full rigour.’
Denning MR said that damages should be on a scale which is not excessive but modest. He referred to Dodd Properties and said: ‘where there is a contract by a prospective buyer with a surveyor under which the surveyor agrees to survey a house and make a report on it – and he makes it negligently – and the client buys the house on the faith of the report, then the damages are to be assessed at the time of the breach, according to the difference in price which the buyer would have given if the report had been carefully made from that which he in fact gave owing to the negligence of the surveyor. The surveyor gives no warranty that there are no defects other than those in his report. There is no question of specific performance. The contract has already been performed, albeit negligently. The buyer is not entitled to remedy the defects and charge the cost to the surveyor. He is only entitled to damages for the breach of contract or for negligence. It was so decided by this court in Philips v. Ward [1956] 1 W.L.R. 471, followed in Simple Simon Catering Ltd. v. Binstock Miller and Co. (1973) 117 S.J. 529.’
Judges:
Denning MR, Kerr LJ, Oliver LJ
Citations:
[1982] 1 WLR 1297, [1982] 3 All ER 705, [1983-84] ANZ Conv R 72
Jurisdiction:
England and Wales
Citing:
Confined – Liesbosch Dredger (Owners of) v Owners of SS Edison, The Liesbosch HL 28-Feb-1933
The ship Edison fouled the moorings of the Liesbosch resulting in the total loss of the dredger when it sank. It had been engaged on work in the harbour under contract with the harbour board. All the owners’ liquid resources were engaged in the . .
Cited by:
Cited – Smith and Another v South Gloucestershire Council CA 31-Jul-2002
The claimants purchased land. The local search did not reveal a planning permission which affected the value of the property by applying an occupancy condition. He claimed compensation. Compensation was eventually agreed to be payable, but the . .
Cited – Lagden v O’Connor HL 4-Dec-2003
The parties had been involved in a road traffic accident. The defendant drove into the claimant’s parked car. The claimant was unable to afford to hire a car pending repairs being completed, and arranged to hire a car on credit. He now sought . .
Cited – Watts and Co v Morrow CA 30-Jul-1991
The plaintiff had bought a house on the faith of the defendant’s report that there were only limited defects requiring repair. In fact the defects were much more extensive. The defendant surveyor appealed against an award of damages after his . .
Cited – Downs and Another v Chappell and Another CA 3-Apr-1996
The plaintiffs had suceeded in variously establishing claims in deceit and negligence, but now appealed against the finding that no damages had flowed from the wrongs. They had been sold a business on the basis of incorrect figures.
Held: . .
Lists of cited by and citing cases may be incomplete.
Damages, Professional Negligence
Updated: 23 March 2022; Ref: scu.182978
