""As usual - First class service and advice""
A decision by the Court of Appeal means professional advisers like surveyors, accountants and lawyers should consider the need to repeat important advice and to be absolutely clear about their intentions if they mean to stop acting for a client.
Bridge McFarland Solicitors say the ruling in the case of Littlewood vs Radford and Boston will cause concern for the members of many professions by making it harder for them to decide when they have done enough to fulfil their professional obligations.
In the case, Mrs Littlewood instructed a firm of surveyors to act for her in a claim to extend the lease on her flat. Notice was then properly served on her landlord exercising her right to extend as provided for in the Leasehold Reform, Housing and Urban Development Act of 1993.
The parties could not agree a price for the extension of the lease, however, and the surveyors informed their client of the deadline for making an application to the Leasehold Valuation Tribunal to settle the price. Two months later, they wrote to Mrs Littlewood informing her that they could not continue to act for her unless she paid an earlier invoice that they had submitted for their work.
The invoice was not paid and, although there was some subsequent communication between Mrs Littlewood and her advisers, they did nothing more to progress the extension and the deadline for applying to the tribunal was missed.
Mrs Littlewood was subsequently able to buy an extended lease for the flat for £485,000, about £100,000 more than she would have needed to pay had she exercised her statutory right.
She sued Radford and Boston for damages, claiming they had been negligent in failing either to make the application to the LVT or to remind her to make it.
The Court of Appeal eventually found that the surveyors were guilty of negligence. The fact that Mrs Littlewood did not comply with the terms of their letter demanding payment did not end their retainer in the case and they were therefore under an implied duty to inform her again of the deadline for making her application.
Although there was no general duty on an adviser to keep repeating important advice, the court held that Mrs Littlewood was not experienced in the area of enfranchisement and could have been expected to rely on her professional adviser to remind her that she needed to protect her position.
Bridge McFarland partner and commercial law specialist Stephen Oldridge said: “The ruling in this case will alarm many professionals and advisers as it imposes a very onerous burden on them not only to give the right advice but to repeat it time and again if necessary.
“The surveyors in the case gave the correct advice once and believed that their duty to act for their client had ended when she failed to comply with their letter demanding payment of their invoice. However, there was some subsequent communication between the parties and the court found, in effect, that their adviser-client relationship had not ended when the deadline was reached.
“The clear message to professionals is that they must be very clear and unambiguous if they wish to end their relationship with a client while a case is still awaiting final resolution. In such circumstances, they would be advised to repeat important advice given previously, particularly if crucial deadlines are approaching.”
