Innacurate property sales particulars and wasted survey fees

[DaveDavis]

Hi

My wife and I recently made, and had accepted, an offer to buy a property.

The first line of the particulars said

"A most spacious five bedroom detached family home with approximately 3,000 sq ft of living accommodation..."

 

There was a plan of the property later in the particulars but no dimensions on it.

There were dimensions on a room by room basis included as part of the description of individual rooms.

 

I had a full survey done.

That states

"The overall internal floor area extends to around 2085 sq ft".

We have withdrawn from the sale principally because the property is a lot smaller than we thought.

At a minimum I would like to recover my lost survey fee.

 

The selling agents are members of the Property Ombudsman Scheme.

Worth going to them?

Or straight to small claims court?

 

 

I have some experience of the small claims court and am comfortable bringing claim on my own,

and I am thinking probably is worth going straight to court.

 

What is basis of the claim?

This looks like a clear breach of Consumer Protection from Unfair Trading Regulations

but can I claim my losses under those regs or is it best to go under general law of misrepresentation?

 

On this - I was induced to enter into a contract with the surveyor by the misleading particulars - is that what I need to establish to succeed ? Put another way does it matter that I did not have any contract with the estate agents themselves?

 

Any thoughts gratefully received. Many thanks

Edited April 19, 2016 by DaveDavis

[AndyOrch]

Hi Dave and Welcome to CAG

 

Did you actually go and view the property before making an offer and instructing the survey to be done ?

 

Regards

 

Andy

[DaveDavis]

Yes, twice

[AndyOrch]

So because its 915 sq ft short of the advertised 3,000 sq ft of living accommodation....you are pulling out? I don't think you will attain much success in achieving your refund of the survey fee.

 

Andy

[DaveDavis]

So because its 15 sq ft short of the advertised 3,000 sq ft of living accommodation....you are pulling out? I don't think you will attain much success in achieving your refund of the survey fee.

 

Andy

 

No, because it is 915 Sq ft short!

[AndyOrch]

Oops typo:oops:

[king12345]

If you look at the adverts page, right at the bottom of it, in very small print, it will say that measurements are not accurate and potential buyers should take their own.

Also all fixtures, fittings, services and so on are not tested.

They do this to avoid being sued for misrepresentation.

[DaveDavis]

If you look at the adverts page, right at the bottom of it, in very small print, it will say that measurements are not accurate and potential buyers should take their own.

Also all fixtures, fittings, services and so on are not tested.

They do this to avoid being sued for misrepresentation.

 

Yes but does that small print get them off the hook? I thought the purpose of the Consumer Protection regulations was to nullify certain get out clauses?

[king12345]

Yes but does that small print get them off the hook? I thought the purpose of the Consumer Protection regulations was to nullify certain get out clauses?

 

I'm not an expert, but I would think that because all estate agents use more or less the same disclaimer, it's been tried and tested to get them off the hook.

When I bought my house it was advertised as a 4 bedroom house when in fact after the survey we found that the loft conversion was never approved by the council and was dangerous because floor had not been re-inforced.

Unfortunately that's the way it is with estate agents I think.

Maybe caggers expert in this field can give you better hope.

[DaveDavis]

I can see that making a misrep case could be difficult, but there are cases that indicate it is possible, see eg McCullagh v Lane Fox & Partners

 

But what about the breach of the Consumer Protection from Unfair Trading Regs. Lets assume there has been a breach. Does a consumer have a remedy or is it only Trading Standards who can enforce those regs?

[Old Cogger]

not much recourse due to standard disclaimers from experience - as far as the amount of discrepancy then the amount is quite high yet not noticed on two viewings? and agreed to pay deposit on viewed property! not looking good but others may know different! afraid! signed paperwork on deposit!

[DaveDavis]

I suspected the real number was lower, obviously estate agent speak "approximately 3,000 sq ft" means it is going to be less in reality, and would not have been too concerned if it was say 100-200 sq ft lower. But was very surprised by the massive discrepancy. And yes not noticed - it is difficult to assess in your head the area of the internal rooms in a good sized house, and I had no reason not to believe "approximately 3,000 sq ft" meant "approximately 3,000 sq ft".

 

Dont understand your comments "agreed to pay deposit on viewed property" and "Signed paperwork on deposit!". Have not signed anything and not paid any deposit. It is wasted survey costs I am concerned about.

 

Does anyone know if consumers can bring actions re breach of Consumer Protection Regs, or is it only Trading Standards that can do that? Does seem to be a clear breach of the regs. I found this comment elsewhere:

 

What these regulations prohibit are “misleading actions” and “misleading omissions” that lead to the average consumer making a decision – which includes the decision to view a property – that they would not otherwise have done. How “misleading action” is defined is very detailed but in essence it means something that contains false information or which, overall, deceives a consumer

[DaveDavis]

By the way, on the misrep issue, I have checked the PDF download of the particulars. There is no general disclaimer. There is a section called "Agents Notes" which has some comments on "Fixtures & Fittings" and "Services Connected" and then says "All Measurements: All Measurements are Approximate". So I am thinking that the misrep claim might not be so difficult.

[hightail]

Did you not notice the property was only two thirds the size you expected when you viewed?

[AndyOrch]

Hi Dave and Welcome to CAG

 

Did you actually go and view the property before making an offer and instructing the survey to be done ?

 

Regards

 

Andy

 

Did you not notice the property was only two thirds the size you expected when you viewed?

 

[DaveDavis]

Please see comments above. I took the particulars at face value, understanding that in estate agent speak approximately 3,000 sq ft would mean less than but not too much less than 3,000 sq ft.

 

The statement in the particulars is a direct misrepresentation and was important when I was considering the relative merits of different properties. There is no disclaimer in relation to this. So I am thinking I could well have a claim in misrep.

[hightail]

I think the word 'approximately' makes it very difficult. You accept it's an estate agent 'guesstimate' so what would have been OK? 5% less - 10%, 20%? This is bound to be asked of you if your argument is that you would accept some difference but not this much.

[hightail]

The other problem you may have is who to sue. The last time I sold a house was about two years ago so reasonably recent and the estate agent had me sign off on the particulars. If that's the case here then who's responsible - the agent or the vendor?

[DaveDavis]

As it is not a technical term I think the test is what the man on the Clapham omnibus would interp it to mean and that certainly would not include a real value of 2085 within "approximately 3000".

 

Or on the Officious Bystander test - there is no way you could imply that Approximately 3,000 included 2,085. If an Officious Bystander said that Approximately 3,000 included 2,085 no one would say "But of course it means that". If when you said Approximately 3,000 you wanted it to include 2,085 you would have to say that expressly.

 

Or consider standard industry practice. If you were to ask an estate agent would you interpret Approximately 3,000 sq ft to possibly mean 2,085 they would almost all say of course not (I have discussed this with the agents I am selling my house through they said the misleading particulars were "unforgivable" and others I have shown the particulars to shook their head in disbelief).

[DaveDavis]

On who to sue yes that is an issue, but I think there could be a valid claim against the agents. In Hedley Byrne v Hellor the court said:

 

Lord Morris of Borth-y-Gest said: ‘it should now be regarded as settled that if someone possessed of a special skill undertakes, quite irrespective of contract, to apply that skill for the assistance of another person who relies upon such skill, a duty of care will arise. The fact that the service is to be given by means of or by the instrumentality of words can make no difference. Furthermore, if in a sphere in which a person is so placed that they could reasonably rely upon his judgment or his skill or upon his ability to make careful inquiry, a person takes it upon himself to give information or advice to, or allows his information or advice to be passed on to, another person who, as he knows or should know, will place reliance upon it, then a duty of care will arise.’

 

An claim against an estate agent McCullagh v Lane Fox & Partners based on this precedent failed because there was a relevant exclusion clause. In the particulars I read there is not any.

Edited April 20, 2016 by DaveDavis

[steampowered]

The most obvious person to claim against would be the person who made the offending statement - i.e. the estate agent.

 

You don't have a contract with the estate agent so you could only bring a tort claim, not a contract claim. The 'officious bystander' test is a contract law thing and not relevant here. I think the Consumer Protection from Unfair Trading regulations are also out, because this only gives you a right to bring a personal claim where you have bought or sold goods or services from the person who breached the regulations - in this case you didn't buy anything from the estate agent.

 

If you could prove that the statement was made fraudulently (i.e. the estate agent knew it was untrue, or made the statement recklessly without caring whether it is true or not), then you could begin a deceit claim. It is very difficult to prove fraud though.

 

You could sue the estate agent for 'negligent misstatement' if you could prove that the estate agent owed you a duty of care. This is what the Hedley Byrne case you refer to is all about. To be honest I don't think a seller's estate agent does owe you a duty of care. It is expected that you will view a property and conduct your own investigations before purchasing.

 

Also, it sounds like the estate agent said the property is approx 3,000 sq ft but the survey talks about internal floor area. These are not quite the same thing. I imagine the property size is a bit bigger than the internal floor area.

 

To be honest I am not seeing a viable route to a claim here.

[DaveDavis]

Thank you Steampowered.

 

The relevant wording of the particulars in full was "a most spacious five bedroom detached family home with approximately 3,000 sq ft of living accommodation". Survey measured internal floor area. Taking into account fact particulars specifically referenced living accommodation I think these are essentially measures of the same area and I believe there was a clear and material misrepresentation. This is supported by the comments of the other agents I have mentioned this to, also by the fact they have re-marketed the property with the same particulars but deleting the words "with approximately 3,000 sq ft of living accommodation".

I agree if I had proceeded to purchase it might be difficult to argue that relying on the particulars alone was reasonable. But surely it is reasonable to rely on particulars for purpose of making a subject to contract offer and dismissing other properties and incurring limited legal costs and incurring survey costs. We have now gone back to the vendor of another property we had previously been in negotiations with and that vendor now wants more money. So there are various costs and losses that have flown from this misrepresentation - the size of the property was an important consideration when making our decision on which of two properties to pursue at the time we were negotiating and deciding between them.

 

I will have to decide what to do but I think a without prejudice letter to registered office setting out my complaint and my losses is probably the right way to go. See what the response is then consider a small claims court action. I think small claims court may well be sympathetic - I think what we did was perfectly reasonable, there is a blatant misrep and clear losses as a result of it. Would they imply a duty of care? Don't know but taking into all the circumstances I think they may well find a way to do so.

[steampowered]

In terms of how you phrase this, this isn't a misrepresentation claim. Misrep applies where you have been induced to enter into a contract with the person who made the statement. The claim you are looking for is negligent misstatement because that doesn't require a contract with the person you are suing - subtle but important distinction.

 

Demonstrating a 'duty of care' would involve looking at all the circumstances - what was said in the advert; whether there was any exclusion clause advising that the estimate shouldn't be relied on; whether you could be expected to have relied on your own analysis because you viewed the property. It sounds possible but I think you would need to do a good job of convincing the judge as to why he should find that a duty of care exists. It is possible that there is specific case law on this, I haven't checked.

 

I doubt you could claim the costs of the other vendor asking more money. That sounds a bit too remote. The cost of doing the survey and wasted legal costs maybe.

[DaveDavis]

Thanks again. I will do some more homework on negligent mis-statement

[hightail]

The special skill here surely is that of a surveyor rather than an estate agent or vendor.