Consultant Certificates: A word of warning!

Steve Bamforth
11 June 2015

Twitter FacebookLinkedIn

Print

Topics 

Business

In association with

Issuing of Consultant Certificates can, in the eyes of the courts, have consequences beyond initial expectation. Steve Bamforth explains.

The very interesting the Hunts & Ors v Optima case highlighted the important issue of whether professional Certificates can be taken as warranties against defective work.

Contractor Optima had built two blocks of flats in Peterborough. Agent Strutt & Parker (S&P) had been engaged by Optima to carry out inspections of the building development and to produce ‘Architect’s Certificates’ for the purchasers and lenders of the flats.

S&P then carried out ten inspections and certified that construction flats was satisfactory but it did so prior to completion of all the works.

"S&P were found to have owed a duty of care to the purchasers both in inspecting the works and in the issuing of the Certificates."

Optima’s solicitors advised that the purchaser solictors Professional Consultants’ Certificates would be forthcoming. The purchasers then exchanged and completed the deal and the Certificates were provided.

However, subsequently construction of the flats was alleged to have been poor, and supervision of the works inadequate.

The purchasers complained of a range of issues including water ingress, floor movement and drainage issues.

As a result, some of the purchasers sued Optima for carrying out the building works badly and S&P for negligence in its inspection duties.

The Court found that Optima was in breach of the sale agreements with the claimants which required that the premises be completed in a good manner and Optima was in breach of its repair covenants.

However, S&P was also liable on the basis of its Certificates. The Court found that the purchasers were entitled to rely upon the fact that the Certificates were going to be provided and the Court decided that they took the form of collateral warranties. S&P were found to have owed a duty of care to the purchasers both in inspecting the works and in the issuing of the Certificates.

It is without question a word of warning. Issuing of Consultant Certificates can, in the eyes of the courts, have consequences beyond initial expectation.

Steve Bamforth, chief executive, Griffiths and Armour

To learn more about the issues arising from the above case, contact Griffiths & Armour at piinsurance@griffithsandarmour.com or call 0151 600 2163.