Following on from our blog “My Seller Lied to Me!”, we thought we would set out some examples of real cases of claims for
misrepresentation
that have been decided on by the Courts.

A recap of the position – what is misrepresentation?

A contract to purchase a property is no different to any other contract. If one party to a contract says something which isn’t factually accurate and the other party relies on that statement when entering the contract, this can give rise to a claim for misrepresentation.

If someone suffers a financial loss as a result of the reliance that they have placed on a representation which is false, then the aggrieved party can normally claim damages to compensate them for this.

In some cases it is possible to rescind the contract. Rescission means putting the parties in the position that they would have been in had the contract not been entered into, effectively “reversing” the transaction completely.

Misrepresentation in property transactions

IIf the seller of a property makes a false statement of fact about it and the buyer relies on this statement when deciding to proceed with the purchase, if this causes the buyer a loss, the buyer may have a misrepresentation claim against the seller.

Property transactions normally follow a well-established process. Part of this process includes the buyer asking questions about the property and the seller answering them. These questions are called pre-contract enquiries. To speed the process up, certain basic information about the property is normally given in advance by the seller, by completing a Property Information Form or TA6.

How misrepresentations happen

Property transactions normally follow a well-established process. Part of this process includes the buyer asking questions about the property and the seller answering these. These are called pre-contract enquiries.

To speed the process up, certain basic information about the property is normally given in advance by the seller, by completing a property information form.

The Law Society has published standard forms which many solicitors will use, but there is no rule to say that a bespoke form cannot be used or indeed that a seller needs to provide this at all. However, if a seller does not provide this information, a buyer may be unwilling to proceed.

The standard forms which are normally used in property transactions include the Seller’s Property Information Form (TA6 – sometimes referred to as a SPIF) and Sellers Leasehold Information Property Form (TA7 – for leasehold transactions). There are other standard forms which the Law Society have produced and may also contain information, when completed, which amount to representations.

Warnings to both the buyer and seller appear on the standard property information forms, informing the parties that the seller must answer the questions accurately because the buyer is entitled to rely on them when deciding whether or not to enter into the contract.

Whilst much of the time it is what appears in the property information form which forms the basis of a misrepresentation claim, any statement about the property which is untrue can be capable of amounting to a misrepresentation. Written (and sometimes even oral) correspondence between the parties and their solicitors can amount to misrepresentations too. It is important to consider the contractual terms, as these would normally look to exclude or limit liability for things said outside of what is recorded in the contract.

Mistakes can happen and a seller can make an “innocent misrepresentation”. Sometimes, a seller may make a “reckless misrepresentation”, saying something without caring or checking whether or not the statement is accurate. In some cases, a seller might deliberately say something which is misleading so the buyer proceeds with the transaction, which may amount to a “fraudulent misrepresentation”.

So what happens when the buyer discovers the truth? We have set out below some real cases, decided by the Courts, to give you an idea of how these cases are dealt with in practice.

What is a false statement of fact?

Historically, only a statement of fact which was false was considered a basis to bring a misrepresentation claim. An incorrect statement about the law, or a person’s opinion of something, were not considered capable of being misrepresentations.

However, in Pankhania v LB Hackney [2002], the Court established that in some cases, a statement as to the legal position can amount to a statement of fact. In that case, the buyers purchased a property on the basis that the existing occupiers were licensees and not tenants.

This was important, as it is easier to terminate a business licence than a business tenancy. The Court considered this to amount to an actionable misrepresentation, even though the inaccurate statement related to the legal position between the seller and existing occupier.

What if the seller doesn’t know?

If a seller does not know the answer to a question in the seller’s property information form, it is important that they do not speculate or suggest anything other than to explain that they do not know the answer. To suggest anything else can lead to trouble.

A primary authority on this point is William Sindall Plc v Cambridgeshire CC [1993]. In that case, the seller of a piece of land for development was asked whether or not they were aware of any rights affecting the property, other than those which could be seen on an inspection or which had not been disclosed in the contract.

The seller answered “not as far the vendor is aware”. This seemingly innocuous statement was considered by the Court to be a false statement of fact.

In fact a sewer ran underneath the land and this was not discovered until after completion. The Court confirmed that the statement “not so far as the vendor is aware” implied that the seller had taken steps to verify what they were saying was correct.

In short, the Court found that the seller had effectively said “I have checked, but can’t find anything”.

What if a buyer has not “relied” on the misrepresentation?

For a claim for misrepresentation to exist, there must be reliance on the part of the person that the representation is made to. If it does not influence the decision to enter into the contract, it cannot be a misrepresentation.

It doesn’t have to be the sole reason for entering into the contract, but it does have to be material and induce the person to enter into it, normally without making enquiries that they may otherwise have made. It generally also does not matter if someone can discover the truth if they had taken steps to do so.

In another case where the phrase “not so far as the seller is aware” was used is Clinicare Ltd v Orchard Homes Development Ltd [2004]. In that case, the prospective tenant of a commercial property asked about dry rot in the property and relied on this response from the landlord, even though the landlord advised the tenant to instruct their own surveyor, which they did.

The surveyor reported dry rot in the roof space. In fact there was also dry rot in the staircase and the surveyor suggested further enquiries about the staircase should take place. The tenant didn’t do this.

The Court held that the decision to ignore the seller’s advice to investigate the staircase further was based on the fact that the seller had said that it was unaware of any dry rot in the premises.

In Redgrave v Hurd (1881), a solicitor was advertising for a partner to join his practice and made claims which were factually untrue about the profitability of the practice.

Even though the prospective partner was given the opportunity to “discover the truth” by inspecting paperwork, and he decided not to, it was held on appeal that there had been an innocent misrepresentation.

In short, the prospective partner was reasonably entitled to rely on the statement made by the existing partner, even though had he checked, he would have realised that the practice was not as profitable as was claimed.

Does a seller have to correct a buyer’s misunderstanding of something?

Silence does not normally amount to a misrepresentation. Normally there has to be something specifically said which is factually untrue; the buyer cannot rely on a statement if it is never made.

However, sometimes allowing the other party to the contract to proceed on an obvious error or misunderstanding without correcting this can amount to a misrepresentation.

Whilst not a property misrepresentation case, the principles of National Westminster Bank Plc v Angeli Luki Katonou [2006] are still relevant. In that case a personal guarantee for a loan was given on the basis that the bank had led the borrower to believe that his company’s loans, including the one being guaranteed, would not be subject to debt collection processes.

The Court decided that the guarantee was given as a result of a negligent misrepresentation in failing to correct the guarantor’s understanding. The guarantee was rescinded and held to be unenforceable by the Court.

Can I force the seller to take the property back?

Rescission can sometimes be available as a remedy for a misrepresentation claim. However, it is what is known as an “equitable remedy” and is therefore at the Court’s discretion. The Court will not award rescission as a remedy unless damages would not adequately compensate the aggrieved party.

With property transactions it is a rare case where the contracts can effectively be reversed and the seller be forced to take the property back and refund the purchase price.

In Harsten Developments Ltd v Bleaken and Others [2012], a developer bought a site at auction and based part of the decision to so on information contained in the auction pack, which was made available to potential bidders in advance. The information provided included factually inaccurate information about the boundaries and a sewer.

The Court confirmed the position that rescission as a remedy to a misrepresentation claim is only generally available in cases of reckless or fraudulent misrepresentation.

The overall result of this case was that the Court applied its discretion under section 2(2) of the Misrepresentation Act 1967 and ordered rescission, along with damages for the other expenses.

Ross River Ltd v Cambridge City Football Club Ltd [2007] involved the sale and leaseback of a football stadium. In this particular case, the Court found that material misrepresentations had been made, and these were done with a view to influence the negotiations relating to the transaction.

As this was considered to be in the mind of the misrepresenting party, the Court considered this to be a fraudulent misrepresentation and ordered rescission of the contract.

What happens if the representation was true when it was made but is now factually inaccurate?

In some cases, a change in circumstances, rendering a previously true representation subsequently inaccurate, can give rise to a duty to update the other party.

In Spice Girls Ltd v Aprilia World Service [2002] the issue was whether or not there was effectively an implied representation that the pop group would not split up for the duration of an advertising contract.

Of course, the group did split up, which resulted in Court action being taken. The Court determined that there was a duty to correct the misunderstanding when it became clear that this was going to happen.

In the case of FoodCo UK LLP v Henry Boot Developments Ltd [2010] this principle was considered in the context of property.

It involved a motorway service station and a proposed development to the local area which would have increased the number of customers to the site. This development did not go ahead.

The Court decided that unless the representing party knew that the previous representations had become false, or did not care whether or not they had, there was no duty to correct the previous representation.

When buying and selling property, caution should be exercised if a seller becomes aware of a change of circumstances. It is generally best to correct any representations which subsequently become untrue as a result of a change of circumstances.

It’s my solicitor’s fault!

It is important to also understand that when a solicitor, giving or receiving information on behalf of their client, their client will be deemed to have that information.

In Strover v Harrington [1988] a property which did not have mains drainage was described as agents and then the valuer as having so. In fact, the seller had given the correct information to the buyer’s solicitor who had failed to pass this on to the buyer client.

It was held that the reason for the loss to the buyer was not as a result of the misrepresentation but because the buyer’s solicitor had not passed the correct information on. In such a case, the solicitor would potentially be liable for a claim for professional negligence.

The converse is also true.

In Cemp Properties (UK) Ltd v Dentsply [1989], the seller’s solicitor stated that certain documentation was not available when in fact it was. Had those documents been supplied to the seller, the seller would have discovered a number of problems with the property.

The buyer was successful in their claim against the seller and no doubt, the seller pursued a claim against their solicitor for professional negligence after this.

The seller told me that everything with the neighbours was fine

In McMeekin v Long [2003], the seller expressly answered “no” to questions about whether or not there were any disputes with neighbours or complaints about them as owners. The sellers in fact went further and orally stated that the neighbours were friendly.

The reality of the position was that there was an ongoing dispute about access to the property, parking and the access road, which the sellers had a right of way over.

The seller suggested that the dispute had been resolved, but the Court considered that there was a continuous confrontational atmosphere between the seller and the neighbours.

The Court specifically referred to how clear the questions in the property information form were and how it was written in such a way that it was designed for everyone to use and did not require any specific legal knowledge.

Based on the fact that anyone would clearly consider the facts of this case to amount to a dispute, the Court decided that there had been a fraudulent misrepresentation.

The seller told me that the property had never flooded

Whilst a Scottish case, and therefore not directly relevant to English Law, the case of Anwar v Britton [2018] (which involved arguments regarding a contractual clauses which sought to exclude representations), gives an example of how subjective questions regarding historical flooding of property can be and what flooding in fact means.

To one person, waterlogging may not constitute flooding, to others, it may very well do.

In this case, the buyer obtained a flood report which identified a low flood risk and recommended that the buyer raise this point with the seller. The seller’s solicitor explained that the seller had not experienced issues of flooding. It transpired that the stream which ran near the property had overflowed from time to time.

The Court held that this was a misrepresentation.

The seller said that there was no Japanese Knotweed on the property

Whilst we are unaware at this time of any reported cases on Knotweed, considering the increase in the number of nuisance claims arising as a result of knotweed being present on neighbouring land following cases such as Network Rail Infrastructure Limited v Williams [2018], it would not surprise us if there have been unreported misrepresentation claims.

Knotweed can be difficult and costly to eradicate, and to be informed that it is not present on the property when in fact it is or was, may very well amount to an actionable misrepresentation.

The seller told me that they were not aware of any developments or planning proposals in the area

In the case of Thorpe v Abbotts [2015] the sellers answered “No” to questions in the seller’s property information form regarding whether or not they had received any planning or other notices affecting the property or had any discussions or negotiations with any neighbour or authority about this.

The sellers had in fact attended public meetings regarding the proposed development of a site nearby to the property. This was at the time one of a number of sites that the local authority were considering for development.

Despite this, the Court found that there had been no misrepresentation. Broadly, the Court highlighted the fact that the property information form was designed for lay people to complete and required no specialist legal knowledge.

With this in mind, it considered that the answers to the questions were factually accurate, as at the time no definite plan to develop the nearby site had been reached, no planning notice served and no specific negotiations had taken place.

The seller told me that everything with the landlord was fine

In leasehold purchases, the new owner will become liable for the breaches of the lease by the previous tenant.

For example, if things such as ground rent or service charges have not been paid, it would mean that the new owner would be liable to pay these. It is therefore important that the position with the landlord is established and standard forms, including the leasehold information form, are normally used for this purpose.

In Greenridge Luton One Ltd v Kempton Investments Ltd [2016] the seller of an office block suggested in the Commercial Property Standard Enquiries Form that the tenant was not in arrears of service charges. This was not the case and significant arrears were found after exchange but before completion.

The Court held that this amounted to a misrepresentation and that the buyer was entitled to rescind the contract and recover its deposit.

What about auctions?

In Atlantic Estates Ltd v Ezekiel [1991] a property was put into an auction. The sales particulars in the auction catalogue described the property as a wine bar and showed a photograph of the wine bar with customers going in and out. The property did not in fact have a licence and was not currently used as a wine bar.

On appeal the Court found that the description of the property as a wine bar and the photograph together amounted to a misrepresentation, insofar as it suggested that there the premises could immediately be used as a wine bar.

With auctions, it is always advisable to take the auction pack, the relevant contractual terms and auction terms and conditions to a solicitor to check the position before bidding. Whilst the seller does not have to volunteer more information about it, this process does help to identify risks and potentially costly mistakes.

So what does the seller have to tell a buyer?

The short answer to this is “nothing”.

If the seller makes no representations about the property and tells the buyer to rely solely on their own investigations, there can be no claim for misrepresentation. The principle that applies is “buyer beware” or “caveat emptor”; it is for the buyer to decide whether or not to purchase the property based on the information they have.

In the case of Sykes v Taylor-Rose [2004], a question appearing in the property information form used at the time asked the seller the extremely broad question “Is there any other information which you think the buyer may have a right to know?” The seller answered “No”.

In fact, a murder had taken place in the property in the past but the Court decided that this was not something which the seller was obliged to disclose.

It considered the question subjective and on the basis that the sellers had answered it honestly, namely that they did not think it was relevant to the purchase, it was held that there had been no misrepresentation.

Conclusion

Every property misrepresentation case turns on its own unique facts. Whilst principles established in historical cases may be relevant, the simple solution to avoid issues in the future is to answer questions honestly or not at all.

However, mistakes can happen and if you have been adversely affected by a misrepresentation in any transaction, do feel free to get in touch with us.

This article is for information only. It is not a precise statement of the law and should not be relied upon as or for a substitution for proper legal advice. The circumstances of every case are different. We are always happy to discuss your circumstances to see if we can assist.

59 thoughts on “Property Misrepresentation Claims in Practice”

  1. We are selling a property in wales. We have had a few disagreements with a neighbour a few house up, this was almost 5 years ago when we first moved in about parking, this resolved and now we have a double drive so hasn’t been an issue for four years.
    We had some work completed to our property in 2020 such as changing roof and doors where our neighbour complained to building regulations and planning council as they believed this was needed, the property was inspected and this was not required.
    On our property form I have disclosed “yes” that the neighbour made a complaint to these offices about the required certificates and approvals, this was inspected. There have been no issues with the neighbour since. However just recently, we had a fairly friendly conversation with the neighbour who complained about our guttering, causing puddles in their pathway (they are local authority) tenants in flats and staying that our guttering is overhanging their airspace. However this is not as it’s within our boundary. I explained that I would clear leaves abs debris from the guttering which we have done and have not heard from them since.
    Surely I do not need to update our buyers in this, as if there was a case of boundary this would be from the landowner, the council and not the tenants. We are considering having a quote to relocate the guttering just to prevent any further issues

    1. Thank you for your comment. We are only able to provide general guidance on our website, which should not be considered an alternative to bespoke legal advice. We are therefore unable to provide you with a specific response.

      However, by way of general guidance, you should discuss this with your conveyancing solicitor. If the standard TA6 Property Information Form was used, you will have read the guidance notes accompanying it, in particular those notes which appear on the form itself which read:-

      If you later become aware of any information which would alter any replies you have given, you must inform your solicitor immediately. This is as important as giving the right answers in the first place. Do not change any arrangements concerning the property with anyone (such as a tenant or neighbour) without first consulting your solicitor.

      If events during the course of the transaction arise and because of these, the information regarding that subject which was previously provided has become inaccurate or now gives a different impression of matters, the only “safe” option to avoid a potential argument in the future would be update the information already provided.

      Sometimes a misrepresentation can occur when accurate information about something is provided but because of some other important fact which is relevant to this but not mentioned, an inaccurate impression of the factual circumstances is given to the buyer. This is not the same as not mentioning anything at all, in which case no misrepresentation arises.

      Reliance is a constituent part of any misrepresentation claim. A buyer must have altered their position and relied on the representation/statement made when choosing to enter into the contract. If nothing is relied upon, because no information about that point has been provided, there can be no misrepresentation. If the representation/statement made is factually accurate on the face of it but because of some critical point which is not mentioned and it would be reasonable to have expected it to be mentioned, then a misrepresentation can still occur.

      Put in the simplest of terms, unless the buyer has relied on something that the seller has said to them when choosing to enter into the contract, it cannot be said that the losses that the buyer has suffered were as a result of what the seller said; the buyer would have entered into the contract whether or not the information provided was accurate or not.

  2. Recently won a property on an online auction where it stated the property was tenanted.

    However, I managed to speak with neighbours and they mentioned that the property has been vacant for a while. I had also visited the premises and there were signs of it being vacant. Unfurnished when peeking through windows, loads of letters on the floor by the door, and the image of net/curtains on the auction site was exactly the same and had not moved.

    As the handover is in process I was just informed by my solicitor that I now need to pay rent arrears which the supposed Tennant hasn’t paid.

    A rental agreement was in place for 6 months which expired many months ago. Since then the property was sold to another buyer. And it is this new buyer I purchased from who has been the owner for approximately 2 months.

    Any general advice would be appreciated.

    1. Thank you for your comment. Unfortunately without having had sight of the contract of sale or the auction terms we cannot say this for certain. However it may be that it is a term of the contract of sale that the buyer pays off any rent arrears. Moreover just that the tenancy is over does not mean that it has not become a statutory periodic tenancy.

      If you want us to look into this then feel free to ring the Litigation team at our Braintree office.

  3. We recently completed on a property purchase and upon moving in, found a letter left for us by the sellers, detailing a planning application for the building of a two storey dwelling at the rear of our shallow garden. The planning application was submitted after the PIF was completed and our sellers did not tell us about it prior to exchange. Planning has now been approved and we face having a house now being built in close proximity to our bungalow, overlooking our main living areas and negatively impacting our privacy. Would this be a valid matter for a misrepresentation claim?

    1. Thank you for your comment.

      Whether or not this amounts to a misrepresentation will depend on quite a large number of factors, but primarily what you were told about planning, nearby development and the receipt of notices by the seller.

      It does occur that planning notices are received after a property information form has been completed and sent. Normally, especially in a situation where the conveyancing solicitors have adopted the Law Society’s Conveyancing Protocol, there would be a general duty to update the property information form.

      In answer to your query, this may amount to a misrepresentation, but much will depend on the facts of the matter.

      Please do feel free to get in touch if you would like to explore the matter in more detail with us.

  4. I had an ongoing problem with a neighbour which saw me put a harassment complaint in with the police in January this year. the neighbour was sectioned in March and, because of this, the police didn’t proceed. he’s back now and there have been no further issues. The word that repeatedly came up with the police and mental health people regarding his sectioning and case in general was ‘confidential.’ Am I obliged to mention the issue on the property information form? And more generally, how likely are claims of property misrepresentation to succeed? Thanks

    1. Thank you for your comment. There is no obligation on a seller to include any information on a property information form if they do not want to. However, if they are going to include information, it should be accurate.

      If the question is “do you need to mention any issues with your neighbours”, the answer to that is “no”. It is not necessary to volunteer that information. However, if asked, the only response you are able to give is either an accurate one, or to tell the prospective buyer to make their own enquiries.

      As to the success of misrepresentation claims, this is not something which we are able to answer, even in broad terms. The success of any claim depends on quite a large number of factors which are all very specific to each individual matter.

      1. thanks for the reply. There have been no further incidents and I don’t really want to ‘brand’ this person for life as he has generally been ok. I have put in writing to him that I am glad he is on the right track now. If something is reported to the police does that mean it should be mentioned in the property information form? If I don’t mention it and something happens again my concern is my buyers would have a misrepresentation case.

        1. Thank you for your reply. As to what to include in a property information form, this is entirely a seller’s choice. A seller is not obliged to complete the property information form at all if they do not want to. If they do want to volunteer information about the situation and the property, they should ensure that the information they are providing is accurate.

          In answer to your specific query, there is no obligation on a seller to mention anything which has involved the police. However, if the buyer asks a question about this and the seller wishes to give a response, an accurate response should be given.

  5. I recently bought a property at auction, couldn’t complete in set 2oday due to lender , notice given which i wasn’t made aware of by my solicitor, a day to end of notice period I received my offer and lender willing to remit funds same day once documents are sent over.
    solicitor tells me seller has rescinded and only on this day did i know a notice was given , called lender who were happy to remit funds but solicitor insists completion cant be met as sellers say it is past 2pm and gave an hour, within the hour my solicitor was on phone convincing me a fund lender promised cannot be received, solicitor calls lender and says its not possible due to checks.
    correspondence from sellers didn’t mention time but that completion must be same day,
    is my solicitor right in insisting we couldn’t complete and not sending my documents to the lender for release of funds as i was told, and is the solicitor right not to have told me of the notice period even though i asked earlier without a response but just told I accrued 41£ per day of non completion making me believe i could complete on my terms and that time wasn’t a constraint and that all i needed to do was pay interest on completion.
    I was only informed of notice to complete on the day letter to rescind was served, and pursued to ensure funds were remitted but my solicitor wouldn’t do the needful until time was spent insisting we couldn’t complete
    in a correspondence from the seller it said I wasn’t in the position to complete at the end of the month which wasn’t true as i could complete same or next day,
    have I been misrepresented by my solicitor and not given adequate information that led ultimately to a fall of sale from an auction

    thanks

    1. Thank you for your comment. We would be unable to provide advice as specific as you require on our website. We are only able to provide general guidance, which cannot be considered a substitution for proper, considered, legal advice.

      In terms of the matter generally, I do not think you are talking about misrepresentation, but a possible negligence claim against your solicitor. We would need to consider the file in much more detail, in particular, when your solicitor was appraised of certain events and when instructions were sought, to be able to give any kind of opinion on whether or not there was any negligence.

      A conveyancing solicitor is broadly expected to behave as a “reasonably competent conveyancing solicitor” but this is not defined by law. This is because the circumstances and facts of any matter are always relevant. If it can be said that your solicitor acted in a way which was in accordance with standard practice or how any other solicitor would have behaved, then there is unlikely to be any negligence. However, if there has been an unreasonable delay in obtaining instructions from you, then there may very well be a basis of claim.

      Please do feel free to get in touch if you would like to consider the position in more detail.

  6. I recently purchased a property in a multi-unit building where some units have balconies installed overlooking the canal that is located at the rear of the property. The estate agent ad for the property mentions that a balcony can be installed by the buyer should they choose to do so. After moving into the property and enquiring about balcony installation, I was informed that a balcony cannot be installed in my unit due to local council controls.

    I would not have purchased the property had I known that a balcony installation was not allowed. The property value is also no longer as high with this limitation. In my meetings with the estate agent, it was discussed that it was an option. However, this item was not brought up in the conveyance process.

    Do I have a legal recourse for this misinformation?

    1. If you consider that the description of the property was misleading, then you may want to consider approaching any redress scheme that the estate agent may belong to, such as the Property Ombudsman. However, we are hesitant to suggest that there would be any sort of claim here against the agent. The role of an estate agent is of course to find a buyer and whilst the advertising should not be misleading, it would still remain the obligation of a buyer to satisfy themselves as to what they were purchasing.

      It is the role of your solicitor to raise pertinent enquiries with the seller and to identify and supply to you relevant documentation and information in accordance with your instructions. If you had instructed your solicitor to check that a balcony could be constructed and the response was “yes” when the information and documentation that they had showed that this was not the case (such as a planning or other restriction identified in searches), there may be a negligence claim.

      If you did not expressly instruct your solicitor to check the position and on the assumption that they could have identified restrictions preventing the construction of a balcony, whether they had a duty to advise you on the position will turn heavily on the “scope of the retainer”. A solicitor’s retainer is the contract between it and its client. It says what the solicitor is going to do and is therefore relevant to the obligations of the solicitor and what the solicitor should be advising their client about.

      If a solicitor’s retainer is silent on whether or not advice on a particular point should be given, it would be necessary to show that it was reasonably incidental to the work the solicitor agreed to do that advice on the particular point would be given. Put in very blunt terms, the question would be to what extent should the solicitor have known about your intentions to construct a balcony and therefore to what extent should advice have been given to you on the point.

      If you would like to consider the position in more detail with us, please feel free to get in touch.

  7. I purchased a property on the 17th of June and within just two days I started to uncover the start of a huge problem which appears to have been covered up by the seller.
    The property is a leasehold ground floor Victorian conversion flat. Two flats above me. I did a homebuyers report which discovered a damp reading which I explored further with two damp companies. Both confirmed damp readings in kitchen and the second confirmed damp in bathroom and speculative wet rot but could only confirm unless the flooring came up.
    Close to completion we negotiated a final price to include remediation game these issues but the seller was adamant there was no wet rot as based on their experience of laying down laminate flooring. He claimed “we dispute the wet rot and this is highly improbable from our experience. We will not be contributing towards something which is speculative!” They then threatened to put the flat back on the market if we didn’t move forward with their final offer (covering just damp remedy) within 24 hours.

    They sounded genuine so I agreed.

    Another point to mention is that they also had drainage repairs done a year ago by the freeholder which used up all the money in the sinking fund. This was to investigate foul smells and a blocked drain. The work was carried out with no further complaints or history of ongoing work so appeared resolved.

    The day after completion I collected my keys and noticed the sellers had taken absolutely everything not on the inventory list – from waste bins to toilet brush holder. I found it bizarre though that they purchased new plug in air fresheners and plugged these in all around the house. Two days later I had a drain fly infestation under my stairs cupboard which is opposite the kitchen. I did not realise these were drain flies at this stage and put it down to the fact that the microwave and freezer were in this cupboard and so there may be some rotting food in here.
    At this point I also removed the air fresheners and soon discovered a very pungent stale damp stench.
    A day later I removed the kitchen tiles to lay new ones down and to my horror thousands of drain flies emerged from underneath and a soaking wet floor. The dishwasher and washing machine were moved but it was evident there were surface leaks from pipe work here which would have been impossible for sellers to miss. I then removed the underlay tiles and the wood was all rotten underneath with holes and a lot of it had crumbled. There was a leak coming in from my toilet next door and my bathroom and kitchen sink all congregating under the floor boards. The damp reading of course wasn’t rising damp – it was this leak that had been congregating under my floor for what appeared a very long time!

    I’ve now called the water company and they found a blocked drain which they cleared. This stopped the leak but suggested there is a possibility of more faulty pipe work because otherwise the blocked pipe would just send water back up my toilet and sink with nowhere to go. The fact that it was leaking under my floorboards suggests there could be more faulty drainage hidden in the system. A drain engineer advised I’d need to take off all the flooring and in my bathroom to investigate as otherwise it would be impossible to confirm the issue had been resolved. He also highlighted the possibly if the wet rot in the bathroom was quite high and could most certainly have spread to other parts of the flat.

    I spoke to the tenants upstairs and they claimed they’d spoken to the flat owners about the drain flies last year and the owners said they had a drain issue and their flat had a lot of drain flies inside. An engineer was going to be called out. I have transcripts of this conversation

    Do you know what my rights are here? The freeholder is looking into the issue but I have been sold a flat where there has been a major issue covered up. This is all too much of a coincidence to happen in just two weeks after my purchase.

    Another thing to note is that the flat went up for sale just two months after the previous attempt to resolve the issue and this cleared the entire sinking fund balance. My assumption is that they put the flat on the market knowing they have a huge issue which could cost a lot of money to sort.

    Do I have a legal recourse with this?

    1. Thank you for your comment.

      From what you have written, we would be hesitant to suggest that there is a claim. For a misrepresentation claim to exist, there must be “reliance” on a “statement of fact”. A “statement of opinion” is not generally actionable. Someone’s opinion of something leaves room for doubt. Someone providing a categorical confirmation of the facts of a matter is different.

      From what you have described, the seller arguably provided their opinion on your findings, rather than expressly stating that the property did not suffer from the problems that you have now found. It would be necessary to consider all of the information and exchanges between the parties during the transaction to form a better view but if what you have described is all that the seller said about the position, whether or not a Court considers the statement one of fact or opinion would be a risk factor in any claim.

  8. Hi,

    We bought a property recently with plenty of renovation work (we knew that).

    However, we very quickly realised (after less than a week) that there is a big issue with a neighbour that is showing clear signs of antisocial behaviour. This goes from putting extremely loud music day and night, throwing stuff on the road, insulting people from his doorstep, to even being outside with a knife (he got arrested for that but then released).

    This is not a one time event and it happens on a regular basis. I suspect the previous owners moved out / sold at least partly because of that. Is that something they should have disclosed in the TA6? I really believe the property was mis sold since it is impossible to « not know » that someone is screaming under your window at night. If we had to sell the property today, we feel we would need to disclose it hence leading to a loss in value.

    Is there anything to do?

    Thanks and regards,
    Nick

    1. Thank you for your enquiry.

      There may be a possible claim directly against your neighbour for nuisance.

      As for any claim against the sellers, this will depend on what you were told about the situation. A seller is under no obligation to volunteer information about a property. However, if they do not provide information, then the chances of a purchaser agreeing to proceed are slim. Therefore standard forms, which include the TA6 or Seller’s Property Information Form, are commonly used to facilitate the exchange of information, but it is not obligatory for the seller to complete this or any other form or specifically point out that they have nuisance neighbours.

      The Property Information Form ordinarily contains a question about disputes with neighbours. If there was an ongoing dispute and the seller has stated that there was not, there may be a claim for misrepresentation. However, if the seller has not expressly said, and this would normally have to be in writing, that there were “no problems” with the neighbours or something else regarding the situation which is factually inaccurate, there is unlikely to be any sort of claim.

  9. Hi

    We are currently purchasing a property where we were told they were not purchasing a property but moving into rented up north. When they completed the form with the question “do you need to complete on another property the same day as your current property?” they answered yes. We straight away went back to the estate agent and queried. They did not know of them offering on a property and thought they had made a mistake but he did double-check and the sellers said it was a mistake. The sellers have now added a property to the chain which now means we can not complete by the 30th June when we could before. We might get 5,0000 towards the additional stamp we will ensure but that is from their estate agent reducing their fee. If we complete can we sue them afterwards for the remainder or all of the extra stamp duty if we nothing towards it? Our offer price was based on getting it through by then, which they knew.

    1. Thank you for your comment.

      In a property transaction, a contract is formed at exchange of contracts. Before exchange of contracts, a date for completion should have been agreed. If that agreed date was after the SDLT holiday deadline of 30th June 2021, then it cannot realistically be said that you relied on any statement when entering into the contract that completion would take place before this.

      If the agreed completion date was before the deadline, and this now looks unlikely to be met, you should discuss with your solicitor the service of a notice to complete. The standard conditions of sale normally incorporated into the contract of sale of residential property does contain provisions for compensation if the completion date is not met.

  10. I purchased the house 4 months ago. We did not have a surveyor’s report only a mortgage surveyor and the TA6 Property information form from the seller.

    We’ve now found a number of problems the major one being that the extension roof leaks. The extension was newly built (2017) by the seller. It was presented as a new high spec extension. On the form the seller stated having planning permission and never having any problems. After getting quotes to get the roof fixed, we’ve found out he’s got the wrong roof tiles (it’s a flat roof disguised as a pitched roof). I’ve contacted the council and they are sending me a completion certificate to state that it was signed off. I am looking for a solution that would involve some form of compensation for this issue, as I was misled in the buying process. Do you think I have grounds for a claim?

    Aside from the extension leak, there are 3 other leaks throughout other parts of the house: kitchen, front room and upstairs bathroom and that’s caused by rotten roof joists that need replacing that would have been seen when putting in the extension and concealed damage built over rotten fascia boards.

    We also had to replace the boiler on the second day as buyer concealed that the boiler was broken and left a bowl under the boiler to collect leaking water (the boiler was in the loft so was not in plain sight when viewing the sight), while stating on the form that it was in good working order, when in fact the bowl needed to be emptied very frequently and ultimately it was unfixable and needed to be replaced.

    He also failed to declare that the 4th bedroom is a garage conversion – the garage roof has been encapsulated which is a major fire hazard.

    Are any of these issues worthy of a claim? Or do I have to accept that I was naive to trust the seller?

    1. Thank you for your comment. Unless you have been expressly told (and this normally has to be in writing) something about the property which is not accurate and have relied on this when entering into the contract, there is probably no basis of claim in misrepresentation. Unless a specific representation was made which was untrue, clause 3 of the standard conditions of sale (which are normally incorporated into the contract) state that the buyer accepts the property in the physical condition that it is in on exchange.

      We would always recommend that a client have their own personal survey undertaken. A lender’s survey is normally restricted to advice on whether or not the property is “worth” what is being loaned against it and normally expressly states that it is not to be relied on by third parties.

      We would also recommend that if there are specific concerns, these are always raised with the seller and if there are specific points to be considered by a surveyor, these are expressly included in that surveyor’s instructions. The reason for this is that in a property transaction, it is always “buyer beware” and it is incumbent on a buyer to undertake sufficient enquiries to satisfy themselves before entering into the contract.

  11. Hi,

    We bought a house in April 2021 that was refurbished and the seller did not disclose on the PIF that they have removed some internal structural walls. A few months after our purchase I see signs of ongoing movement(cracks) where the structural walls have been removed. Can I take the sellers to court for lying about the structural alterations?
    I should mention the seller is a Limited Company.

    1. Thank you for your comment. From what you have said this may not necessarily be sufficient to allow for a claim against the sellers. If they merely failed to mention a structural alteration or structural issues that is not necessarily a misrepresentation as a misrepresentation requires that the seller actively made a false statement. So if they were asked specifically if there were any structural issues or structural movement, or whether any structural alterations had taken place, and they said that there had not been, and this was false, then there may be a claim.

      If you are seeking additional advice on this please feel free to contact our Litigation department at the Braintree office.

      1. Hi Jon,

        As part of the enquiries the seller has been asked weather the property suffers from any structural defects and they declared no.

        To me the Property Information Form (TA6) is quite clear on the wording:

        “Have any of the following changes been made to the whole or any part of the property
        (including the garden)?
        (a) Building works (e.g. extension, loft or garage
        conversion, removal of internal walls). If Yes, please give details including dates of all work undertaken:”

        They have not given details of the walls that were removed. Is that not a lie?

  12. Hi – I purchased a property last year that came with a private road leading to 3 properties. The house I purchased owns the private road with the 2 other properties having shared access across it – however the driveways for all 3 properties are not shared. The hatched shared part stops at the boundary to my driveway on the title deeds. However my neighbours continually use my driveway to access a gate to the rear of their property. There is a very narrow pathway adjacent to my driveway but it has bushes, foliage on it so is not passable. This path, whilst inadequate, is within the boundary of my neighbours property and borders my driveway so if cleared could be used by them to access their back gate although given the width, wouldn’t be ideal. They did have a garage also that had a rear door and a garage door on the front which would also have given them access from front to back but they converted this into living accommodation approx 5 years ago. It would appear my neighbours have always used what is my drive as their outside access from front to rear of their property and vice versa which is in my eyes trespassing. In the the PIF my vendors stated “No” to the question “Are there any other rights or arrangements affecting the property” Do I have any recourse for misrepresentation with my Vendor or should I have noticed the gate and questioned whether the neighbours used the driveway to go back and forth ?
    Thank you.

    1. Thank you for your comment. It seems that there are two issues here, and the one will inform the outcome of the other.

      Firstly, the issue of rights of way and access. Whether there is a right for the neighbours to use this part of the driveway that you consider to be your property and the use of which you consider to be trespass will depend upon the exact wording and title plans of the parties’ conveyances and other documents. I would need to inspect these to determine whether in fact such a right does exist for the neighbour to use these.

      If it does not, then I would be able to advise you as to whether action can be taken against the neighbour and what the likely cost of that might be.

      If it does exist, then there may be the possibility of taking an action in misrepresentation against the person who sold the property to you if, as you say, they put on the property information form that there were no other rights or arrangements affecting the property, when the reverse was in fact true. However you will need to show that they knew that this right existed or could reasonably have known about it, and that had you known about it, you would not have bought the property at the sums for which you paid for it. Whether that is actionable as a representation on which you were entitled to rely will also depend on the exact wording of the Property Information Form and also the content of the contract, which may contain non-reliance or entire agreement clauses which may affect your right to claim against them.

      As regards the actual losses you have suffered as a result of this and thus the value of your claim, that is also something we would need to consider in order to decide whether such a claim might be economical to pursue.

      I will be available to discuss this further if you contact the Litigation team in the Braintree office.

      1. Thank you – there’s currently no right of way for the neighbours. I had already taken my title deeds/ plans etc to a property solicitor to check this. On checking, I asked neighbours not to use my drive however they continue to.
        I’ll possibly be in touch though to see whether I can pursue the issue with neighbours further and also check re PIF / vendors possibly misrepresentation.
        Thanks again

  13. If you have had a past dispute, for example claims that your building works have damaged neighbors property, that were resolved via insurance but led to an ongoing unfriendly and sometimes uncomfortable relationship I understand I would need to include the dispute on the PIF. But would I need to mention the ongoing unfriendly/uncomfortable nature of the relationship with the neighbors?

    Regards

    1. Thank you for your comment. The Property Information Form is intended to be completed, read, and understood by a lay person and as such there are no hard and fast rules for what constitutes a dispute in respect of the questions asked. If there has been a claim resolved by insurance this is as you say something you would need to disclose as a previous dispute. As regards your ongoing relationship, though, we cannot meaningfully comment upon this without proper and full knowledge of the complete picture and context of that relationship, though the usual wording on a Property Information Form is whether there have been disputes involving the property and if they are merely personal between you and your neighbour over an unrelated matter that may not necessarily be something you must disclose. However, this will obviously depend very much on the exact circumstances and also on the wording of the specific question you have been asked so I think therefore you may wish in the first instance to discuss the matter with the solicitors acting for you in this transaction.

  14. Hi,
    We purchased a leasehold flat in August 2019 and on the LPE1 form, in boxes 4.8 and 4.8.1 where the landlord is asked about anticipated section 20 works expected within the next 2 years, the landlord answered “anticipated” and in the further description box stated that “internal redecoration works would be required” – no reference was made to external redecoration works. In addition to this, the TA7 form we received from the vendor stated that no external redecoration works were anticipated within the next 3 years.

    Fast forward to January 2020 (5 months after we purchased the property) we received a letter from the land lord stating that external redecoration works were required and that a “substantial contribution” would be required from each of the leaseholders. We have since received a letter (in April 2021) stating that the total cost of the works is £50k with our share being £17k. This is almost equal to the deposit that we put down on the flat and if we had been aware of such a substantial cost when we were purchasing the property we would not have bought it.

    Do you think the above would be sufficient for a misrepresentation claim? And if so, would it be against the landlord or the vendor?

    Many thanks,
    Octavia

    1. Thank you for your comment and apologies for the delay in responding. From what you have said this may found a claim in misrepresentation but it is not clear cut. One generally only is liable in misrepresentation if one makes a false statement; it is very rare that one can commit a misrepresentation by omission. Therefore you would have to show that they specifically knew, or could reasonably have known, that when they were filling out the property information forms, that there were section 20 works envisaged. The issue therefore will be whether you can show that the seller knew, or could reasonably know, that such works were in fact envisaged.

      If you wish a confidential discussion about this further then please feel free to contact our Litigation team.

  15. Hi, my partner and I bought a house from a builder 4 years ago. We were flooded last year and have now found out the house is built in a high surface water flood risk area (not disclosed by the builder or searched for by our solicitor that was recommended by the builder) and the house is not built in accordance with the Flood Risk Assessment recommendations e.g. the finished floor level is half the recommended height from the surrounding ground levels and the surrounding land is slanted down towards the house. We have also been told by someone that the house flooded whilst being built, but the builder never told us about this.

    1. Thank you for your comment. I am surprised that your solicitor did not recommend an environmental report. This is fairly common practice. This would have identified whether or not the property was situated in an area which was at risk of flood. However, it would not have revealed anything specific to the property in this respect.

      As for whether or not there is a claim against the builder, much will depend on what was said during the course of the transaction. The basic position is “buyer beware”. This means it is down to the buyer to ask the relevant questions of the seller and take the relevant steps, for example by instructing a surveyor, before committing to the purchase. Normally, during the course of the transaction, a property information form will be used. This will normally contain a question about historical flooding. If it can be proved that there has been some historical flooding, and that the answer given to the question regarding it was inaccurate, there may be a claim for misrepresentation.

      There may also be a claim if it was in some way represented to you that the property was constructed in accordance with relevant building regulations. If this is not the case, then again there may be a claim for misrepresentation.

  16. Hi, We purchased a property a few years ago and included was information about the service charge. A quote for £40000 was given for these works, of we which pay our percentage based on what’s included in the lease. There is talk about these figures increasing by double or threefold now, due to the new owners believing they are allowed to have extras included that weren’t included when we were quoted £40000 for these works originally. Could this be seen as property misrepresentation?

    1. Thank you for your comment. The first question we would have here is how long ago you purchased the property as such a claim may be statute barred due to limitation if the contract was entered into more than 6 years ago.

      Secondly, for a claim against the seller you would need to show that the seller knew about the proposal to increase the service charge or carry out major works, but when asked about whether any major works were envisaged falsely claimed there were none. We would need to see exactly what was said before entry into the contract on this point to be able to advise you properly. Please feel free to contact us for a confidential discussion at our Braintree office.

  17. We recently purchased a flat and within a short period of being in residence, noticed a few issues, ie the kitchen tap was leaking so badly, that it had to be replaced. The seller was likely aware of this as they had put a bowl in the cupboard under the sink to catch the leaking water. Additionally, the oven had been left in an unhygienic state necessitating a professional clean. On turning on the oven thereafter, the glass door pane shattered, requiring us to replace the oven. We approached the seller through the attorneys to be compensated for the costs incurred. She offered only to refund the cost of the oven cleaning, denying any leak or that the oven was not cleaned and therefore unusable and certainly after the glass shattering, even more so. Would we have any legal recourse against the seller for her failure to disclose and her subsequent denial when clearly we have photographic evidence of her actions to disguise the issue. As this was purchased during the current pandemic, the agent discouraged touching anything in the flat on viewing,

    1. Thank you for your comment. Based solely on what you have said here, whether there is an actionable misrepresentation or not depends upon what the seller specifically said to you. There is no general obligation to disclose defects when selling a property, however, if a seller is specifically asked something and gives an incorrect answer, or actively makes a false statement in respect of the property, and this false statement is one that you rely upon, then you may have redress against the seller in misrepresentation. Therefore her failure to disclose the issues you refer to would only give rise to a claim if you can show that she actively made statements that were false on, for instance, the property information form or similar.

      You also say that she attempted to disguise the issue. This also can give rise to a claim as in attempting to cover up the issues she may have taken actions which constituted an attempt by her to “paint a false picture.” However this will be more difficult to establish than pointing to a specifically false statement that you relied upon.

      Please feel free to telephone our Braintree office for a confidential discussion.

  18. Hello,
    My mum had just bought a new family home, we have lived here 2 months and suddenly sewage is coming out of the drain leading to the cesspit which as far as we knew was unused as all the house sewage was connected to the mains and only the outside toilet was connected to it, we had the outside toilet knocked down so now there should be no sewage draining to the cesspit right? Well after the sewage company have come to investigate apparently our main toilet is still connected to the cesspit! So they can’t touch it as it is private? We were not informed about this now it is over flowing and the pipe has cracked causing a huge job for us to repair the whole thing! Are we liable to a claim after being told in black and white written in the contract that we are connected to mains?

    1. Thank you for your comment. Sewage backing up is always unpleasant and understandably can cause severe distress.

      From what you have said there may be a claim against the seller in misrepresentation. If they had stated positively that the property was connected to mains and this was in fact not the case, and this was stated in the contract or property information form, this could give rise to a claim. However we would need to check the contract in full and also any other communications between the parties, as there may be a non-reliance clause or exclusion clause therein which affects your ability to bring such a claim. We would also have to determine whether it was an intentional misrepresentation by the seller, or merely a negligent or innocent one, which would affect the merits of such a claim also.

      Please can you contact us on our office number for a confidential discussion should you wish to take this further.

  19. Hi there!
    I recently bought a property. Seller failed to disclose known upcoming major works, which nature and extent was being communicated to the leaseholders up to 2years before the property was sold to me. A few months after I moved in I received a Sect. 20 for the value of 35k. The seller always denied knowledge or the nature or likelihood of major works taking place (as stated as well in the pre-contracy documentation). She only mentioned there was the intention of carrying out some work and provided outdated section 20s from as early as 2010, for works that were clearly never done. She then concealed knowing about this major works plan, which was disclosed in detail to her by the council, when she notified them of her intention to sell, as well as being communicated to all leaseholders since as early as 2018-2019. I have a statement from the council confirming her knowledge of such work, as well as exchange documents in which she denies knowing any detail on any possible work to take place, except for asbestos removal (which is not applicable to the property anyway) . Do I have the grounds for a property misrepresentation claim?

    1. Thank you for your comment.

      It is difficult to say whether or not there is a misrepresentation claim without considering the exact statements made and looking at the timeline of events. Certainly, if there is good evidence that the seller was aware of the proposal and took deliberate steps to conceal this, there could be a misrepresentation claim.

      Section 20 Notices and the invoices for these can sometimes be several years apart. Depending on what information was supplied to your solicitor, there may also be some professional negligence here. It would be usual in a conveyancing transaction to obtain a management pack, which would normally contain details of upcoming works or Section 20 Notices. If you were not properly advised about this, there could be some negligence on the part of your solicitor.

      If you would like to consider the matter in more detail, please do feel free to get in touch (https://cunningtons.co.uk/contact)

  20. Terry Young

    Thank you for your time, I also believe they signed docs knowing the issues ie that Gov and Local authority had been passed , they did alterations hence rate block, without approved plans which is fraud in my eyes

  21. My partner and I have recently bought a house through an agent. A huge selling point for us was to have an open space area downstairs combining the living room and kitchen. In this particular house there is a wall in between the two rooms – we notified the agent straight away (during the viewing) that we would plan to knock it down if we were ever to purchase the property. We’ve put an offer down and it got accepted but before the exchange of contracts I asked the agent in an email to confirm in writing if the wall was non-load bearing. They came back to me saying that the seller confirmed that it is in fact non-load bearing. We went through with the sale.
    We got the keys and wanted to get rid of that wall as it was a crucial part of renovating the downstairs area. Unfortunately we came across block work. We managed to get a structural engineer in to check the wall and were told that this wall is load bearing and would need a lintel and a column if we ever wanted to get rid of it. The cost of removing the wall and putting the beams in is quite significant and of course not something we expected. We both feel like if we had known that the wall was load bearing we either wouldn’t have gone through with the sale or would have negotiated the price of the house.
    Is there any basis for us to request any compensation?
    Would really appreciate any help with this!
    Thank you!

    1. Thank you for your comments on this and your enquiry regarding the misrepresentation relating to a load-bearing wall. While we cannot give specific legal advice in these comments, If you can show that the seller knew, or could reasonably have known, that the wall was load-bearing but gave a false statement as to whether this was the case when asked, then there may be a claim here. The issue, though, is that there may be non-reliance clauses in the contract that may affect the position. It would also depend on whether it can be shown that the seller did in fact know that the statement they gave was, in fact, false. Please feel free to telephone us on our office number if you wish to discuss this with us further.

  22. Greetings

    I bought directly from a individual who signed the OTP that all warranties had been met including all plans passed by Gov and Local authorities. I moved in prior to transfer at agreed occupational interest, that was 3 months ago, transfer held up at rates office and can take 4 mths to redo plans and be passed, hopefully, I stopped the occ interest, this a fraudulent misrepresentation, together with severe storm water flooding, had these been passed these items would have been highlight as it is very clear someone has tried to patch a wall of the home and flooding internally as well. OPINION PLEASE going off my my head

    1. Thank you for your comments relating to a possible misrepresentation over flooding. It should be noted that it is not necessarily a misrepresentation for the seller to withhold information, rather, you would have to be able to point to a specific false statement by them. This may be something we can assist you with as we may be able to go through the documents and plans and warranties that they signed and see if there are such falsehoods. Please feel free to contact us at our office number for a confidential discussion.

      1. Thank you for your time, I also believe they signed docs knowing the issues ie that Gov and Local authority had been passed , they did alterations hence rate block, without approved plans which is fraud in my eyes

      2. I’ve just bought a property which the seller stated is connected to a septic tank. I can’t find the septic tank and just as worryingly can see the kitchen sink waste emptying straight into the river. I can see the consequences of what will happen if Environmental Services become involved. Is there a case for the Seller to answer?

        1. Thank you for your comment. While we cannot give specific advice on individual cases, whether or not this would be a misrepresentation depends on what exactly was stated in the Property Information Form and other written communications. If they stated that there was a septic tank for drainage but there is not, then that is potentially a misrepresentation. Though this will of course depend on the contents of that form and also the contents of the contract or other communications between the parties.

          If you wish to discuss this further please feel free to telephone us on our office number.

  23. Hi,

    I recently purchased land described as an “former advertising site” from auction. I bought the land with the intention of using it as an advertising site and for this reason paid significantly more then the guide price.
    I viewed the legal pack and there was nothing to suggest that the site was not suitable for advertising purposes. The LA searches did not list details of a discontinuance order, planning breaches or enforcement notices involving the site. My decision to buy the site was determined by the details in the LA search document and the statement saying it was a former advertising site.

    I have now been informed that enforcement action was taken against a billboard on the site and the planning inspectorate ruled the location was not suitable for billboards(something i wanted to install) . If I knew of the enforcement action, I would have never purchased the site. Due to the enforcement i have lost a contract i secured with a very large company who wanted to use the site for advertising.

    My questions are:

    A) Can a company use the phrase former when they know the site was no longer suitable? In my opinion this statement was misleading..

    B) The local council failed to document the enforcement on their search, is this negligence?

    I will be grateful for your opinions on this matter..

    Thanks

    1. Thank you for your comment.

      We are not so sure that there is a misrepresentation claim here. There is a case called Atlantic Estates Ltd v Ezekiel (1991) which we refer to in our blog on property misrepresentation claims in practice. In that particular case the auction pack described the property as a wine bar and showed photographs of it in use. It transpired that the bar itself did not have a licence and therefore could not be used as a wine bar. The Court considered this a misrepresentation.

      However, that case could arguably be distinguished from your current matter insofar as the words “former” were used to describe the property. A “former wine bar” or “former advertising site” would necessarily imply that the property is no longer being used as such. It may be a push to suggest that this is misleading. The inclusion of the word “former” is probably sufficient to inform any prospective bidder that the property is no longer used in the same way as it was previously. Therefore it may be a step too far for the Court to find that this implicitly suggested that the property may be used in the same way again.

      As for the search results, we are surprised to hear that enforcement notices were not identified in them. It may be the case that the enforcement notice is included elsewhere in searches and that you were only provided with an extract from it. If this was the case then perhaps there is some misleading statement of fact to the extent that the full situation was not made known to you and the information provided was factually inaccurate as a result.

      Sometimes third parties can be held liable for negligent misstatements or misrepresentations. Ordinarily what is set out would need to be deliberately aimed at a class of people. In this matter, that class would presumably be all purchasers intending to rely on the search.

      It is not uncommon for solicitors to purchase search results rather than their client incurring the cost of a new one. Provided that the client is made aware that the search is old and may not identify more contemporaneous or recent matters, there is no harm in this. Therefore there may be some scope (although we suggest this tentatively) to say that the search provider may have made a mistake and you have suffered a loss as a result, being within the class of individual entitled to rely on it.

      As for the Council itself, whether or not they can be held liable for failing to record information which should have appeared in a search is again something which we are unable to provide any specific advice on at this stage. There is an outside possibility that the Council is in breach of its statutory duty to record data and information properly, if this is what has happened. Whether or not this entitles someone to take action depends very much on whether or not the relevant Act of Parliament envisages a claim for compensation.

      Unfortunately we are unable to provide specific advice on our website. We are only able to provide general guidance. If you would like to consider the matter in more detail with us, please do feel free to get in touch.

    1. Thank you for your comment.

      Broadly, the Limitation Act 1980 sets out deadlines (called limitation periods), for the vast majority of claims which can be pursued in England and Wales.

      For misrepresentation claims, the normal limitation period would be six years from the date that the claim (called a cause of action) arose. This would most likely be six years from exchange of contracts on the basis that the misrepresentation which induced you into the contract but which was factually inaccurate, caused you a loss when you committed and entered into the contract. This would be the date that the damage was caused, as you would have agreed to purchase a property which had defects and which might have had an impact on its true value. Whether or not a cause of action arose in a property misrepresentation claim at the point of exchange of contracts or completion was the issue in the case of Green v Eadie [2011] EWHC B24 (Ch). In some cases, this limitation period might be capable of being extended to three years from the date that the purchaser should have become aware of the misrepresentation.

  24. Hi
    We pulled out of a property purchase just before exchange due to misrepresentation by the vendor /agent (property land was 3 acres short and the location of a footpath was hidden and misdescribed. We had to let down our own purchasers as a result and we have legal fees and other financial losses to cover as a result. Are we able to claim compensation ?

    1. Thank you for your comment.

      The short answer is that there is no real way to claim any losses arising from an abortive property transaction until exchange of contracts take place. Until exchange of contracts, which is when a contract comes into existence, there is no contract in place for the parties to be in breach of. For the purposes of a misrepresentation claim, it cannot be said that an aggrieved party relied on the inaccurate information given by the other party when entering into a contract if no contract was ever entered into.

  25. Hi!
    I have been to a local solicitor in the past regarding a flat I purchased 4 years ago. They weren’t very helpful as they were not sure whether it would be a case against the landlord that owned the flat downstairs where there is trouble tenants. Or whether I could have a case against the sellers. I don’t have much to go on there at the time other than I knew there had been past disputes with problem tenants in the flat downstairs.
    However I am still having these ongoing issues (currently it is an alcoholic that is up all night and general nuisance). And due to this I have just been told by the landlord that owns it that the sellers had the council involved in the past disputes and were told the property has very poor sound insulation. Is this something that should have been declared when they sold to me? I specifically asked them if the flat was quiet and they told me “yes very”. I never would have gone ahead knowing about poor sound insulation and problem tenants over the years. I have been off work with stress. I feel ill and depressed m I feel like I would lose money if I try to sell (I am currently in dispute due to problem tenant downstairs). The main problem is I don’t know if I can proceed with legal case against the sellers. This feels like new evidence even though it has been 4 years. Would I have a case? Any advice greatly appreciated!
    Thank you for your time.

    Regards

    Kate Laing

    1. Thank you for your comment Kate and we are sorry to hear of this.

      We are afraid that we cannot give anything but general guidance on our website, primarily for the fact that without considering the position in detail with our clients, we cannot give accurate advice.

      The chances are that if you were given the express representation that the flat was quiet and there were no disputes with neighbours, then there may be a claim for misrepresentation so far as it can be proved that this was not the case.

      You may also have a claim against the freehold owner under the terms of your lease. Long leases will invariably contain clauses requiring the lessee not to cause a nuisance to other owners and these are normally mutually enforceable.

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