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
If 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 that the question was 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.
Hello. I have just bought a flat in a block with garages attached. The sales information and the current lease both document that my flat has a specific numbered garage. When I picked up the keys I was told that there was no garage. I have now found that the garage was sold many years ago( not by my seller) but records were not updated. When I was originally shown the flat the agent said that he didn’t have the keys but confirmed that there was a flat attached. I chose not to have a survey as I had previously attempted to buy another flat in the same block. My solicitor asked the seller’s solicitor(by email) to confirm the presence of the garage but got no reply. My solicitor did not include the question in the Property Information Form (TA6). The seller’s solicitor says that this meant that they didn’t need to reply to the original enquiry. Where do I stand?
Thank you for your comment. We cannot give specific advice on our website, if only for the fact that we do not know all of the details.
You should get in touch with us if you do need some specific input. This could be a case of seller misrepresentation or solicitor negligence. Much would turn on the documentation. Also, we would need to know whose “fault” it is that the records you refer to were not updated. In some circumstances the Land Registry can be held liable for losses.
Broadly, the basic position is that it is up to the buyer to satisfy themselves as to what they are buying. Having said this, your seller must surely have known that there was no garage. The sales information must have been approved by the seller. Even if not, there might be a basis of claim against the seller under the law of agency, where the principal (the seller) is bound by the representations of the agent (the estate agent).
Do feel free to contact us if you would like to consider the matter in more detail.
We bought a house in Sept 2018, the sellers confirmed on the Law Society Document that the property had never flooded and that they did not have any dispute with the neighbours. The sellers had installed a pump in the right hand of the garden which the surveyor failed to pick up on. The neighbour confirmed they had fallen out over the flooding issues and the neighbour continuously requested us to switch the pump on due to alleviate the surface water flooding in her garden, she claimed that the seller always switched it on for her when she requested. When we phoned and confronted the seller she claimed they in fact did not get on and a pump was installed to alleviate the surface water flooding issue in their own garden and there wasn’t any agreement with the neighbour to switch it on to alleviate the issue in the neighbours garden. She also confirmed they had fallen out with the neighbours. She realised she had made a mistake and later that evening the husband messaged to say they never experienced any flooding. It transpires that the whole area suffers from surface water flooding as other neighbours in the area all experience it and have pumps put in or do something to alleviate it. We paid a premium for the property. We don’t want to hand the property back to them but the price to reflect the issue. Had we known about the issue we would never have bought the house. When we sell we will not be lieing about this issue and as a result will suffer a price reduction.
Thank you for your comment.
We regularly come across issues where disputes with neighbours and flooding have not been disclosed despite the appropriate questions being asked of the seller.
“Flooding” and “disputes” are of course subjective phrases but from what you have written it does appear that there may be some basis of claim here.
Do feel free to get in touch if you would like to explore it further.
In August 2021 we purchased a partially renovated mews house from a developer. There are 10 properties in total with a joint responsibility for the communal areas.
The agreement was that within 21 days of purchase we would have a seat on the Residents Management Company and in return we had to pay the whole year’s management fee on completion of our purchase.
It is now January 2023 and no one has a seat on the RMC apart from the MD of the development company.
We are still expected to pay the management charges which we have refused to do until we have a seat on the RMC as per our agreement.
During our purchase we had to fill in forms for Companies House and much was made of our obligations to the management of the site in terms of financial responsibility etc.
We have tried repeatedly to get answers to this without success.
It is worth noting that we also have a number of restrictive covenants here: we cannot block the access way, we cannot run businesses from home, we can’t have pets etc etc.
In December 2021 the company gave permission to a new shop lessee to park in our grounds on a daily basis. They are a delivery company and the nuisance factor is very high as they constantly block the access road.
There was no mention of this shop or any other third party rights in our paperwork.
Do we have a case here?
Thank you for your comment.
This is not really something we are able to provide any input on without looking at the position in much greater detail.
We would need to look at what was discussed during the transaction, consider the relevant contractual term and also consider the nature of what it is that you are being charged.
It is not clear what your objective is here, but if it is a seat on the residents’ management company, there may be some scope to claim this, however, we do note that it appears that your property is a house rather than a flat.
Do feel free to get in touch.
Hi,
We purchased an old terraced property in December 2022. Prior to exchanging contracts we were told by the estate agent that a recent chimney stack leak had been repaired and that the kitchen flat roof failure would also be rectified before we moved in. Even went as far as to say that the house would be “100% ready to move into”. The day after we picked up the keys, it rained and it became clear that the chimney stack and flat roof were both still leaking. We’ve since had to fork out a considerable amount of money to make the place watertight again.
Had we known that these problems were not sorted then we wouldn’t have purchased the property! My solicitor has also told me that we don’t have a legal leg to stand on because these things weren’t in contract. However I genuinely feel that there’s misrepresentation at play here
Thank you for your comment.
It is correct that the contractual position between the parties is very important. Often with residential sales, the standard conditions of sales are incorporated into the contract. This does specifically say that the purchaser buys the property in the condition that it is in. Further, there will normally be a contractual clause excluding any kind of liability for misrepresentation unless it is in writing and between the seller or their respective legal advisers.
We suspect that you would have to prove that the agent acting on behalf of the seller was deliberately misleading you. In the case of fraudulent misrepresentation, the terms and conditions become “less important”. They are still extremely relevant to the position, however liability for fraud cannot be excluded from contracts generally.
Hello there,
We bought a house in Scotland located within farm land. On the home report it said that the house was connected to mains electricity. The seller confirmed that it was, but that there wasn’t a meter in place. In the Disposition he agreed to pay for the expense to instal the meter. When we completed we discovered that he had lied to us, both in person and in the Home Report (which he had signed). The house is not connected to the mains, it’s connected to the farm. He installed a meter and said we have to pay him for our electricity at a tariff of his choosing. When we protested he said he would cut off our power if we didn’t pay what he asked. On top of this, within the Disposition he agreed to fix the boundary walls and fences within three months of our date of entry. It’s now been nine months since we moved in. Could we sue for fraudulent misrepresentation and breach of contract?
Many thanks for your advice,
Matheu
Thank you for your comment. We are unable to advise on Scottish law.
Hi
I recently purchased a property where the buyer put ‘no’ on the SPIF form about neighbour disputes.
However I have learnt from other neighbours that a couple of years ago the seller did contact the adjacent property’s landlords to complain about suspected criminal activity.
Our neighbours the other side said maybe the sellers overlooked it because it had been resolved for over 12 months before the sale.
I’m worried this issue could crop up in the future. What are my rights? Can I take them to court for lying, or is it too ambiguous?
Thank you for your comment. The Property Information Form does usually include a question as to whether there have been any events which could have given rise to a dispute with neighbours. In theory they should likely have, from what you have said, disclosed this on the property information form when asked. However, unless the dispute with the neighbour is ongoing or the behaviour of the neighbour that gave rise to that dispute is ongoing, it is unlikely there will be a claim as there will be no real loss or damage you have undergone or could point to as a result.
Hi – I have just bought a house and moved in 4 days before Christmas. The same day I moved in the boiler completely packed up. Gas valve not working, water pressure non existent, circuit board failure and expansion vessel broken. We had 3 quotes on the same day, all said you need a new one straight away. We now don’t have heating or hot water over Christmas and the house was also left unclean so cleaning with cold water. Aside from that, one of the people I had a quote from was the sellers gas engineer I found from an invoice in the legal paperwork. I wanted someone over who knew the boiler and could help quickly. I chatted about the problems we were having and mentioned that in the legal work the seller had written down that the boiler was 8 years old. The gas engineer told me this wasn’t true, as he had been the sellers engineer he knew it was 15 years old!!! And he spoke to the seller about replacing it last year. We also have written down from the seller that the boiler was in “good working order”. To contrast this further, I took a photo of the boiler when I viewed it and looking back, I can now see in that photo 3 months before we bought it that the same error code is on the boiler. The same one we have now that has lead to replacement. I’ve never had a boiler before so it didn’t occur to me to check that very minor detail whilst we were offering as all the information I had on the transfer forms were that it was 8 years old and in good condition. Do I have grounds for a case based on fraudulent misrepresentation here? Thanks
Thank you for your comment. While we cannot give full advice without having seen all the documentation and evidence, it would appear that there may be a case here.
The seller is not required to volunteer information but any information they do volunteer must be correct. It appears that the seller knew, or could reasonably have known, that the boiler was faulty yet they put that it was in good working order on the Property Information Form. This is a false statement. As it was on the property information form you would have been entitled to rely upon it and you did. Based on this there may be a valid claim there, though this will be subject to any exclusion or non-reliance clauses within the contract.
In terms of damages, this will be relating to the losses of and occasioned by the misrepresentation. This would likely be the costs of a new boiler and possibly damages of and occasioned by this, together with a potential diminution in value. However it is unlikely to be particularly high value in the grand scheme of things.
Hi
We purchased a property 4 years ago which had one right of way over our property – our immediate neighbour. After a couple of weeks we noticed other people coming through our property, on foot and horseback. When we asked the immediate neighbour she said they had been coming through for years. As we were new we didn’t want to cause trouble so didn’t say anything, we were also busy renovating inside. However once we started clearing and making a garden outside, these people started causing damage to newly planted grass and flower beds – letting their dogs run amock and their horse causing damage to the grassed areas instead of staying on the driveway. There is nothing in our deeds giving them access or A right of way. We sent a solicitor letter asking them to stop causing damage. On the TA6 form the sellers said NO when asked about any other rights of way or arrangements. Although they haven’t used the drive for approx 18months (due to the police getting involved and telling them to stop using shortcut) we have recently found out the have applied and been granted a prescriptive right of way. We never received notification of this, presumably because of covid and the L.Reg office working from home.
Our question is would we have a case against the seller as we wouldn’t have purchased if we had known ‘random strangers and neighbors could come through our property.
Thank you
Thank you for your comment. While we are not able to give detailed advice at this stage as we do not have all the documentation to hand, there may be a claim in misrepresentation against your seller. To make out such a claim you will need to show that the seller made a false statement which you relied upon, and on which you were entitled to rely, and as a result of which you have suffered a loss. If the seller made a false statement regarding rights of way on the property information form then that is a false statement that you could rely upon. However, you will need to show also whether they knowingly made this false statement or otherwise as that will affect whether it is a fraudulent or reckless misrepresentation or merely a negligent or innocent one. We also would need to see the contracts of sale as that may contain further non-reliance or exclusion clauses. This would also depend on the extent of the right of way that was not disclosed when asked about.
Regarding what redress is available, rescission of the contract will likely be off the cards due to the fact it was 4 years since the sale took place. However there may still be a claim open to you in damages. As to how much those damages would be, this would be the consequential losses of potential damage to your property as a result of the right of way, increased maintenance, and also diminution in the value of the property to you as had you known there was a public right of way over it you may not have paid so much for it.
Please feel free to contact our Braintree office for a confidential discussion if you want to go further.
Hi there
I bought a share-of-the-freehold flat, managed by a limited company where the directors are the other flat owners. In the last two years, numerous problems with lack of maintenance and poor quality repairs stretching back well before I purchased have come to light. These will cost 10s of thousands of pounds to put right, and I seem to be the only person interested in fixing things, so I would have to organise all the work, too… I believe at least some of these past problems were outlined in past AGM minutes of our limited company, but these minutes are ‘unavailable’ to me, for some reason. Would I have a claim for misrepresentation based on e.g. the Leasehold Information form TA7 where the seller states that he doesn’t know of any problems re management/service charge (5.6) when actually there were and continue to be disputes about the repair schedule, charges, etc, and (5.5) where only a very limited work scheduled is outlined -this work is necessary but by no means the whole story. The company secretary (who also owns the basement flat in the building) also states on LPE1 that the service charge was suspended for two years prior to the sale due to “the amount of funds” however these funds were not nearly enough to carry out all the repairs that are currently (and also were then) necessary. The work mentioned on TA7 directly benefits the basement flat but no others, looking to me like some kind of ‘agreement’ was reached between the seller (who was the previous company secretary) and the current company secretary (who owns the basement flat). (Neither of them lived in the building and rented their respective flats out). Thanks for any advice!
(PS I’ve slightly obscured my published name – hopfully for obvious reasons)
Thank you for your comment.
It does sound like a frustrating situation. If it can be said that the facts that the seller gave you were not accurate, then there may be a claim for misrepresentation. We often see cases where sellers make an express representation that they are not aware of anything which might lead to a dispute, only for the buyer to move in and find that there is an ongoing argument with the neighbour.
We would, however, question what your loss is. At a basic level, the loss in a misrepresentation claim like this would be based on diminution in value. This is the difference between what was paid for the property and what it is worth with the defects or issues. Put another way, you do have a property which has some value. Whilst as solicitors, we would have to ask a suitably qualified surveyor to give us an opinion on diminution in value, we do question the extent to which the inconvenience and poor management of the building would have on the value of your property.
Do feel free to get in touch if you would like to consider matters in more detail with us.
Hi Mark
We purchased a house back in March this year and moved in to the property the following month. Unfortunately we have noticed massive patches of damp coming through on the bedroom wall and the bathroom which is situated on the back of the house. Both rooms now have green furry mould all over the walls and is actually spreading onto the furniture inside the bedroom. We are unable to sleep in the bedroom due to the bedding being so damp. This was not mentioned on any forms or paperwork even after the solicitor asked the seller was there any problems with the property before we purchased the house. On viewing the property before the purchase all the rooms had been newly painted with no signs of damp visible. Could you kindly advise if there is anything we can do or claim for misrepresentation. Thank you!!
Thank you for your comment.
From what you have written, there may not be anything that you are able to do in terms of a misrepresentation claim. For a misrepresentation claim to exist, the buyer must have relied on something the seller said about the facts of the situation (i.e. not the buyer’s “opinion”). Occasionally it is possible to base a claim on what is left unsaid, but this involves showing that whilst the statement of fact made by the seller was accurate, because of what was left unsaid, the statement does not accurately reflect the facts of the matter. It is also necessary to show that the seller knew the buyer was proceeding under a misapprehension.
If you were not actively told by the seller that there was no damp issue, or at least something was said to you which reasonably led you to believe this and the seller realised you had made a mistake, then there would not be a claim for misrepresentation. Put another way, a buyer would have to be able to “blame” the seller for saying something that was factually inaccurate. If the seller said nothing about the particular issue, then the buyer has relied on nothing the seller said; the buyer has relied solely on their own assumptions.
Thank you Mark for your kind reply. The seller was asked if the property had any known problems before the sale went through. For which he confirmed no on the legal form signed by him. We have also had a rain water pouring into one of the bedrooms. Which we have had to pay to have the roof repaired, this was also not mentioned or confirmed on the legal form. Is there absolutely nothing we can do either through the seller or surveyor. Thank you Mark. Kind Regards Terence.
Hello,
I bought a new build property this month on the top floor of a building (3rd floor). After moving in I noticed that the building vibrates every 5/10 minutes for 10 seconds, which generates noise too.
It turns out that the underground line passes right under the building, the cause of the vibrations are the underground train traffic.
I have not been told about either the underground line or the vibration-noise problem. It looks like the seller & estate agent were aware of this problem (via anecdotal evidence).
There are other leaseholders having the exact same problem in the building.
Do you think I can make a case against them to rescind the purchase?
Thank you
Thank you for your comment.
From what you have written we do not think you would have a claim for misrepresentation entitling you to rescind the contract.
A seller is under no obligation to volunteer information to a buyer. A buyer is entitled to ask for information, but the seller does not have to respond to those enquiries if they do not want to. The basic position is buyer beware, which means that the buyer has to satisfy themselves of what they want to know and if they do not get the answers they want, make a decision about proceeding or not.
Unless the seller made a factual statement that the building does not vibrate, or at least said something that could reasonably be implied to mean that this was not happening, there would be no claim. This is because the buyer would have to have relied on something inaccurate that the seller said when agreeing to enter into the contract. If the seller did not make any factual statement, the buyer cannot say that they relied on anything but their own assumptions and there would not be a claim.
We bought a property in May this year. The seller claimed in the legal paperwork there was no ongoing disputes with neighbours. Since moving in the said neighbours have made our lives hell. There is issues with parking, issues with summerhouse in our garden followed by a letter from planning at council (summerhouse was put up by the previous owner) issues with the constant deliberate noise from neighbours. All of which was known by the seller and why they finally sold the property. The seller did not disclose any of this, however when we contacted the sellers they confirmed (via writing a text) all of the issues including the neighbours threatening behaviour, which we also have endured. Calls to the police, which we have also had to do. The parking issues, the planning and the noise issues and many other things exactly what we are now dealing with and have been since 8 weeks living in our new home. To say we are in a living hell is an understatement. Is there anything we can do? Would we have a case or a ‘get out’ clause?
Thank you for your comment. While we would need to see all the relevant documentation to make a proper assessment of your situation and whether there is a claim, it is possible to bring a claim in misrepresentation over neighbour problems. While there is no duty to disclose or volunteer information as to same on this, the Property Information Form usually asks whether a seller is aware of anything relating to the property which has or which could give rise to a dispute, or to a neighbouring property. Therefore if the seller has put “no” to this when in reality there were such disputes, and you relied upon it, then you may have a claim in misrepresentation. However this is of course subject to the content of the contract which may contain non-reliance or exclusion clauses.
In terms of remedies, in theory rescission of the contract is available for a claim in misrepresentation, however, in practice it is rare that a Court will order this in the context of a residential property where there may be chains at both ends that render unpicking the transaction practically difficult. In addition that you have completed on the sale may also act as a bar to rescission if the Court finds that you could have discovered the misrepresentation before completion. However that would not stop you recovering damages which would be expressed as a diminution in the value of the sale.
If you are interested in discussing this further, please feel free to contact our Litigation department at the Braintree office.
I am in the process of purchasing a three bed bungalow (auction property). The property was advertised by the agent as having three bedrooms with a floor plan showing bedrooms one and two being upstairs in the converted loft. In addition all other documentation from the agent and the seller describes the property as having three bedrooms. I have checked with the council and the loft conversion has got planning permission and was completed some 38 years ago. My solicitor has asked the seller for proof that the loft conversion was built to the appropriate standards at the time but they cannot produce this information (the conversion was completed prior to them owning the property). This information will need to be passed on to my mortgage company and may result in the sale falling through. Did the agent/seller misrepresent the property? What action can they take to rectify the issue? If the sale falls through can I claim any compensation?
Thank you for your comment.
This sounds like a comment we have had before, so you may wish to check through this blog.
In short, it does not sound like a misrepresentation because no promises about the structure of the conversion were given. Unless it can be said that the seller in some way suggested or led you to believe that the loft conversion was to a particular standard, there probably would not be a claim.
If you have a solicitor instructed, they probably have considered this already, but it could be an insurable risk, subject to your lender’s particular lending critera.
We recently purchased a new build property, during the sales process we were told about the development’s lamp post locations, greens, open areas but they didn’t tell us about our road becoming the new bus route or speed humps being fitted outside our house. Neither were highlighted or mentioned on the plans we signed. Since finding out we’ve managed to find out both were part of the s106 agreement. Is this a case of misrepresentation?
A misrepresentation occurs when one of the contracting parties is induced to enter into the contract on the basis of something that is factually inaccurate. It often does not make a difference if that inaccuracy was innocent or deliberate/fraudulent.
However, normally something has to be expressly (or at least reasonably implied) about the particular facts of a situation for a misrepresentation claim to exist. An assumption on the part of the aggrieved party is not the same as saying that the other party to the contract actively misled the other party. Do have a look at our blog on reliance.
In short, whilst we cannot give advice on our website, especially not without knowing all of the relevant facts of the matter, the chances are that unless you were expressly led to believe that the facts you refer to would not arise, there probably isn’t a basis of claim in misrepresentation.
We completed a purchase last August. The seller signed to say the loft, garden and outbuildings would have rubbish removed and the property would be left in a clean and tidy condition. The vendor left waste building materials, recycling/green waste bins full of non-recyclable and non-green waste, discarded clothing, unwanted paint and chemical waste to mention a few things. They left dog and cat litter all over the garden, human hair in the shower and all over the bathroom, dog and cat biscuits and hair everywhere, sticky stains with animal hair in them that were extremely stubborn, filthy interior of windows (hand and lip marks from their children) to name a few gripes. Apparently, the sellers both have mental health issues which they have cited but they could have mitigated at low cost which has left my wife and I feeling less than sympathetic. If we pursued them in court, would we have a case? Would they get mitigation from the judge due to mental health issues? The health issues would not limit their ability to be honest or adhere to the terms agreed on the contract. Thanks in advance…
Thank you for your comment.
We do often see situations where buyers have moved into property, after sellers have promised to remove rubbish and leave the property in a clean and tidy state, and do not consider that the seller has complied with this promise.
The basic situation is that yes, it may be a representation, but what is or is not a “clean and tidy condition” is a subjective question. This is a very similar issue to a situation where the seller does not consider that there is a dispute with neighbours but the buyer considers that there is, discovering the issues after they have moved in. This is, again, a fairly common situation to arise.
When it comes to the Court interpreting subjective questions about what the seller and buyer intended to explain and what would be understood, from property information forms (such as the TA6) or otherwise, the Court will apply “common sense”. It will consider what the root of the question or enquiry is aimed at and what a reasonable person would have understood the response to mean. As a result, there is not a “right or wrong” answer to your query or a black and white answer in law. Put into context, to one person who put rubbish in the wrong bin, this would be acceptable, to others this would not.
In answer to your query and what you describe, there is chance that you may have a basis of claim and there is probably a reasonable prospect of success. However, it would not be without its risk as to what or was not a promise given, and the cost associated with getting to Court making that adjudication is unlikely to be cost-effective.
Hi there
I completed the purchase of a flat a few months ago and there has been antisocial behaviour from a group of young men since I moved in, outside and inside the building even though they aren’t residents. Apparently this has been happening for about a year now and residents have complained and filed police reports. The seller had answered no to most questions in the property information form and I understand the closest related question on disputes/complaints tend to relate to direct neighbours, not so much non-residents. Is there a claim for misrepresentation? I understand from one or two residents that the seller was aware of the issue but the reason they moved was to go back to their home country. what kind of evidence would I need to make a claim if it is possible to make one? I don’t know if the seller has made complaints apart from just having conversations with other neighbours.
Thank you for your comment. Depending on the wording on the property information form, it may be a misrepresentation for the seller to have denied the existence of, when asked, anything that they were aware of or that they could have been aware of that could have given rise to a dispute. In addition, if they answered negative when asked about whether the local authority or any other body had served any notice concerning the property or a nearby property when the opposite is true (as local authorities have statutory powers to deal with ASB) then this may be something that might constitute a misrepresentation. However without a full rundown of exactly what had happened and whether or not action was taken we would be unable to determine whether there is a claim there.
Put simply, you would need to be able to point to a false statement and then show you relied upon it and were entitled so to rely, and that as a result of same you suffered a loss. You may also have to show that you have mitigated your losses which could include yourself taking action against the persons engaging in ASB in the area or showing that you have engaged with relevant authorities.
Please feel free to contact our Litigation team if you wish to discuss this further.
Great article thanks.
Is a seller obliged to declare a defect such as a water leak? Is there any recourse for the buyer for damages caused and repairs?
Thanks
Thank you for your comment. There is no obligation on the seller to volunteer any information about the state of the property, however, any information they do disclose, such as on a Property Information Form, must be accurate. We have done a number of blog posts on misrepresentation, and also on reliance and when one can be entitled to rely upon a statement given and would suggest you start by consulting those.
We have exchanged contracts to buy a flat on a 999 year Lease, in a part renovation/part new build property….the TA8 completed by the developer stated that the property would be completed December 2021, subsequently the solicitor acting for the developer stated that completion would be February 2022…….it’s now September 2022 and we are still waiting. Unfortunately our own solicitor failed to have a long stop completion date added to the Lease Agreement. The Agreement allows that in the event that we fail to complete the purchase, we loose the deposit and risk being sued by the developer. We are tied in to an Agreement which has no effective end date……we would be prepared to walk away from our deposit
but are reluctant to leave ourselves open to litigation. Is there any solution to this?
Thank you for your comment.
The position is a contractual one and the right to rescind the contract and walk away from the transaction (with or without your deposit) will depend on the terms of that contract. Without considering the contract in detail and the various events which have taken place, which may have had an impact on the legal position between the parties, we would merely be speculating about the position. Sometimes, variations to contracts can be agreed through further negotiations after the contract is signed, although most contracts would ordinarily try to exclude the possibility of this arising by including a clause which says there is to be no contractual variation unless this is in writing and signed by the parties. Sometimes there is also a contractual clause relating to “unreasonable” delay, entitling the seller to “cancel” the agreement in the event that this arises; this would in effect be a long-stop date.
There may be some limited scope for a misrepresentation claim against the developer if you were given factually inaccurate assurances regarding completion dates. There is some historical case law which supports the argument even if the “truth” could have been discovered by a proper review of the contract, this might not prevent a misrepresentation claim from being pursued. A primary authority on this point is Peekay Intermark v Australia and New Zealand Banking Group [2006] which is mentioned in our blog on reliance.
As for your solicitors, whether or not there is scope for a negligence claim will also depend on the contractual terms between you and the solicitor (called a “retainer”) and whether or not it can be said that the solicitor should have insisted upon a long stop date. Much would also turn on providing that had this been insisted upon, it would have been agreed to. Sometimes developers are simply not in a position to be able to provide accurate time frames. It would also need to be proved that what you were advised about the issue fell short of what a “reasonably competent conveyancing” solicitor would have advised.
Normally, expert evidence on the conduct of conveyancing solicitors and whether or not that conduct was negligent is not required in Court. However, there is case law (Brown v Gould [1996]) which does lend considerable support to the proposition that references to practitioners guides in setting out a broad baseline as to accepted conduct is admissible evidence. We are not immediately aware of any specific guidance in practitioners guides (such as the Law Society Conveyancing Handbook) which expressly states that a new build purchaser’s solicitor “must” always advise that a long stop date should be included. However, there is guidance and recommendations that a client is made aware of the situation and how it could impact on associated sale transactions, for example.
Many large developers sign up to a Consumer Code for Home Builders. This does expressly recommend that a long-stop date be included. This is arguably something that a conveyancing solicitor that is instructed to deal with off plan and new build properties should be aware of. Much would turn on the exact advice given to you about the issue.
We have very recently bought a property (May 19th) . The vendor answered NO to the Qs on the SPIF re disputes and neighbours and specifically said when asked about their relationship with the neighbour that they had an amicable relationship . There was a redundant (no longer necessary ) agricultural easement going over our land to a barn which can now be accessed from the neighbours land. When this land was developed in 2016 the access hadn’t been used for 15 years but we have recently heard that the neighbours insisted on starting using it (which we were OK about when we bought as it didn’t feel like a big deal as the farmer only came a couple of times a week). However, within 5 weeks of us moving in the neighbour put in a Class Q prior approval notice wholly reliant on our land to give the proposed barn conversion light/air and access from OUR garden! Our neighbours’ solicitor repeatedly confirmed for them that they can’t use a limited agricultural access for residential purposes however they couldn’t accept this and have spent six weeks causing nuisance/harm/intimidation culminating in their arrest for common assault/ABH/criminal damage and carrying an offensive weapon. They have now been forced to withdraw the Class Q but are still VERY VERY ANGRY. Not only for not getting to own this land but now being stopped from converting the barn because they don’t own our land.
Subsequent to moving in we have heard that when our land was being sold our neighbour physically assaulted the old man selling the land lifting him in the air and shaking him. We have heard that he then caused a whole lot of issues during the build making life as difficult as possible and built a large side extension on his barn (without planning permission) to block the view from our property down the valley. We have heard that he has a reputation in the village for being a bully and we are not the only people he has terrorised. We have also heard that when he moved here he put a padlock on the community well and stopped the whole village from using it even though the well isn’t in his Title he now pumps gallons of water out of it every week. The whole village seems to be very frustrated by this.
So even though our vendors hadn’t involved the police should they have disclosed what the neighbours from hell are really like and their reputation in the village? From what we are hearing the reason our vendor rented this property and then put his recently married daughter and son-in-law in the property for years was to just let time pass before selling the property. Neighbours have said that they when they heard the property was for sale that our neighbours from hell must have “settled down”. In other words the vendor knew they couldn’t sell if the neighbours from hell hadn’t settled down and accepted that they didn’t get to own this land. Obviously they HADN’T actually settled down just the daughter and son-in-law had been told to not do anything to upset him. Neighbours have said that our vendor and family like many in the village just kept their heads down. Thus the Class Q five weeks after we moved in and the loss of 6 weeks of our lives and counting.
So did our vendor have a duty to disclose EVERYTHING that had happened since he purchased the land in 2014? Did they have a duty to disclose our neighbours from hell reputation in the village?
We haven’t met anyone yet without some dreadful story to tell us about our neighbours. We doubt though that any of them would go on record as they are all good friends of our vendor. So do we have any comeback on being left in this dreadful situation with the neighbours from hell.
Thank you for your comment. This is a situation that we have come across before. There is no requirement for the seller to volunteer information but as you identify, there is a question on the property information form as regards whether there are any disputes involving the property or a neighbouring property. And it does seem that there have been incidents which could lead to a dispute regardless. It would seem therefore that their answer to this question may have been incorrect and knowingly so, and also that this false statement was made on a document you were entitled to rely upon, based on what you have said.
The issue here, though, will be proving these incidents occurred. Unless there has been Police or local authority involvement and a third party disclosure application can be made against them, if the neighbours are not willing to give evidence to that effect, this may be difficult. It is possible to in theory witness summons them to attend at trial but this is a high-risk strategy as there is no guarantee they will not simply deny everything. You may also wish to consider taking action against the problem neighbour in tandem with this claim both to mitigate your losses and also because the neighbours may be more willing to give evidence on such a claim which can then be used in a misrepresentation claim.
If you therefore wish to take this further please feel free to telephone our Litigation team for a confidential discussion.
I am in the process of buying a c. 100 year old property. The area I am purchasing in has a high clay content, and therefore it is not unusual for properties to experience settling etc over time.
Especially in the context of the very hot summer/drought, I was wondering to what extent the sellers should disclose such potential issues both historic and more recent re settling/indications of subsidence? Is there a clear definition/distinction of both? My surveyor has already visited (before summer) with no issues noted, but what for example an issue developed between his visit and completion? What if the seller was to redecorate etc prior to completion?
The TA6 form does not address structural issues if I understand correctly, rather only planning/access/services etc?
Thank you
Thank you for your comment. Firstly, please note that the Property Information Form is intended to be completed and read by lay persons and Courts have ruled that as such it is not there to try to trip up buyers or sellers, and that there is no hard and fast definition of such things. However, it is a representation on which a buyer can rely and is entitled to rely, and usually does rely. Therefore it is important that any information given in it must be truthful.
However, at the same time, there is no requirement to volunteer information necessarily. The seller is only required to ensure that where they do volunteer information it is true. That being said, answering “no” to a question about whether you are aware for, for instance, any structural defect is a representation on which the buyer may rely, so if that turns out to be false there may be a claim for misrepresentation there.
You may wish to contact your conveyancing solicitors in respect of this question as they will be better placed to, in the context of the transaction as it currently stands, advise you on filling out the PIF.
So if a seller puts “Seller makes no representations about the property- buyer to rely solely on their own investigations” does that suffice to allow no claim for misrepresentation?
Thank you for your comment. Unfortunately without having seen the contract and other relevant documents we would not be able to give any meaningful answers to this. However, we have written an article on the issue of reliance in misrepresentation claims at https://cunningtons.co.uk/reliance-in-misrepresentation/ which may be of use to you.
Hi, I bought a ground floor flat almost 5 years ago and when the new basement flat owner moved in last year , they started complaining about the noise coming from my flat.
The entire flat had a wooden flooring, which was one of the attractions when buying a flat.
He then found a clause in the lease that states that the both the bedroom and living room must be fitted with a wall-to-wall carpet. I was happy to install a carpet in the bedroom as that’s where the downstairs neighbour had the biggest issue. I am now trying to sell the flat and the potential buyer is pulling out because he doesn’t want the carpets in the living room.
In this case, who’s at fault here? Is it the seller who had wooden flooring illegally, and didn’t tell me when they sold the flat? Or is it the management company, who hadn’t noticed this and only now have decided to enforce me to do it or is it me for not checking this?
It’s very frustrating and just wanted to know whether there is anything I can do to claim some kind of compensation.
Thanks!
Thank you for your comment.
It is very unlikely that you would have any basis of claim against the seller. You purchased the flat in the condition that you viewed it in and it was not down to the seller to identify any possible breaches of the lease. If the seller expressly stated that there were no subsiding breaches, then there may be a basis of claim, but ultimately it is down to a buyer and their solicitor to decide whether or not there are any breaches by a seller which need to be remedied before proceeding with a purchase. This is likely what you are discovering at this time.
If you purchased a flat which was in breach of the applicable leasehold terms, and floor coverings is a fairly usual term to appear in a residential lease, then you are liable for rectifying the issue.
In April 2022 we made an offer on a property which was accepted. One of the key factors in the decision to offer was the annual service charge for the property. We were informed by the agent twice verbally and once in email that the service charge ~£2000 per year. In July 2022 the report on title and supporting documentation was provided by the conveyancer, which showed the actual service charge to be 2 x the amount that had been quoted, resulting a significant, unbudgetted additional cost. We decided to proceed rather than pull out of the sale for a number of reasons, principally the interest rate increases that have taken place since the initial mortgage in principle was provided, which would have resulted in an even higher additional outlay. We have now exchanged contracts on that basis and will complete in late August. I consider that I have a claim for either innocent or negligent misrepresentation against the estate agent. Grateful for your thoughts. Thanks
Thank you for your comment.
From what you have stated, it is very unlikely that you have a claim for misrepresentation. Reliance is a key element to any misrepresentation claim. A buyer cannot hold a seller liable if the seller has not misled the buyer and caused the buyer’s loss. Our blog on this can be found here… Reliance: A Necessary Ingredient in Misrepresentation Claims.
In short, you did not rely on the seller’s inaccurate statement of fact regarding the service charges, whether made by the seller or the seller’s agent. You knew that this statement was inaccurate and decided to proceed for other reasons.
I have a very similar issue to the above poster, but have not yet completed as I am still wanting clarity. If I were to not complete, would I be able to make a misrepresentation claim for my costs incurred so far?
Can you please be more specific about your issue? You can always contact us about any legal problems you may have, and we would be happy to help.
Hi Mark, Thanks for your response I have followed up with you by email. Graeme
Hi Mark,
Thanks for your response, which I found really useful.
Would it be possible to argue that I relied on the information on service charge costs in association with current interest rates and the potential time to completion to enter into the contract? It was the combination of these 3 factors that led to a decision.
When the accurate information was available to me it would have been too late to a) find another property in the time required and b) obtain a mortgage at the same interest rate as I had previously obtained. I had relied on a timely completion and a minimal net monthly total cost (including mortgage repayment and service charge). The increase in monthly service charge would be less than the increase in mortgage repayments and therefore provided the lowest increase in cost – given that we wanted to complete a purchase within a certain timeframe.
Happy to discuss further by phone.. Thanks
We purchased our property in January 2021 and both the waste water company and the seller confirmed that the property was connected to mains drainage. In April 2021, the manhole cover overcharged and we reported a blockage to the waste water company. The following morning, their contractor attended and confirmed we were discharging into a cess pit and we had no mains drainage connection.
I took this up with the waste water company and exhausted all their complaint process and enlisted the assistance of the Consumer Council for Water. They said they confirmed on the basis that a water bill had been paid on the property as far back as their records existed (to 2006). In correspondence they did confirm an enquiry had been made for a mains connection in 2016.
We understand the sellers had purchased the property around 2008 and only lived in it periodically with older relatives being the main residents.
The connection to mains drainage was a material fact in our decision to make an offer of the full asking price. Had we known about the drainage situation we would definitely have made a reduced offer as we are not happy with cess pit drainage and would have factored in the cost of connection into our finances as we were using all of the proceeds of our sale to purchase and did not intend to take out a mortgage to buy the property.
We cannot afford to pay to make the connection so we haven’t made a “loss” and would use any damages from a claim towards the connection. Having a cess pit is a constraint on value compared to the property on mains drainage. What are our options?
Thank you for your comment.
If you were informed that the property was connected to the mains by both the seller and the relevant water authority, when it was not, there would be a basis of claim in misrepresentation against the seller. Also, check your water searches as if these were not accurate, the search provider may have insurance which can be claimed against. There will be a question on whose representation you relied on. We suspect that ultimately, liability would likely be shared between them in some way.
As you have identified, your loss is the fact that you would have negotiated the purchase price if you had known. Your loss is therefore the difference between what you paid or the property and what a reasonable person would have paid for it knowing about the cess pit. This is called diminution in value. There is also some limited scope for the cost of claiming remedial works in a misrepresentation claim.
We recently purchased a house about 5.5 km from an RAF base and we asked the seller if this caused noise issues, and were assured via Text Message it didn’t, however having been here now a week it is very clear to us noise is an issue, and flying takes place several hours a day every week day, but, not at weekends. Would this be deemed miss representation as the main thing we were looking for was peace and quiet.
Thank you for your comment.
Anything said which is factually inaccurate and that a buyer has relied on when entering into the contract is a potential misrepresentation.
However, it would be necessary to prove that you relied on the misrepresentation when entering into the contract. Put another way, you would likely have to convince a judge that you reasonably believed that there would be no noise issues from a nearby RAF base.
More fundamentally, and likely problematic, would be the fact that a noise nuisance to one person may not be a noise nuisance to another. There is an element of subjectivity with matters such as this and there is a difference between a seller expressing an opinion on whether or not the noise was a problem for them or whether they were saying, as a matter of fact, that no one would have any issues with noise. A statement of someone’s opinion is not actionable because someone else disagrees with that opinion. Only a statement of fact which is not accurate is actionable.
Your matter would likely turn on what the text message, given its ordinary meaning, would mean to a reasonable person reading it.
Hi
Please I would like some advice on a property purchase I made at a time I was going through a lot of stress in my personal life that I did not bother reading any of the paper work . I relied on the seller’s oral information about the age of the property. When I asked when the property was built she said 1959 I thought that was okay as long as it was less than a hundred years old . So I proceeded on the basis that the property was not that old and therefore the level of repair would not be significant. However I later found out that the property age is actually 1930 to 1949 which means the property is way older than I had been made to believe by the seller. Since moving in , the amount of repair I have done and still doing is causing me a lot of financial and emotional stress , the roof tiles are so brittle and has been falling down the driveway so I am asking people to avoid standing in the drive way to prevent being hit by the falling tiles so far I have spent over 3000 pounds on repairing the roof and I have now decided it is better to replace the entire roof to avoid spending more on repairs . 2 Quotes obtained for roof replacement is around 10000 pounds per quote . The seller also lied that they intend to build a timber house far behind my property, she pointed her finger inside the bushes far in to indicate where they intend to build a home , this led me to believe that it was far inside but only to find out the building garage is so close to our boundary and it’s giving me a shade in the mornings. Had I been given the right information I would not have made the offer so high . I believe I had paid too much considering the amount of repairs I have had to do . I have also replaced the driveway completely because it was so damaged and constituted a hazard which cost almost 5 thousand pounds . When I came to view the property they covered the driveway with several cars it was impossible to see the level of damage .
I would appreciate your advice . I am really stressed out about the extent of repairs and it’s very clear that I paid too much . I have been deceived .
Thank you for your comment. We cannot give specific advice on our website, just general guidance which should not be considered a substitution for informed legal advice.
For a misrepresentation claim to exist, the buyer must have relied on the false statement of fact made by the seller.
Whilst we would need to review matters in much more detail to form a proper view, from what you have written we think it is unlikely that you would have a claim. There are several possible risk factors here but the main reason for this is that it cannot realistically be said that you relied on what the seller told you.
You have said that you were only prepared to purchase a property that was less than 100 years old, because you had formed a view that maintaining it would be less burdensome than a property older than this. If the property was built in 1930, it is still less than 100 years old and would still have met your criteria.
In determining reliance, the Courts will consider whether or not the person bringing the claim has “changed their position”, as this is a primary indication of reliance. Put another way, unless the buyer can prove that they would not otherwise have purchased the property or would otherwise have behaved differently, it cannot be said that they have “changed their position” based on what the seller has said to them. As you would still have purchased the property because it is less than 100 years old, we think it is unlikely that you would be able to successfully prove that you relied on the misrepresentation about the age of it; you would have proceeded to purchase the property even if you were told it was built between 1930 and 1949, as it would still be less than 100 years old.
If your surveyor was instructed to investigate and report back on the issues that you are now experiencing but failed to identify any possible problems, then you may have a professional negligence claim against your surveyor.
As for the location of the subsequent build by the seller, there may be a basis of claim in misrepresentation. However, we suspect that you would have some serious evidential issues. You would have to prove that the seller had pointed to a specific location and also convince the Court that your reliance on this was not an unreasonable interpretation of the “statement” that the seller had made. Put another way, it is a general principle of law that “he who alleges must prove”. The burden of proof, or threshold, is “on the balance of probabilities”. In plain English, this means that you would have to prove that there is more than a 50% possibility where the seller indicated the build would be and that it was not an unreasonable interpretation of the statement. Unless the seller admits this, we think you would struggle to discharge the burden of proof.
Hi, we purchased a new build property from a small-scale local developer last year and found out that the property was not connected to the public sewer as had been stated in the TA6 property information form and the Water and Drainage search. Following investigations from the water board, and an admission by the developer that that this is their responsibility to fix, the developer has been instructed to address the issue under the Water Industry Act 1991. Whilst this is good news, this feels like a misrepresentation case, potentially based on negligence and has caused us a great deal of stress and inconvenience. I’d be interested to know your thoughts about this – thank you.
Thank you for your comment.
Before considering any claim, thought must be given to the loss that has been suffered. With the exception of a few types of cases, if there has been no loss or damage, there will be no claim. Trespass for example, is what is called ‘actionable per sale’, meaning that there need not be a loss to take action to stop it.
If the developer has agreed to rectify matters, there is a potential argument that there has been no loss. Whilst diminution in value, namely the difference between what was paid for the property and what it was worth with the defect, would ordinarily be the measure of damages the Court would apply, the Court does have discretion and can sometimes award the cost of repairs. If the repairs or rectification solves the issue, then it would probably not be in your interests to pursue a claim.
Compensation, damages, would not generally be available for stress and inconvenience alone. The exception to this is normally when a contract is entered into for enjoyment. For example, if a package holiday was poor, then damages for loss of enjoyment would be a head of loss.
Hello,
We have just concluded missives on our new build. We were informed that there was a plot of vacant land next to the property which would house stays which support two wooden pylons. We were informed that the pylons would be moved further back and that only the stays would remain on the property next to us.
As we were not permitted to access the building site we got a view of the site weeks later with drone footage. We noticed that the wooden pylons had not been moved and we questioned this via email. The response was that it had not been done but that power company would be moving them.
We sent a follow up email just prior to missives. The sales person moved to a new site and was replaced. It has now come to light that the site manager and building director are advising that the pylons are not going to be moved.
The pylons are literally a few feet off the right side of our fence and we may actually have power cables running over our garden. The property was bought on the premise that these would be moved further back. During the initial review of the plans prior to us paying a reservation deposit it was expressly explained that they would be moved.
Besides being an eyesore and possibly a safety issue. We believe that it may also affect the property value as well. We entered into this purchase being informed about f pylons being moved.
Would this constitute misrepresentation and as we have concluded missives are there avenues that we could follow to achieve some sort of compensation or having the seller stick to moving the pylons?
We started to purchase a property in Feb2020, just before the 1st lockdown and completed in July 2020. There were things we were not told on the TA6. One of which was the question that asks whether the Seller owns or owned property/land adjacent to the property. He said no, when indeed he did and he was already in the process of selling it to a friend in the village with a 40% net profit overage and full control with a timeline based on getting planning approval and/or development. Before we purchased the property we tried everything we could in lockdown to find out more about it but information was not forthcoming as councils and land registry were mainly on furlough. We asked the Seller and the Estate Agent about the land surrounding the property and the Seller said that it was all owned by the local Farmer and there is no way it would be built on, followed up by telling us that he was a man of honour and he does not break his word. Stupidly we believed him. The Land to rear of us has subsequently got planning, dubiously for a large Agricultural storage and lambing shed, widening of the access apron on a blind bend and a large driveway. This is basically stage 1 of an in-depth long TA1 set of overidges on the land, which is clear both the Seller and his Friend are looking to develop the land further. Do we have a case against the Seller or do we just have to accept that Cheats really do prosper?
Thank you for this. While we cannot give definitive advice without having seen all the items in question, whether there is a case there will very much depend upon the contents of the Property Information Form and on the contract. It should be noted that it is not normally a misrepresentation for the seller to fail to volunteer information. It is, however, a misrepresentation if they make a statement that is false and which you rely upon and are entitled to rely upon, and as a result of which you have suffered loss or damage.
The concerns I have here are whether the false statement he made, if indeed it was false, would have engendered you undergoing any loss. If he does own land adjacent to the property, then whether he gets planning permission for it or not is a matter for him. Yes, if he did not disclose when asked that he did own that land, then that is a misrepresentation. However, I cannot see that any loss you have suffered would flow directly from this, unless I am missing something here.
As regards verbal misrepresentations that he would not build on this land and that he is a man of his word, I am afraid that is unlikely to be a cause of action. It is usually a term of the contract of sale that no party may rely upon any representation made to the other except those in writing. Obviously, your contract may differ but that is the usual wording included in it, so I do not think that in and of itself would form a course of action.
Hi! We purchased a house 18 months ago which was advertised to us as a 5 bedroom property. Recently the council contacted us to say that we owe 18 months of council tax on the basement flat. Obviously this is distressing as we were not informed we were purchasing two rateable properties and on the TA6 form it referred only to a single council tax rate. I have contacted the seller’s estate agent and they have confirmed in writing that they were never made aware of this fact. The seller’s estate agent contacted the seller to try to get to the bottom of it, and the seller said that because she removed the cooker from the basement, that council tax was not applicable (we never saw it in there and were not told that the basement had eve been used as a separate flat with kitchen, though there is a shower in the basement). I have contacted the council and they have said that is simply not true and they would never give that advice in any case. They have also confirmed that rates have been payable on the basement since the 1980s. And has been paid separately. We since found out that she had been renting the basement to several persons over the years. Obviously, we are now paying two council taxes potentially in perpetuity. We would not have bought the property if that was the case, and our mortgage specifically prohibits renting out any part of the property in any case. It is clear that the seller was aware of the council tax in the second property as she had been renting it out but never disclosed this to either the estate agent nor on the TA6 form which we relied on when deciding to purchase. She has since refused to communicate with us and we now feel that a legal avenue is the only way to resolve the issue. Do you think we have a case to make a claim against the seller in this instance?
Thank you for your comment.
This is an unusual situation, but then this blog has thrown up a number of novel points in the past.
In short, there may be a claim for misrepresentation but it will depend a great deal on what you were told. If you were expressly told that there would only be one council tax bill to pay, then this would likely be actionable.
It sounds as though perhaps the seller was aware of this issue and allowed you to proceed on under a misunderstanding. This is not a straightforward point legally. A misrepresentation can occur by reason of what is left unsaid. However, in the simplest of terms, this would involve showing that the seller allowed you to proceed under a misapprehension without correcting you.
Do get in touch if you would like to consider this in more detail.
Note: This is general guidance only and should not be relied on as a substitution for properly considered legal advice.