Misrepresentation In Property Sales: the consequences of not telling the truth when selling property
Buying property is a big investment for anyone, so it’s only right that the purchaser should be satisfied with what they are buying.
Likewise, the seller should be entitled to some comfort in knowing that once their property is sold, that is the end of the matter.
The Seller’s Property Information Form
During the conveyancing process, the buyer will ask the seller questions about their property. These are called pre-contract enquiries and requisitions on title. As part of the process of selling a property, the seller will normally complete a Property Information Form. Much of the time, the form used is the Law Society’s Property Information Form, sometimes referred to as the Seller’s Property Information Form.
The idea behind this process is that the buyer satisfies themselves by asking the seller relevant questions and the seller answers them. If the seller has been as upfront as possible in response to those questions, the seller cannot normally be held liable for anything else they say.
What happens if the seller’s information is not accurate?
We see a lot of cases where a seller, sometimes unintentionally but sometimes deliberately, misleads a buyer by answering a question on the Seller’s Property Information Form or during negotiations incorrectly – or partly incorrectly so as to create a misleading impression. The buyer then purchases the property and moves in, only to discover that the information provided by the seller was inaccurate.
We have dealt with cases where a seller has:
- failed to disclose existing disputes with neighbours;
- suggested that a property does not suffer from a flooding issue when it does;
- inaccurately maintained that the property does not suffer from Japanese knotweed when it does;
- stated that the boundaries are in one place or have not moved when in fact they are not or have been changed;
- suggested that the property does not suffer from damp, when it does;
- explained something in relation to an existing tenant which is incorrect; and
- stated that there are no planning or other proposals nearby which could have an effect on the property.
… the list goes on.
In all of these cases, the buyer may very well have a claim for misrepresentation, depending on what the seller said about the position.
If you are interested to read about real cases which have been decided by the Courts, examples can be found in our article Property Misrepresentation in Practice.
Misrepresentation is a false statement of fact that induces a party into a contract causing a financial loss. It does not have to be the sole inducement, but the buyer would have to have relied upon the statement to bring a claim. Read more about reliance in misrepresentation claims here.
Depending on whether or not the seller innocently, negligently or fraudulently answered the questions inaccurately in the Property Information Form, the buyer may be entitled to claim damages from the seller. In some cases, the buyer will be entitled to ‘rescind’ the contract. This means that the buyer is entitled to their money back and to return the property to the seller. This does not happen very often and a Court will normally award only damages.
Normally the measure of damages awarded to a buyer is based on ‘diminution in value‘, or the difference between what a buyer would have paid for the property knowing about the issue, and what they actually did pay for it. This may not necessarily reflect the actual cost to the buyer in rectifying the issue. However, in some cases, additional damages can be awarded to cover other expenses incurred.
Diminution in value
To give an example of how diminution in value is calculated, we have acted for insurers in professional negligence claims against surveyors, who have failed to identify that a property suffered from subsidence. The measure of damages was based on diminution in value. The cost to the buyer in underpinning the property to stop the subsidence was greater than the actual loss suffered. This is because the property was situated in a highly sought after location with a large rental market, meaning that the impact on the value of the property was less.
Based on the fact that a hypothetical purchaser would have seen the property as an investment opportunity that could provide a return by renting it to tenants, rather than considering it a family home for life, the expert’s opinion was that a hypothetical purchaser would have been more likely to negotiate a smaller reduction in the purchase price than the full cost of the repairs, to make sure that their offer was accepted by the seller and because even with the defect, the property represented a good investment.
How can a seller ensure that their buyer will not bring a claim for misrepresentation against them?
Sadly there is no way to be 100% certain that a buyer may not make a claim later. All a seller can do is minimise the risk of this as much as possible.
Although completing the Seller’s Property Information Form is not mandatory, it is unlikely that a buyer will proceed with the purchase if their questions are not answered.
Therefore when completing the Seller’s Property Information Form, the seller should answer questions as fully and honestly as possible. We often advise clients to think about what they would want to know about the property if they were buying it, and how they would react if they bought a house with problems that were not disclosed.
If a seller is not certain about an answer to a question in the Seller’s Property Information Form, they should think carefully about whether they want to answer it.
What happens if the seller’s replies were accurate at the time they were given to the buyer, but by the time of exchange the information has changed?
In some circumstances, a seller is under a continuing obligation to ensure that their replies to enquires are accurate up to the date of exchange of contracts. Therefore if there is a change of circumstances meaning that the original statement is no longer accurate, there is every chance the seller would be obliged to update the buyer.
The Seller’s Property Information Form also specifically tells the seller that in the event that something happens which would mean that their replies are no longer accurate, they should notify their solicitor of this, who should in turn notify the buyer’s solicitor.
If they don’t do this, the seller risks a potential claim against them for misrepresentation.
What if a seller knows something which is not specifically asked about by the buyer?
Have you bought a house with problems which were not disclosed? Unfortunately, this is unlikely to give rise to a claim for misrepresentation.
The basic position here is ‘caveat emptor’, or ‘buyer beware’. If a buyer does not ask the seller a question, they cannot then look to the seller for compensation if they discover something that they do not like about the property. It is up to the buyer to satisfy themselves that they want to purchase the property and ask questions about it which are important to them.
As the basic position in a property transaction is buyer beware, it follows that if no statement or answer is given by the seller, the buyer cannot be said to have relied on it to enter into the transaction.
Having said this, sometimes (but this is unlikely unless a special or fiduciary relationship exists) a misrepresentation can take place by a failure to mention something material to the transaction.
In some cases, a “half-truth” or explanation which is accurate on the face of it but misleading about the true circumstances of the matter can also amount to a misrepresentation.
The moral of the story
Sellers should be upfront about any issues that affect the property and buyers should take all steps they consider appropriate to obtain the information that they want before committing to a purchase.
If a seller doesn’t know or is unsure of the answer to a buyer’s question, they should consider not answering the question. However, by not providing a response the seller could be putting their sale at risk, as the buyer may not be prepared to proceed without an answer.
Sometimes a seller will qualify their response, but this in itself is not always enough to prevent a claim. It is important to discuss it with your property solicitor. You can be sued
If you are interested to read about real cases which have been decided by the Courts, examples can be found in our article “Property Misrepresentation Claims in Practice”.
If you are facing a claim for property misrepresentation or believe that you have a claim yourself, please do feel free to get in touch.
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.
Questions people ask about misrepresentation
As you can see, buying and selling property is not always as simple as you think. We’ve tried to address some common questions below, but if you are still unsure please feel free to contact us for an answer.
> What is property misrepresentation and what are property misrepresentation claims?
There is no specific definition of this but broadly this could be described as a claim which arises by reason of a misrepresentation occurring during a property transaction.
> Can I sue the seller if I bought a house with problems that were not disclosed?
A seller does not have to volunteer information about a property. If a seller stays silent on something, a representation has not been made and a claim for misrepresentation can arise.
> What compensation will I receive in a property misrepresentation claim?
Damages for all types of misrepresentation cases are intended to put the claimant in the position that they would have been in had the misrepresentation not been made.
In property misrepresentation cases, this is normally the difference between what you paid for the property and what it would have been worth, had the truth been told. This is called diminution in value.
> What should a seller disclose when selling their property?
The seller does not have to disclose anything but if they do not, then a buyer might decide not to take the risk of buying the property.
Normally a seller will fill out a property information form. For residential purchases, the Law Society published a standard property information form for this purpose, called a TA6 or a TA7.
> What if the seller lied on the property information form?
If a party to a contract deliberately misrepresented facts relating to the property with the intention of misleading the buyer, a fraudulent misrepresentation can arise. Often, such a representation does not need to be in writing.
> Do I have to declare planning applications, like a neighbour’s extension?
There is case law on this and it will normally depend on whether or not you have received a formal planning notice.
Have a look at our article Property Misrepresentation Claims in Practice for a case on this point.
Hi, I was in the process of buying a house recently and decided to pull out after mortgage valuation uncovered that the house has structural issues and there are movements meaning the property is not stable. A structural engineer is required to undertake a thorough inspection before mortgage offer is accepted.
When I shared the valuation outcome with the estate agent instead of resolving the issue they increased the property value to proposed market value (suggested by the lender ONLY after significant work is done to ensure stability of the property) and advertised it within few hours since I made them aware of the valuation results and have pulled out. It maybe that they miraculously managed to get an engineer to come and inspect within the few hours which is highly unlikely. Is it legal to advertise falsely in the UK and hide the survey outcome? If the issues not picked up again let’s say by poor valuation and the building collapses potentially leading to serious consequences i.e. loss of lives who will be liable? Since the estate agent and the seller are both allowed to get away with hiding serious structural issues and not penalised in anyway.
Thank you for your comment.
We are not able to offer any advice or guidance on criminal law. However, from a contractual point of view, there is no obligation on a seller to provide specific information to a buyer. It is for the buyer to make the necessary enquiries, of the seller or through searches or surveys, until such time that they are satisfied and prepared to commit to a transaction.
Hi. An interesting site, thanks. I moved into an apartment 18 months ago and it’s very near to a multi-storey car park. There’s regularly anti social behaviour, skate boards for hours at a time, music, loud shouting till midnight sometimes which is really loud. I’ve done some digging and the previous owners have been in the local press complaining and stating they’ve had issues for the last 8 years on similar lines! This was never declared. Do I have a case? Thanks
Thank you for your comment. There may be two potential claims here.
You may have a claim for public and/or private nuisance against the car park owners. Much will depend on the nature of the antisocial behaviour and what steps could reasonably be expected to be taken by the owner to prevent a nuisance arising as to whether or not it can be legally said that the car park owner has a duty to prevent the behaviour claimed of from arising.
As for a claim against your sellers, there appears to be a common misconception that a seller is under some sort of duty or obligation to provide information about the property that they are selling. There is no obligation on any seller to disclose anything about a property. It is up to the buyer to satisfy themselves that they are prepared to purchase the property and to do this, they will normally make formal searches, ask questions about the property and have a survey undertaken. Whilst a seller has no duty to a buyer to provide information about the property or answer any questions, the practical aspect of this is that if a seller does not answer questions when asked, then the chances are a buyer would not proceed.
Therefore, in answer to your question, the seller was under no obligation to declare anything regarding the antisocial behaviour. However, there is a need to ensure that when a seller does provide information about a property to a prospective buyer, accurate information is provided. The position is different if the seller provided inaccurate information about the property.
If information provided was relied upon by you when deciding to purchase the property and it was factually inaccurate, then there may be a claim for misrepresentation. For example, if the seller had stated during the transaction, either directly or via their solicitors, that they had no trouble at all from the car park, then this could be a misrepresentation as they have had 8 years’ worth of trouble. These representations, or answers given about the property, will normally be contained in a property information form or in writing between the buyer and seller’s solicitors. For example, there are questions in the standard property information form regarding disputes and complaints about the property. It may be that the answers given by the seller in the property information form are inaccurate, if there have been disputes and complaints historically but the seller has ticked “no” in answer to the question regarding whether or not they were aware of any disputes.
We have produced a blog citing some examples of real-life cases of property misrepresentation here (https://cunningtons.co.uk/property-misrepresentation-claims/). McMeekin v Long [2003], is mentioned as an example of a case where the seller stated that there were no ongoing disputes with neighbours but that transpired to be untrue.
Do feel free to get in touch if you would like to explore the matter further.
Our property has a history of subsidence which was underpinned by a previous owner in 1985. As it is now 35 years + since any subsidence was underpinned, are we still liable to inform a buyer of this history, especially when there has been no subsidence in the 14 years we have owned the property ? Our sellers form did not ask if there has been any history of subsidence either.
Our home insurance premiums are as per any normal home as we were advised the subsidence was more than 25 years ago.
While we cannot advise on specific matters without having properly considered all the documentation in this case, whether you must disclose something depends upon what is asked of you. There are generally only very limited duties to disclose defects. However while the property information form is important, it is not the be all and end all. If the buyer specifically asks you about something, and you give a false reply to it, and they could reasonably be expected to rely upon that statement, it is just as much a misrepresentation as if you had given a false statement on the property information form.
This is something that you may want to discuss with us in more detail so we can advise you having properly considered all the documentation in the case, especially if the buyer is alleging that you have misrepresented yourself. Feel free to contact us for a discussion in complete confidence.
Apologies it was the property information form that didn’t question anything specifically to subsidence. The buyer has not asked any direct question either in relation to subsidence.
I agree, if we should be asked directly by either the buyer or surveyor on this matter it is only right to be honestly open. We do have paperwork relating to all correspondence and underpinning work etc. as well as a structural survey undertaken (which had the all clear) at the time we purchased the property.
My question really is, after 35 years surely it wouldn’t be necessary to have to declare any history of subsidence or does this saga never end ?
Thank you for this. We cannot give specific advice over the web without having seen the documentation. However from what you have said whether you do need to disclose it depends upon what effect it is having on the property and whether it is still an issue that is having an actual effect upon the property. Normally the property information form will include a question relating to structural issues. Whether this means you should disclose it depends on how exactly it is worded.
The property I purchased was sold with the understanding that it had tenants and that everything was okay with the property this was confirmed by both clients and solicitor. In essence we completed on Friday last week they refused to give us the keys until Tuesday this week and sent the assured short hold tenant see agreement summary of the six rooms but did not send any of the tenants agreements. also when quizzed a week or so ago in regards to the mortgage I was asked if any thing has changed with the property in regards to the tenancies. I went back to the seller and the response was it was all still tenanted but as it appears today there are no tenants in the property at all. anyway long story short I am needing to get the transaction reversed and claim for costs.
While we cannot give specific advice on this page as we would want to see all the documentation first, there may be some redress here. To succeed in a claim for misrepresentation you have to show that they made a statement to you which you could have reasonable been expected to rely upon and which was false. It would also be important to consider the contract for sale as there may be non-reliance or entire agreement clauses which may have to be considered.
You also would have to be able to point to some loss or damage that you have suffered. In order to determine whether in this case you would be entitled to this we would have to see some sort of evidence as to what you believed you were purchasing and for what reasons. Please feel free to contact our offices if you wish for a discussion in complete confidence.
Hi guys
I’ve purchased a flat in a building recently and it has started to leak in one room through a wooden beam in heavy rain
The seller has said there was a small leak when they first moved in but this was sorted by replacing some guttering outside which was done by the building owner but it still seems to leak occasionally. There seems to be water staining on the beam that leaked which looks old, but I never had a survey done and never asked any questions directly about leaks, where do i stand in terms of misrepresentation?
Hello Edward,
We are afraid that we cannot give anything other than general guidance on our website, primarily for the fact that without considering the position in detail with our clients, we cannot give accurate advice.
Normally one can only be liable for misrepresentation when a statement is made that turned out to be false and which you relied upon. Whether they did misrepresent the situation with the leak may depend on the exact wording of the statement on the Property Information Form or wherever else they made it. That it did not suppress the leak entirely is not in and of itself grounds for a claim in misrepresentation. Please feel free to contact us for a confidential discussion if you wish to take this further.
Apologies it was the property information form that didn’t question anything specifically to subsidence. The buyer has not asked any direct question either in relation to subsidence.
I agree, if we should be asked directly by either the buyer or surveyor on this matter it is only right to be honestly open. We do have paperwork relating to all correspondence and underpinning work etc. as well as a structural survey undertaken (which had the all clear) at the time we purchased the property.
My question really is, after 35 years surely it wouldn’t be necessary to have to declare any history of subsidence or does this saga never end ?
Thank you for this. We cannot give specific advice over the web without having seen the documentation. However from what you have said whether you do need to disclose it depends upon what effect it is having on the property and whether it is still an issue that is having an actual effect upon the property. Normally the property information form will include a question relating to structural issues. Whether this means you should disclose it depends on how exactly it is worded.
What would be the position where some particular item contained within the property is specifically referred to on the estate agent’s particulars as being included in the sale, but a) the particulars have a clause confirming nothing in them shall be construed as a representation of fact, b) the seller removes the relevant item/property before exchange of contracts and c), the buyers inspected the property between the removal of the items and exchange of contracts, but failed to note the items had been removed?
Thank you for your comment. We suspect that the contractual clauses would take precedence unless it can be show that there was a deliberate or reckless misrepresentation. Much would probably turn on whether or not the items in question could be considered fixtures and fittings or chattels and whether or not a separate sum was agreed for those chattels.
There is a case called Taylor v Hamer [2002] which may be relevant here in terms of principles, although we are not aware of any case which is specific to your circumstances. In that case flagstones forming a fixture of the property were removed before exchange of contracts. The seller was held to be in breach of contract as the flagstones formed part of the property.
Hi,
We were in a process of buying a house. We had twice viewing the house. We were really interested then we put an offer, till this time the home agancy didn’t say anything to us this house sold once in March and it came back to market again because the buyer didn’t pay money. We put our offer and didn’t have any call back of them when we phoned to asked this time they said this house was sold and now the seller wanted to sell the house to that buyer again, we told them why they put the house in the market why you didn’t told us, they replied the seller wants to push them to buy the house and very silly reason. Actually I’m too frustrated I’m still thinking about that house their behaviour wasn’t fair with us. I would please if you tell me is there anything I can do? Now the house is STC in the market.
Thanks
Thank you for your comment.
We do not believe that there is any sort of legal recourse available to you here. An offer, once made, does not have to be accepted or even considered by a buyer. There is no duty of care between a prospective buyer and seller and there is no contract in existence which give rise to any sort of rights or obligations.
Hi,
We are in the process of buying a house and on the Property Information Sheet next to building work the seller has ticked ‘no’. However, our mortgage valuation has uncovered the house was underpinned (during the seller’s ownership even) and we requested paperwork which shows the whole house — every room in fact — had work carried out during the underpinning. We want to pull out and would not have instructed a survey to be done had the seller disclosed this information. Are we in a position to demand the seller pay our loss on the survey?
Thanks.
Thank you for your comment Sarah.
If you have not yet proceeded to completion, then you may have the option of rescinding the contract. However, much will turn on when you discovered the issue. Presumably the mortgage valuation was undertaken prior to exchange of contracts. If the standard conditions of sale were incorporated into the contract, then a buyer would normally be accepting the property in the physical state it is in when exchange takes place, underpinning and all. The question will therefore arise as to what extent you should and could have relied on the representation, bearing in mind that contrary information appeared in the mortgage valuation.
Having said this, most mortgage valuations will contain an express proviso that the buyer should not rely on its contents. It is undertaken merely so the lender knows that the security (the property) that they are lending against is worth at least what they are lending. This may provide you with some scope to argue that you were entitled to fully rely on the representations made by the seller.
There is generally no legal basis to reclaim things such as solicitor and surveyor costs incurred prior to exchange of contracts. The primary purpose of instructing solicitors and surveyors is to safeguard your position and enable you to withdraw from the transaction before exchange of contracts if there is a legal or structural issue with the property. At this point, there is no contract between the buyer and seller. Put another way, these are costs that you would have incurred whether or not you proceeded to completion and therefore would not generally be something that can be claimed.
We bought a house in 2017, since then we have learned that according to the deeds we own the majority of a shared car park and it states that we should allow the neighbours access and repass rights to their car parking bays which we do allow. However, the previous owner of the house is allowing her daughter to park on our land (which is registered in the Land Registryc, of which she states that her ex husband should’ve changed when selling the house. Obviously this wasn’t done and now the land is registered to our address), we have stated that she is not allowed to park there to which we get abuse and are continuously ignored. What’s rights do we have? Because she is ignoring the fact it is our land as well as implying that all documents are wrong.
Thank you for your comment.
The basic position is that if someone has no right to enter onto your land, with or without a vehicle, then there is a trespass. The rights someone may have are normally contained in the deeds but sometimes these can arise through prescription (long usage) and in other circumstances.
It is difficult to provide even preliminary guidance what rights you or the daughter may have without investigating the position in full, but if there is a case of trespass and possibly nuisance, then it is possible to apply to the Court for an injunction and/or declaration as to the rights. A declaration is a Court order which states what rights the parties have.
We cannot really add anything in relation to the allegation that the seller should have taken steps to amend the title deeds without considering the conveyancing file in full.
If you are subject to intimidating and abusive behaviour, then this is possibly something that the police should be notified of.
What would be the position where a buyer buys a property at auction having not viewed it and on the basis of photographs in sale particulars, only to find out after completion that the agents had (knowingly) included in the particulars rather old photographs of the property showing it in good condition whereas the property was in fact in terrible condition due to abuse by the most recent tenants?
Thank you for your comment. A great deal will turn on the auction terms and conditions. These will no doubt take steps to exclude any possible reliance on any representations made in the auction pack and they would probably be effective in doing so. Having said this, if a fraudulent or reckless misrepresentation can be established, this may get around the issue on the basis that fraud cannot generally be excluded from contracts.
Arguably, the photographs could amount to representations regarding the condition of the property. If they did not accurately reflect the current condition of the property, why include them? However, we are not aware of any specific cases on this point. In the case of Atlantic Estates Ltd v Ezekiel [1991], which refer to in our Property Misrepresentation Claims in Practice which can be found here, photographs of the auctioned property showed it being used as a wine bar when in fact the licence for it was no longer valid. This was found to be a misrepresentation. Whilst not on all fours with your matter, it does provide authority for the suggestion that photographs can amount to representations.
However, you would need to find evidence of the condition of the property at the time the auction catalogue was released, as otherwise you may find yourself faced with the argument that the seller was unaware of the condition.
Hello, we purchased a property but are having issues with our neighbour. Screaming, shouting, throwing things etc. We have been told by the care company that this should have been disclosed. We rang our solicitor and checked the files and it wasn’t disclosed within Section 2 of the Property Form. Can we still move forward with this as a misrepresentation, even if the sellers deny knowing about the issue?
Thank you for your comment.
If there was a complaint or dispute which the seller was aware of and they expressly stated that this was not the case before you entered into the contract, then there could be a claim for misrepresentation.
However, as with may matters, it is often about “proof, not truth” by which we mean any potential claimant can proceed with their claim but if they do not have sufficient evidence to prove it, they are unlikely to win. Sometimes, if that evidence is lacking but there is a good potential claim, an application for pre-action disclosure can be made. Whilst the rules in relation to such applications are complicated, this would potentially oblige the other side to disclose documentation which supported your claim. However, it is still necessary to show that there is a reasonable prospect of a claim as a part of that application and that the evidence required is merely conclusive of this and would help resolve the matter. Speculative applications are not allowed.
In any civil claim, which a property misrepresentation claim would be, the burden of proof is on the claimant to prove “on the balance of probabilities” that the allegations made are true. This can very broadly be said to me a more than a 50% chance that what the claimant is saying is right. If there is a 50/50 chance that the seller or defendant is right, then this burden of proof is not discharged. This issue arises most often when there is a lack of documentary evidence and the position turns on witness evidence alone.
We own the freehold to a building which is split into two apartments – ours and the one below us. The lease says no pets but, as we own a dog, we felt this was archaic and had no objection to the residents below us getting one too.
We have just exchanged on a sale. The purchaser and the solicitor obviously had full access to the lease but have never asked if there are any dogs / pets in the apartment below. Can there be any comeback from the purchaser or us it a case of ‘buyer beware and they should have asked if it was something that would bother them?
Thank you for your query. We think it is unlikely that there would be a claim for misrepresentation against you.
Whilst the pre-contract enquiries (normally a LPE1) will ask whether or not there were any breaches of the terms of the lease, which there would have been if a pet was kept without consent, clearly you as the freeholder gave that consent, which by law could probably not be unreasonably withheld in any event.
I’m currently going through the process of purchasing a property, I went through the process made an offer which was accepted and the paperwork exchanged through solicitors. It come to light after all this that the property had a large fire a year and a half ago and suffered structural damage related to this which has been corrected and signed off. I was not made aware of this by the agent at all even after asking the question “why are they selling the property” and made a clear point of them owning it for around 10 years and doing a full refurb (roof, re-wire, new kitchen and bathroom, plastered, new carpets etc) to then just sell it. At this point the agent who was fully aware of the fire and structural damage that had happened to the property as the property was in fact previously on their books when the fire happened replied “the seller has met someone and is moving out of the area” no mention whatsoever of any fire or damages to the property. I feel that I’ve made an offer now on false pretences thinking I was buying a perfect house, when although it looks that way their could be a whole heap of hidden issues due to the 1000s of gallons of water pumped into the house by firefighters as well as other damages created by the fire itself. I am now in the process of having to pay for an additional buildings surveyor to go through the place with a fine tooth comb!! Is this something they are legally obliged to disclose to me or is it more just morally wrong that they didn’t????
Thank you for your comment.
We are hesitant to suggest that there is a misrepresentation claim here. The basic position is that the seller does not legally have to volunteer any information about the property. Sometimes allowing the aggrieved party to proceed under a misapprehension or on the basis of a half-truth, in this case the reason for selling (which of course may be true) can amount to a misrepresentation but it is rarely clear cut. As for the cost of the surveyor, it is unlikely that this would be recoverable as a result.
Further, on exchange of contracts, normally the terms of the contract state that the buyer is purchasing the property in the condition it is in on exchange. A buyer should take all necessary steps to satisfy themselves as to what they are buying before exchange of contracts.
Having said this, if there was a fire, you would expect a property owner to claim against their buildings insurance. If the newest edition of the Seller’s Property Information Form (TA6) was used, there is a question contained within it about whether or not the seller has made any claims against their insurance. If this is ticked “no” then there could be a better prospect of a claim on the basis that had you been aware of the claim, you would have been able to make further enquiries and decide whether to proceed or not. However, as you were not made aware and exchanged contracts, you have had to instruct a surveyor as you are committed to the purchase. We are not aware of any specific cases on this point, so cannot say with any certainty whether the argument may be successful, however, it may be of assistance in negotiating prior to completion.
Hi Hope you can help me.
I recently purchased a property Ground floor and basement flat , On the TA6 FORM the seller stated property did not suffer from any flooding .
Seems this is a lie as i was informed by neighbours and cleaner who worked for seller , that property has flooded in the past year 3-4 times.
Seems that the drain cannot cope at certain times during heavy rainfall. So the drain overflows and water manages to come into the basement area, which is the Kitchen / diner lounge combined.
I was planning on a new kitchen , however don’t want to do this as water could damage the new kitchen
Where do i stand , do i contact seller directly, as if i had been aware i would either reduced my offer or not continued with sale
regards
Patrick
Thank you for your comment and we are sorry to hear of the situation.
In short, there probably is a claim for misrepresentation here. If there has been historical flooding but the seller expressly stated “no” to this question on the property information form, then this will more than likely amount to a misrepresentation. We are unable to provide anything more specific without considering the papers in more detail, however. There could be something in the paperwork which adversely affects your claim or might represent a risk, such as searches or a survey which reveals the potential for flooding.
You are also correct to identify that your damages are probably likely to be calculated based on diminution in value; what someone would have paid for the property knowing about the issue and what you would have paid.
If you would like to explore the matter in more detail, please feel free to get in touch.
Good afternoon,
I put a reservation fee on an off-plan new build in January 2018 with the developer Scarborough Group. At this time it was made aware that their would be a concierge within the development. I completed the purchase of the apartment on October 10th 2018 and at this point I received a handover document stating concierge services 15 times.
Two years on the freehold of the estate has been sold of to ‘Get Living’ who have taken over two buildings within the development suite and the management suite in my building which was where the concierge was supposed to be. After now speaking with the Management company ‘Savills’ it has been made clear we will not be getting a concierge, but a parcel room whereby we can pick up parcels when delivered. He also mentioned that he had to advise to Savills to take any mention of concierge services of the handover document which has now been done.
As a concierge is now a highly common service within Manchester apartment developments, this has now created an issue in residents like myself renting/selling our apartments, with estate agents making it aware this has devalued/made the property less desirable.
I want to know what my legal stance on this and whether this can be deemed as misrepresentation when purchasing the apartment. This has not only happened to myself but at least 20 other residents within the development.
Kind Regards,
Peter Bowling
Thank you for your comment.
Whether or not there is a misrepresentation will depend on what was agreed contractually about representations made during the pre-contract stage (i.e. what representations would be excluded), along with how those representations were made and how specific they were.
The property would have been sold subject to the terms of the lease and this will be relevant to the position as to whether or not there is an obligation on the freehold owner to provide such a service. If there is such an obligation, then there would probably not be a misrepresentation, as the property was sold with this service and as a leasehold, have the right to demand it. If the lease does not contain this obligation on the freeholder, whether or not the “truth” can be discovered from a review of a particular document is not always fatal to a claim for misrepresentation.
Thanks for coming back to me.
In Part 2: other particulars, it says the following:
Common Parts: all parts of the Building and the Estate which at any time during the Term do
not form part of the Property or of any other premises within the Estate let or intended to
be let to any other tenant of the Estate including:
(a) the main ceilings, main floors and floor slabs, main walls, structural steelwork,
structural and main columns, beams and joists and all other structural parts of the
Building including all external windows (but not the glass) window furniture (including
the gaskets between glass), doors, door frames and door furniture forming part of the
Building (but not the front door of the Property its door frame and door furniture or
the internal frame and internal handle of external windows of the Property);
(b) all internal walls, whether load-bearing or not, inside the Common Parts or
separating the Common Parts from the Property or any other premises in the Building
let or intended to be let to any other tenant in the Building and all windows and
doors and window and door frames in those walls;
(c) all entranceways, concierge, hallways, balconies, passageways, lifts, and all Service
Installations other than those demised to the Tenant or any other tenant in the
Building;
(d) any central heating, air handling or air conditioning system and radiators, boilers,
ducts, pumps, coolers, controls and other equipment (including all associated
Service Installations) which serve the Building as a whole or any parts of it
communally;
(e) any video, monitoring, security, control, access, fire detection, fire prevention
or sprinkler system, and any other electrical or other systems of any type (including
all associated Service Installations) which serve the Building as a whole or any parts of
it or of the Estate communally;
(f) any bin store, bicycle stores, concierge suite, landscaped areas, driveways, estate
roads, covered ways, pedestrian accessways and areas, loading areas, courtyards,
footpaths, forecourts, refuse collection and disposal areas, garden verges and private
street lighting within the Estate, and all gates, gate posts, boundary walls.
As you can see in (c) and (f) it states concierge, however doesn’t go into the service any further within my lease.
As stated previously, I have been told that we will not be getting a conciege due to lack of space in the building, after they sold what was meant to be the concierge suite to ‘get living’ (the new freeholder of the estate).
Can you advise further?
Thank you for your further comment. This is not really the forum where we are able to provide specific legal advice. We are only able to provide general guidance which shouldn’t be considered a substitute for bespoke and more fully considered legal advice.
The definition you have provided from the lease appears to deal only with the physical aspects of the common parts of the building. Clearly it envisages a concierge service but the obligation to provide such a service, if any, will be contained elsewhere in the lease. You will likely find these in a schedule to the lease headed “landlord covenants” or similar. It may be the case that there is a management company who is a party to the lease which deals with the provision of such services.
If there is a dispute over what services the landlord or management company should be providing, this can ultimately be decided by the First-Tier Tribunal (Property Chamber – Residential Property). It would be important to attempt to resolve the dispute before taking this step, however.
As for a misrepresentation, there may be a potential claim and your loss would most likely be the difference in what you paid for the property and what it was worth had it been known that a concierge service was not to be provided. It would be necessary to obtain valuation evidence of this. At a basic level, if you were led to believe that a concierge service would be provided when in fact this was not the case, and you relied on this when entering into the contract then there may be a claim.
I had my snagging visit to a new build property I’m due to complete on imminently, only to find the much highlighted Induction hob was nothing of the sort. But was in fact just a nasty ceramic one. Given this was in writing in the property description do i have any grounds for redress?
Thank you for your comment. If you have exchanged contracts, then the contract is the most important document to consider, along with the description of the property contained in it which might specifically refer to separate designs or finishes. Unfortunately we would not be able to give you any guidance on what legal redress you may have without considering the contractual and other documentation itself. Put simply, if there is a claim for breach of contract or misrepresentation, it will depend on what you were told, normally in writing, and what was contractually agreed.
It would not be unusual for a new build contract to contain a clause enabling the developer to make non-material changes to the property or fittings, provided is has no material impact on the value of it. The reason for this is to avoid situations where, for example, particular items or materials are not available and suitable alternatives have to be provided. It would prevent a situation where completion could not take place as a result of a minor deviation from the agreed design or plan.
Your best course of action at this stage would certainly be to politely ask the developer to replace the hob with what was contractually agreed and you were led to believe would be installed. They may very well be amenable to this to avoid the aggravation of a potential claim and a potential refusal to complete. With the latter, we would strongly advise refusing to complete. Whilst the cost of replacing the hob may be unwelcome, it is unlikely to be worth incurring the potential cost of being served with notice to complete and the consequences which can follow from this.
Hello.
I know this isn’t the ideal place but you seem to be giving good legal advice here so it’s worth a shot.
About a year ago I purchased a leasehold property. I was informed by the estate agent that I would have to pay a service charge, and ground rent. I was specifically told the service charge would cover the property insurance.
Upon buying the property, my solicitor did not once mention or inform me of the property insurance. Again, only mentioning the service charge and ground rent. A year later I receive a letter saying I have not been paying property insurance and it must be paid + additional fees. The property insurance is quite expensive, on top of the other monthly charges, likely would have influenced my decision to buy the property. It would also make the property harder to sell than I imagined due to not knowing about this extra charge.
Would there be any legal case in this? I have been completely failed to be informed of this charge by any party involved. And I also feel like I was misled by the estate agent prior to putting in an offer on the property.
Thank you for your comment Jason.
We are unable to provide legal advice. We can only provide general guidance which shouldn’t be considered a substitute for bespoke and considered legal advice.
There are a few things which you can consider.
Firstly, you should check the terms of your lease. There should be a provision in it entitling the landlord to charge the insurance back to leaseholders.
Secondly, if there is an issue with respect to amount you are paying under the lease by way of insurance or other service charges, this may be capable of challenge; they must be “reasonable”. Ultimately, the First-tier Tribunal (Property Chamber) can be asked to make a decision about whether or not the charges are reasonable.
The Section 18 of the Landlord and Tenant Act 1985 states that a service charge is an amount payable by a tenant of a dwelling as part of or in addition to rent. The Act also give tenants the right to request information about the service charges and inspect accounts. In relation to insurance in particular, Section 30A of the Act allows a tenant to ask for a summary of the insurance cover. This may be of use if you want to consider the amount being paid for the insurance if you consider this unreasonable.
As for a claim against your solicitor, it would be necessary to consider the solicitor’s retainer and what the solicitor agreed to advise you on contractually. On the assumption that they agreed (expressly or impliedly) to advise you on the terms of the lease in this respect, this duty would normally discharged by providing a client with a copy of the Leasehold Property Enquiries, or LPE1 form. There is a section within this form which deals with insurance for the building. If you were not provided with this form, then there is a possibility that there is a claim for professional negligence. However, this would not be the end of the story. It would be necessary to consider what your loss is. The loss would be that which flows naturally from the negligence and in this case, the opportunity to negotiate the purchase price. It would be necessary to consider what prospect you had of negotiating the sale price and what that agreed figure would have been.
As for any claim against the estate agent, we consider this unlikely. There is normally a contractual clause agreeing to exclude all but written correspondence from the contract.
We note that you state that it has been alleged that you have not been paying the insurance. You should have received a demand for this and if not you, the seller. If you were expressly informed in the pre-contract stage of the transaction that there were no arrears, then there could be a claim for misrepresentation against the seller for that proportion now demanded which relates to the seller’s period of ownership.
My property (a 70s bungalow in Scotland) is proceeding to sale. The buyers live 200 miles away and have only viewed once. I recently completed the SSC form (similar to the TA6) where I was asked to confirm that all systems/appliances are working commensurate with age. I confirmed yes but (the form kept repeating that the buyer could sue the seller if he/she fails to disclose) stated that the property (a bungalow at the top of a hill) has low hot water pressure. I have since had the pressure tested by the water authority who state it is acceptable. I told my solicitor and have left it at that.
In the interim, my buyers have asked no questions but I am worrying myself sick over what constitutes ‘disclosure’.
I would have assumed that the onus is on the buyers to test/ask about water pressure etc? (if they do, not sure what I will say).
I’m getting a plumber round to see if there’s a quick way to improve the water flow but other than that, what would you advise?
Thanks in advance.
Thank you for your question.
Unfortunately we are unable to provide any guidance on Scottish Law. This is something you should discuss with your existing solicitor.
Hi brought a new build carried out the usual checks Flood Risk came back Zone 1 low Risk no problems!!! moved in 18 months ago every time it rains the drain in the road over whelms on several occasion it has flooded my property I now discover that the front of the property is on a post development exceedance route and this will happen on a regular bases. My question is should the developer disclosed this fact to us a the point of sale?
Thank you for your comment Steve and we are sorry to hear of your difficulties.
There is no positive obligation on a seller to disclose anything in relation to a property. If a seller chooses to provide information regarding the property, the requirement is that the information provided should be accurate, or a misrepresentation claim could follow.
Therefore it is highly unlikely that there was a requirement to inform you that the property fronted onto a route where excess rainfall would flow in the event that the drainage capacity was overwhelmed.
There is also the question of reliance. For a misrepresentation claim to exist, the aggrieved party must have relied on the representation made. It sounds as though you relied on the Flood Risk report, rather than anything that the seller had said. It goes without saying a “low risk” does still mean that there is a risk. Whether or not there is any scope to consider a negligence claim in relation to the flood report will turn heavily on the terms and conditions under which that report was supplied.
A point which could be relevant, although this would require investigation and further consideration, so we raise it very hesitantly, is whether or not the developers could be said to have breached their duty of care under the Defective Premises Act 1972. This imposes a duty on those constructing properties to ensure that the work is undertaken in a professional manner using the right materials, so the property is fit for habitation when complete. We do not know the extent of the flooding issue but arguably, if it is serious to the extent that the property is not habitable, perhaps there is scope to say that improper materials were used to safeguard the property from flooding knowing that the property was situated in an area where excess water would flow in some circumstances. We are not aware of any cases on this point, but it may conceivably be relevant.
Hi, I’m selling my house and made noise complaints about my next door neighbour to the council. Mainly for loud music which could be heard throughout my house during lockdown. It is nowhere near as bad now since the council has contacted the neighbour and the case was closed. Does this need to be disclosed on the pif form?
Thank you for your comment.
There is no statutory definition of what constitutes a “dispute” with neighbours. It is a subjective question and for an example of a case where the Court was asked to consider whether or not a seller misrepresented the existence of a neighbour dispute, you might want to have a look at our Property Misrepresentation Claims in Practice article. A transcript of that case can be found on the internet.
A seller does not have to disclose anything about the property. However, this is not the same as saying on the property information form or in correspondence that there is or was no dispute in relation to the property. If “no” is answered to either of the questions in section 2 on the property information form, then this will be considered confirmation that there is or was no dispute.
We appreciate that clients want to know specifically whether or not something constitutes a neighbour dispute and whether or not such a neighbour dispute needs to be disclosed on the property information form. Sadly, because all cases are different and have to be considered on their own individual facts, there is no black and white answer to this subjective question.
We would generally advise a common sense approach to this issue. The Court has pointed out that the property information form is designed for people without legal qualifications to complete and read when deciding whether or not to purchase a property. If you would consider that a reasonable buyer would consider the facts of the matter a dispute, then the chances are it is something which should be mentioned in full or the questions not mentioned at all. However, with the latter approach, you may find that your buyer presses the point until a satisfactory answer is given. The safe option is always to explain the position in full.
Hi,
I don’t know if this fits under the misinterpretation but we have just found out that the property that our seller is purchasing has tenants under AST. This puts my daughter’s school place and the job that my fiance’s was offered this week. Is this something that our solicitor should have asked the seller’s solicitor who is acting for the seller on both sale and purchase? We’re waiting to find out if the tenants have been given notice as our sellers offer for the house with the tenants was accepted in mid June and what notice period they are on.
Is there any safeguard clause we should include or negotiating point we could use to enable my fiance to start his job such as cost of week nights accommodation as the house we’re buying is 3 hours journey. I realise that COVID-19 could also delay things and my fiance cannot give up his current job and take up the offer so it’s quite a mess.
Many thanks, Angie
Thank you for your comment.
We regularly advise on aspects of landlord and tenant law in residential and commercial premises. At present, we expect to see long delays in obtaining vacant possession (i.e. a property without anyone occupying it) of properties from tenants who do not leave a property voluntarily, as a result of changes to notice periods and the way in which the Court is presently operating with respect to possession claims.
Solicitors operate in different ways and whether or not this was information that should have been asked about is open to debate. It probably is not something that would ordinarily be asked about by a buyer’s solicitor before anything else, because there is a specific question in the property information form about whether or not the seller is the occupier, which you should have been supplied with when it was received at the beginning of the transaction. Most estate agent particulars would mention something like this, as it is not in the seller’s interest not to mention it. However, there is no obligation on the buyer to volunteer this or indeed answer the question in the property information form.
If you have not yet exchanged contracts, this is something to raise with your conveyancing solicitor. Contractual clauses, including the point you suggest regarding accommodation to allow your fiancé to take up his new role are subject entirely to negotiation.
We bought a cottage nearly three years ago and our seller did not disclose on the Property Information Form that the house and grounds had been flooded. The actually wrote in this segment of the form that asked regarding floods ‘Not in our occupancy ‘. Ten months after we moved in Storm Callum flooded the whole of our downstairs to a level of eighteen inches throughout and the insurance claim came to approx. 42K plus we had to spend approx 20K on things that were not covered. After this several neighbours informed us the cottage had flooded during the previous owner occupancy and produced photographs of the grounds to prove it. The previous owners even had purchased flood gates which they took with them. We sought legal advice from a local solicitor who told us it would not be worth pursuing as we could be offered as little as £10 per month as settlement what ever the claim came to.
Could you let me know if we do have a case and have been misinformed please. Many thanks.
We are sorry to hear of this, which must have been very stressful.
It does sound as though you have a claim if what was said in the property information form is what you stated, nothing else was said or done which might qualify this statement during the transaction and you have categorical evidence that it was not in fact true. The missing flood gates would seem to be particularly helpful evidence, as would the oral evidence of neighbours, who would probably need to confirm when the photographs were taken.
On the basis that it does sound as though there is a claim, perhaps you have misunderstood the advice from your local solicitor. One of the first steps to take before committing to the cost and risk of any litigation is to consider whether or not the proposed defendant has assets to pay any judgment which you may be awarded by a Court, or any settlement sum agreed. If a Court makes a judgment in your favour (which includes approving a settlement agreement that the parties reach – called a Consent Order or Tomlin Order), this is really just a piece of paper.
Once a Court makes a judgment order against a defendant, the defendant becomes a judgment debtor and the claimant a judgment creditor. If a judgment debtor does not comply with a judgment or court approved settlement agreement, then enforcement action would need to be taken through the Court. If a judgment debtor does not have any assets or only limited means to pay a judgment debt, then sometimes a judgment debt can be varied by the Court to make it payable by instalments. For judgment debtors that have very little means, this could potentially be as low as you were advised.
It is always worthwhile taking steps to make sure the proposed defendant is not bankrupt (for individuals) or in liquidation (for companies) or subject to other formal insolvency processes. Registers of such individuals and companies are kept and normally, details are publicly advertised.
Assuming the proposed defendant appears solvent (there is of course no way to be certain) then identifying property or other assets that they own is worthwhile. Again, public registers exist which can be helpful to consider.
Various enforcement options exist and which can be applied for through the Courts. These include:-
· Attachment of Earnings Orders – When the Court orders the debtor’s employer to pay a certain sum direct from their salary to the creditor
· Charging Orders – When the debt is secured against the debtor’s property or shares
· Bailiffs of High Court Enforcement Officers – These are individuals empowered by the Court to take items of value from the debtor in discharge of the debt
· Third Party Debt Orders – This is when the Court orders a third party, which owes the debtor money, to pay such sum to the creditor. This would include banks where the debtor might hold accounts
· Asking the Court to make an Order forcing the debtor to attend Court and provide information – Whilst not an enforcement option in itself, it can result in information about assets being provided
· Bankruptcy or Liquidation – Again, not an enforcement method in itself, if a debtor cannot pay a debt, then they may be insolvent
All of these options have benefits and drawbacks and do not guarantee payment of the judgment debt. Unfortunately it is true to say that “you cannot get blood out of a stone”; if a debtor has no assets at all, the prospect of the judgment debt being paid is low. However, judgment creditors will have a number of years to enforce their judgment, so sometimes waiting for the opportune moment is appropriate.
As a final point, whilst three years have gone by, the basic position is that you will have six years from the date of completion (but possibly earlier) to bring your claim.
We would be happy to discuss matters further with you, if you would like to get in touch.
Thank you so much for your informative response. We will consider our options and get back to you.
Very grateful.
Thank you for your comment. We do have to point out, however, that we cannot give specific advice on this website. We are only able to provide general guidance, which should not be considered a substation for obtaining full legal advice.
We are in the process of selling our house and we will need to complete the TA6/10 forms at some point. I am a little worried and unsure what/how to explain our neighbours behaviours and if it is classed as a dispute or if it is just reasonable. It depends on the person I guess but this is how I see it:
We are between two neighbours which I have known for years and one in fact was a relative by marriage. We are on talking terms and they are friendly. We do/have had intermittent noise from both sides, one during the day and one during the night. Sometimes it is hardly noticeable, background noise and sometimes you can hear the words and singing. It can lapse into the garden if the weather is nice. I must add I have lived in a village location all my life and I am use to it being very quiet so this may not be a problem for other people.
The neighbours on the adjoining side have had sporadic music on after 11pm, mostly during lockdown but sometime this is at weekends. It is then hard to get their attention to turn it down. I have previously called the police to try to get them to make contact. Although on talking terms and they are fine face to face we believe this could be backlash from my uncles marriage breakup and therefore personal (we heard my name being shouted).
The neighbours not adjoining our property have music on during the day but this only came to light during the lockdown as it was hot and the windows were open. We had spoken to her but it didn’t really make much difference so we contacted the council and this has now been resolved. These neighbours are council tenants and don’t take pride in the property so we also trim the hedge top (their border) for them and we have enquired about a new fence between the properties too. We had done some corrective works on some rotten wood as it was an eye saw and we have a two year old and they have a dog, so it could be dangerous (not sure on the dogs nature but they have grandkids around we guess that it should be fine).
For some people whom are use to quiet they may find this a little too noisy or the neighbours untidy but for others this may be hardly noticeable. What on earth should we disclose and how do you explain this without making it sound horrendous (when it is down to interpretation and you need to be there really) but without landing yourself in hot water by not disclosing enough…is it simply what I have put above?!
Many thanks for your comment.
There is no statutory definition of a “dispute” and you are correct in your assumption that the answer to such a question is quite subjective. This is relevant to any misrepresentation claim and does complicate things as a result. What one person considers to be a dispute may not be to another. With this in mind, there is no right or wrong answer per se. In law, grey areas always exist and it is about balancing risk and benefit.
We have cited the case of McMeekin v Long [2003] in our blog “Property Misrepresentation Claims in Practice” (https://cunningtons.co.uk/property-misrepresentation-claims/) as an example of a misrepresentation claim which related to whether or not a seller was correct to answer “no” to the questions regarding any pre-existing disputes with neighbours. To the trial judge, it was clear that there was an ongoing dispute and there was therefore a misrepresentation, despite the seller having considered the matter closed.
Another case relating to neighbour disputes which have not been disclosed in the property information form (noisy neighbours in particular) is Pedro v Thompson [2012]. In this case, it was determined that there had been no misrepresentation as the seller was not aware of the dispute and answered the enquires truthfully.
These cases show that there is no black and white answer to the question and that each matter will turn on its facts. You should be able to find on the internet transcriptions of these judgments. A read of these may be of assistance in deciding what answers you may wish to give in the property information form and how the Court deals with such subjective answers.
The only “safe” way to avoid future arguments is to explain the position as a whole, so the buyer knows what they are buying and what the “problem” is. Broadly, it is fair to say that if it is something that an average buyer might want to know about, then it is probably something which should be disclosed. A misrepresentation cannot occur if the statement given is accurate or true.
The alternative is to say nothing and decline to answer questions on the point. A misrepresentation cannot (or would very rarely) occur if no statement is made at all.
This may be something that your conveyancing solicitor is prepared to advise on and they would certainly be worth speaking to. We always make time for clients that instruct us to deal with their conveyancing but realistically it may not be possible to give a categorically clear “yes” or “no” answer, as there probably isn’t one. This can, for example, be contrasted with the question in the property information form regarding whether or not the property is in a controlled parking zone; clearly here it either is or it isn’t.
We hope that this guidance if of some assistance.
We are about to put our house on the market. It has a listed building next door which needs renovation and this is owned by our neighbours. When the neighbours moved in 3 years ago they immediately erected a fence around their property. At the time we queried with the council (anonymously) whether this fence was permitted within the curtilage of the listed property without listed consent as it was an eyesore. The council said they didn’t have a problem with the fence as it didn’t touch the listed building, but our query alerted them to the fact that the listed planning permission on the neighbour’s property had lapsed many years ago so and wasn’t live. They subsequently threatened enforcement action against the neighbour (who had commenced building work) who had to reapply for listed planning permission in order to continue to renovate their house. This took 2 years at considerable expense no doubt, and has just come through. Our neighbours are grumpy and blame us for this (we gather) although we have never actually spoken to them about it, or had any exchange of words for 2 years. Do we have to explain the full series of events on the seller’s property information form? There is no ‘dispute’ as such, we just have grumpy neighbours who we don’t speak to.
Thank you for your comment.
There is no statutory definition of a “dispute” and case law relating to undisclosed disputes with neighbours highlights the fact that answers given in the property information form on the point are very subjective. What one person considers a dispute is not necessarily something which someone else does and the Court will have regard to the fact that the property information form is designed for lay persons, without legal knowledge, to complete. The question would ordinarily turn on what a reasonable individual would consider to be a dispute.
Whilst we cannot give specific legal advice on this website, by way of guidance, generally the only correct advice to minimise future risk is either to explain the position in full to the purchaser or not answer the question at all. From what you have written, we would suggest that most people would consider the circumstances as not amounting to a dispute, as there is no difference of opinion or argument between you, but we do not know the full circumstances. It would be up to a client, based on their appetite for risk, to decide whether or not they wanted to answer “no” to the question in the property information form or explain the position in full.
For an example of a case in which there was a failure to disclose details of an ongoing dispute with neighbours, see our blog post “Property Misrepresentation in Practice”, under the heading “The seller told me that everything with the neighbours was fine”.
My partner and I have recently completed on a 3 bedroom mid terrace property, prior to making an offer on the property we asked all the routine questions you would normally ask, structural integrity, neighbours etc. We also asked how long ago the property had been rewired, we have in writing from the estate agent that the house was rewired 12 years ago, who presumably got this information from the sellers. Not long after moving in we started decorating and removed a plug socket and light switch in one of the bedrooms and saw wiring that was definitely not up to current regulations (some of the wires didn’t even have a sheath on them) so we called an electrician who has told us the whole house needs rewiring and that in fact a lot of the wiring upstairs is pre 70’s and very unsafe.
Rewiring the whole house is going to cost us in the region of £5000. This is obviously a very unexpected cost for us and something we would have factored into our offer when purchasing the house. We feel we have been directly misled by either the seller or the estate agent and are wandering whether we have any legal leg to stand on or if we could try and seek some recompense for this massive cost that we are now going to have to pay out for. It isn’t even just the rewiring, the house was built in 1867 so the chance of there being any conduit in the walls is extraordinarily low which will mean all the walls for light switches and plug sockets will have to be channeled out in every single room. We are having the upstairs done as quickly as possible because it’s in far worse condition and we are so worried when we go to sleep we turn all the electrical outlets to the upstairs off.
This is obviously a very stressful situation and one we didn’t anticipate being in, we just don’t know how best to proceed now and whether we do have any grounds to seek compensation.
Thank you for your comment, Damien.
Unfortunately, we are unable to provide you with much in the way of input at this point. Whether or not this will amount to a property misrepresentation claim will turn on exactly what was asked and exactly what the response was. The Law Society standard conditions of sale, which are normally incorporated into a contract, would generally exclude oral representations and representation made by any party apart from those made in writing by the other party or their solicitor. Therefore what the estate agent told you may not be capable of forming an actionable misrepresentation unless the statement was made fraudulently or recklessly. This can sometimes be difficult to prove.
Property misrepresentation claims can sometimes be straightforward. Sometimes they can be very complex, as the matter will turn on the subjective understanding of the party responding to questions asked and identifying evidence. It may very well be the case that the property was rewired in 12 years ago but was done so defectively, using outdated or existing wiring. At the moment, you have (which is probably right) the opinion of another electrician but this would probably not be enough without further input.
If the property was rewired 12 years ago (so 2008), there should have been an electrical safety certificate. Information regarding the electrical installations would normally appear in question 12 of the property information form. Many solicitors will use the standard Law Society Property Information Form (TA6) which was updated in February this year (4th edition). It can be found on the Law Society website. Whether or not your solicitor should have pointed this out to you is also a point you may want to consider.
You are correct to identify the fact that your loss is the opportunity to negotiate on the sale price. You may not have had enough information to know what the overall cost of the works would be at that point and the seller may have decided not to negotiate on the point anyway. Therefore your loss is going to be the difference in value for what you paid for the property and what someone would pay for it knowing about the problem.
If you would like to consider the matter in more detail, please do get in touch with us.
Hi
I recently purchased a house in central london and have since discovered that the lower ground floor is suffering from rising damp in many areas. The Homebuyers Survey I commissioned did state that there were high levels of damp in the property and I asked for information from the sellers.
The sellers stated that when they purchased the house a few years ago, they were told that it did register damp but it was normal for that age property. They also stated that they had a contractor round during renovations that said it didnt need damp proofing and there was nothing unusual for that age of house. They discloused that when they moved in tbey needed to repair some flooring in the bay that had been damaged due to damp from the old wooden windows. These had been replaced by new windows. They also stated that the bathroom registered high levels of damp but they had an extractor fans fitted and insulated the walls to overcome the problem. They stated in writting that although they are not disagreeing with the levels of damp noted by my homebuyers report – they have never seen signs of damp such as mould, water marks or flaking paint. They property was well maintained and well decorated throughout.
They seemed very open and I continued with the purchase without getting a more detailed survey. However, the damp problem soon became evident a few months after moving it and there is some flaking of paint. I cant tell but it looks like they have also used damp seal paint.
There were no questions about damp on the property information form from the solicitors and I didnt ask specific questions regarding damp, I simply asked for more information based on the homebuyers surbey report. In my opinion, although it seems they have been very open I believe I have been mislead.
In your opinion do I have a legal option to seek compensation?
Thank you for your comment.
We are unable to provide specific legal advice which can be relied on in this blog. We would need to consider your case in much more detail and look at all of the relevant documents and correspondence before we could provide an informed opinion.
However, we can provide some general guidance and from what you have described, we are not sure that you would have a claim.
It sounds as though you effectively asked whether or not the property suffered from damp and you have been told that it did. Even if the issue was more specific, namely whether or not the sellers experienced any issues with damp and were informed not, then you would need to identify evidence that this statement was untrue. We suspect that this would be difficult to do.
Whilst we would be happy to consider the position with you in more detail, we are hesitant about whether or not there could be a claim here.
We purchased our flat last year. The flat is in a block of 100+ new built properties and we bought it directly from the builder. The builder showed us our parking lot when we were buying the property and it was indeed the best parking lot available. Since then, we found out that the builder has assigned and sold the same parking lot to another flat owner in our building. When raising the dispute, we are told that the other party will keep the parking lot. The builder suggested they will find a new parking lot for us and allocate that to us. They are taking too long and I would prefer to keep the same slot.
Do I have a case of misrepresentation?
Thank you for your comment and we are sorry to hear about this. Clearly the lack of a parking space would have a reasonably detrimental impact on any property. However, valuation evidence of the extent of this would be required.
In respect of misrepresentation, this does depend on the terms of the contract of sale, including whether or not the Law Society Standard Conditions of sale applied. Normally, oral representations are expressly excluded from being actionable. This is to ensure that there can be no dispute later on about what was agreed, which should all be in writing. Often developers will have bespoke contractual terms.
However, what you have written does sound strange. If you purchased a flat with the benefit of a parking space, then it is yours to own. We cannot see how the subsequent purchaser of the parking space would obtain what is called “good title”. It was not the developer’s to sell, as they had already done so. It may seem obvious but in law and put simply, it is not possible to sell something that does not belong to you. If this is what has happened, we are struggling to see how the buyer of the parking space would be able to register themselves as the legal owner. If you own the parking space, you would need to have signed a transfer to the new buyer.
We would need to look at the contractual documentation carefully and also consider the terms of the lease before we could provide any advice. The terms of the lease will set out the rights and obligations of the parties and would need careful scrutiny. Sometimes, leasehold flats have parking spaces included in the same Land Registry title number. Sometimes, the parking space may be a separate title number or even have a separate lease. It would be necessary to work out exactly what the contractual position was.
If you would like to look into the position in more detail with us, please do feel free to get in touch.
Thanks for your quick response Mark!
I have already bought the property and the parking space is clearly written in the agreement
Just to clarify a few things if that helps
– the parking space is noted in the deed
– the same space is mentioned in the deed of another flat owner, they bought the flat and hence parking space before me. Hence they are the rightful owner I suppose.
– builder is proposing to give us a new parking space instead of the original one. However I’m concerned because
A) they are taking too long to find out which spot they want to allocate. It’s causing a lot of hassle for me
B) the space I was originally allocated was quite convenient
Thank you for your further comment.
We are unable to provide specific advice which can be relied upon on this website. This is primarily for the fact that we have not considered your documentation and correspondence which would be relevant to matters.
However, from what you have written, it appears that you have paid for something that you did not receive.
We do not believe that you can compel the developer to give you another parking space, which would effectively be property belonging to them. The possible exception to this was whether or not it can be said that another contract had been entered into. For example, if you have agreed a settlement, which is just another form of contract (i.e. that you would not pursue a claim in exchange for a different parking space) then this may be capable of being enforced by the Courts. However, this is questionable on the basis that the terms agreed appear reasonably uncertain. A contract can be void at law for uncertainty.
It is more likely that your claim lies in damages. This would be to compensate you for the loss of value to the property, which may be significant depending on the availability of alternative parking arrangements. This is something that a valuer should be asked to provide input on.
You will also probably need to consider amendments to the lease and Land Registry title. A buyer may be unwilling to purchase a property which is not accurately reflected in these formal documents. This is not necessarily difficult to do but of course would require work.
Please do feel free to get in touch if you would like to explore the matter further.
Hello,
We purchased a 3 bed semi-detached house in May 2020. The seller who stated he had been there since 1984 answered ‘no’ on point 4.1a on the TA5 form ((Have any of the following changes been made to the whole or any part of the property? Building works (eg. extensions, loft or garage conversion, removal of internal walls)).
Our survey noted that some internal walls had been removed/altered and that it should have been carried out with building regulation approval and recommended to enquire with our legal advisers. We enquired with our solicitor and the seller said: “There has never been any walls removed don’t no why the surveyor put that on the report.”.
We’ve now been in the house for a couple of months and experienced 3 different leaks. All the leaks have been a result of the shower which looks to have been the area our surveyor had noted regarding having building work done (internal wall removed). Upon having a builder and plumbing come and look at the shower and repair the leaks they have confirmed that it wasn’t part of the original bathroom and had been added (different spotlights vs the rest of the bathroom, ceiling texture is different where the wall originally was, new joists going the opposite way etc). We’ve also removed wallpaper that has revealed calculations and markings for the addition around the new walls. The addition to the bathroom is a shower which extends over the bottom of the stairs that would’ve included new pipework and drainage. We’ve spoken to our neighbours whose house is connected to ours and was built at the same time and they have shown us their bathroom which doesn’t include a shower over the top of the stairs and only has a bath (ours doesn’t have a bath).
We’re looking to modernise our bathroom which will include the shower but we are hesitant to do any work on it now in case the new flooring/structure isn’t strong enough and will support what we want to do. Would we be in a position to make a claim for misrepresentation under the ground a new addition has been added to the bathroom without building regulations approvals and the seller has state that no work had been carried out at all?
Thank you for your comment Jack.
The fundamental point here is whether or not what has been said in the property information form and normally in writing between your solicitors and the seller’s solicitors is factually untrue. If it is, then there may be a claim for misrepresentation.
However, we would be hesitant with a matter like this, as the value of the claim may not be as high as some clients often imagine. The basic position is that the loss someone suffers as a result of a misrepresentation is the difference between what was paid for the property and what someone would have paid for it knowing the truth. This is called diminution in value. The cost of repairing the situation is not necessarily the correct or standard measure of damages. We appreciate that this is an inconvenience and a worry, but whether or not this would have a material impact on the value of the property is questionable. This is something that would be worthwhile considering with a valuer.
Putting diminution in value into context, we have acted in the past for a client who required substantial underpinning to their property. The cost of these works was in the region of £70,000. However, the property was in a highly sought after area, meaning that the impact on the value of the property itself was not as much as this. Put another way, a potential purchaser may be prepared to put up with some defects or bear the cost of some repairs themselves because the property represents a good investment.
Having said this, it is conceivable that if presented with the correct information, your solicitor may have advised you and you may have obtained lack of building regulations approval insurance, which may have covered the cost of any rectification. The aim of any award of damages in misrepresentation cases is to put the aggrieved party in the position it would have been in had the misrepresentation not been made. It would be fairly standard practice for a solicitor to advise their client to consider insurance in the event of works being undertaken to a property which required building consent but this was not provided or obtained by the seller. Damages are intended cover the amount that the aggrieved party is out of pocket by. It may therefore be possible to argue that the cost of any rectification works should be met by the seller.
However, every case is very fact specific. What facts in any particular case lend themselves to particular legal principles established in previous case law will differ.
Do feel to get in touch with us if you would like to explore the matter in more detail.
My partner and I purchased our house a couple of years ago and on the property information form the sellers said that they had not undertaken any structural works, and ticked no to any windows or glazed doors being installed during the time they owned the house. We have now started our own extension on the rear of the property only to find the left side of the house was just proper up by a jack and no lintel had ever been installed, similarly on the right hand side where there were patio doors (which neighbours have confirmed they watched the previous owner install) there is no supporting lintel above them either, leaving the whole rear of the house vulnerable, obviously this was not picked up in our survey as it is all encased in the plasterboard, would we have a case that we were mislead?
Thank you for your comment.
It does sound as though there is the prospect of a misrepresentation claim here. You have lost the opportunity to ask for building certificates and the like and as a result, have purchased a property which may be suffering from some structural defects.
However, at the moment, you appear to only have the neighbour’s word that the seller installed the patio doors. We suspect some more investigation and evidence gathering would be required to be able to prove that works were undertaken during their period of ownership and not before this.
If you would like to get in touch to discuss the position further, please feel free to contact us.
Hi,
Looking for some advice in regards to ownership and use of a garage.
We moved into the property 6 years ago with a garage that we assumed was part of our back garden. We have had and still currently use this garage for storage and have maintained it since moving in, as we were given the keys to it.
It has recently come to light that another neighbour across the street actually owns the garage and when checking the land registry it is actually the neighbours garage plot.
I am wondering if you know where we stand in regards to being mislead into believing we owned a/the garage.
Upon looking further into paperwork the estate agents advertised the property with a garage and it was agreed on the seller property information form (ta6) that there was a private garage with the property. Also when viewing the house the owners at the time also used the garage themselves for storage.
The title plans show a garage on the land just not in the position it currently is. We were thinking of selling within the next couple of years but can no longer sell with a garage/land which we thought we had paid for as part of the valuation made in 2014. Are we entitled to make a complaint to the EA in regards to misleading information?
TIA
Hi Carrie,
Many thanks for your comment. It does sound as though this could cause you difficulties.
The amount of time that has gone by might prove to be a problem. Basic limitation periods for misrepresentation claims are six years from the date of the misrepresentation/contract, so you may be out of time to pursue the seller for damages.
What is said in estate agents particulars and discussed during the course of the transaction is not as important as to consider what the contract of sale actually said and how it described the property. The pre-contract documentation and discussions can amount to misrepresentations if they were reckless or fraudulent, but if they were made with an honest belief, then they would not readily lend themselves to a claim for misrepresentation. This is because normally, the Standard Conditions of Sale will apply to residential conveyancing transactions. These specifically exclude things which are said by other parties other than in writing and between the buyer and seller or their respective solicitors.
The property information form will be very relevant and if it describes the property as having a garage when it does not, then, subject to any limitation period, there is likely to be a claim at the very least for innocent misrepresentation. This would potentially entitle you to claim damages based on diminution in value. This is the difference between what you paid for the property at the time and what someone would have paid for the property at the time without a garage.
Depending on how long the previous owner or owners used the garage, provided that this was not pursuant to any sort of agreement with the person that actually owns it, there could be a possible adverse possession claim. This is when someone occupies a property or piece of land, to the exclusion of all others for the required period of time (this is normally 10 years for registered land, which your property sounds as though it is). This might entitle you to apply to be registered as the owner. However, the actual owner might very well have grounds to object to this and would be notified of the application. The historical use of the garage and how the situation came to be what it is would be very important to consider before embarking on this route. Likewise, an approach to the actual owner might be detrimental. An adverse possession application can be defeated by “acknowledging the true owner’s title”. This means that if you accept that the garage is owned by someone else, this could mean that you lose any right to claim adverse possession.
We cannot provide any real advice on whether or not there is a possible professional negligence claim here against either your solicitor or surveyor. It would be necessary to consider what they were instructed to do and the advice they were expected to give. Professional negligence claims can be pursued even if the negligence occurred more than six years ago (up to a maximum of fifteen years). This happens when it is not possible for the person that instructed the professional to have known that there was any negligence and extends the deadline to bring a claim to three years from the date that the aggrieved person became aware of or should have become aware of the negligence. I would add that it would be unusual for a solicitor to undertake any sort of site visit or agree to do anything other than to ask their client to confirm that their understanding of what they were buyer was correct.
The situation may also be a problem for your mortgage provider, if you purchased with the assistance of a mortgage. They leant money against the property based on its value, which must have included the garage. If the lender’s security (the property) is not worth what they were led to believe, issues might arise.
It would be necessary to consider the conveyancing file in detail, to see whether or not there is scope for a claim and who this might be against. Whilst we can obtain your purchase file, you should be aware that a solicitor owns some parts of the file, and this would include copy correspondence with you. It sounds as though you may have done this already, but we would recommend you look for any old correspondence that your solicitor sent you, as copies might not be supplied to you when you ask for the file.
If you would like some assistance in looking into the position, please do feel free to get in touch.