A cautionary tale
Head of Dispute Resolution James Johnston discusses a recent case which may make professionals think twice before offering free services to friends.
The High Court has recently passed judgment at a hearing of some preliminary issues in what it termed a ‘cautionary tale’ to all professional consultants offering free advice to friends and family.
A professional consultant had agreed to provide consultancy services to a friend and her husband who was undertaking a landscape gardening project. She agreed to provide those services free of charge having previously provided free advice to friends, including this particular friend’s husband and his business. Friends being friends, inevitably nothing was put into writing and the project got underway. It very soon began to go wrong and the relationship between the two friends broke down. A claim was brought against the consultant, by her client friend, for the cost of remedial works.
At the hearing into some preliminary issues the Judge held that whilst the friends had not actually agreed a contract between them for the professional services, the consultant did nevertheless owe a duty of care in tort . There was a dispute between the parties as to what exactly was covered by that duty of care, but the following were all held to be included: -
- The selection and procurement of contractors and professionals.
- Preparing such designs are were necessary to price and construct the project.
- Attending site at regular intervals to project manage and to direct, inspect and supervise the works, their timing and progress.
- Receiving the contractor's applications for payment and advising the clients in relation to paying those applications.
- Exercising cost control by preparing a budget and overseeing expenditure against it.
- Preparing detailed designs.
The ‘cautionary tale’ and point for all professional advisors to note is that when they are prepared to give gratuitous advice they must be prepared for the reality that they owe a duty of care under which they can be held liable for the advice given and any work undertaken. Whilst the court did make clear that this was more than just an ad-hoc piece of advice and had been approached in a professional and organised way as compared to the occasional advice sometimes proffered by professional advisors in an out-of-work context, it is nevertheless an important reminder that the professional’s duty does not necessarily cease when they leave the office.
Finally, as this was a preliminary issues hearing there was no final judgment in the case, but the court did make clear that this was a case that was perfectly suited to mediation and that too serves as a reminder that the courts are now actively encouraging resolution of disputes by mediation as opposed to expensive, stressful and at times very lengthy litigation.
Burgess and another v Lejonvarn  EWHC 40 (TCC).
About the author
James is a Partner and Head of the firm’s Dispute Resolution team.
Published: Wednesday 6th April 2016
Categorised: Commercial Dispute Resolution