What duties of care might you owe if you offer a friend free professional advice?
In this recent case, Ms Lejonvarn, an architect and project manager by trade offered to design and project manage a landscape gardening project for her neighbours, Mr & Mrs B, who she had been friends with for many years.
The arrangement was not formally documented in writing. There were various email exchanges which were a mixture of social and professional. The emails described the nature of the duties to be carried out by Ms L but did not contain any detail regarding the nature of the professional relationship.
As with many construction projects there were a number of problems on site and the costs escalated by 100%. The parties fell out and Mr & Mrs B commenced proceedings against Mrs L claiming damages for the cost of remedial works together with the increased cost of completing the project.
So what if any duties of care did Mrs L owe Mr & Mrs B given that she had provided her services gratuitously?
The Technology & Construction Court (TCC) was asked to decide a number of preliminary issues including the following:
- Was there a contract between the parties?
- If so, what were the terms?
- Did Mrs L owe a duty of care to Mr & Mrs B in tort?
- If so, what was the nature and extent of that duty?
The Judge decided that there was no concluded contract between the parties as the essential terms of a contract had not been agreed by the parties. There was no offer and acceptance and no consideration as Mrs L had provided her services at no cost. There had been no discussion between the parties regarding key contractual terms such as the duration of the services, termination, remuneration etc.
Importantly however the Judge held that Mrs L owed a duty of care to Mr & Mrs B in tort. Although the services were provided free of charge, Mrs L had assumed a duty of care to Mr & Mrs B in providing professional services on a professional footing. The judge held that firstly Mrs L had assumed a duty of care and secondly, that Mr & Mrs B had relied upon Mrs L to provide those services with reasonable skill and care.
The judge confirmed that a duty of care can arise even when the services are provided free of charge. The judge also confirmed that the duty of care was owed in respect of pure economic loss on a construction project. The judge held that Mrs L should be judged by the standards of a reasonably competent architect and project manager, not by the standards of a structural or geotechnical engineer.
Clearly this case should provide a stark warning to professionals in any capacity who are asked to provide free advice or services to a friend or relative as the professional may inadvertently assume a duty of care and end up liable in damages in the event that things go wrong.
However, before panicking, we need to consider some of the facts that were specific to this case. One important factor was this was not a case where a one off piece of ad hoc advice was provided. In this case, professional services were provided for a major professional project over a prolonged period. Another perhaps important factor is that although the services were provided free of charge, it was Mrs L’s intention to charge for services which she might carry out later in the project.
If you find yourself in this scenario then it is preferable to agree in advance the scope of the services that you are providing and to document the arrangement in writing thus forming a legally binding contract. Without a formal contract then there is now a risk that you could owe a wider duty of care in tort.
On a sourer note, this case is perhaps a warning not to mix business and pleasure.
If you have any queries relating to construction and engineering or if you have any other dispute resolution and litigation related queries please do not hesitate to contact Martin Stafford, Katherine Sibley or Hannah Bradley on 01228 552600 or 01524 548494.