Flannery and Another v Halifax Estate Agencies Ltd, trading as Colleys Professional Services
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE HENRY |
| Judgment Date | 18 February 1999 |
| Judgment citation (vLex) | [1999] EWCA Civ J0218-13 |
| Docket Number | Case No: CCRTF 98/0203/2 |
| Court | Court of Appeal (Civil Division) |
| Date | 18 February 1999 |
[1999] EWCA Civ J0218-13
Lord Justice Henry
Lord Justice Laws
Mr Justice Hidden
Case No: CCRTF 98/0203/2
IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM MANCHESTER COUNTY COURT
(His Honour Judge James QC)
Royal Courts of Justice
Strand
London WC2
Mr Paul Darling (Instructed by Messrs Pannone & Partners, Manchester M3 2BU) appeared on behalf of the Appellant
Mr Graeme McPherson (Instructed by Messrs Wragge & Co, Birmingham B3 2AS) appeared on behalf of the Respondent
Thursday 18 February 1999
This is the judgment of the Court. This is an appeal by the plaintiffs from the judgment of His Honour Judge Charles James QC sitting in the Manchester County Court on 23rd January 1998. The outline facts are not contentious, and are taken from the summary contained in the skeleton argument of the appellants.
The plaintiffs, Mr and Mrs Flannery purchased a first-floor flat at 70 Simons Way, Wythenshawe, Manchester. They did so with the benefit of a mortgage from the Derbyshire Building Society. The defendants ("the valuers") were asked by the building society to carry out a valuation. The valuers, by their employee Mr Haining, valued the property at £33,000 and in their report stated in relation to movement of the land on which the property stood: "Heave landslip or settlement" that:
"No undue hazards were apparent at the time of inspection."
The Flannerys claimed to have relied on that report in going ahead with their purchase.
The Flannerys then spent substantial funds renovating the property, but decided they did not like living there. They accordingly put the property on the market for £48,000, and received an offer at that sum from a prospective purchaser, Miss Hitchon. She applied to the Halifax Building Society for a mortgage. By coincidence, the Halifax asked the valuers to carry out a valuation, and this task was performed by another of the surveyors in their employ, Mr Earley. He expressed a view in direct conflict to that expressed a year or so earlier by his colleague Mr Haining. He reported that the property was affected by structural movement. The purchaser withdrew, and the Flannerys then sued the valuers for professional negligence in relation to Mr Haining's original valuation.
The valuers' defence, both as set out in the pleadings and in the trial as conducted, centred on denial that the property at any time suffered from any or any significant structural movement—neither at the date of the report nor at any time thereafter. Even though the ultimate issue for decision by the court was whether the valuer in inspecting and reporting on the property had fallen below the standard ordinarily to be expected of a competent valuer, nevertheless one, or the central issue in the action was one of fact, namely whether the property was or was not suffering from foundation subsidence at the time of Mr Haining's inspection. It was common ground that there was some cracking in the superstructure of the building, but it was contended on behalf of the valuer that that cracking was caused by thermal movement, rather than foundation disturbance. At trial there was, in relation at any rate to six of the seven cracks or other indicia of movement however caused, no dispute as to what was there to be seen. The dispute centred entirely on what had caused those cracks. The plaintiffs' called an expert valuer and an expert engineer (Mr Johnson and Mr Rhodes) who supported Mr Earley's thesis, and Mr Earley himself did not give evidence. The defendants called Mr Haining and as their expert valuer and expert engineer Mr Atkinson and Mr Cohen. The hearing covered eight court days and the judge gave a reserved judgment some six weeks after the conclusion of the case (that time including the Christmas and New Year break).
The first 25 pages of a 29 page judgment show every sign of being prepared with care. The central documentation, such as it is, is set out, as is the history summarised above. Included in the judgment is a factual account of the investigations carried out after the second valuation, even where the report was not in evidence, and no witness had been called.
Pages 25 to 27 are a bare summary of the expert evidence given on behalf of each party, being introduced with the observation that the plaintiffs' evidence was "entirely different" from that called by the defendants. Ten lines or thereabouts is spent on the plaintiffs' case—with a bare assertion of the conclusion "the property had suffered from significant structural movement" without any supporting argument or detail beyond saying:
"They drew my attention to a number of features concerning the property which they said confirmed their opinion…"
Then just over a page is spent on the defendants' case, with the conclusions from Mr Atkinson's report of 4th March 1997 being expressly quoted. Again, assertion and not supporting evidence or argument is there set out.
Next there is a bare reference to technical guidance for surveyors, and a publication called "Subsidence in Low Rise Buildings" (published by the Institute of Structural Engineers) to which the judge had been referred. Then he accurately set out the crucial issue, and what he had to decide.
And then, with all set up, he concluded:
"I have had the advantage not only of hearing the various witnesses give evidence but also of seeing the way in which they reacted to the questions that they were asked.
Having done so,
I prefer the Expert Evidence that was given for the Defendants to that which was given for the Plaintiffs.
I find, on the balance of probabilities, that the property was described reasonably accurately by Haining in his Report and that the opinion expressed by Mr Atkinson is correct.
Accordingly,
I find that it was not right to say in July 1995 that: "The property is affected by Structural Movement".
On the evidence which I have heard,
I find that there was no reason connected with the structural stability of the property which rendered it unmortgageable at the time when Haining inspected it in April 1994 and there is no such reason now that could justifiably do so.
Since the claims brought by:
(a) the Plaintiffs jointly for damages in respect of the condition of the property.
(b) the Second Plaintiff separately for damages in respect of personal injuries and loss
both depend upon establishing that Haining was negligent in the manner in which he described the property in his Mortgage Valuation Report dated 20th April 1994 it follows the claims fail and accordingly I dismiss them.
If necessary, I will hear further submissions from Counsel concerning the issue of costs."
That passage is the only passage in the judgment which purports to set out reasons for the decision. The appellants complain that in truth no reasons are given—we do not know why the judge preferred the defendants' expert evidence to that of the plaintiff. By way of illustration, it seems from the terms of the judgment that the judge got particular assistance from having seen the experts give evidence and "…the way in which they reacted to the questions that were asked." But that information leaves us none the wiser. We do not know why the oral evidence and the experts' reactions were so valuable, and so cannot judge whether that gave the judge good reason or no reason for preferring...
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