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‘Love thy neighbour? Not!’

Lejonvarn v Mr & Mrs Burgess [2017]EWCA 254

The Court of Appeal has recently upheld a decision that an architect, who had provided her services gratuitously to her friends by project managing the landscaping of their garden, had assumed an obligation to exercise reasonable skill and care in the provision of those services.

Summary

Mr and Mrs Burgess owned a house in Hampstead. They wanted to carry out extensive landscaping of their garden. They were planning to use a well-known garden designer but were concerned by the cost. Mrs Lejonvarn was a friend and former neighbour of theirs. She is also an architect who had been involved in previous projects for Mr Burgess’ business. He asked her if she could carry out the garden project for them and she agreed to do so.

After the project had been going for a few months, the parties fell into dispute and they parted company. Mr and Mrs Burgess reverted to their original designer who then completed their garden, which ended up costing twice as much as they had originally been quoted. They brought proceedings against Mrs Lejonvarn alleging breach of contract and negligence.

The Judge at first instance held that there was no contract but that Mrs Lejonvarn had nevertheless assumed a responsibility to Mr and Mrs Burgess for performing her professional services and that they had specifically relied upon her to do so. He held that she owed them a duty to exercise reasonable skill and care when acting as architect and project manager on the project.

Mrs Lejonvarn appealed. Her primary ground of appeal was that the Judge had erred in holding that a duty existed at common law in circumstances where he had found that there was no concluded contract between the parties because there was no certainty as to what Mrs Lejonvarn had agreed to do and because there was no consideration.

It was submitted on Mrs Lejonvarn’s behalf that the decision by the Judge ‘represented a novel and unparalleled extension of the ‘assumption of responsibility’ doctrine to create positive and continuing obligations on her part to provide a range of ongoing services notwithstanding the parties had no intention to enter into any contract.’ In effect, or so it was said, the decision pushed the boundaries of Hedley Byrne too far.

Decision

The Court of Appeal disagreed and dismissed the appeal. Hamblen LJ (who gave the leading judgment) said that the fact that there was no contract did not mean that the parties’ relationship could not be akin to a contractual one. He said that the Judge had given express regard to the fact that the services were provided gratuitously but had nevertheless found that these ‘were professional services provided in a professional context and on a professional footing.’

He held that the Judge was entitled to conclude that there had been an assumption of responsibility in the light of the findings of fact made by him. This was a case in which Mrs Lejonvarn had said that she would provide professional services acting as an architect and project manager; in which she did in fact provide such services; in which she confirmed she had provided such services and in which she knew that Mr and Mrs Burgess were relying upon her to perform those services.

Hamblen J said that the Judge was also entitled to conclude that it was appropriate or fair, just and reasonable to find such a duty arose. The context was a professional one; it was not informal or social. There was an obvious relationship of proximity and although Mrs Lejonvarn was not going to be paid initially, there was an expectation that she would be paid for later stages of the works.

Comment

The case is instructive for a number of reasons.

First, although it was suggested that this was a case that went beyond the ambit of Hedley Byrne, the Court of Appeal held that the Judge had applied the test of assumption of responsibility consistently with authority. In particular, and as the decision of the House of Lords in Customs & Excise v Barclays Bank makes clear, assumption of responsibility is the appropriate test in cases that involve a relationship akin to contract as the Judge found this to be.

There was no need to make a further enquiry into whether it would be fair, just and reasonable to impose liability because such considerations would have been taken into account in determining whether there was an assumption of responsibility. The same factors that justified the finding of an assumption of responsibility justified the finding that it would be fair, just and reasonable to impose the duty.

Secondly, and importantly, the Court made it clear that the assumption of responsibility did not carry with it an obligation actually to provide the services she said she was going to provide. Her obligation was to exercise reasonable skill and care only in performing the services she in fact performed. She did not have to provide any such services, but if she did, she owed a duty of care in their provision.

Therefore, if she had said that she was going to carry out periodic inspections but then carried out none, she could not be found negligent for having failed to do so. But the question arises whether, having said she would carry out such inspections, and having carried out only a few, she could only be liable for negligence in respect of the inspections she actually carried out or whether she could also be held to have been negligent for not carrying out more (if a reasobaly competent project manager would have done so).

Both common sense and authority suggest that it should be the latter. Having assumed a responsibility to inspect the works, and having taken steps to carry out that responsibility, it would be a very curious result if a defendant in that situation could escape liability simply on the basis that he or she had not carried out all the inspections that a reasonably competent project manager would have performed. As Mustill LJ recognised in The Zephyr: ‘doing something badly may often involve an act of neglect to carry out an act which would turn bad performance into adequate performance; so that allegations of misfeasance may be implicit in an allegation of non-feasance.’

It therefore seems likely that, having assumed responsibility to provide a service, and having started to perform it, a professional will be liable for his or her failure to carry it out properly, including by failing to do whatever is required as frequently as would normally be expected.

Thirdly and finally, it has been suggested that this case provides a cautionary tale for professionals doing favours for friends such as, for example, giving informal advice at a dinner party.  Whilst true that it highlights the risk, this case (like any other case of its kind) very much turned on its own peculiar facts. A reading of the judgment swiftly reveals that this case was far removed from the case of a professional simply giving informal advice to a friend.

By way of example, Mrs Lejonvarn’s own emails written at the point when the relationship broke down are instructive. They included one in which she suggested that she might have ‘wholly misunderstood their professional relationship’ because Mr Burgess seemed to be suggesting that she should have done everything ‘as a friendly favour.’ As the Court found, and as Mrs Lejonvarn herself clearly realised, the context was indeed a professional one, which went well beyond the informal or purely social.

Conclusion

This is obviously an important case because it demonstrates that a professional can assume a responsibility to avoid causing economic loss when providing his or her services even if the parties do not enter into a contract and the services are provided gratuitously.

It is important too because it affirms the appropriateness of the ‘assumption of responsibility’ test in cases which involve a relationship akin to contract and, in this case, where ‘professional services were being provided in a professional context and on a professional footing.’ It does not represent either a ‘novel or an unparalleled extension’ of the assumption of responsibility doctrine.

It is an important case also because the decision makes it clear that any such assumption of responsibility only imposes a duty to exercise reasonable skill and care in the performance of the services actually provided. Having said she would provide such services, Mrs Lejonvarn did not have to provide them but, to the extent that she did so, she owed a duty to exercise reasonable skill and care in performing them.



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