Volkszone Forum banner
1 - 16 of 16 Posts

·
Registered
Joined
·
12,283 Posts
Discussion Starter · #1 ·
Right, here's the situation:

I carry out inspections on people's new houses to identify defects (or snags). These snags are the responsibility of the builder to put right, but the homeowner pays me to carry out an inspection and provide a snagging list.

What happens if I miss one? It would still be the responsibility of the builder to correct the defect, but I should have identified it and included it my report.

What would my liability be in that instance? The amount I charge for the survey, or the cost incurred by the homeowner in getting the defect corrected.

The NHBC should have a system in place to pay for the rectification of the defect should the original builder fail to do it, or if they go out of business.

What I'm really asking is - should I have PI insurance or not? If a homeowner sues me, what would my liability be? If it's just a refund of my fees, then I don't need insurance to cover that do I?

I guess I'll need to see a solicitor to get an accurate opinion, but I'm throwing it open to good people of VZi for opinions first :)
 

·
Registered
Joined
·
14,296 Posts
not limited to your fee

(I know of a case where someone did consultancy work for a fee of £5K, messed up and the bill went into the £millions !!!!!)

Yes, you should probably have PI cover I think. Are you in the RICS ? They can prob advise on best route.

You could end up liable for any loss. This could incude loss of value as well as cost of cure

BUT if you're only snagging new properties then there is a (practical, if not hypothetical / strict ) limit.
 

·
I see 'dub' people!!!
Joined
·
6,640 Posts
Ste

top of the design chain is the architect ( :D ) and its their responsibility!

nuff said!

j :D
 

·
Registered
Joined
·
12,283 Posts
Discussion Starter · #4 ·
I'm in the CIOB - Chartered Institute of Builders. Pretty much equivalent to the RICS, I suppose.

The thing that's confusing the issue for me, is that the property is supposed to by up to the standards set out by the NHBC, and all I'm doing is identifying those areas where it falls short.

So any loss of value, due to the property being substandard, is really the fault of the builder. The same goes for the cost of the rectification.

The inspection report states clearly that it's based on a non-invasive, visual inspection and only lists defects that were apparent at the time of inspection (therefore excluding latent defects).

To be honest, I can't see how I could be held liable beyond my fee, if I failed to list all the defects that were apparent at the time of inspection - but then, I'm not looking at this through the trained eyes of a solicitor...

Thanks for the reply, Cheekymonkey. Any idea where's best to look for PI insurance?
 

·
Registered
Joined
·
12,283 Posts
Discussion Starter · #5 ·
janski said:
Ste

top of the design chain is the architect ( :D ) and its their responsibility!

nuff said!

j :D
Ahh, but arty-tects charge so much, they can afford the best solicitors :D

Me, I work for peanuts. Not all the time, obviously... sometimes it's dried bread and piece of moldy cheese :D
 

·
I see 'dub' people!!!
Joined
·
6,640 Posts
veedweeb said:
Ahh, but arty-tects charge so much, they can afford the best solicitors :D

Me, I work for peanuts. Not all the time, obviously... sometimes it's dried bread and piece of moldy cheese :D
Even so, architects/designers are relaible for what they did/done, so not your responsibility......their desiegn, their problem....as you said, thats why they pay P.I........ :hangloose

j ;)
 

·
Registered
Joined
·
12,283 Posts
Discussion Starter · #8 ·
dragster172 said:
I`m guessing your a LTD company?
That's correct.

I'm doing these inspections on a freelance basis for another company, but I'd like to do them direct (I can charge more! :D )

I was just trying to get an idea of whether or not I'd need PI insurance. I can't ask the company I'm doing them for at the moment, 'cos they'll twig that I want to steal some of their business!
 

·
I really must get out more
Joined
·
5,658 Posts
i would get some PI just incase i am a self employed chippy and there have been times when i have had to be very careful (listed buildings)
better to be safe type of thing :D
not to sure on how much cover you will get or the price your not going to drill thru the gas pipe writing a snagging list are you .

i have no idea how it would work if you missed an item in a new build or who would have to pay the costs sorry dude. but as a rule if you are working in other peoples property PI is a must
 

·
Registered
Joined
·
34,377 Posts
veedweeb said:
That's correct.

I'm doing these inspections on a freelance basis for another company, but I'd like to do them direct (I can charge more! :D )

I was just trying to get an idea of whether or not I'd need PI insurance. I can't ask the company I'm doing them for at the moment, 'cos they'll twig that I want to steal some of their business!
I have insurance as a chippie but it`s my understanding that you being Ltd means that if it goes "tits up" in a big way you can wriggle out of it?
 

·
I see 'dub' people!!!
Joined
·
6,640 Posts
Designer/architect HAS to follow building regs. as long as contractors follow plans. If so, his/her PI will stay be intact. Gotta remember, other peeps involved with the building prosses i.e. contractors and sub-contractors may tend to deviate from plans for whatever reason!!!!

it happens!!!!!!!!!!!!

j :smurf:
 

·
Registered
Joined
·
14,296 Posts
hypothetical scenario (just as an example):

design is perfect

contractor does not build properly

dangerous (and patent) defect results

you inspect and miss it

someone is injured

you and contractor are both to blame

but in meantime, contractor has gone bust.....

you are 100% liable

....you see the problem ?


it may not be very likely, but then again....

its got to be worth doing some research on what insurance is available, cost, terms, excess etc I'd have thought

oh, and being a limited co does not get you off - you will have personal liability too (its just not often relied on)
 

·
Registered
Joined
·
14,296 Posts
janski said:
Even so, architects/designers are relaible for what they did/done, so not your responsibility......their desiegn, their problem....)
not quite - you'd potentially both be liable if there was a design defect and you missed it and should have seen it (but that depends on the terms of your contract about what you're actually checking for), although what proportions you are liable in (and it can be 100:0, 50:50, 10:90 or any other combination) would depend on the facts of each case

look at it this way - you're being paid as an expert to exercise a level of expertise someone else doesn't have, and if you fall below a reasonable standard in doing that, then you are liable

but I do stress that this is the legal position and in practical terms, on new build, the actual risk may not be very high at all
 

·
Registered
Joined
·
34,377 Posts
CheekyMonkey said:
oh, and being a limited co does not get you off - you will have personal liability too (its just not often relied on)
Thats interesting mate-i thought Ltd status ringfenced your personal liability from your professional one....urban myth then?
 

·
Registered
Joined
·
14,296 Posts
dragster172 said:
Thats interesting mate-i thought Ltd status ringfenced your personal liability from your professional one....urban myth then?
no, not urban myth - 98% true

100% true with breach of contract claims (if contract is with ltd co) unless one of the (rare) exceptions applies, such as trading while insolvent

but little bit different where someone owes a duty of care for providing prof services instead of / alongside contractual duties

strictly, any individual providing professional services can be sued for (the tort of) negligence, as well as their employee (be they a ltd co, LLP, partership whatever)

its just very rarely worth doing

I've always tried to make sure I have an indemnity from any employer firm (since they have the PI cover not me) just in case
 

·
Registered
Joined
·
12,283 Posts
Discussion Starter · #16 ·
CheekyMonkey said:
hypothetical scenario (just as an example):

design is perfect

contractor does not build properly

dangerous (and patent) defect results

you inspect and miss it

someone is injured

you and contractor are both to blame

but in meantime, contractor has gone bust.....

you are 100% liable

....you see the problem ?
Hmm. In that situation, there would be systems in place via the NHBC to cover the cost of the rectification works, so I don't think I could be held liable for that. But there is the issue of consequential loss and compensation for disruption etc. I think I could see a situation arising where I might be held (at least partially) liable for that.

Thanks again for the replies, it's been very interesting. :)
 
1 - 16 of 16 Posts
Top