Can consultants be liable for bad professional advice given to friends?

The case of Burgess & Anr v Lejonvarn Construction Services Ltd [1] is a ‘cautionary tale’ for professional consultants when offering free informal advice, as they could nevertheless find themselves owing a duty to exercise reasonable skill and care, and paying the price when this duty is breached.

Lejonvarn was an architect who had extended her professional services, and began providing design and project management services for works to her neighbours’ garden. This was free advice as no fee was charged, and there was no contract for the services. As work progressed, the neighbours (B) became concerned at both the cost and quality, and hired a new landscape designer. They then sued Lejonvarn for the increased costs of completing the works and remedying the defects; the claim was for £265,000. The court held that whilst Lejonvarn did not owe them a contractual duty, she did owe them a duty of skill and care to protect them against economic loss. The work carried out by Lejonvarn had gone beyond a piece of ad hoc advice; she had provided services over a length of time, and had put a great deal into the project with her management and design. In turn B had relied on this input, and had put in a considerable amount of capital. Lejonvarn had therefore assumed professional responsibility for the works.

So how does ‘informal’ advice fit into this equation? It is clear here that Lejonvarn went above and beyond friendly free advice. The outcome of the case is therefore a cautionary warning to consultants who offer free advice to friends, or advice to a prospective new client during initial communications - this may be a brief comment given in passing, but this does not mean it is any less relied upon.  This is where lines become blurred, as the friend may act on this advice, and therefore what was intended to be informal can quickly become professional. Whilst we do not think consultants need to be forcing disclaimers and engagement letters in the faces of friends and new clients, they can cover themselves reasonably easily with very clear wording to make it clear that it is ad hoc advice, not based on any documents, is not a detailed reply and is not to be relied upon.

If you are concerned as to advice you have given, or simply want to ensure that your professional appointments are set out in a clear and sensible way, then we would be happy to advise as to formal appointments.