Burgess & Anor v Lejonvarn

A contract for professional services requires objectively ascertainable agreement, sufficient certainty, an intention to create legal relations and consideration. A professional relationship may nevertheless give rise to a tortious duty of care despite the absence of a contract or payment. The duty may protect against pure economic loss where the professional assumes responsibility for services involving special skill, the recipient relies on them, and the circumstances make a legal remedy appropriate.

Such services may include design, procurement, cost control and periodic inspection of construction work. The professional is judged by the standard of a reasonably competent professional undertaking the relevant role, but not by the standard of a specialist outside that role.

The claimants engaged their friend, an architect with project-management experience, in connection with extensive landscaping works at their home. The defendant selected and managed contractors, assisted with pricing and design, monitored expenditure and inspected the works. The parties disputed whether their dealings created a professional services contract, whether the defendant owed a duty in tort, the scope of any such duty, and whether a £130,000 budget had been discussed.

The court tried those questions as preliminary issues to limit the cost and scope of any later trial. The central issues were whether contractual liability existed and, if not, whether the defendant had assumed responsibility for professional services so as to owe a duty of care in tort.

1. Contract. The court held that no contract had been concluded. The emails did not disclose a sufficiently clear offer and acceptance or consensus on the basis of the defendant’s engagement. The parties had not discussed remuneration, duration, termination or an intention to enter legal relations. Attendance on site when work began was not unequivocal acceptance. In any event, there was no consideration: an uncertain possibility of later payment for optional design work could not support the services already provided.
2. Tortious duty. The contractual and tortious claims had different foundations. Applying the principles of assumption of responsibility and reliance, a professional may owe a duty in respect of pure economic loss for services involving special skill, including supervision, even where the services are gratuitous and no contract exists. The relationship here was professional and akin to contract, not merely social. The defendant had assumed responsibility for the Garden Project and the claimants had relied on her services.
3. Scope. The duty covered selection and procurement of contractors, preparation or oversight of design sufficiently detailed to produce a fairly firm estimate, periodic inspection and project management, review of payment applications, cost control, and appropriate detailed design. The defendant was not responsible for the contractor’s planning of commencement, preliminaries or initial strip-out. Inspection was periodic, not continuous. She was to be judged as a reasonably competent architect and project manager, rather than as a structural or geotechnical engineer, and could rely on competent specialists where reasonable.
4. Budget. A VAT-exclusive budget of £130,000 had been discussed with Mr Burgess on 28 April and 17 May 2013. The defendant knew that the claimants relied on it in deciding to proceed and therefore assumed responsibility for its accuracy.
5. The preliminary issues were answered: no contract; issue (ii) not applicable; a tortious duty existed; its scope was as stated subject to the qualifications in the judgment; and the budget had been discussed on both dates. Further case-management directions were to follow.