Platform Funding Limited v Anderson & Associates Ltd [2012] EWHC 1853 (QB)

Lender Claimant unsuccessful in claim against surveyors notwithstanding surveyors’ breaches of the RICS Red Book.

The facts

Anderson & Associates Limited (AA) valued a flat in London in respect of which Platform Funding Limited (PFL) was considering a mortgage advance. AA valued the flat at £275,000 and PFL advanced £250,960 to the borrower who subsequently defaulted on the loan. PFL sold the flat in 2008 before pursuing a claim in negligence against AA.

At the time of the valuation, AA was unaware that the seller had agreed to purchase all of the flats in the development at a significant discount as part of a large scale fraud. The developer marketed the properties on behalf of the seller, who directed the developer to provide any valuer with "appropriate" comparable information from flat sales within the same development. Incentives offered by the seller (or the fact that he was the initial purchaser of the property) were not revealed to AA.

PFL brought a claim in negligence against AA alleging that its valuation was negligent. PFL argued that AA had negligently failed to have regard to the prices achieved for similar properties on nearby developments and that it had also failed to uncover the incentives offered by the seller.


The RICS Red Book stated that comparables could be taken from sales on the same development but that such comparables were not reliable if considered in isolation. It also stated that comparables should be considered in the context of any incentives available, the market in the area, prices realised for similar new properties on other developments, the second-hand market and other information considered relevant.

The Court concluded that AA had failed to take these factors into account and that it had therefore acted in breach of its duty of care. However, the Court held that even had AA taken these factors into account the resulting valuation would still have been the same. The Judge, therefore, held that the breaches were not causative of PFL’s loss and that, as a result, PFL’s claim failed. The Court went on to comment, albeit obiter, that AA’s arguments on contributory negligence would not have lead to any reduction to an award of damages.


Although a surveyor may have breached his duty of care in the methodology adopted in preparing a valuation he might still be able to avoid liability in the event that the actual valuation proves to be correct. Conversely, the Court’s findings also provide support to an argument that a valuer has not breached his duty of care if he has concluded an incorrect valuation based upon artificially inflated comparables. If a valuer can demonstrate compliance with the requirements of the RICS Red Book, the lack of legitimate comparables and that he could not reasonably have unearthed information on price uplifts then he might be able to avoid a finding of breach of duty.

The comments on contributory negligence are troubling for valuers and their insurers and will no doubt be relied upon by lenders progressing similar claims. However, the lack of any detail given by the Judge on the arguments advanced on AA’s behalf in what were obiter comments should allow defendant surveyors (or their solicitors) to rebut any such reliance by Claimant lenders.