Q4 Professional Liability

Question 1

Recession often sees a rise in claims against valuers - by what percentage did professional negligence claims increase in the High Court between 2008 and 2009?

A.
1.3%

B.
13%

C.
130%

D.
1300%

Answer 1

C.

130%

Question 2

Why is Merrett –v- Babb (2001) a particularly scary professional negligence case?

A.
It involved a valuer being held personally liable for his negligent valuation.

B.
It involved a valuer’s employer being held vicariously liable for his employee’s negligent valuation.

C.
It involved a valuer’s employee being held vicariously liable for his employer’s negligent valuation.

D.
It involved a valuer being held personally liable for his non-negligent valuation.

Answer 2

A.

It involved a valuer being held personally liable for his negligent valuation.

Question 3

Which of the following is not a correct statement of the professional standard of care as taken from the Eckersley –v- Binnie (1988) case?

A.
He should be alert to the hazards and risks inherent in any professional task he undertakes to the extent that other ordinarily competent members of the profession would be alert.

B.
He must bring to any professional task he undertakes no less expertise, skill and care than other ordinarily competent members of his profession would bring, but need bring no more

C.
The standard is that of the reasonable average. The law does not require of a professional man that he be a paragon, combining the qualities of polymath and prophet

D.
If he becomes aware of a change in scientific or other relevant knowledge after he has completed a project then he is duty bound to warn the client that the design and/or execution of that project may have not adequately dealt with risks as they are now understood.

Answer 3

D.
If he becomes aware of a change in scientific or other relevant knowledge after he has completed a project then he is duty bound to warn the client that the design and/or execution of that project may have not adequately dealt with risks as they are now understood.

(no general duty requiring an adviser to warn his client after his appointment had ended)

Question 4

Beyond what percentage margin of acceptable error is a valuation likely to be regarded as negligent in relation to a common type of property?

A.
0.1%

B.
0.5%

C.
15%

D.
25%

Answer 4

C.

15%

Question 5

What precedent does Freeman -v- Marshall (1966) declare?

A.
If you hold yourself out as a specialist, you will be judged as one.

B.
If you hold yourself, you will be judged by a specialist.

C.
If you hold out, you will be judged as a specialist.

D.
If you judge you will be a held to be a specialist.

Answer 5

A.

If you hold yourself out as a specialist, you will be judged as one.

Question 6

The Bolton -v- Stone (1951) involved what?

A.
Considerations of public policy (the public benefit of cricket) in deciding whether or not balls being hit occasionally out of the ground was an acceptable risk in negligence

B.
Considerations of public policy (the public benefit of baseball) in deciding whether or not balls being hit occasionally out of the ground was an acceptable risk in negligence

C.
Considerations of public policy (the public benefit of rugby) in deciding whether or not balls being hit occasionally out of the ground was an acceptable risk in negligence

D.
Considerations of public policy (the public benefit of football) in deciding whether or not balls being hit occasionally out of the ground was an acceptable risk in negligence

Answer 6

A.
Considerations of public policy (the public benefit of cricket) in deciding whether or not balls being hit occasionally out of the ground was an acceptable risk in negligence

Question 7

The Urban Regeneration Agency –v- Mott Macdonald (1998) case involved

A.
Failure to clean-up a contaminated site to a ‘suitable for use’ standard

B.
Failure to clean-up a contaminated site to a ‘squeaky clean’ standard

C.
Failure to clean-up a contaminated site to an affordable standard

D.
Failure to clean-up a contaminated site at all

Answer 7

B.

Failure to clean-up a contaminated site to a ‘squeaky clean’ standard

Question 8

Which of the following created criminal offences for incorrect statements made when selling a property?

A.
Negligent misstatement

B.
Misrepresentation

C.
Property Misdescriptions Act 1991

D.
RICS Rules of Conduct for Members (2007)

Answer 8

C.
Property Misdescriptions Act 1991

(The Act applied to statements made by Estate Agents and property developers, but was repealed in October 2013 and replaced by more generic provisions in the Consumer Protection from Unfair Trading Regulations 2008 (CPUT))

Question 9

Rescission is a remedy associated with which of the following?

A.
Negligent misstatement

B.
Misrepresentation

C.
Property Misdescriptions Act 1991

D.
RICS Rules of Conduct for Members (2007)

Answer 9

B.
Misrepresentation

The remedy of rescission (the right to treat a contract as cancelled) is a feature of the Misrepresentation Act 1967

Question 10

What is special about ‘negligent misstatement’ in comparison to the rest of the Tort of Negligence?

A.
If you can show a special relationship between the statement maker and the person who has relied upon an erroneous statement then you can recover compensation for economic loss caused by reliance upon that erroneous statement if it was made negligently

B.
If you can show a relationship between the statement maker and the person who has relied upon an erroneous statement then you can recover compensation for economic loss caused by reliance upon that erroneous statement if it was made negligently

C.
If you can show a special relationship between the statement maker and the person who has relied upon an erroneous statement then you can recover compensation for non-economic loss caused by reliance upon that erroneous statement if it was made negligently

D.
If you can show a relationship between the statement maker and the person who has relied upon an erroneous statement then you can recover compensation for non-economic loss caused by reliance upon that erroneous statement if it was made negligently

Answer 10

A.
If you can show a special relationship between the statement maker and the person who has relied upon an erroneous statement then you can recover compensation for economic loss caused by reliance upon that erroneous statement if it was made negligently

Question 11

Which of the following is not a feature of the Misrepresentation Act 1967?

A.
Reverses the burden of proof - it is for the statement maker to prove that his mistake was innocent (i.e. not careless or intentional).

B.
Provides a particularly generous measure of compensation if damages are awarded in lieu of rescission

C.
It applies to situations where someone has been persuaded (i.e. induced) to enter into a contract in reliance upon an incorrect statement (a misrepresentation)

D.
Makes it an offence to intentionally (i.e. fraudulently) make a statement that induces someone to enter into a contract

Answer 11

D.
Makes it an offence to intentionally (i.e. fraudulently) make a statement that induces someone to enter into a contract

Making a statement with the intention of misleading someone and gaining a financial advantage by that is fraud - and separately covered by anti-fraud criminal legislation (e.g. the Fraud Act 2006). The 1967 Act is only concerned with the contract law aspects of misrepresentations

Question 12

In what year was thatched housing banned in London?

A.
1212

B.
1667

C.
1875

D.
1965

Answer 12

A.

1212

Question 13

The EU Construction Products Regulation of 2011

A.
Sets down standards and specifications on how buildings can be constructed

B.
Sets down standards and specifications on where buildings can be constructed

C.
Sets down standards and specifications on how demolished buildings should be recycled and reused

D.
Sets down standards and specifications for construction products so that they can be lawfully used

Answer 13

D.
Sets down standards and specifications for construction products so that they can be lawfully used

(The products themselves)

Question 14

What is the name of the technical documents that support the Building Regulations?

A.
Codes of Practice

B.
Authorised Documents

C.
Approved Documents

D.
Approved Codes of Practice

Answer 14

C.

Approved Documents

Question 15

Which of the following are never crossed referred to in the Building Regulations and therefore made part of ‘the law’

A.
British Standards

B.
British Board of Agreement certificates

C.
EU Directives

D.
Recipes for Bakewell tart

Answer 15

D.

Recipes for Bakewell tart

Question 16

Which of the following were not ‘prescribed matters’ under the Property Misdescriptions (Specified Matters) Regs 1992 and therefore matters which it was ok to make unsubstantiated claims about when selling a property?

A.
My name is Fred. I am a camel.

B.
There are 50 pubs within a 2 minute stroll of this lovely property

C.
This 1960s semi used to be owned by William the Conqueror

D.
The property has been built to the latest standards, including the 2034 Building Regs

Answer 16

A.

My name is Fred. I am a camel.

Question 17

A collateral warranty provides a route of remedy because

A.
It is a contract made directly between the person providing the service (e.g. an architect) and the person (e.g. client) who wants to rely upon the accuracy and quality of the work that the service provider is performing under contract to someone else (e.g. a developer)

B.
It is an implied contract made directly between the person providing the service (e.g. an architect) and the person (e.g. client) who wants to rely upon the accuracy and quality of the work that the service provider is performing under contract to someone else (e.g. a developer)

C.
It is a contract made indirectly between the person providing the service (e.g. an architect) and the person (e.g. client) who wants to rely upon the accuracy and quality of the work that the service provider is performing under contract to someone else (e.g. a developer)

D.
It is an implied contract made indirectly between the person providing the service (e.g. an architect) and the person (e.g. client) who wants to rely upon the accuracy and quality of the work that the service provider is performing under contract to someone else (e.g. a developer)

Answer 17

A.
It is a contract made directly between the person providing the service (e.g. an architect) and the person (e.g. client) who wants to rely upon the accuracy and quality of the work that the service provider is performing under contract to someone else (e.g. a developer)

A collateral warranty sets up a direct contractual relationship between a service provider and someone who he is not in a contractual relationship with under the main contract. The intention of this is to give that third party a right to claim against the service provider if things go wrong.

Collateral warranty = direct between service provider and client

Question 18

If you are offered a collateral warranty from a non-contract party, which of the following is not a factor that you should look for as a way of evaluating the strength of that warranty?

A.
Check that the warrantor’s PII (Professional Indemnity Insurance) insurer is happy for the collateral warranty to be given

B.
Check that the collateral warranty is in a form likely to be acceptable to any funder providing finance for your project

C.
Check that you understand any limitations of liability in the main contract to which the collateral warranty is cross referenced

D.
Make sure that the collateral warranty is not in the form of a deed

Answer 18

D.
Make sure that the collateral warranty is not in the form of a deed

It is in your interest to ensure that a warranty IS made in the form of a deed as this will extend the liability period (under the Limitation Act 1980) to 12 years rather than the 6 years applicable to a basic contract.

Question 19

The Contracts (Rights of Third Parties) Act 1999 was an important change to contract law because

A.
It introduced the privity of contract doctrine

B.
It partially abolished the privity of contract doctrine

C.
It abolished the privity of contract doctrine

D.
It reinforced the privity of contract doctrine

Answer 19

B.
It partially abolished the privity of contract doctrine

The privity of contract doctrine is an ancient principle of contract law that says that only parties (i.e. signatories) to a contract can make claims / enforce rights under the contract. The 1999 Act makes it possible for benefits to be conferred upon third parties,

Question 20

Which of the following statements about the Contracts (Rights of Third parties) Act 1999 is correct?

A.
The Act only applies England

B.
It is not possible to ‘contract out’ of the Act’s conferring of rights upon third parties

C.
The Act applies in England & Wales

D.
The Act applies to contracts entered into before 1999

Answer 20

C.

The Act applies in England & Wales