The ‘Bowerman’ duty continues to apply despite the existence of the CML Handbook

October 27, 2014

In the recent case of E.surv Limited v Goldsmith Williams Solicitors [2014] EWHC 1104 (Ch) the Court held that a surveying firm was entitled to a contribution under the Civil Liability (Contribution) Act 1978 from solicitors who had failed to report to their lender client details of a previous sale of the property that would have had an effect on the surveyor’s valuation had they known about the previous sale value.

By way of background, the surveyors in question valued the property for mortgage purposes as £725,000, having been told by the borrower that it had been sold for £600,000 within the previous 12 months.

The lender’s solicitor owed various duties to the lender under the CML Handbook. In particular, they owed the duty to take reasonable steps to verify that there were no discrepancies between the description of the property as valued and the title and other documents which a reasonably competent solicitor would obtain. The solicitor obtained Land Registry official copies which showed that the property had been sold within the previous six months for significantly less than £725,000.

The surveyors paid £200,000 to settle an earlier claim from the lender and they sought a contribution towards same from the solicitor. The solicitor argued that they were not liable to the lender under the more restricted CML Handbook duty and that the incorporation of the handbook into the retainer ousted the general ‘Bowerman’ duty. They therefore argued that they were not liable to contribute to the settlement.

It was held that the solicitors owed a general duty under the principles laid down in Mortgage Express v Bowerman (1996) to report any matter to the lender which they consider may adversely affect the lender. More particularly, the incorporation of the CML Handbook into the retainer did not oust this general ‘Bowerman’ duty.

The court therefore gave judgment in favour of the surveyor, finding that the difference between their valuation and the previous sale value was so significant that the solicitors should have reported it to the lender. The court also held that the transaction would not have proceeded had the solicitor reported the previous sale to the lender. The solicitors were therefore liable to make a contribution towards the settlement.

Please note; the content of this article is for information purposes only and further advice should be sought from a professional legal advisor before any action is taken.

Please contact Cleaver Fulton Rankin on 028 9027 3141 or alternatively visit