What do you do when there is an issue of damage caused by work authorised by a Party Wall Award?
If you are an Adjoining Owner and you suspect that damage has been caused by your neighbour’s work then you should notify the Building Owner (or his contractor / representative on site) of the matter. If the Building Owner accepts that the damage is due to his work, he should offer to put it right or pay you sufficiently to do so. If you think his offer (of either work or payment) is a reasonable one then there is no “matter in dispute” between you and you should accept it. You may wish to seek advice before doing so, but be aware that your Party Wall Surveyor is unlikely to have any legal jurisdiction to issue an addendum Party Wall Award in the matter. They may be willing to give you some helpful advice, but their role as your Party Wall Surveyor will probably have come to an end when they issued their Primary Award. Don’t be led (by an unscrupulous or misguided party wall surveyor) into believing that the right way to do things is for them to issue an Addendum Award in the matter, and that the costs will all be awarded against your neighbour (as they were before in the Primary Award). Such a surveyor may well be leading you into an unnecessary dispute which might cost you.
If you are a Building Owner, and someone has notified you of damage allegedly caused but your work, ask to see it, take a photographic record, note the circumstances and timing of the discovery as reported by the neighbour and/or the building occupant. Discuss the matter with your builder – when and how was he doing relavent jobs at the property? Check the Schedule of Condition prepared by your surveyor before work started. If you need to, seek your surveyor’s advice in the matter, but if you believe the damage is likely to be caused by your work then seek to discuss with your neighbour how to make amends. If you make an offer to your neighbour (of work or of money) keep a record of that.
Many party wall surveyors have for decades been under the misconception that their jurisdiction continues beyond the issue of the standard Party Wall Award to cover any possible future eventuality which might be covered by the Act (such as damage caused by the Building Owner’s work). Indeed, they often insert clauses giving themselves the purported right to make further awards. However, two landmark legal cases in 2021 made it clear that they have no such jurisdiction. The effects of these two cases is still reverberating around the party wall surveying profession. These cases are;
K Group Holdings Inc v Saidco (unreported) 2021;which decided (amongst other things) that the Primary Award had resolved the deemed dispute between the parties, and that the surveyors had no ongoing jurisdiction.
Evans v Paterson 2021; in which, the judge held that the clause in the Primary Award which purported to give the surveyors ongoing jurisdiction in the event of damage occurring was in fact invalid as the surveyors were acting ultra vires by including it.
Some surveyors seem to consider it either their right or their duty to step in when they are told of damage, and make another Award in the matter, without even checking to see if the matter is in fact in dispute between the parties at all! It is now clear that they have no jurisdiction over such matters and any award they make will probably have no legal standing.
That is not to say though that the Party Wall Act cannot be used to resolve a genuine dispute between the owners over an issue of damage. It certainly can, and that capability is a fundamental tenet of the Act. The Act can only be used though if there is a genuine ‘matter in dispute’, and then the owner wishing to use the Act to resolve it must re-appoint a surveyor to do so. That could be the same surveyor that acted for them before, or a different one. The original surveyors have no right to demand that they be reappointed, the choice of surveyor(s) for resolving the new dispute is entirely up to the parties. It could (as before) be either a single Agreed Surveyor, or two separate surveyors. In effect, the party wall dispute resolution process starts anew (relating only to the newly arisen matter in dispute) with the appointment of surveyors and the selection of a new Third Surveyor.
As to who should pay the surveyors’ costs, that is a matter which is a great deal more uncertain in an Addendum Award than it would have been in the case of the Primary Award. In a Primary Award, costs are almost always awarded against the Building Owner. Only in very rare circumstances would any costs be awarded against the Adjoining Owner. In the case of an Addendum Award for damage though, that is not the case and costs could be awarded either way – depending on who the surveyors see as being ‘at fault’ for of the dispute (just as it would be in a court hearing). It is therefore important for allegations of damage not to be made or denied lightly, and for every effort to be made by the owners to resolve them without recourse to using surveyors under the Act. Indeed, many surveyors when asked to resolve such a dispute will require a fee deposit to be paid in advance which may not be refunded should they decide in favour of the other side.
Damage caused by the party wall work is sometimes unsurprising or even unavoidable, and whilst the cost of repairing such damage should of course fall to the Building Owner, it does not follow that party wall surveyors’ fees should as well. When considering the allocation of responsibility for their fees, the surveyors should consider matters such as;
- Was the work carried out in accordance with the primary award or not? For example – a contractor uses mechanical tools to remove a chimney breast where the Primary Award specifies hand tools only.
- Did the Adjoining Owner unfairly seek to claim for areas of damage which were obviously unrelated to the work? Sometimes relations between neighbours aren’t good and one owner may attempt to use the PWA to vexatiously try and land their neighbour with as much cost as possible. It happens all too often!
- Did the Building Owner or his contractor make a reasonable offer to put right the damage or compensate the AO? Rejecting an offer to put right damage should not be done lightly. Just because you’ve had an argument with your neighbour or their builder does not mean you can deny them the opportunity to rectify matters. It is much less expensive for a builder already on site to repair the damage he caused than to pay for another builder to do so, and it may not be fair to deny him the opportunity to do so. That said, the Act does allow an Adjoining Owner to opt for financial compensation instead – but that might only be the sum it would have cost the original builder to put it right himself. It’s up to the surveyors to decide, and they may well be influenced by the reasonableness of behaviour of the owners.
- Is it fair to demand that the repairs are inspected on completion by a surveyor? In some cases, yes, in others maybe not. It all depends on the circumstances and there is no clear-cut answer.
If the owners really cannot agree, and wish the matter to be resolved by surveyors then they should ensure that the surveyors both have clear new instructions to act over the new disputed matter, and thus have the required legal jurisdiction. It would be advisable to ask to see copies of surveyors instruction letters and ensure that the other owner really does know what the dispute is about, and is still not willing to settle privately. All too often surveyors take it upon themselves to perpetuate ‘disputes’ that their owners are not really fully behind. Owners sometimes just want to ‘leave it to their surveyor to sort out’ without thinking whether they really want to dispute their neighbour’s position or not. Such owners run the risk of having costs awarded against them.
In many cases a dispute will change as negotiations continue, and as concessions are made. Owners should be aware that as points in the dispute become agreed they are no longer ‘matters in dispute’ and the surveyors thus have no jurisdiction over them. If a dispute is fully agreed before an award is made then the award should not be made at all as it would have no legal validity. Surveyors can only make awards in relation to matters which are genuinely in dispute between the owners – which matters can of course include the amount of the surveyors’ own fees.
So, resolving disputes about damage caused by work authorised by a Party Wall Award should ideally be done between the parties directly, and surveyors used only as a last resort, as how costs will be defrayed between the owners is often not at all certain. If surveyors take it upon themselves to make awards without clear authority to do so over matters which are clearly and actively in dispute, then their awards can be set aside and owners can appoint new surveyors.
Bob Gibson FFPWS
Registered Third Surveyor with the Faculty of Party Wall Surveyors