There may come a time when a friend calls upon your professional skills and expertise. You do your friend a favour and get their kudos in return. What could go wrong? If a recent Court of Appeal decision is anything to go by, the answer is a lot.
The facts
In Lejonvarn v Burgess and another, Mrs Lejonvarn (a project management consultant) carried out some project management work in relation to garden landscaping as a favour to her friends and neighbours Mr and Mrs Burgess. However, Mr and Burgess soon complained about the quality of the work and the spiralling costs of Mrs Lejonvarn’s contractor. Mr and Mrs Burgess “dismissed” Mrs Lejonvarn and brought in another consultant to complete the project. They then claimed against Mrs Lejonvarn for the increased cost of completing the project.
The decision
The court held that no contract had been formed between the parties. This was partly because Mrs Lejonvarn had not accepted payment (or “consideration”) for the works. Nevertheless, it was held that Mrs Lejonvarn owed her neighbours a “duty of care” (under tort or delict) to exercise reasonable skill and care in acting as an architect and project manager and to prevent economic loss.
The Scottish position
As a side note, the issue of “consideration” may not have prevented a contract forming in Scotland. However, the judge also found that it was impossible to identify any “offer” and “acceptance” from the emails between the parties. On that basis, it is likely that a Scottish court would also have found that there was no contract between the parties.
The duty of care
Mrs Lejonvarn’s duty of care arose because she had “assumed responsibility” for the project. In reaching his decision, the judge noted that Mrs Lejonvarn:
- agreed to and provided a series of professional services over a period of time;
- expressed a degree of confidence in her ability to manage the project and control the budget;
- performed the services “in a professional context on a professional footing”; and
- was or should have been well aware that her neighbours’ were relying on her to properly perform her services.
The effect
The case is cautionary tale against helping out friends in a professional context. The judge was at pains to emphasise that this was not a case of “brief ad-hoc advice”. The situation may have started as a casual conversation between friends at a party, but it soon progressed to something which was “akin to a contract”.
If your friend asks for informal advice in a social context, it is unlikely (though not impossible) that a duty of care will arise if you offer an informal opinion. However, you should think twice before offering your services in a more formal context, or get drawn into a longer project. The absence of payment or a contract will not necessarily prevent a duty of care arising. If you hold yourself out as a professional and allow your friend to rely upon your skills and expertise, you may have assumed responsibility for the favour. In those circumstances, you may have more to lose than just your friendship.