Secrets and lies: Aukett Fitzroy Robinson's fraudulent misrepresentation

When advising a potential client about the availability of a person on your team, you need to be honest. If that person then leaves, plans to leave or becomes unavailable, you need to be honest about that too, without delay. This is what the Technology and Construction Court held in the recent case of Fitzroy Robinson (now Aukett Fitzroy Robinson) vs Mentmore Towers, Good Start and Anglo Swiss Holdings. On 7 July, Mr Justice Coulson found that architect Aukett Fitzroy Robinson’s failure to do this amounted to a fraudulent misrepresentation.

The case sprung from the architect’s appointment on the redevelopment of the In and Out Club in central London into an exclusive private members club called the PM Club. The project also included the redevelopment of Mentmore Towers in Buckinghamshire (the former home of the Rothschild family) into a hotel.

The architect signed a contract with the property owner in May 2006. What is important is what happened leading up to the appointment.

The client first contacted the architect in August 2005 specifically to speak to Jeremy Blake, one of its directors. There were then a series of meetings throughout the autumn of 2005 that Blake and the client attended. The client liked and was impressed by Blake.

In September 2005 the architect submitted a formal bid document. Blake was described in it as the project director. The bid emphasised the firm’s work on a previous project (converting a listed building in Hertfordshire into a hotel) that Blake had overseen. It also stated that it had staff that were registered under the Architects Accredited in Building Conservation (AABC) scheme. In fact, Blake was the only AABC-registered architect at the firm. Included with the bid were schedules indicating that Blake would work on the project for its full period of more than three years.

Although Aukett Fitzroy Robinson was the highest bidder, it was asked to “sharpen its pencils” and submit a revised bid, which it did. Negotiations continued between September 2005 and March 2006 and culminated in the parties agreeing terms. The architect signed the contract on 8 and 30 May 2006. All the documents named Blake as the team leader.

However, on 17 March 2006, seven to 10 weeks before the contract was signed, Blake had resigned. The architect made Blake a counter offer a few days later, which he refused, so on the days it signed the contract, it knew Blake was leaving. It did not inform the client of this change and it instructed Blake not to do so either.

At trial the architect said that this was because it was concerned that if the client knew he was leaving, it would not have got the contract.

On the days it signed the contract, it knew Blake was leaving. It did not inform the client of this

Blake continued to work on the project during his notice period and maintained his silence. Eventually in November 2006 (following concerns raised by Blake) the architect told the client he was leaving. It was not happy. It halted its payments to Aukett Fitzroy Robinson, which then commenced proceedings for outstanding fees. The client launched a counterclaim for negligence and raised the issue of Blake’s resignation.

Mr Justice Coulson did not find there to have been negligence, but did rule against the architect in its conduct in relation to the Blake affair, its subsequent attempt at “re-writing history” and its unreliable witness evidence at trial.

The judge said the architect’s failure to correct the pre-contract assertions it had made about Blake's involvement in the project, once it knew he was leaving, amounted to fraudulent misrepresentation and deceit.

The court accepted that Blake was the principal reason the client had contacted Aukett Fitzroy Robinson in the first instance, and one of the main reasons it was appointed, despite its bid being the highest of all. The court was satisfied that if the architect had told the client that Blake was leaving, it may not have been hired.

The client is now entitled to recover damages for the losses it has suffered as a result of the misrepresentation. This amount and the fees due to the architect will be determined at a second trial.

The lesson is that if you are putting forward an individual as a central part of your project team, you need to be honest if you know that individual is on their way out of the door.

Simon Hunter is a partner and James Brownlie is a solicitor at Mishcon de Reya