When a helping hand slaps you in the face

Friendship is a wonderful thing. It can last a lifetime and is emotionally rewarding. A friend is someone you can trust implicitly with your most intimate secrets. However, when friendships cross over into work relationships, even if no money is proposed to be exchanged or is never mentioned as friends do not dirty their relationships with such material things, disaster can lie in wait.

Such an issue arose in the recent case of Peter Burgess and Lynn Burgess vs Basia Lejonvarn. Mr and Mrs Burgess and Mr and Mrs Lejonvarn came to know each other as near-neighbours. Both Mrs Burgess and Mrs Lejonvarn had been born in Montreal. For some years the families were good friends, and the Burgesses had helped out the Lejonvarns on a number of occasions such as some free office space, free input on graphic design (Mrs Burgess was a graphic designer) when Mrs Lejonvarn was setting up her architectural practice, and the Burgesses had even provided a short bridging loan to help the Lejonvarns buy a new property in Hampstead. On any analysis, they were very good friends.

Mrs Lejonvarn, who was an architect registered in the Netherlands and very experienced, was known as and described herself as an architect (albeit not registered in the UK as an architect and therefore not able to describe herself as such in the UK).

Does this mean that any favour or thought expressed over a coffee or in the gym puts you at risk of being sued?

In 2012 the Burgesses were seeking to have a major landscape gardening project at their house, by which time Mrs Lejonvarn was setting up her own business. The Burgesses had received an estimate for the landscaping works which they felt was too high, and over a period of time up to the spring of 2013 Mrs Lejonvarn took on the role of the design and project manager, but no fee or formal contract was ever discussed. The project then went badly wrong.

There was, unsurprisingly, a considerable amount of evidence placed before the court. The judge was asked to consider a number of preliminary issues, and found that there was no contract between the parties. However, he found that Mrs Lejonvarn did owe a duty of care in tort and that this included a duty of care in respect of pure economic loss on a construction project.

So does this mean that any favour or thought expressed over a coffee or in the gym puts you at risk of being sued? Should every sentence in the pubs and wine bars begin with “without accepting any potential liability on my behalf…”? Should we carry two sets of business cards, one for giving professional advice and one by way of a general disclaimer?

None of the above apply, but there is a risk to professionals in offering informal advice. The Burgess case included a significant project, and professional input was given and received over a relatively lengthy period of time - it was clear that the Burgesses’ relied on Mrs Lejonvarn’s professional expertise and that Mrs Lejonvarn played an integral part in the project.

So if you are dispensing “free advice” to friends, enemies and/or prospective clients, think twice about being sucked into a larger task, and if you are, formalise and agree terms of engagement. Also, bear in mind the terms of your insurance, and whether in such “freebie” scenarios, you will be insured. Otherwise, feel free to punch yourself in the face.

Laurence Cobb is a partner in the construction and engineering team at Taylor Wessing