£39 million claim struck out

Posted: 18th January 2013

A property developer’s misrepresentation claim against surveyors in respect of abortive property purchases has been struck out by a High Court judge on the basis that the proceedings had been subject to prior settlement and amounted to harassment of the defendants and an abuse of court process.

empty buildingThe developer claimed that it had been fraudulently or negligently misled as to the development potential and value of two properties. It argued that it had agreed to purchase the properties in reliance on misrepresentations and had been justified in refusing to complete the transactions.

Two of the defendants to the action, both of them public authorities, had agreed to pay the developer £2.7million in full and final settlement of its claim. However, the developer continued its action against surveyor defendants, claiming damages of £30-39 million.

Striking out the developer’s case, the court ruled that the settlement had operated as a release of all the defendants in the action, who were alleged to be concurrent tortfeasors, from potential liability. The continuation of the action against the surveyor defendants subsequent to the settlement amounted to ‘unjust harassment’ of them and an abuse of process.