Pre-Contract Enquiries: Another Case Of Caveat Empty

Introduction

When buying a property Sellers are usually required to give replies to written enquiries about the property. The standard response often given is "the Buyers should rely on their own inspection/survey". But is this reply sufficient to relieve the Seller from liability, if the Buyers subsequently discover problems with the property?

This issue has recently been reviewed by Lord Justice Lewison in First Tower Trustees Limited & Intertrust Trustees Limited v CDS (Superstores International) Limited [2018] EWCA Civ 1396. The result was in the tenant's favour, demonstrating that landlords need to take renewed care in their responses to buyer's enquiries, and may not be able to rely on exclusion clauses.

The case

First Tower Trustees Limited & Intertrust Trustees Limited (FT) let premises at Dearne Mill, Darton, Barnsley to CDS (Superstores International) Limited (CDS) on 30 April 2015.

Before contract, CDS was given by FT a copy of an asbestos report said to relate to the premises; in fact, it did not.

CDS, through its solicitors, also raised standard enquiries before contract, which FT's solicitors answered on 16 February 2015.

The enquiries had the usual disclaimers:

"4. The Buyer acknowledges that even though the Seller will be giving replies to the enquiries, the Buyer should still inspect the Property, have the Property surveyed, investigate title and make all appropriate searches and enquiries of third parties.

5. In replying to each of these enquiries and any supplemental enquiries, the Seller acknowledges that it is required to provide the Buyer with copies of all documents and correspondence and to supply all details relevant to the replies, whether ornot specifically requested to do so.

6. The Seller confirms that pending exchange of contracts or, where there is no prior contract, pending completion of the Transaction, it will notify the Buyer on becoming aware of anything which may cause any reply that it has given to these or any supplemental enquiries to be incorrect."

CDS asked for details (so far as the Seller was aware) of the existence of any hazardous substances, including asbestos or asbestos containing materials. The reply was:

"The Buyer must satisfy itself".

CDS asked for details of notices, correspondence relating to real or perceived environmental problems that affected the property, including communications relating to the actual or possible presence of contamination at or near the property. The reply, so far...