My first post gave a brief background to party walls and the procedure of preparing and responding to notices served in accordance with the Party Wall etc. Act 1996 (PWA 1996). This second post provides an overview of the award procedure and process from a surveyor’s perspective.
Need for a party wall award
If an adjoining owner has dissented to the building owner’s works, or has remained silent for a period of 14 days after the service of a notice, a party wall award is required before the notifiable works can proceed.
Section 10 principally deals with the award procedure or, more correctly put, the resolution of disputes. In essence, any issue or “dispute” arising between the building owner and the adjoining owner in connection with works proposed under the PWA 1996 may be settled by an award.
The award is concluded by either an agreed surveyor appointed by both owners, or by two surveyors appointed by each party.
The third surveyor
The first duty of the two appointed surveyors is to select a third surveyor who will be instructed should they be unable to resolve any disputes between themselves.
One question that often arises is, can a party change its surveyor? The simple answer is no.
“Your surveyor” is purposefully misleading because the surveyor(s) has a statutory role and is not an advocate for the owner who appointed them.
The PWA 1996 sets out that once a written appointment is made it cannot be rescinded, but also goes on to state that if:
- A party’s surveyor dies or is incapable of acting, that party may appoint another surveyor to act with the same powers and authority.
- A party’s surveyor refuses to act or fails to act within 10 days of a request so to do, the other party may proceed ex parte.
- An agreed surveyor dies, is incapable of acting, refuses to act or fails to act within 10 days of a request so to do, the procedure shall start all over again.
- A third surveyor dies, is incapable of acting, refuses to act or fails to act within 10 days of a request so to do, the other two of the three surveyors may select and appoint another third surveyor with the same powers and authority.
There have been come interesting new cases recently regarding surveyors appointments including Property Supply and Development Ltd v Verity and Mills v Savage.
The obvious conclusion to draw here is that any owner should ensure they appoint a surveyor who is suitably experienced to deal with the complexity of the instruction.
The party wall award
A party wall award can determine:
- A right for the building owner to execute work under the PWA 1996.
- The time and manner for executing the works (although, unless agreed between the building owner and the adjoining owner, the time for executing the works shall not commence until the initial period included in building owner’s relevant notice has expired).
- “Any other matter arising out of or incidental to the dispute including the costs of making the award”.
The PWA 1996 gives surveyors a wide jurisdiction to regulate any matters connected with work that the PWA 1996 relates to and the surveyors must carry out a review of the factors specific to the property/site. This is not the place for an exhaustive list of such factors, but listed below are some typical examples to give an insight into the surveyors’ role in the award process:
- Review of scheme drawings, method and impact statements to understand how the works will be undertaken and what (if any) restrictions or obligations might be needed.
- Imposing time restrictions for the notifiable works (such as only working between 9 am to 5 pm, Monday to Friday).
- Placing limits on or requiring monitoring for movement and vibration.
- Requiring temporary protective measures for support or weathering.
- Security for expenses (itself a whole topic of its own!).
Sometimes circumstances may have the potential to require a surveyor to consider acting “ex-parte” or using the third surveyor to make a determination. Such circumstances can include where:
- Surveyors are being slow to respond (especially if they have a large workload).
- Surveyors have requested significant levels of information over and above what is considered reasonable.
- The costs as set out might not be viewed as reasonable – more on this later.
Party wall surveyor’s costs
Surveyor’s fees can be a matter of contention. Indeed, it is one of the most common matters referred to the third surveyor. The PWA 1996 states that the reasonable costs in making or obtaining an award, inspecting work to which the award applies or “any other matter arising out of the award” shall be paid by such party as determined by the surveyor or surveyors making the award.
In an unreported case in 2004, a judge commented that fees were a three course banquet out of what should have been a snack.
Farrs Lane Developments Ltd v Bristol Magistrates’ Court
With fees being such a pertinent issue, it is probably appropriate to mention Farrs Lane Developers Ltd v Bristol Magistrates Court. This case concerned 10 awards made by one surveyor acting either as the “agreed surveyor” or jointly with the surveyor appointed by the relevant adjoining owner. Each award stated the building owner should pay the surveyor’s fees of £1,300 plus VAT for preparing and serving the relevant notice plus fees for his additional work at the rate of £90 per hour plus VAT. The fees totalled £24,363.72.
Instead of appealing the fees to the county court within 14 days of the awards being served, the building owner simply failed to pay. Therefore, the surveyor issued 10 complaints in the Bristol Magistrates’ Court for non-payment of his awarded fees.
The building owner defended the claims saying the magistrates had no jurisdiction to make the orders the surveyor sought as he (the surveyor) was neither the building nor adjoining owner and his fees were not a matter of dispute between those parties. The magistrates disagreed and ordered the fees to be paid. They refused to give reasons for their finding and the building owner sought a judicial review of that decision in the High Court.
The case was heard by Holgate J, who had three issues to determine:
- Were the awards in respect of the surveyor’s costs ultra vires as they did not relate to a dispute between the building and adjoining owners?
- Held: while the PWA 1996 relates to disputes between the owning parties, an award may determine “any other matter arising out of or incidental to the dispute” (section 10(12)(c)).
- Even if an award that includes an order to pay the surveyor’s costs is not disputed between the owners, can it direct a party to pay them to the surveyor directly (instead of awarding direct payments between the two relevant owners)?
- Held: “The statute enables the surveyor(s) to determine which party is to pay the costs awarded without limiting the discharge of that obligation in the award to a payment to another party, rather than to the surveyor entitled to receive that payment.”
- Had the magistrates erred in awarding the surveyor his costs based on the number of hours he spent on the case (38.5 hours) multiplied by his £90 hourly rate?
- Held: it was within the magistrates’ discretion to award the surveyor reasonable and just costs.
In considering the issues before him, Holgate J reviewed comments made in paragraph 7.5.1 of RICS’ party wall guidance note to the effect that case law suggests that there is no contractual or statutory basis for surveyors addressing responsibility for costs in an award. He disagreed and said the issues before him had not previously been dealt with by any judicial authority. Further, while the building owner could have challenged the awards in the County Court, it had chosen not to do so and thereby incurred costs that exceeded the challenged fees. His disapproval, while not forming part of his judgment, was clear.
Service of a party wall award
Service depends on who makes the award:
- If the parties’ surveyors make the award, the surveyors shall immediately serve it on the parties.
- If the third surveyor makes the award, then after payment of the costs of the award, the third surveyor shall serve it on the parties or their appointed surveyors. If the latter, the appointed surveyors shall immediately serve the award on the parties.
Service may be conducted in person or by post (section 15). In addition, The Party Wall etc. Act 1996 (Electronic Communications) Order 2016 (SI 2016/335) allows notices and other documents to be issued by electronic communication (including by email), subject to the recipient having stated they are willing to accept documents this way.
Appealing a party wall award
Subject to either party’s right to appeal the award within 14 days of it being served, an award is binding and conclusive and it cannot be questioned by any court. On appeal to the County Court, the court may rescind or modify the award, or make such order as regards costs as it thinks fit.
Thankfully, appeals are rare.
Non-compliance with a party wall award
The first consideration must always be the validity of the award. For example:
- Was the surveyor properly appointed?
- Did the matters set out in the award fall within the surveyor’s jurisdiction?
- Was the award served in accordance with the PWA 1996?
- Was the appeal issued within the 14 day time limit set out in section 10?
The second consideration is whether non-compliance amounts to a criminal offence under section 16 of the Act. For example, where an occupier refuses to allow a person to enter the property (having first given not less than 14 days’ notice of proposed entry), to stay to carry out the works, or if any person hinders or obstructs another from carrying out the works. If the property is locked, the building owner or the contractor may enter by breaking open gates or fences, if accompanied by a police constable or officer. However, any breach is punishable by summary conviction and a fine.
Thirdly, if the non-compliance is not a criminal offence under the PWA 1996, it is worth considering whether there has been a breach of a civil right or breach of a statutory duty that is enforceable (potentially) by an injunction. For example:
- If works are carried out that are outside those works covered by the award.
- Entering on to land other than under the PWA 1996, which can amount to a trespass, as can carrying out works other than those covered by the award (and this may also amount to a nuisance giving rise to a potential claim in damages).
Having covered the basic operation of the PWA 1996, there are, of course, more complex matters that may arise such as special foundations and (as I’ve already hinted at) security for expenses. I will focus on these issues in my next post on party wall matters.