Brochure Disclaimer prevents Negligent Misstatement Claim

Posted on
The Supreme Court has overturned a High Court decision that allowed a property developer to claim €350,000 in damages for negligent misstatement after he relied on incorrect information from Jones Lang LaSalle, an estate agent.

Originally, the High Court ruled that the property developer, Mr David Walsh, should receive damages for losses caused by the negligent misstatement of information contained in a leaflet provided by Jones Lang LaSalle.

In a landmark case, the Supreme Court reversed this decision with a 3:2 majority. They stated that the disclaimer used at the bottom of the brochure was sufficient to abolish any assumption of an obligation to provide accurate information and consequently this also extinguished any duty of care the estate agent owed to Mr Walsh. The disclaimer stated that “whilst every care has been taken in the preparation of these particulars…” Jones Lang LaSalle did not accept responsibility.  It was held that Jones Lang LaSalle had not assumed the risk of providing the inaccurate information and so the estate agent's appeal was allowed.

This decision reinforces the "buyer beware" principle and demonstrates an obligation on property developers and purchasers to confirm the accuracy of the information by conducting their own enquiries. It is also clear, however, that this judgement does not allow estate agents to make inaccurate statements in their advertising without the potential for liability and there are still circumstances where a duty of care will be found. A disclaimer will need to be carefully drafted to ensure that it sufficiently protects the estate agent from any liability regarding incorrect information. It highlights the importance of "entire agreement" clauses whereby a seller or agent states that no information found in any of their documents regarding the property constitutes a representation on which the buyer should rely upon when considering a purchase.