Professionals: Prompt payment of fees

A recent Court of Appeal judgment demonstrates that professionals should seek payment of their fees promptly in order to avoid their claim becoming time-barred. Insurers and legal representatives defending claims should also keep in mind the consequences of the time bar provisions when defending claims where there has been an element of delay.

The judgment was given in the context of an unusual set of facts. The appellant surveyor was engaged by a homeowner to survey a window of a property that suffered from subsidence and to oversee the necessary remedial works. The surveyor’s fees formed part of the owner’s insurance claim. Despite completion of the work in 1998, the surveyor’s bill was not presented to the owner’s insurers until 2001. The insurers queried the size of the bill and asked for further information. The surveyor did not respond to their enquiries until 2007 due to ill-health and other reasons. The insurers were only willing to pay the surveyor a lower sum than that invoiced to the owner (the owner having died). In 2008, the surveyor commenced proceedings for payment of his fees from the executors of the owner’s estate. The court found that his claim was out of time, the reason being that the surveyor’s contract was not an entire contract, so he did not have to perform all of his obligations (to include, in this case, managing/completing the insurance claim) before he was entitled to payment. In those circumstances the surveyor’s cause of action had accrued at the very latest by 1999. The Court of Appeal upheld this finding.

The decision highlights the importance of professionals seeking payment of fees promptly following the completion of the majority of their work (regardless of whether some work still remains outstanding). Insurers and legal representatives defending claims should also be mindful of the provisions in case there are defences available based on the claim being brought out of time.

Further reading: Smales v Lea & Others (2011) CA (Civ Div) 19/10/2011 Judgment delivered extempore