Sub-prime lender Rooftop Mortgages is suing E.Surv for more than £145,000 for valuing a property that later had to be abandoned following a landslide.
According to papers filed at the High Court in December and recently made public, Rooftop offered a £175,000 10-year remortgage in December 2005 on a Torquay house belonging to William and Alice Watson.
Rooftop’s agent, Mortgage Choice, asked E.Surv to carry out a valuation.
Rooftop claims E.Surv valued the property at £450,000 and failed to take enough notice of a landslide risk with the house located near a clifftop.
In February 2013 the neighbouring house was damaged in a landslide. Geologists Frederick Sherrell advised the Watsons to move out immediately. The local council blocked off their house and the Watsons stopped mortgage payments to Rooftop in March 2013.
Rooftop claims E.Surv was negligent for not mentioning that the house was near a cliff, failing to spot the significance of telltale cracking in the walls and not recommending a geological survey.
The lender also says E.Surv was negligent for not properly taking into account the Watsons’ claim that the property had been worth £500,000 in 2005 despite having been bought for £189,000 in 2003.
According to Rooftop, E.Surv “failed to consider the significant potential for the low price to have been associated with a risk factor connected with the property’s close proximity to the cliff”.
Rooftop argues the house was worth only £50,000 to £100,000 in 2005 and following the landslide “is now unsaleable and of no realistic or substantive value at all”.
The lender bundled and sold the remortgage but is still responsible for the property because the sale was not “legally perfected”.
E.Surv director Richard Sexton says: “Proceedings are stayed at this point in time. I cannot add further comment because it’s a current court matter.”
Rooftop’s lawyers, Dentons, were unavailable for comment.