LETTER OF APPOINTMENT
A letter of appointment is a document that complies with Section 10(2) of the Party Wall etc. Act 1996 and serves to appoint a Surveyor to resolve a dispute. It is worth noting that Section 10(2) merely states that ‘all appointments and selections made under this section shall be in writing and shall not be rescinded by either party’, and this therefore means that there can be a good deal of variation from one letter of appointment to another.
To comply with Section 10(2) the appointment merely needs to be in writing so there is an element of flexibility in relation to the make-up of any letter of appointment. You should also be aware that quite casually thrown into Section 10(2) is the fact that once the appointment has been made it ‘shall not be rescinded by either party’.
Over the years, the biggest and most common problem that we have encountered is excessive fees. The Party Wall process can be a stressful time and the additional costs associated with settling a ‘dispute’ can really add to the stress. Furthermore, many Surveyors charge by the hour, so the longer it takes to settle the dispute, the more money the Surveyor stands to make.
At The Party Wall Collective, we fix our fees so that there is an element of certainty. Costs associated with the Party Wall Act often come as a surprise, so we do our best to ensure that you have as much certainty as possible.
The risk of high fees applies not only to the building owner (the person doing the work) but also to the adjoining owner (the neighbour). That is why it is so important to carefully read the letter of appointment that a Party Wall Surveyor asks you to sign.
There are some letters that specifically mention fees and that you, as the signatory, will meet any fees not met by the building owner. The purpose of this wording is to create a contract that gives a Surveyor extra security. However, we would recommend that you carefully consider the ramifications of signing such a letter.
Our own Letter of Appointment does not make reference to fees. This is simply because the issue of fees is settled within an Award. Surveyors need to agree on reasonable fees and if they are unable to do so, they can ask that the Third Surveyor adjudicates on the matter.
Fee disputes should not delay service of an Award. So, if the Third Surveyor were to rule that a Surveyor’s fees were too excessive, and the Third Surveyor for example reduced the Surveyor’s fees from £4,500 to £1,500, then the person that has signed a letter of appointment mentioned previously will have to pay the £3,000 shortfall. So, we can see that it is important to check the wording of the Letter of Appointment and perhaps question it with the Surveyor that you are considering to appoint.
To summarise, some letters have wording that make you liable for excessive fees. We would argue that such wording is inappropriate and serves only to protect a Surveyor and not the appointing owner. Section 10(2) states that an appointment need only be made in writing and therefore the extra wording on some letters is unnecessary.
We do all we can to protect people from unfair fees. You are welcome to contact us should you wish for us to have a look at your letter of appointment. If you are concerned about unfair fees, we would be happy to discuss your options. Unfortunately, whilst there are several mechanisms that can give you protection, there is sometimes little we can do. So please, be careful, read the letter of appointment carefully, and perhaps do some research on the Surveyor you are considering appointing.