Cluttons has paid a £2m settlement over a boom-time valuation on a block of flats in East Sussex.
Channel Islands-based Economic Lifestyle Property this afternoon announced that it had settled its claim against the agent for the sum, which includes interest and costs.
Economic Lifestyle was suing Cluttons over an alleged negligent valuation on St James’ Heights, a Bexhill-on-Sea residential development site.
It was suing for loss and damage after agreeing to buy the block, based on Cluttons’ valuation, for £8.5m.
The investor alleged that in early June 2006 Cluttons valued the 51-flat block at £9.8m, with an additional freehold reversion of £210,000, giving a gross freehold value of just over £10m. It alleged that, based on that valuation, it agreed to pay St James’ Estates £3.1m for the land and Allum £5.4m to build the development – a total of £8.5m.
It claimed that valuations later that year and in early 2007 valued the property at just £7.7m and £7.1m respectively and that Cluttons had therefore breached its duties to act with reasonable skill and care.
Economic Lifestyle said it had decided to settle the case after discovering that a court claim was not likely to be completed until October 2013 at the latest.
Cluttons was not immediately available for comment.
samantha.mcclary@estatesgazette.com
