The negligent valuation of contaminated land?

Abstract

There has been much discussion in the academic and practitioner press about the valuation of contaminated land. Most of this discussion has centred upon the various techniques that can be used to determine an “appropriate figure” and what the effect, if any, might be of contamination “stigma”. Despite a re‐emergence in recent times of papers discussing professional liabilities in other aspects of valuation practice (particularly concerning bank loan valuations), there has been little discussion about the possibility of negligence being committed by valuers of contaminated land. The professional body which represents most professional valuers in the UK, the Royal Institution of Chartered Surveyors (RICS) has issued guidance for the benefit of its members which attempts to clarify the complexities of law and valuation methodology which exist in this area. It has been suggested that due to the complex nature of the valuation of contaminated assets, as evidenced by the quantum of papers on this matter, many practising valuers might still not be discharging the professional duty to an adequate degree. This paper seeks to determine whether this is an accurate suggestion by verifying the existence and clarity of the guidance and then investigating both whether professional practitioners are familiar with it and implement it. Existing literature and case law are referred to in order to assist these tasks and a questionnaire survey to 400 practitioners was administered. The paper concludes that levels of valuers’ competence in this area, as measured against an objective standard, is often very low and that many valuers are possibly negligent when acting for clients with an interest in a potentially or actually contaminated site. Assessment and monitoring of professional competence in this area is recommended.

Citation

Keeping, M. (2001), "The negligent valuation of contaminated land?", Journal of Property Investment & Finance, Vol. 19 No. 4, pp. 375-389. https://doi.org/10.1108/EUM0000000005791