The High Court found that an auctioneer negligently valued a Wexford farmer’s land at €10 million to €11 million, and that the valuation contributed to the farmer’s loss after he bought part of another farm before selling his own. The court also found the farmer 50% responsible because he chose to buy before selling.
The judgment, delivered by Mr Justice Hedigan on 20 September 2013, concerned a claim by Frank Brownrigg against Aidan Leacy, trading as Phoenix Estates, and Ben Kavanagh Auctioneers Limited. The second defendant did not appear at the hearing.
Brownrigg owned a 46-acre farm at Clonhaston, near Enniscorthy, which he intended to sell to help fund a bid for the adjoining Coolbawn farm. In June 2007, Leacy wrote that Clonhaston had an estimated open-market value of €220,000 to €240,000 an acre. Kavanagh separately valued the holding at €6.9 million.
At auction, Brownrigg bought two lots of Coolbawn for €5.9 million. He was unable to sell Clonhaston, and his deposit was forfeited. AIB later obtained judgment against him for €590,000 plus interest in respect of the deposit.
Leacy disputed that his letter was a formal valuation and denied being retained to sell the land. He also argued that market conditions changed and that Brownrigg contributed to his loss by buying before selling. The court considered whether Leacy knew Brownrigg would rely on the letter, whether it was intended as a valuation, whether it was negligently prepared, whether Brownrigg relied on it, and how responsibility and damages should be assessed.
The judge concluded that Brownrigg’s efforts to obtain the letter showed it was important to him and that he intended to rely on it. The letter expressed a professional opinion on market value and was a valuation, the court held. Expert evidence placed the land’s June 2007 value at €2.2 million. The judge found Leacy had not demonstrated adequate research or appropriate consideration of comparable sales and zoning risks; the valuation was far outside the range a careful valuer could reasonably reach and was negligently prepared.
The court accepted that Brownrigg relied equally on both valuations when deciding to bid. It assessed his loss as the €590,000 deposit judgment plus interest, calculated to the date of judgment. Brownrigg was held responsible for 50% of the consequences, with each defendant responsible for 25%. The judge ordered the defendants jointly and severally to pay 50% of the total amount, with their respective liability between themselves divided equally. The judgment did not award the full deposit loss against the defendants.