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Are managing agents responsible for any negligence from contractors they employ?

There are not many days that go by when a contractor selected by a managing agent is not working at a block, whether it be cleaners, lift maintenance, building safety works or porters. When one of those contractors is negligent, leading to a negative impact on a leaseholder or the management entity, who is responsible and therefore culpable?

Looking at the case of Shamsan v 44-49 Lowndes Square Management Company Ltd (2024), we provide the answer to this question and details on how the decision was reached.

Case Background

Within this case the appellant occupied a flat on a shorthold tenancy in a block containing leasehold residential units, for which the respondent was appointed as the property management company.

The management company for the block had selected an independent contractor to supply a number of services, including portage, for the building. Part of the porters’ responsibility was to look after copies of residents’ keys, which the residents were required to leave with them. This ultimately led to the appellant claiming that possessions had been stolen from their property due to porters negligently giving the keys for their property to criminals and bringing proceedings against the property management company. Following this claim the management company applied for an order for summary judgement to state that the respondent did not owe a duty of care to the appellant, which was granted. This judgement was then appealed by the claimant.

Appeal Decision

Within their appeal the appellant argued that negligence by the contractor’s porters breached the duty of care owed by the contractor, which the management company were subsequently responsible for. However, the Court of Appeal found that whilst the management company had chosen the contractor, the contractor was independent of the management company, and it was the contractor who had selected the porters. Therefore, the Court of Appeal dismissed the appeal, as they concluded that the management company had no control over the delivery of the portage services.

Summary

This decision will provide managing agents and freeholders who have appointed independent third parties to manage certain services on their behalf with some comfort.

It is worth noting that in this case the property management company had appointed a contractor, who had then selected the portage provider. It is therefore not completely clear whether the same outcome would have been reached had the property management company selected the portage provider themselves.

If you have any questions regarding the case or require any expert legal advice to support your block management challenges, please get in touch and one of our team will be happy to help.

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