HT-2019-CDF-000012 - [2025] EWHC 1315 (TCC)

Paragraph 48 of the Schedule of Loss defines “Secured Borrowing Loss” to mean “losses resulting from the Claimant’s inability to raise capital by way of secured borrowing on the Flats for re-investment”. The following further paragraphs are especially relevant to this head of claim.

“9.

The Wilsons bought both the Flats for cash. At the time of the purchases, the Flats would have been mortgageable because the Defects were substantially unknown. The Wilsons’ expectation was that this situation would continue, and that mortgage finance could be raised at a later date, particularly when they required cash.

…

11.

The Wilsons’ rationale for their investment in the Flats was:

11.1.

An investment in residential property (as opposed to a different investment) would provide a natural hedge against their children’s future need for a property to live in.

11.2.

Cardiff (as opposed to other locations) was a place they knew; it was convenient, and forecasts for the future growth of property prices in Cardiff were good.

11.3.

They would be able easily to realise the value in the Flats (by sale or remortgage) to provide finance to their children to purchase (rather than rent) property to live in once their children were established in secure employment.”

Several points can be made about this head of claim. First, it is not pleaded. Second, there is no averment of fact in the POC that would support it. Third, no averment of fact is made, even in the Schedule of Loss, that would support the existence of such a loss as a matter of fact. It is not said that the Wilsons attempted to raise finance, or wanted to do so, but were unable to do so. Fourth, the actual averments made are that Mr and Mrs Wilson purchased the first of their flats in 2012 and that in 2019 they intended to transfer one of the flats to their company, the third claimant, but decided against doing so when the defects were discovered. Fifth, the alleged loss, as defined in paragraph 48, is inconsistent with the stated intention in paragraph 11. I regard Redrow as correct to characterise the head of claim as “opportunistic” and as “rel[ying] entirely on the benefit of hindsight.” Sixth, in the circumstances, the alleged loss is clearly too remote. It is no part of the Wilsons’ case that they made anyone aware of any reinvestment plans.