Mortgage refused - cavity wall insulation

I have just lost a mortgage I was in the process of taking out on my house (borrowing to pay parents back for buying me the house) because it is a timber framed construction and the cavity wall insulation I had done last year is not suitable for a timber framed house. I was expecting the money Monday/Tuesday next week.

From what i can remember the insulation was a wool type substance that was blown in at a dozen or so points through the brick work of the house.

Now, when I had the work carried out (by Heat Savers IIRC) no one mentioned the type of house it was suitable for. Should they (as the experts who quoted & carried out the work) have told me, or as me (home owner, asking for the work) should I have known/researched it more?


More importantly, has anyone ever heard of this cock up before? Is there a way to remove the stuff without dismantling the house?


http://www.energysavingtrust.org.uk/...all-insulation

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Originally Posted by Andehh

I have just lost a mortgage I was in the process of taking out on my house (borrowing to pay parents back for buying me the house) because it is a timber framed construction and the cavity wall insulation I had done last year is not suitable for a timber framed house. I was expecting the money Monday/Tuesday next week.

From what i can remember the insulation was a wool type substance that was blown in at a dozen or so points through the brick work of the house.

Now, when I had the work carried out (by Heat Savers IIRC) no one mentioned the type of house it was suitable for. Should they (as the experts who quoted & carried out the work) have told me, or as me (home owner, asking for the work) should I have known/researched it more?


More importantly, has anyone ever heard of this cock up before? Is there a way to remove the stuff without dismantling the house?


http://www.energysavingtrust.org.uk/...all-insulation

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They should have told what insulation was suitable for your type of home.

You might have a case based on the insulation not being fit for purpose but it's not gonna be a clear cut or easy case to win

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Originally Posted by Lucio

You might have a case based on the insulation not being fit for purpose but it's not gonna be a clear cut or easy case to win

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I'd have thought there was a pretty good chance of a decent case. When a professional company does a job, part of what they're being paid for is their professional expertise, and that includes not damaging the premises they're working on .... and are almost certainly insured against doing so, though whether tehir insurance would cover what sounds like rank incompetence is another thing.

As for how easy it would be to win, well, talk to a solicitor ion that one. But remember the basic definition of negligence ....

- existing duty of care, and
- breach of that duty, and
- resulting damage.

From the latter, the damage is obvious - a house with inappropriate insulation, and the loss of the mortgage. Presumably, the lender's surveyor found the issue, but a report from an independent surveyor may well be necessary.

Back to duty of care. If you engage a professional to do a job, they're expected to be competent at it. If you hire a mechanic to service your car, and he forgets to replace the oil after draining the old and the engine blows up, it's negligent. It would be different if Andehh had insisted on this particular type of cw insulation against the installer's recommendations, but presumably he didn't.

So, I'd have thought the case for there being a duty of care was pretty clear, in so far as anything ever is in court cases.

And if that's right, we've got two out of three elements, and all that's left if breach of duty. And on that, the company were expected to insulate the home, not damage it. If the mechanic in my example used the wrong typer of oil, or filled up the customer's car with diesel, not allowing for it being a petrol car, he would be (IMHO) liable. And so it goes for using an unsuitable type of insulation.

My only concern would be if Andehh was too reliant on the lender's opinion that the insulation was the wrong type. If it is the "wrong" type in that they don't like to lend on houses with it, that's one thing, but if it's generally accepted, industry-wide, that it's unsuitable for valid technical reasons, that's entirely another.

Were it me, I'd want a lot more information on the "the cavity wall insulation .... is not suitable for a timber framed house" bit. If that can be independently established, I'd have thought a good basis for a case existed. But then, I'm not a lawyer. ;)

Supply of Goods And Services Act 1982 - Service not carried out with reasonable care and skill if they have used the wrong type of insulation, the trouble is proving it.

Not fir for purpose is a very generic (and vague term)

My first thought was the Supply of Goods and Services Act 1982 - s12 defines the contracts it applies to (of which this is one, as the contract is for the service of installing the insulation, as much as the provision of the insulation itself) and s13 implies a term of 'reasonable care and skill' into the contract.

So you'd need to prove that a reasonably careful and skillful insulation installer would not install the type of insulation you mention into your house by virtue of the nature of its construction. That bit is fairly easy, consult an 'expert' on the subject and get him/her to confirm that it is unsuitable.

As an alternative, what Saracen mentions is indeed correct. Though I'd disagree that the loss of the mortgage would automatically be recoverable. The consideration of Pure Economic Loss in English law is complex at best, and focuses on the proximity of the loss to negligent act. This means that if the economic loss is 'too remote' then it is not recoverable, and ultimately that would need a court to decide (basically would a reasonable man have foreseen that the installation of the wrong type of insulation would void a mortgage offer).

Either route would provide the ability to recover the costs of putting right the wrongly installed insulation and the installation of the correct insulation, but the negligence route would open up the possibility of consequential losses. (I'm assuming here there will be a contractual term of some description limiting liability for consequential loss, or if not, Hadley v Baxendale would likely limit the recoverability to that which was 'reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it'. This I would believe is unlikely to extend to the loss of a mortgage, unless you specifically made the installer aware that the mortgage was contingent upon the installation of the insulation.)

If you were to take it to court (depending on the sums involved, then you may have to) then it would be common to consider a primary claim, and a second, additionally or alternatively claim in case the first fails. Note though, you cannot recover twice - so either which way you would be put into the position you would have been in, had the contract been properly performed, ie an insulated house having paid the original fee.



My suggestion? Get a solicitor. That could be through your home insurer, who will likely be willing to help through the legal insurance that is included with your policy, or through your current mortgage provider, as they have a vested interest in the current and continuing value of your property.

You could also get a (good) architect to do a few sums for you. It may be ok - though the supplier should really be justifying their workmanship. In the event they're not around, an architect can do some checks on dew points and U values (thermal performance). I imagine it is these factors that may be causing the problem. The wrong insulation in a cavity can cause a dew point to form within the wall fabric, so condensation builds up in the wall itself creating a damp problem, for which you will then be seeking to redress via insurance, and which will affect the property value if not resolved. If redress via the installer is a complete dead-end it may applying a render, or similar might sufficiently alter the wall behaviour enough to circumvent the problem, though that is purely speculation on my part.

It would be useful to know why they think it is unsuitable for a timber framed house. (Historically TF houses were rather unpopular following some well publicised problems in the 70s)

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Originally Posted by dave87

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As an alternative, what Saracen mentions is indeed correct. Though I'd disagree that the loss of the mortgage would automatically be recoverable. The consideration of Pure Economic Loss in English law is complex at best, and focuses on the proximity of the loss to negligent act. This means that if the economic loss is 'too remote' then it is not recoverable, and ultimately that would need a court to decide (basically would a reasonable man have foreseen that the installation of the wrong type of insulation would void a mortgage offer).
....

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I didn't say, or at least I don't think I said, that it would be recoverable. I think I said it (and probably other things too) would establish resulting damage. Perhaps, resulting 'loss' would be a better way of putting it.

What's recoverable would be a more complex argument. That the mortgage was lost seems, to me, to be irrefutable. What the financial consequences of that are is far more complex. It might, for instance, simply mean applying to another company, with a period of delay but minimal financial loss. Or it could cause a deal to fall through, with large extra costs on a bridging loan.

According to my old law lecturer, if you can prove those three elements I mentioned, you will win a negligence case. What damages you get, and what is recoverable, is a whole different issue.

It may have changed now but it used to be the case that if a driver hit a pedestrian, negligence was pretty much a given. The duty of case is statutory, the breach is self-evident if you hit someone, and they only need a bruise or torn trousers to establish resulting loss. Case won.

But .... after a rash of people carefully choosing to jump into the side of cars in carefully planned "accidents", the principle of contributory negligence was used to mitigate that, and say, "well, you won the case. Dames = £0.005. i.e. half a penny, in old money. And that is really the judge saying that the law says it's negligence but I know damned well what you're up to. ;)

Establishing negligence is one thing. Establishing the basis for compensatory damages is, or at least can be, quite another.

I would think the company would be at fault if they used a none type approved insulation in your house.

However I am confused by one point you mention.

You say it's a timber framed house and then go on to say they blew the insulation in through the brick work.

So I would have to ask exactly how the house is constructed.

Since the insulation is blown in from top to bottom (IIRC) I'm assuming that you do not have wood frame at the bottom and brick at the top as that would make for a very unsound house.

So that leaves the option that it is wood framed with a brick fascia over it so it looks like a brick house but is not. If this is the case the company could very well try to put it down to a simple mistake since they thought the house was brick.

Like I say a bit more clarification on than actual construction of the house would be helpful and can make all the difference between negligence or mistake, and court case or warranty claim

I imagine it is brick facade (or even worse, brick slip facade :yucky:) supported by a timber frame. Knowing the structure of a building is pretty fundamental before commencing any alterations to it. The contractor should verify the construction to satisfy himself prior to commencing work. Unless they were explicitly told it was the wrong construction and instructed to work regardless the onus under law is still on the contractor. The client, a non-professional in the building industry, has appointed the contractor, a professional in the industry, to undertake work to improve his property. The duty of care rests with the contractor not the client.