How to land in the deep end: Trade associations

All you folk running trade associations, institutions or professional bodies of one sort or another, frequently do a bit of bragging about your members. And why not? Well, watch out. You could land up in court when one of those members gets into a row with his client or customer.

That’s what happened to SPATA (the Swimming Pool and Allied Trades Association). The customer got nowhere in his row with the offending contractor so he turned on the trade body and insisted they pay up instead. The case came all the way to the Court of Appeal. By a split decision, SPATA got home and dry. Close run thing, though.

Three years ago, Mr and Mrs Patchett decided to treat themselves to a swimming pool in their back garden. Google came up with SPATA’s name. The association is well established and has about 250 members.

Mr Patchett went to three SPATA members for prices. Crown Pools’ £56k bid was accepted. Work got under way. The Patchetts paid some installments. Then a few complaints arose. Crown got into financial difficulties. It left the job half done and the Patchetts had to get in another contractor. Snag is that all these ups and downs saw the Patchetts having to shell out an extra £44k. Complaining to Crown was hopeless. They Googled SPATA’s website again – to remind themselves why they went for a SPATA member in the first place. It was the bragging that did it.

Credit: Simone Lia

SPATA’s website does what so many member organisations do. It holds its members out expressly or implicitly to be a cut above the rest. It is “making representations”, suggesting to the punter that he or she “relies” on their member; and with all that going on, lawyers’ ears prick up. It is an exciting area of law.

The injured party can’t point to any contract because they have not contracted with the advice giver. Nor need the advice givers ever know or have had contact with the complainant. In a sense, advice by institutions and associations is given to all the world and is intended to be relied upon. And if the advice proves useless but was relied on and, having so relied, causes loss, that can amount to a claim of “tortious liability in negligence”. When Mr and Mrs Patchett knocked on the door of SPATA, the association had never heard of the Patchetts. They have now.

SPATA’s website, from top to tail, tells the nation that building a swimming pool needs special skills, and yes, SPATA’s members have the skills. More than that, to get membership, the pool builder has to “be approved”. It has to meet the “standards governing construction of pools”. Even more, SPATA members are “fully vetted before being admitted to membership, with checks on their financial record, experience in the trade and inspections of their work”. And once they are members, they must be seen to comply with a code of ethics, with their work periodically inspected. Are you already sold? Will you dare go anywhere else for the swimming pool in your next penthouse flat?

Now then, all this does not make SPATA liable if their member does a poor job. SPATA may well have done all the checks but it doesn’t warrant that its contractor member will not later behave badly. But you can see how SPATA or any other trade body or institute can get near the edge of liability.

In fact, SPATA went one step further to reassure its members’ customers. And this is admirable. Its pool and spa installers belong to Spatashield, a bond and warranty scheme “offering customers piece of mind that their installation will be completed to SPATA’s standards – come what may”. Wow! That’s great. Then came the bombshell. Spatashield applies to members. Crown was only an “affiliate member”. If Mr Patchett had taken up the offer of an information pack, he would have found this out. He didn’t.

So, said two of the three judges in the Court of Appeal, by failing to call for the pack the Patchetts can’t point their loss at SPATA. But the third judge parted company. She thought the website, read as a whole, was enough to invite ordinary folk to rely on SPATA.

This case is a signal to associations and institutions; there is a duty of care not to oversell the members nor set the bar low for membership just to get annual subs. Is that what your institute does?