I am a party wall surveyor and I am sorry to hear of the circumstances whereby a surveyor (who I probably know) has sent unsolicited letters to neighbours. This happens when certain surveyors trawl the internet for planning applications. I imagine your neighbour received a letter from several surveyors shortly after your planning application was submitted.
In my opinion such behaviour is unethical.
I have challenged these surveyors in the past and they take the stance that they are merely 'informing' people of their rights and that the work they do is good as it is 'educational'.
In practice, they couldn't care less about the people who appoint them, they literally just want to pick up the cash, nice and quickly, and without fuss.
This means that you will pay their fees, and in my experience, you are looking at about £1,100 + VAT.
I will answer your specific questions as follows:
Are they now tied in to using this surveyor? Is that fact that they signed before receiving a notice a factor?
This is very difficult to answer and I have changed my mind on this several times. Some people argue that the act is not invoked if a notice has not been served. I used to believe this, but this would suggest 'no notice - no act'. The act itself implies that it can be invoked without serving a notice (for example section 3(3)(a)). There is also case law where someone who had done work without serving a notice argued he was not subject to the act as it had not been invoked. The Judge disagreed, essentially saying the act had been invoked and notices were not necessarily required.
In the past, I have had a surveyor step aside and you will find that this will usually happen if your neighbour regrets his decision. There are also other options, however these would require co-operation from your neighbour.
What are my options if they go ahead with a dodgy surveyor? Can he pretty much charge whatever he likes with me footing the bill?
Absolutely not - but be prepared to pay around £1,100 + VAT. Paying anything for this type of a surveyor is too much as far as I am concerned. He may act as the 'agreed surveyor' which would save you your own surveyor's fees. However, if for example you were to appoint your own surveyor, part of the award would include the determination of the other surveyor's fees and these need to be reasonable. There are plenty of arguments as to what 'reasonable' is and unfortunately party wall surveyors can often be greedy.
I presume I would have to hire an alternative surveyor just to mitigate any against any decisions my neighbours surveyor makes?
Yes - I imagine the way forward now is to get your own surveyor. Do some research and make sure your surveyor hasn't got a bad reputation. I would be happy to assist (firstname.lastname@example.org
To summarise, I think the party wall act is being abused and is not working as well as it should be. This is mainly down to the conduct of surveyors and 'ambulance chasing' is just one example of many where surveyors are pushing the boundaries and acting unethically to make money of people who just want to do work to their homes. I am trying to challenge behaviour where possible as change needs to come from within, but it is very tough and as you can imagine, challenging such behaviour can leave me a little isolated. There are plenty of good surveyors out there, but too many are silent on this type of behaviour.