The parties disputed the effect of a contract between them for the sale of a leasehold property. After exchange the solicitors failed to obtain the landlord’s consent to the proposed assignment as required by the lease. In the meantime the proposed assignees set out to enfranchise the lease under the 1967 Act as envisaged by the contract. The notice proved defective and after difficulties with the licence to assign, the purchaser purported to rescind (but offering a reduced price).
Held: The purchaser was not disentitled to rescind for failure to apply for the licence to assign, since that duty fell on the sellers under the standard conditions. It had however failed to provide accounts as requested by the landlord. They had been provided later, and the question of whether they were in breach of the contract was to be asked not at the time fixed or completion but at the time when the notice to rescind was given. The standard conditions provided for the possibility that the landlord’s consent might not have been obtained before the date fixed for completion, and apportioned risk between the parties in contuing to act on the basis of the contract’s continued existence. This in turn implied a limitation on the freedom to rescind. The purchasers had not acted promptly as required, and ‘An equitable approach to the exercise of rights between the parties contained in contracts for the sale of land has been established for a very long time.’
Sales J
[2008] EWHC 2675 (Ch)
Bailii, Times
Leasehold Reform Act 1967
England and Wales
Citing:
Cited – Homburg Houtimport BV v Agrosin Private Ltd (the ‘Starsin’) HL 13-Mar-2003
Cargo owners sought damages for their cargo which had been damaged aboard the ship. The contract had been endorsed with additional terms. That variation may have changed the contract from a charterer’s to a shipowner’s bill.
Held: The specific . .
Cited – Re Hewitt’s Contract 1963
The interpretation and effect of standard conditions governing the sale of land are informed by the background rules of equity governing the operation of contracts for the sale of land. . .
Cited – ICI Chemicals and Polymers Ltd v TTE Training Ltd CA 13-Jun-2007
The Defendant had applied for summary judgment under CPR Part 24. One argument was a short point of construction. The Judge suggested the parties agree that he should decide the point as a preliminary issue. They were unwilling so he proceeded on . .
Cited – Bowman v Hyland 1878
A vendor’s right to rescind a contract for the sale of land on receipt of a requisition was not to be exercised for reasons unconnected with the contract. . .
Cited – Smith v Wallace 1895
Romer J said that a vendor of land wanting to exercise the right of rescission given him by the relevant contract term must do so ‘fairly, and to determine promptly whether he [will] exercise the power or not. He [is] not entitled to take advantage . .
Cited – Aubergine Enterprises Limited v Lakewood International Limited CA 26-Feb-2002
A sought confirmation that it had successfully rescinded a contract for the purchase of a leasehold property from L. Either party was to be able to rescind, if consent to the assignment had not obtained before three days before completion. There . .
Cited – Selkirk v Romar Investments Ltd PC 1963
A vendor of land may properly only rescind a contract on receipt of requisitions for reasons associated with the contract. . .
Cited – St Leonard’s Shoreditch Vestry v Hughes 1864
The vendor of land is only allowed a reasonable time within which to make his decision whether to rescind or not in reliance on a contractual term providing for this right where requisitions have been raised which he cannot fulfil. . .
Cited – Dedman v British Building and Engineering Appliances CA 1973
The claimant sought to bring his claim under a provision which required a complaint to the industrial tribunal to be made within four weeks of the dismissal unless the employment tribunal was satisfied that this was not ‘practicable’. He did not . .
Lists of cited by and citing cases may be incomplete.
Land, Contract
Updated: 01 November 2021; Ref: scu.277552