The court described the duties of a vendor as trustee of the property after exchange but before completion: ‘It is well-established law that, subject always to the terms of the particular contract, a seller of property under a specifically enforceable contract is to be regarded after the contract has been made as holding the property as a trustee for the buyer. However, he is not a bare trustee. His trust obligations are limited in certain respects. For example, if, as is usually the case, he is entitled to remain in possession for the period after the contract has been made pending the date fixed for completion, he is entitled to keep and retain for his own benefit the rents and profits of the land arising during that period . . The seller must take care not to damage the property or to prejudice the buyer’s interest in the property of which, on completion, he will become the legal owner. But in general, within those limits he is entitled to the ordinary rents and profits, and for him to take steps to obtain them after contract and before the date fixed for completion, either by occupying and using the property himself or by permitting another to occupy and work the property in return for a rent, is not a breach of his duties as seller under a contract for sale.’ The release of a tipper from an indemnity agreement was not a matter of which a purchaser could complain, since the benefit of the agreement was not part of the property being sold: it was not annexed to the land, and was a benefit vested in the vendor under an agreement which, on completion, would not survive to bind or to benefit the purchaser as the new owner. If the purchaser could not compel the vendor to assign that benefit, then the purchaser could not complain if the vendor chose not to do so.
Judges:
Sir Donald Nicholls VC
Citations:
Unreported, 21 January 1993
Jurisdiction:
England and Wales
Cited by:
Cited – Englewood Properties Limited v Patel and Another ChD 16-Feb-2005
The claimant was a property developer, which sought to sell a row of shops at auction. One lot was a Woolworths store, where the company owned both freehold and leasehold interests, with Woolworths occupying an underlease, which the claimant had . .
Lists of cited by and citing cases may be incomplete.
Land, Contract
Updated: 10 July 2022; Ref: scu.223741
