Jones v Lipman and Another: ChD 1962

The defendant had contracted to sell his land. He changed his mind, and formed a company of which he was owner and director, transferred the land to the company, and refused to complete. The plaintiff sought relief.
Held: Specific performance is available against a contracting vendor who has it in his power to compel another person to convey the property in question. An order for specific performance was made against both the director and the company. The company could not escape from or divest itself of its knowledge gained through the director. The company was: ‘A creature of [the controlling director], a device and a sham, a mask which he holds before his face in an attempt to avoid recognition by the eye of equity.’

Russell J
[1962] 1 WLR 832, [1962] 1 All ER 442
England and Wales
CitedGilford Motor Co Ltd v Horne CA 1933
The defendant was the plaintiff’s former managing director. He was bound by a restrictive covenant after he left them. To avoid the covenant, he formed a company and sought to transact his business through it. At first instance, Farwell J had found . .
CitedElliott and H Elliott (Builders) Ltd v Pierson ChD 1948
Harmon J: ‘At law A may contract to sell to B any defined subject matter and can enforce the contract if by the time when he is obliged to do so he has obtained a sufficient interest or can compel other interested parties to concur in the sale. It . .

Cited by:
CitedCrawford v Financial Institutions Services Ltd PC 2-Nov-2005
(Jamaica) The government had intervened in banking institutions under the control of the appellant. Subsequently orders had been made against him for compensation in respect of loans made negligently or otherwise than in accordance with good banking . .
CitedColes and others (Trustees of the Ward Green Working Mens Club) v Samuel Smith Old Brewery (Tadcaster) (Unltd Company) and Another CA 29-Nov-2007
The claimants appealed refusal of an order for specific performance of a contract for the purchase of land under the exercise of an option agreement. The defendant had conveyed the land to a subsidiary in order to defeat the option.
Held: ‘The . .
CitedPrest v Petrodel Resources Ltd and Others SC 12-Jun-2013
In the course of ancillary relief proceedings in a divorce, questions arose regarding company assets owned by the husband. The court was asked as to the power of the court to order the transfer of assets owned entirely in the company’s names. The . .
CitedBen Hashem v Ali Shayif and Another FD 22-Sep-2008
The court was asked to pierce the veil of incorporation of a company in the course of ancillary relief proceedings in a divorce. H had failed to co-operate with the court.
After a comprehensive review of all the authorities, Munby J said: ‘The . .

Lists of cited by and citing cases may be incomplete.

Company, Equity

Leading Case

Updated: 01 November 2021; Ref: scu.237486