MIDILL (97Pl) Ltd v Park Lane Estates Ltd and Another: CA 11 Nov 2008

Refusal to return Land Contract Deposit

The court was asked as to whether a seller could retain a deposit paid by the claimant on a sale where contracts had been exchanged but the buyer had proved unable to go ahead.
Held: The appeal against refusal of return of the deposit failed. The court looked at the case law and said: ‘the judge’s reasoning was impeccable. He was entitled to find that it was not enough that the vendor sold at a higher price some months after the date for completion. That delay distinguishes the case from Tennaro. There is nothing to suggest that the price rise was exceptional, in relation to movements in the market generally. There is no obvious reason why the purchaser should have the benefit of any such price rise. It was the vendor who had borne the risk and cost of holding the property during the intervening period. I also agree with the judge that to decide otherwise would add undesirable uncertainty to the well-established contractual understanding. ‘

Keene, Carnwath, Maurice Kay LJJ
[2008] EWCA Civ 1227, [2009] 7 EG 92, [2009] 2 All ER 1067, [2008] 46 EG 114, [2008] NPC 120, [2009] 1 WLR 2460, [2009] 1 EGLR 65, [2009] 2 P and CR 6
Law of Property Act 1925 49(2)
England and Wales
Not helpful in this context.Finch v Underwood CA 1876
The landlord had covenanted with the tenant, on receipt of notice from the latter, to renew the lease ‘in case the covenants and agreements on the tenants’ part shall have been duly observed and performed’. Notice was duly given but the landlord . .
CitedOmar v El-Wakil CA 11-Jul-2001
The parties entered into two linked contracts providing for a property and a business to be transferred, a lease granted and otherwise. The transfer of the property was in the sum expressed in the sum and at the time the other agreement provided for . .
CitedAero Properties Ltd and Another v Citycrest Properties Ltd and Another ChD 6-Feb-2002
Contracts were entered into for the sale of five flats. Completion of each contract was conditional upon simultaneous completion of the others. Completion did not occur, and the defendant sellers issued a notice to complete, then rescinded the . .
CitedUniversal Corporation v Five Ways Properties Limited CA 1978
The purchaser had failed to complete, notwithstanding the service of a notice to complete. The purchaser a Nigerian company suffered a delay in obtaining funds due to a change in the exchange control regulations. There was no attempt to exclude . .
CitedTennaro Ltd v Majorarch 2003
The parties entered into three related contracts to grant long leases of three flats in the same block (Nos 37, 32 and 31), and deposits paid. The vendor served notices to complete and when the purchaser did not comply, he rescinded each agreement . .
CitedRe Scott and Alvarez’s Contract No 2 CA 1895
Lindley LJ discussed the circumstances under which a deposit paid under a contract for the sale of land could be returned. Even where specific performance was refused to the vendor because the title was wholly defective, the purchaser might be left . .
CitedWorkers Trust and Merchant Bank Ltd v Dojap Investments Ltd PC 22-Feb-1993
(Jamaica) The purchaser at an auction had been obliged under the terms of the auction contract to pay a deposit of 25%. He failed to complete, and the vendor took the deposit by way of forfeit. The standard deposit payable would be 10%. The Court of . .
CitedJames Macara v Barclay CA 1944
The court declined to express a view on the use of section 49(2) to order the return of a deposit. . .
CitedSchindler v Pigault 1975
The purchaser of land had not completed and sought return of the deposit paid claiming default by the vendor, or alternatively under section 49(2).
Held: He was entitled to the repayment of the deposit on the first ground. The court went . .
CitedMichael Richards Properties Ltd v Corporation of Wardens of St Saviour’s Parish Southwark 1975
Property was offered for sale by tender. The tender documents contained all the detailed terms upon which the contract was to be based. The successful tender was accepted by letter, but by mistake the secretary who typed it typed in the words . .
CitedDimsdale Developments (South East) Ltd v De Haan 1983
The court considered the interpretation of clauses allowing a notice to complete a contract for the sale of land. Godfrey QC said: ‘In my judgment this notice, served as it was under cover of the letter of November 10, 1981, referring to the . .
CitedCole v Rose 1978
The vendor had purported to rescind the contract and retain the deposit, while selling to another purchaser at a higher price.
Held: The purchaser was entitled to return of the deposit, because the notice to complete had been ineffective. . .
CitedBidaisee v Dorinsa Yusidai Sampath and Others PC 1993
(Trinidad and Tobago) The parties contracted for the sale of a half share of land to the co-owner for TT$2 million. A 10% deposit was paid. A notice to complete was not met. The vendor sold the share to others for more. Arguments as to the validity . .
Appeal fromMidill (97Pl) Ltd v Park Lane Estates Ltd and Another ChD 16-Jan-2008
Was the vendor of shares in a company owning a single property, who had served notice to complete on the purchaser, itself ready, able and willing to complete? . .

Lists of cited by and citing cases may be incomplete.

Land, Contract

Updated: 09 November 2021; Ref: scu.277731