Tennaro 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 The vendor served notices to complete and when the purchaser did not comply, he rescinded each agreement and forfeited the deposits. The purchaser sought repayment of the deposits under section 49(2).
Held: Special circumstances are needed to justify the return of a deposit where the purchaser is in breach of contract. The fact that the vendor has resold the property elsewhere for a profit might constitute such a special circumstance. Two of the deposits were ordered to be returned. As to Dimsdale, Neuberger J said: ‘As I understand it, (the judge) considered that the fact that the Seller had sold the property at a substantially higher price than it would have received under the contract with the defaulting Buyer, was the crucial factor which justified the return of the deposit. However, it is right to add that he made deductions from the deposit, in favour of the Seller, in relation to expenditure wasted by the Seller under the abortive contract.’


Neuberger J


[2003] EWHC 2601


Law of Property Act 1925 49(2)


England and Wales


ApprovedDimsdale 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 . .
Too restrictiveUniversal 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 . .
Too restrictiveOmar 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 . .

Cited by:

CitedMIDILL (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. . .
Lists of cited by and citing cases may be incomplete.

Land, Contract

Updated: 02 May 2022; Ref: scu.279041