The husband had executed a deed in favour of his former wife after dissolution of their marriage covenanting to pay a specified sum per annum free of income tax up to but not exceeding a stated amount. This provision was in substitution for one drafted by the wife’s solicitors that provided for the payment of such an amount that after the deduction of income tax not exceeding the stated amount would represent the specified sum. The husband sought rectification to restore the deed to the terms of the draft. After the proceedings had been commenced but before the matter came before the Court, the parties executed a supplemental deed rectifying the error so that as between themselves the deed then took the form, and was thereafter to be treated as having always taken the form, that the obligation was to pay such an amount as, after deduction of tax, would leave the specified sum per annum.
Held: Without a dispute between the parties, rectification was refused. Rectification may be available where a document contains the very wording that it was intended to contain, but where it has in law or as a matter of true construction an effect or meaning different from that which was intended. The jurisdiction to rectify documents is one which is ‘cautiously watched and jealously guarded’.
Evershed MR commented on a passage from Kerr on Fraud and Mistake, 6th ed, at 620: ‘The passage is this: ‘Though the court will rectify an instrument which fails through some mistake of the draftsman in point of law to carry out the real agreement between the parties, it is not sufficient in order to create an equity for rectification that there has been a mistake as to the legal construction or the legal consequences of an instrument.’ I do not read that passage as meaning that if the mistake made is in using language to perfect an agreement which in law has some result different from the common intention, that is not a case in which there can be rectification. I do not read the passage as so stating, and I think, as at present advised, that if it did it would be too wide. I think it may well be that if the mistake has arisen from the legal effect of the language used that may provide a ground for the exercise of the court’s reforming power. Subject however to that qualification, I think that the passage cited is correct’
Judges:
Lord Evereshed MR
Citations:
[1950] Ch 65
Jurisdiction:
England and Wales
Cited by:
Cited – AMP (UK) Plc and Another v Barker and Others ChD 8-Dec-2000
The claimants were interested under a pension scheme. Alterations had been made, which the said had been in error, and they sought rectification to remove a link between early leaver benefits and incapacity benefits. The defendant trustees agreed . .
Cited – Oun v Ahmad ChD 19-Mar-2008
The parties agreed in writing for the sale of leasehold property to the claimant. One document had been signed, but later one said that it had not included an aportionment. Another document then set out the apportionment. When the defendant refused . .
Cited – Ashcroft v Barnsdale and Others ChD 30-Jul-2010
The parties sought to rectify a deed of family arrangement varying a will. The variation deed had had several mistakes which in fact increased the sum of Inheritance Tax owed. HMRC refused to accept the rectification deed unless approved by the . .
Cited – Gibbon v Mitchell ChD 1990
G executed a deed surrendering his life interest in a trust fund in order to vest the property in his two children: the deed did not have that effect because of two errors (one of which was ignoring the fact that his life interest was subject to . .
Lists of cited by and citing cases may be incomplete.
Equity
Updated: 12 May 2022; Ref: scu.184585