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“What was the total amount on the table H” “£250K for the land [Plot C] £325K for the house [Plot F]…The deal is take it or leave it…”
“What was the total amount on the table H”
Mr Lomax replied:-
“£250K for the land [Plot C] £325K for the house [Plot F]…The deal is take it or leave it…”
Mr Gregson told me that Mr Lomax had informed him that he had reached an agreement with the Defendants and that that prompted him to contact Mr Rose. Mr Gregson said that Mr Lomax had given him a number of different figures to put to the Defendants. Mr Lomax was unclear about the conversations which he had had with Mr Gregson and Mr Rose about the possible Purchase Price of Plots C and F.
There was then a telephone conversation between Mr Gregson and Mr Rose on Friday, 10 July 2020. After the weekend, Mr Gregson emailed Mr Rose at 10.30 am on Monday, 13 July, stating
“Re our conversation on Friday could you send out a letter to Lorna Dimelow setting out the final agreed offer to purchase both options, and for phase 3 and purchase of existing farm house and paddock…”
“I am not currently able to confirm that our clients are in a position to proceed with the contract as drafted. As a matter of priority, and without waiving any legal privilege, our clients are engaging in a claim against their previous advisors, Hibberts LLP and must, therefore, mitigate their position in that regard.”
“Please accept this letter as notice that the contracts tendered are now withdrawn as the basis for future discussions between our clients. Please be good enough to return the documentation to us forthwith.”
“ You will perhaps understand why [Orchard House] feels that (1) it has been dealt with inequitably and (2) that your valuation is based on incorrect assumptions and is erroneous.
Our client, therefore, invites you to withdraw the valuation delivered on 9 June and to reset the timetable to give it the opportunity to respond to the submissions of [the Defendants]”.
“For the record, I did not accept either party’s submissions in their entirety nor did I accept either Mr Eckersley’s or Mr Rees’s definition of market value. You have stated that I have somehow relied upon privileged information but I did not. All the information used by me is in the public domain.
Throughout the process, I have given the parties equal opportunity. I took on the burden of the appointment and decided the issues in absolute good faith without fear or favour. If my valuation is erroneous then that is up to others to decide.
[Orchard House] is now free to decide whether or not to exercise the option and whether or not to reach an agreement on the apportionment of value.”
“If these errors are correct, we have advised our client that these are of sufficient gravity to pursue a High Court application to have the valuation set aside on the grounds of manifest error…
…if a court application has to be made to set aside the valuation, which application will only be made if your clients do not agree to the re-opening of the valuation determination, then we reserve our client’s right to seek a costs order from your clients.”
“It is clear on any objective and reasonable analysis that there has been no manifest error by the independent expert and of course there is no question of fraud.
“…completion was to take place 4 weeks after the Purchase Price is agreed or determined. The Purchase Price was determined by the expert on 9 June 2021. The relevant 4 week period therefore expired on 7 July 2021. [Orchard House] is therefore in fundamental breach of contract for failing to complete in the requisite period and…has deprived [the Defendants] of the benefit of the Option without prejudice to [their] position as to the validity of the Option.
The above is also a fundamental repudiatory breach at common law.
….Under Clause 21 [the Defendants] may terminate the Option with immediate effect if [Orchard House] “is in fundamental breach of any of its obligations in this agreement.
It is very clear that Mr Wilson adhered to his professional obligations and followed his instructions in reaching his determination. He has not made any obvious or demonstrable error in his expert determination. Our client is therefore very confident that there has been no manifest error such that the independent expert determination is not to be final and binding pursuant to Clause 17.11 of the Option.
[Orchard House] is in fundamental breach of the Option because it is not accepting a determination of the Purchase Price pursuant to the expert determination which is final and binding and because [Orchard House] has failed to complete in accordance with Clause 19(b) of the Option as set out above.
…[the Defendants] hereby give [Orchard House] notice to terminate the Option immediately based upon its fundamental breach in failing to accept the valuation as determined by the independent expert and seeking to avoid completion pursuant to Clause 19(b).
[The Defendants reserve] all of [their] rights and remedies in relation to any breach under [Option Agreement C] and at law”.
- Heading
- The Parties
- The Background Facts
- The Master Agreement
- By Clause 2.5, the Defendants agreed to grant Mr Lomax an option to purchase plot F ( Option F )
- Option Agreement C
- the “Option Period” is defined as “five years from [19 January 2017]”
- by Clause 8.2, “the Deposit must be paid by direct credit”
- the Deposit is defined as “10% of the Purchase Price (exclusive of VAT)”
- Option Agreement F
- by Clause 1.1 (definitions)
- Subsequent events in relation to Plots C and F
- informed the Defendants that he had been unaware that a main water pipeline ( the Severn Trent Pipeline ) ran directly across the land which the Claimants had acquired and proposed to buy and suggeste
- proposed a Purchase Price of £250,000 for the remainder of Plot C proposed that the Defendants agreed to remove the restrictive covenant on Plot F prohibiting the construction of additional buildings on that land, other than the redevelopment of the
- “What was the total amount on the table H” “£250K for the land [Plot C] £325K for the house [Plot F]…The deal is take it or leave it…”
- The date of the Defendants’ move to the New Farmhouse
- a holiday request form, indicating that she was to be away from work on 28 and 29 June 2018 a removal van invoice/receipt dated 28 June 2018 referring to a “part move, total cost £80. Paid cash”
- a Certificate of Practical Completion dated 25 June 2018
- The issues to be determined in relation to Plot C
- whether Orchard House was ready and able to tender any deposit on 6 January 2021
- what loss, if any, has been suffered by Orchard House by reason of any breach by the Defendants The Parties’ broad positions on Plot C
- Issues to be determined in relation to Plot F
- the date on which the Defendants moved into their new property
- whether the Defendants are in breach of Option Agreement F by failing to transfer Plot F to Mr Lomax
- The Parties’ broad positions on Plot F
- Procedure
- The Part 8 Claim
- he valued the incorrect size of the development authorised by the Planning Permission
- he failed to allow for other build costs; and
- Mr Wilson’s calculation of Gross Development Value and build costs is, therefore, overstated
- Approach to the witnesses’ evidence
- the demeanour of the witness; and the inherent probability of the witness’s account being true
- The witnesses
- The minutes of the meetings taken by Mrs Davies
- Discussion and Analysis
- The key factual issues to be determined
- Was there a certain and binding oral agreement between Orchard House and the Defendants reached between September 2018 and March 2019 as to the Purchase Price for Plot C (less Plot G)?
- Was there a further binding oral agreement (or a certain binding variation to any prior agreement) reached between Orchard House and the Defendants in or around July 2020 as to the Purchase price for
- What was the date on which the Defendants moved into the New Farmhouse?
- Plot C – Issues for determination
- Issue 2: Was there a further certain and binding oral agreement (or a certain and binding variation to any prior agreement) between Orchard House and the Defendants in or around July 2020 as to the Pu
- Issue 3: Whether waiver by estoppel arose up to July 2020 upon which reliance was placed by Orchard House, so that the Defendants are estopped from denying that a Purchase Price of £250,000 was agreed
- Issue 4: Whether the purported exercise of the Option C on 6 January 2021 was required to be conditional upon the payment of a deposit; and, if it was so, whether the Defendants waived compliance with
- The Law
- commercial common sense; but disregarding subjective evidence of any party’s intentions
- Issue 5: Whether Orchard House was ready and able to tender any deposit on 6 January 2021
- Issue 6: Whether the Defendants validly terminated Option C on 21 October 2021 for the reasons set out in their solicitors’ letter of the same date
- Issue 7: Whether the second purported exercise of the option for Plot C on 17 January 2022 was valid
- Issue 8: Whether the Defendants are in breach of Option C by failing to transfer Plot C to Orchard House
- Issue 9: what loss, if any, has been suffered by Orchard House by reason of any breach by the Defendants
- The Part 8 Claim
- Option F – Issues for determination
- The parties’ respective positions
- Analysis and decision
- Issue 2: the date on which the Defendants moved into the New Farmhouse
- Conclusions