[2023] UKUT 200 (LC)

We have to begin with the principles relating to the construction of contracts in general and of conveyances in particular. The modern starting point is the Supreme Court’s judgment in Wood v Capita Insurance Services Limited [2017] UKSC 24. In paragraphs 10 to 13 it was said that the courts must:

“consider the contract as a whole and, depending on the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to that objective meaning.” (Lord Hodge para 10)

Furthermore:

“… where there are rival meanings, the court can give weight to the implications of rival constructions by reaching a view as to which construction is more consistent with business common sense. (Lord Hodge at para 11).

In Pennock v Hodgson [2010] EWCA Civ 873 Mummery LJ explained the approach to be taken to the construction of conveyances in order to ascertain the extent of the land conveyed:

“Looking at evidence of the actual and physical condition of the relevant land at the date of the conveyance and having the attached plan in your hand on the spot when you do this are permitted as an exercise in construing the conveyance against the background of its surrounding circumstances. They include knowledge of the objective facts reasonably available to the parties at the relevant date. Although, in a sense, that approach takes the court outside the terms of the conveyance, it is part and parcel of the process of contextual construction..”

Accordingly, extrinsic evidence may be considered where the conveyance itself and the physical features on the ground do not clearly indicate what has been conveyed: Nielson v Poole (1969) 20 P & CR 909, Clarke v O’Keefe (1997) 80 P & CR 126, and Ali v Lane [2006] EWCA Civ 1532. Off limits, however, is evidence of the negotiations between the parties; in Investors Compensation Scheme Limited v West Bromwich Building Society [1998] 1 WLR 896 Lord Hoffmann said:

“The law excludes from the admissible background the previous negotiations of the parties and their declarations of subjective intent.”

Sometimes it is clear that something has gone wrong in the drafting of a conveyance. Where there is a clear mistake, and it is clear what the correction should be made in order to cure it, then that correction can be made as a matter of construction without the need for an application for rectification: East v Pantiles (Plant Hire) Limited[1982] 2 EGLR 111; Chartbrook Limited v Persimmon Homes Limited [2009] UKHL 38..

Those are the general principles, and they are not in dispute. The issue in the present case is the inconsistency between the words of the conveyance and the plan.