Correction by Construction: Dealing with Drafting Errors by Way of Interpretation

Document Cited in Related
DOI10.3366/elr.2023.0813
Author
Pages90-94
Date01 January 2023
Published date01 January 2023

In Monsolar IQ Ltd v Woden Park Ltd1 the Court of Appeal corrected a drafting error in a rent review provision of a lease as part of the interpretive exercise. No claim for rectification of the clause had been made. The Court of Appeal noted that the courts have long been able to disregard the literal meaning of a provision were it is clear (1) that an error has been made; and (2) what the contractual provision should have said. The Court of Appeal was of the view that recent Supreme Court decisions on interpretation had not altered that position.

THE FACTS

The parties had entered into a lease of a site near Cardiff. The appellant was the landlord and the respondent was the tenant. The lease was for twenty-five years and six months. The land was to be used as a solar farm.

The rent review provision was set out as a formula, the effect of which, when read literally, was to increase the previous year's rent by the total increases in RPI since the beginning of the lease, resulting in exponential rises year on year.2 There was no dispute between the parties as to the effect of the rent review provision read literally. The dispute was whether the rent review formula should be construed so that the rent was indexed in line with the RPI, under the principle by which clear mistakes in drafting could be corrected as a matter of construction of the contract.3

 DISCUSSION

Nugee LJ gave the decision of the court. He began by noting that the principles of construction of contracts had been considered by the Supreme Court in a series of well- known cases but that those authorities were largely concerned with the position where a contractual provision had two possible interpretations. This was not such a case. Rather, this case was concerned with what he referred to as the “Chartbrook principle” in terms of which the literal meaning of a provision could be corrected if it was both clear that a mistake had been made, and what the provision was intended to say.4 That was a different exercise from choosing between rival interpretations.5

The Court of Appeal did not read anything said by Lords Neuberger or Hodge in Arnold v Britton6 as qualifying or departing from Lord Hoffmann's approach in Chartbrook. Lord Neuberger's point was that the parties could not control commercial common sense or the surrounding circumstances but that they could control the language used in their contract. As such, that was primarily where the reasonable reader would expect to find out what the parties had intended. In Nugee LJ's view none of that really applied where the suggestion was that the parties had made a drafting mistake.7 He went on to note that Arnold v Britton...

Get this document and AI-powered insights with a free trial of vLex and Vincent AI

Get Started for Free

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex

Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant

  • Access comprehensive legal content with no limitations across vLex's unparalleled global legal database

  • Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength

  • Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities

  • Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting

vLex