Joyce v Bowman Law Ltd
| Jurisdiction | England & Wales |
| Judge | MR JUSTICE VOS,Mr Justice Vos |
| Judgment Date | 18 February 2010 |
| Neutral Citation | [2010] EWHC 251 (Ch) |
| Docket Number | Case No: HC08C01373 |
| Court | Chancery Division |
| Date | 18 February 2010 |
[2010] EWHC 251 (Ch)
Before: Mr Justice VOS
Case No: HC08C01373
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Mr Simon Williams (instructed by Ross & Craig) for the Claimant
Ms Eva Ferguson (instructed by Beachcroft LLP) for the Defendant
Hearing dates: 8 th, 9 th, 10 th and 11 th February 2010
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
Mr Justice Vos
Introduction
The Defendant, Bowman Law Limited (“Bowman”), a firm of licensed conveyancers, acted for Mr Paul Peter Anthony Joyce (“Mr Joyce”), the Claimant, when he purchased Warren Cottage, Severals Road, Bepton, West Sussex (the “Property”) for £360,000 from Dorothea Elizabeth Bannister Chesters (the “Vendor”) on 2 nd September 2005. A somewhat dilapidated cottage, dating back between 200 and 300 years (“Warren Cottage”), stood on the Property in a plot of 0.12 hectares or 0.30 acres.
The Property had been advertised with an option for the buyer to purchase the lower end of the existing garden (the “Additional Land”) for £20,000 within 12 months, if the Vendor's application for planning permission to erect one dwelling on that land was unsuccessful. The Additional Land extended to 0.09 hectares or 0.22 acres. The Property and the Additional Land, therefore, together amounted to 0.21 hectares or 0.52 acres.
Contracts for the sale of the Property were exchanged (the “Contract”), and completion (“Completion”) took place simultaneously on 2 nd September 2005. At that time, Mr Joyce thought that the Contract contained an option in the form that it had been advertised. It fact, it contained a seller's option instead.
On 3 rd February 2010, Bowman admitted negligence in failing to appreciate the nature of the option that the Contract contained, and in advising Mr Joyce wrongly that, if the Vendor failed to obtain planning permission within 12 months of completion, he (Mr Joyce) would be able to purchase the Additional Land. Bowman also admitted that it was negligent in permitting Mr Joyce to enter into the Contract when, in fact, it contained a seller's option rather than a buyer's option.
The question that arises in these proceedings is what, if any, damages, Mr Joyce is entitled to recover from Bowman for its negligence.
Background facts
The sales particulars for the Property, which were “subject to contract”, included the following wording:—
“A picturesque character cottage adjacent to woodland and offering scope for modernisation and extension (subject to the usual consents) …
Important Note
(Subject to Contract)
The lower end of the garden is being retained by the vendor and a planning application for the erection of one dwelling is to be submitted. Should this prove unsuccessful, both on application or any subsequent appeal that might be considered, then the purchaser will have the option within 12 months of completing the purchase of Warren Cottage to purchase the additional area of garden at the price of £20,000 …”
As it stood, Warren Cottage had a total floor area of 182 square metres and an external footprint of 142 square metres, both including garages and outbuildings, and a height of between 6.5 and 7 metres. The footprint without the garage was 118 square metres, and the upper floor had an area of 40 square metres.
Mr Joyce made an offer of £385,000 for the Property on 5 th June 2005, expressly indicating that he wished to take up the option to purchase the Additional Land if the Vendor were unable to obtain planning permission. On the 6 th June 2005, King & Chasemore, the Vendor's agents, prepared a Memorandum of Sale recording the sale “subject to contract” and including the following: “option for the purchasers to acquire remainder of the garden for £20,000 (see sales particulars)”.
Mr Joyce was first represented in the purchase transaction by George Ide Phillips, Solicitors (“GIP”). GIP was replaced by Bowman in mid-August 2005. On 16 th August 2005, MacDonald Oates, solicitors for the Vendor, asked Bowman whether the option contained in draft special condition 5 was acceptable to Mr Joyce. In due course, Mr Joyce commented on the period of the option (asking that the period be reduced from 2 years to the one year advertised in the sales particulars), but the Contract was exchanged and completed with the terms of the clause otherwise unchanged. Special Condition 5 (the “Option Clause”) provided in part as follows:—
i) “5.1 In this Clause: … 5.1.5 “the Option Notice” means the Notice served by the Buyer pursuant to clause 5.3”
ii) “5.2 In consideration of [£1] paid by the Seller to the Buyer … the Buyer grants to the Seller the Option to require the Buyer to buy the freehold interest in the Additional Property [the “Additional Land”] at the Additional Purchase Price [£20,000]”.
Mr Joyce raised the purchase price of the Property by mortgaging it to Northern Rock Building Society to raise £306,720. The balance of the purchase price of the Property came from the Birmingham Midshires Building Society, and was charged on Mr Joyce's existing family home at Yew Cottage, Charlton Road, East Dean, Chichester, West Sussex PO18 0JA (“Yew Cottage”). Mr Joyce contributed no cash towards the purchase of the Property from his own resources.
At some time during August 2005, Mr Joyce instructed Mr Barrie F Morse MRICS FCIOB FASI (“Mr Morse”) of Wilkins, a firm of Chartered Surveyors, Project Managers and Construction Cost Consultants, to advise him in connection with Warren Cottage. The date of Mr Joyce's first meeting with Mr Morse is rather unclear, but it was certainly before the Contract was concluded on 2 nd September 2005.
Mr Joyce claims that at about this time he prepared a sketch plan of the large house, with dimensions noted of 12 meters by 18 metres, that he wished to build on the Property (the “Sketch Plan”), once he had been able to exercise the option to acquire the Additional Land.
Shortly before the Contract was executed, Mr Joyce negotiated a reduction in the contract price from £385,000 to £360,000 on the grounds that he had discovered that a sand quarry landfill site was proposed close to the Property.
In the period leading up to Completion, Mr Joyce dealt mostly with Mr Keith Curran (“Mr Curran”), an experienced conveyancer then employed by Bowman. Mr Joyce says that he also spoke to Mr Simon Bowman (“Mr Bowman”), the principal of Bowman. Mr Bowman now admits that he met Mr Joyce briefly on the morning of Completion, and Mr Joyce undoubtedly met Mr Curran that morning to sign the Contract and to discuss the transaction. Mr Joyce phoned Mr Curran from the airport (whence he was leaving for France) at lunch-time that day to confirm that the transaction had gone through.
As I have said, the Contract that was exchanged and completed on 2 nd September 2005 contained the Option Clause allowing the Vendor to require Mr Joyce to buy the Additional Land for £20,000 during the period of one year ending on 2 nd September 2006. There was, also as I have said, no option allowing Mr Joyce to require the Vendor to sell the Additional Land to Mr Joyce.
An exchange of correspondence immediately after the sale between Mr Eddie Lintott of King & Chasemore, and Mr Martin Chesters, the Vendor's nephew (“Mr Chesters”), who was handling the sale on her behalf, shows that both Messrs Lintott and Chesters were relieved that the sale had gone through.
It appears that, on 3 rd September 2005, whilst Mr Joyce was in the South of France), he e-mailed Mr Morse as follows:—
“very nice to meet you on Friday, e-mail as promised with full address of the [Property] … Can you please arrange TPOs orders on the trees asap as I dont have the luxury of time … I will forward you a file on [Yew Cottage] asap and send it to you r.e. the new planning application”.
On 5 th September 2005:—
i) Mr Morse replied to Mr Joyce explaining how he was progressing the Tree Preservation Orders on the Additional Land (which Mr Joyce had instructed him to obtain in order to obstruct the Vendor's intended application for planning permission), and saying that a survey would be necessary and that “[t]he latter information will be required when we prepare a scheme to extend the present house [on the Property]”.
ii) Mr Morse also sent Mr Joyce a letter explaining his charges in detail. Almost the entire letter is premised on the proposed extension to the existing Warren Cottage to make it into a 5/6 bedroom house.
On 9 th September 2005, Mr Morse wrote again to Mr Joyce enclosing his proposed plans for such an extension, and saying that retaining the original portion of the building incurred problems “low ceiling heights, poor thermal qualities and damp ingress”, and that “[i]t may be prudent to consider demolishing the whole of the [Property] (upon receipt of planning approval) and erect a purpose-designed house to comply with modern standards. You would also save VAT, as new properties are zero-rated”.
On the 9 th September 2005, Mr Joyce emailed Mr Morse as follows: “… think we may have a misunderstanding wanted to object to the planning on the extra piece of garden. Seems like a major project, as regards to the house if i wanted a modern one i would have looked elsewhere as it stands if i built new with the price i paid i would be looking at another project. If the way forward is to obtain outline planning thats fine, but im not ready to build …”.
I should say at once that I do not accept Mr Joyce's explanation for this email, which was that he had his wires crossed with a proposed extension project at Yew...
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