Laditi and another v Marlbray Ltd
| Jurisdiction | England & Wales |
| Judge | Lady Justice Gloster,Lord Justice McFarlane,Lord Justice Jackson |
| Judgment Date | 24 May 2016 |
| Neutral Citation | [2016] EWCA Civ 476 |
| Docket Number | Case No: A3/2014/1146 |
| Court | Court of Appeal (Civil Division) |
| Date | 24 May 2016 |
[2016] EWCA Civ 476
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT, CHANCERY DIVISION
MR NICHOLAS STRAUSS QC
HC11C02783
Royal Courts of Justice
Strand, London, WC2A 2LL
Lord Justice Jackson
Lord Justice McFarlane
and
Lady Justice Gloster
Case No: A3/2014/1146
Romie Tager QC and Henry Webb (instructed by Gordon Dadds LLP) for the Appellant
Brie Stevens-Hoare QC and Lina Mattsson (instructed by Berry & Berry LLP) for the Respondents
Introduction
This is an appeal by Marlbray Limited, the defendant in the action ("the appellant"), against the decision of Mr Nicholas Strauss QC sitting as a deputy judge of the High Court on a preliminary issue given in a judgment dated 28 October 2013 ("the Judgment"). The appellant also appeals against the judge's refusal of its application for permission to amend its counterclaim as set out in his judgment dealing with consequential matters dated 10 December 2013 ("the 2 nd Judgment").
There were six claimants in the court below; the 1 st and 2 nd respondents to this appeal, Dr Mobolaji Laditi ("the 1 st respondent"), and his wife, Dr Olutola Laditi (the 2 nd respondent") were the 2 nd and 3 rd claimants (together "the respondents"). The appellant was successful as against the other claimants in relation to the preliminary issue which is why they are not respondents to this appeal.
The appeal in my judgment (although not as a analysed by counsel) raises issues as to:
i) whether a contract for the sale of land, signed by the 1 st purchaser on behalf of himself and purportedly on behalf of the 2 nd purchaser, is "void", "invalid" or "unenforceable":
a) because the 2 nd purchaser never gave authority to the 1 st purchaser to sign the contract on her behalf; and/or
b) because of alleged non-compliance with section 2 of the Law of Property (Miscellaneous Provisions) Act 1989 ("the 1989 Act); and
ii) whether, in the event that the purchasers fail to complete the contract, the vendor can insist on retaining the deposit as against the purchaser who signed the contract and paid the deposit.
On the appeal Mr Romie Tager QC and Mr Henry Webb appeared as counsel on behalf of the appellant; they did not appear below. Miss Brie Stevens-Hoare QC and Miss Lina Mattsson appeared as counsel on behalf of the respondents. They also appeared below.
Factual background
The proceedings concern the 1,021-bed, 4-star Park Plaza Westminster Bridge Hotel ("the Hotel"), which is located in the former GLC finance office building (the Island Site) at the south end of Westminster Bridge. The ownership structure is what is sometimes referred to as an "aparthotel". The claims and counterclaims which are the subject of the appeal concern Unit 687, one of many hundreds of individual hotel room units which were pre-sold off-plan on long 999-year leases at a launch day "sales fair" organised by Galliard Homes Ltd, as agent for the appellant, over the weekend of 22/23 October 2005. Solicitors were available at the sales fair to represent buyers. Exchange of contracts could, and usually did, take place at the sales fair.
The respondents were among the many hundreds of people who attended the October 2005 sales fair. 225 units were sold or purportedly sold at, or shortly after, the 22/23 October 2005 sales fair (see the judgment at paragraph 4).
The respondents attended the fair on 23 October 2005. They, or at least the 1 st respondent, were interested in the purchase of unit 687. At the fair:
i) The 1 st respondent, but not the 2 nd respondent, signed an "instruction memorandum" to Lucas McMullan Jacobs ("LMJ"), one of the firms of solicitors acting on behalf of purchasers at the fair, who acted on behalf of the respondents, or at least the 1 st respondent; the instruction memorandum was in the following terms:
"Re: Hotel Unit No 687 Westminster Bridge, London SE 1
I/We hereby instruct you to act on our behalf in connection with our purchase of the above mentioned property at the price of £315,000 plus VAT. I/We further instruct you to proceed to an immediate exchange of contracts in connection with the purchase of the above at the aforementioned price. I/We confirm that you advised me/us fully of the consequences of entering into this contract before I/we did so and would confirm that I/we have read and understood the context of your report (dated 18. 10. 05) that you had it to me/us before giving you these instructions and instruct you on the basis of that report."
ii) After the 1 st respondent's signature, the 1 st respondent set out his contact details.
iii) The 1 st respondent also signed what purported to be a contract between the appellant, the respondents and Galliard Homes Ltd ("Galliard") for the grant of a long lease of unit 687. This contract consisted of a first page headed "Precedent Form of Contract for UK Launch" and then, on the next line the statement "Particulars" ("the Particulars)". There were then set out the following particulars:
"PARTICULARS"
HOTEL UNITS AT THE ISLAND SITE WESTMINSTER BRIDGE LONDON SE1
Date: 23 October 2005
1 Intitial Deposit £1,000
2 Rent Guarantee Yes
3 Property Unit Number [687]
4 Purchase Price £315,000
5 Purchasers Name and Address
Purchaser 1 Purchaser 2
Mr Mobolaji Laditi Mrs Olutola Laditi
59, Taunton C lose 59, Taunton Close
Bexleyheath Bexleyheath
Kent Kent
DA7 6NN DA7 6NN
6 Purchasers Solicitors
Lucas McMullan Jacobs
7 See Rider — 10 day
———————————————————————————————————————————————————-
Signed for and on Signed for and on Signed for and on Behalf Behalf of the Vendor Behalf of Galliard of the Purchaser"
Attached, or backing on, to the particulars was a standard form of agreement for the sale of a lease of the unit stated to be between "the Vendors of the first part" and "the Purchaser of the second part" and Galliard of the third part. The following provisions are material for present purposes:
i) a definition of "Purchaser" — "As set out in clause 5 of the Particulars";
ii) a provision at clause 4 requiring that "The Purchaser shall pay to the Vendors' Solicitors on the date hereof a deposit equal to Initial Deposit to be held as stakeholders";
iii) further provisions at clause 4 requiring "The Purchaser" to pay in stages further deposits amounting in total to 25% of the purchase price of the unit;
iv) a provision at clause 24 in the following terms:
"Where two or more persons constitute the Purchaser all obligations contained in this Agreement on the part of the Purchaser shall be joint and several obligations on the part of such persons";
v) provisions whereby Galliard provided an income guarantee in favour of the Purchaser (see paragraph 10 of the judgment in relation to the role of Galliard).
Howard Kennedy ("HK") likewise signed Particulars in identical form on behalf of "the Vendor" (i.e. the appellant) and on behalf of Galliard.
The 1st respondent paid the initial deposit or reservation fee of £1000 by way of credit card. He also paid LMJ's solicitors fees of £587.50 on his credit card.
Pursuant to the instructions given by the 1 st respondent to LMJ in the instruction memorandum, the contracts were physically exchanged as between HK, as agent for the appellant and Galliard, and LMJ, as agent purportedly for the respondents.
On 26 October 2005, a Mr. Mughal of LMJ wrote to the 1 st and 2 nd respondents to confirm that contracts had been exchanged, and to remind them of the next instalment of the deposit due on the 8 November 2005. The respondents did not protest.
On 20 January 2010, HK wrote two letters to LMJ, the first to give advance notice of the projected dates for completion and the anticipated date for Notice to Complete and a completion date, the second stating that their records showed the buyer's name and address for insertion into the lease as Mobolaji and Olutola Laditi, and seeking confirmation that this was correct. On 25 January 2010, LMJ sent this on to the 1 st and 2 nd respondents, stating that, unless they notified LMJ of any amendments, the lease would be prepared as set out in HK's letter.
By February 2010, the 1 st respondent was seeking to arrange a mortgage, and kept in touch with Mr. Mughal to advise him of the progress. There was no suggestion that "the Purchaser's" name should be other than as specified by HK.
On 11 May 2010, the 1 st respondent wrote to the mortgage brokers, asking for an update on progress; this letter included the following passage:-
"Myself and wife, Olutola are the joint applicants for the mortgage. Notice for the completion has now been served and the completion notice set for 24 May 2010. The vendor's solicitor has emphasised that failing to complete on the date may lead to the contract being rescinded and consequently our deposit being forfeited plus the possibility of facing legal action."
On 14 May 2010, the 1 st respondent sent an email to Mr Mughal, to keep him up to date with the situation with regard to "our mortgage application", and this was signed "Mobolaji & Olutola".
On 24 May 2010, NatWest wrote a letter relating to finance for the purchase, referring to a valuation which had just been received, and this was addressed to "Dr. M. & Dr. O. Laditi". Similarly, the valuation, dated 13 May 2010, named both as the customer.
The evidence relating to payment of the 25% deposit appears to be that the 1 st respondent actually paid the balance of the 25% deposit over the next two years in stages amounting to £78,750, but that, although the 2 nd...
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