Mountford v Scott
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE RUSSELL,LORD JUSTICE CAIRNS,SIR JOHN PENNYCUICK |
| Judgment Date | 17 October 1974 |
| Judgment citation (vLex) | [1974] EWCA Civ J1017-6 |
| Date | 17 October 1974 |
| Court | Court of Appeal (Civil Division) |
[1974] EWCA Civ J1017-6
In The Supreme Court of Judicature
Court of Appeal
Civil Division
On appeal from Order of Mr Justice Brightman.
Lord Justice Russell,
Lord Justice Cairns and
Sir John Pennycuick
Mr H.G. NARAYAN (instructed by Messrs Suriya & Co.) appeared on behalf of the Appellant (Defendant).
Mr I.H. MAXWELL (instructed by Messrs Hancock & Willis) appeared on behalf of the Respondents (Plaintiffs).
This case below is reported at 1974 1 All England Reports, at page 248, and 1973 3 Weekly Law Reports, 884, and reference may be made to those reports for the details of the case.
Mr Narayan, who has argued the case for the appellant with courtesy and candour allied to pertinacity, has taken number of points, some attacking the validity of the option agreement itself, and a final point, in the alternative, if the option agreement be valid, asserting that specific performance should not be ordered of the contract, constituted by the exercise of the option, for sale and purchase of the property at the price of £10,000.
His first contention is that the option agreement was vitiated by a representation made on behalf of the plaintiffs by Mr Sambruck on the occasion when the agreement was signed by Mr Scott, the representation being to the effect that what he (Mr Scott) was being asked to sign was a document which he would be able to get out of at any time within six weeks of its signature. The Judge's finding that there was no such representation was, it was contended, against the weight of the evidence. This was indeed, with respect, a hopeless point, particularly in the absence of any transcript of evidence. The learned Judge heard the evidence of Mr Sambruck and of Mr Scott; he preferred the evidence of Mr Sambruck where the evidence of the two diverged, and he came not only to the clear conclusion that no such representation had been made in any shape or form, but further that Mr Scott was never under any misapprehension on this point. That attack on the validity of the option agreement, in those circumstances, cannot possibly succeed.
The next attack on the validity of the option agreement was that it was an unconscionable bargain and consequently one that a Court of Equity would not support. I may say at once that there was no evidence or even any suggestion that the price of £ 10,000 was inadequate. Indeed, Mr Scott had successfully stuck out for £1,000 more than his neighbours. Nor, under this head, was any reliance placed on the £1 option money being inadequate consideration for the option. The suggestion mainly made really amounted I think to this, that Mr Sambruck ought to have told this house-painter with a wife and six children that he ought, before signing, to have considered whether if he sold the house he would have enough money to buy himself a suitable house elsewhere. Several cases —and of this I make no complaint — on unconscionable bargains were cited to us. But, in my view, none of them assist. It is perfectly true that Mr Scott cannot read; but there is nothing before us to suggest that he was not intelligent, let alone that he has any weakness of mind. He speaks (according to the learned Judge) and understands English perfectly well. The option agreement was explained to him by his friend and lodger Mr Reid, and I have little doubt that the whole matter of the options on this row of four houses was the subject of much discussion between Mr Scott and his neighbours well before he signed the final document at the price which he thought right. I can find nothing in this case remotely approaching the circumstances in which equity has been prepared to intervene under the general heading of unconscionable bargain.
The third ground of attack on the validity of the option agreement was that the consideration for the grant of the option, stated and paid, namely £1, was a sum which thelaw would not regard as valuable consideration: therefore there was no consideration in the eye of the law to support the obligation on Mr Scott not to withdraw his offer for six months. this I found a startling proposition. The industry of Mr Narayan has not been able to find any support for it in English authority; and his reliance on a Canadian case of Gilohrist v, Sedley. which is reported in (1967) 66 Dominion Law Reports, Second Series, page 24, was based on a misreading, in my view, of the decision in that case, which appears to me to suggest only that possible future obligations which could be avoided by payment of $1 were illusory as consideration.
The situation in this case, therefore, is that the option agreement was valid and effective, it constituted an irrevocable offer to sell (so that Mr Scott's purported rejection of any obligation in his letter in January 1972 was inoperative as a withdrawal of the offer) and, on the exercise of the option, the offer to sell was accepted and the contract for sale and purchase was constituted.
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