Wickens v Cheval Property Developments Ltd
| Jurisdiction | England & Wales |
| Judge | Judge Purle QC |
| Judgment Date | 08 September 2010 |
| Neutral Citation | [2010] EWHC 2249 (Ch) |
| Docket Number | Case No: 9BM 30408 |
| Court | Chancery Division |
| Date | 08 September 2010 |
[2010] EWHC 2249 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
BIRMINGHAM DISTRICT REGISTRY
Birmingham Civil Justice Centre
Priory Courts
33 Bull Street
BIRMINGHAM B4 6DS
Before: His Honour Judge Purle QC
(Sitting as a High Court Judge)
Case No: 9BM 30408
John Randall QC and Anthony Verduyn (instructed by Moore Brown & Dixon LLP) appeared for the Claimant.
Shail Patel (instructed by Brightstone Law LLP) appeared for the Defendant.
This is the trial of a preliminary issue of construction of an agreement (“the Agreement”) dated 2 nd July 2009 for the sale of a property (“the Property”) known as Earle's Croome Court in Worcestershire. The property is registered. The Claimant was “the Buyer”. The Defendant was “the Seller”, selling as mortgagee in possession. The Property was unoccupied at the date of the Agreement.
At the time of the Agreement, other purchasers were (the Buyer was told by the Seller's agents) interested and he was under pressure to exchange. The purchase price was £1.3 million, having been increased upwards by £100,000 on the day of exchange. The Buyer now seeks an abatement of the purchase price as a large number of items in the Property which the Buyer thought were included in the Agreement were removed by intruders shortly before exchange. There is no suggestion that the Seller removed the items in question, which would (for the main part) but for their removal have passed to the Buyer as fixtures. The remaining missing items would have passed as fittings. As will appear, all fixtures and fittings were included in the sale. The issue is as to whether only those fixtures and fittings remaining at the Property on exchange were included, which is the Seller's case, or whether the fixtures and fittings present on the Buyer's earlier inspection were included, which is the Buyer's case. The Agreement has not yet been completed.
The sale particulars (which the Buyer saw) expressly provided that they were not to form part of a sale contract and that “prospective purchasers must satisfy themselves by inspection or otherwise as to their correctness”. They also provided:
“All fixtures, fittings, chattels and other items not mentioned, are specifically excluded unless otherwise agreed within the sale contract documentation or left in situ and gratis upon completion.”
The Buyer carried out a detailed inspection of the Property over several hours before exchange, on 16 th June 2009. This was before the removal of the items in question. That inspection revealed that some renovation work was needed. For example, part of the fireplace in the hall had been removed and was in that sense damaged, the dining room fireplace was missing and a fender was missing from the Oak Room fireplace. Other fireplaces remained. Those fireplaces, and many of the doors, were notable features of the property. A number of the doors were oak panelled.
There was also a schedule of minor works to be completed under an enforcement notice, of which the Buyer was aware. Nevertheless, the property was habitable. The Buyer intended to move in and carry out renovation works while living there. He now says that the removal of the items from the Property meant that the Property was and is uninhabitable. He also says that the cost of replacing the removed items would be in the region of £300,000. The items removed after his inspection included three fireplaces (in addition to the one the Buyer saw had been removed when he inspected the Property), a large number of doors, kitchen and bathroom equipment, a hot water cylinder, copper piping, a chandelier, carpets and stair rods.
The question of construction I am asked to decide is (somewhat unhelpfully) not defined in the order directing the trial of the issue, which was a consent order. That order merely recited the parties' agreement that “the single issue of construction of the contract be put before the Court for determination at the subsequent trial date”. The point of construction was identified by Mr Randall QC (for the Buyer) in argument by reference to a passage in the witness statement of the Seller's Solicitor as follows:—
“Whether [the Buyer] contracted to buy the fixtures and fittings which had, by the time contracts had been exchanged, been removed from the Property.”
Mr Patel for the Seller did not demur from this formulation of the issue.
It is clear both from the evidence and the contemporaneous correspondence that what the parties had in mind was determination of this issue of construction without the Court having to resolve disputed items of fact. This has the potential to cause difficulty, as there is a dispute of fact as to what the Buyer was told by the Seller about the Property prior to exchange, and (possibly) as to the extent of the Seller's knowledge also. (When I refer here to the Seller, I am referring to its agents, who conducted all negotiations.) What was known to the parties may of course be part of the background bearing upon the issue of construction. Each of the parties contends, however, that the point of construction can be resolved in that party's favour without resolving any disputed issue of fact. In my judgment, it is only if the answer is the same whichever version of the facts is accepted that I can properly proceed to determine this issue. If resolution of the disputed factual issues is needed, then directions will have to be given for pleadings and oral evidence and (possibly) disclosure as well. The matter presently proceeds as a Part 8 claim.
The Agreement incorporated the Standard Conditions of Sale (Third Edition) and a number of Special Conditions, which were to prevail in case of conflict.
The following contractual provisions are material:
(i) The property was described as “Earl's Croome Court, Church Lane, Earl's Croome, Worcester WR8 9DE”.
(ii) Special Condition 4 provided
“The Buyer admits that he has inspected the Property and agrees that he has not been induced into entering into this Contract by reason of any warranty or representation either written or oral and given to him in writing by the Seller or by any other person on the Seller's behalf other than written replies made by the Seller's Solicitors to written enquiries raised by the Buyer's Solicitors or supplied in any Property Information forms.”
(iii) Special Condition 13 provided:
“The sale shall include all fixtures and fittings therein.”
(iv) Special Condition 16 provided:
“The property is sold in its present state and condition.”
(v) Standard Condition 3.2.1. provided:
“The buyer accepts the property in the physical state it is in at the date of contract unless the seller is building or converting it.”
(vi) There was no schedule of fixtures and fittings.
These were not the only provisions of the Agreement referred to in argument, but they seem to me to be the material ones.
Mr Patel, founding himself on Special Condition 13, argued that the fixtures and fittings could only include those still at the Property at the date of exchange, as no contract came into existence until then. This conclusion is apparently reinforced by Special Condition 16, which referred to the “present state and condition” of the property, an expression somewhat wider than Standard Condition 3.2.1. The reference to “state and condition” and not merely “physical state” suggested that something more than condition of repair (or disrepair) was referred to, and was apt to embrace a property from which fixtures had been removed by intruders between inspection and exchange.
In answer to these points, Mr Randall QC placed reliance on the decision of the Court of Appeal in Taylor v Hamer [2002] EWCA Civ 1130; [2003] 1 EGLR 103. In that case, the seller's husband removed 282 square yards of old flagstones from a dog garden after the buyer's initial inspection but before exchange of contracts. He successfully concealed this fact by seeding over the area so that, by the time of a further inspection by the buyer's solicitor, the removal was not obvious. The solicitor, whilst not appreciating that the flagstones had been removed, saw a pile of flagstones on his inspection, and raised an inquiry about them. He was told (deceitfully) that these had not been taken from the property. He was also told that they were not included in the sale, but were to be removed by the seller, as in fact happened.
The agreement in that case contained a deemed inspection clause and Standard Condition 3.2.1 in the same form as it appeared in the Agreement I am considering, but no precise equivalent of Special Condition 16. There was an incomplete (described as “motley”) schedule of fixtures and fittings said to be included or excluded (as the case may be) which did not mention the flagstones. Standard Condition 5.1.1 (which also referred to “physical state … at the date of the contract”) was incorporated. In the present case it is excluded and replaced by something else, which does not shed any light on the issue I have to decide.
There was also an entire agreement clause which precluded reliance on statements or representations other than those contained in written replies to preliminary inquiries. The clause in question, though differently worded, was the broad equivalent of Special Condition 4 in the present case. No issue arises in this case, however, as it did in Taylor v Hamer, in relation to replies to preliminary inquiries.
The Court of Appeal by a majority held that the buyer in Taylor v Hamer had a contractual claim, as the reference to the property being sold should, in the circumstances of that case, be interpreted as meaning the property with the fixtures which the buyer saw on his inspection, or reasonably believed to be included in his sale when he made his initial...
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