Duffy v Ridley Properties Ltd

• Jurisdiction: Ireland
• Judge: Ms. Justice Finlay Geoghegan
• Judgment Date: 07 July 2005
• Neutral Citation: [2005] IEHC 314
• Docket Number: 13120P/2003
• Court: High Court
• Date: 07 July 2005

[2005] IEHC 314

THE HIGH COURT

13120P/2003

Duffy v Ridley Properties Ltd & Anor.

DUFFY v RIDLEY PROPERTIES LTD & STOKES

BETWEEN

DONAL DUFFY

PLAINTIFF

AND

RIDLEY PROPERTIES LIMITED AND EDWARD STOKES

DEFENDANTS

Abstract:

Contract - Specific performance - Terms and conditions - Whether sufficiently certain to justify decree of specific performance - Sale of land - Special condition - Whether complied with - Completion notice - Validity - Whether vendor ready, willing and able to complete sale - Words and phrases - “or thereabouts” - Whether order for specific performance should be granted.

Damages - In lieu of specific performance - Quantum - Loss of bargain.

Facts: the plaintiff signed a contract with the first defendant for the sale to him of a plot of land comprising “2.05 acres or thereabouts”. The parties met on the site for the purposes of marking out the boundaries but could not agree where they should be. Subsequently, the first defendant served a completion notice on the plaintiff which the plaintiff contended was invalid as it was not ready, willing and able to complete the sale. The first defendant then sold on the plot to the second defendant. The plaintiff sought specific performance of the contract and, in the alternative, damages in lieu thereof for, inter alia, loss of bargain.

Held by Finlay Geoghegan J in awarding the plaintiff €880,000 damages in lieu of specific performance that the first defendant was not ready, willing and able to complete the contract for sale as he had failed to comply with a special condition in the contract prior to the service of the completion notice by him.

That the uncertainty surrounding the determination on the ground of the plot to be transferred, in conjunction with the fact that the contract did not provide any mechanism or special condition as to how the boundaries should be defined, was such that the court should exercise its discretion to refuse an order for specific performance and to award the plaintiff damages in lieu thereof.

Notwithstanding that the plaintiff was not entitled to an order for specific performance, as the completion notice was invalid, there remained a subsisting contract in respect of which the plaintiff was entitled to damages in lieu thereof.

That the court, in determining the amount of an award of damages in lieu of specific performance, would take into account the loss of bargain.

That the loss suffered by not getting the property agreed to be sold should be measured at the date of judgment which decides that the claimant should have damages in lieu of specific performance and the loss under that head was the difference between the value of the property at the date of that judgment and the contract price.

Reporter: P.C.

1 Judgment of Ms. Justice Finlay Geoghegan delivered on the 7th day of July 2005

Ms. Justice Finlay Geoghegan

2 The plaintiff's claim is for damages for specific performance of a Contract for Sale which is an agreement in writing dated the 7th May, 2003, made between the plaintiff and the first named defendant whereby the plaintiff agreed to purchase and the defendant agreed to sell the property described in the particulars therein in consideration of €520,000 ("the Contract"). The Contract incorporated the Law Society general conditions of sale. The plaintiff also has ancillary and alternative claims for damages.

3 The proceedings were issued by plenary summons on the 25th November, 2003, against the first named defendant alone. In February, 2004 the plaintiff became aware that the same or substantially the same property was alleged to have been sold by the first named defendant to the second named defendant. On the 2nd November, 2004, an order was made adding the second named defendant to the proceedings.

4 The proceedings were heard before me over four days at the end of April, 2005. During three of those days oral evidence was given by the plaintiff, two directors of the first named defendant, the second named defendant, the solicitor for the plaintiff, the solicitor for the second named defendant, the architect for the plaintiff and the engineer for the first named defendant. In addition all correspondence between the parties, including certain correspondence between the plaintiff and the first named defendant which had been "without prejudice" but in respect of which a claim to privilege was withdrawn, was also agreed as part of the evidence. Likewise the contracts for sale between the plaintiff and the defendant dated the 7th May, 2003, and the first named defendant and second named defendant dated 10th November, 2003, and certain other documents were admitted in evidence.

5 Certain of the facts referred to below were not in dispute. Insofar as facts were in dispute the following statement of the facts includes my findings of fact.

6 The plot of land at issue between the plaintiff and the first named defendant is part only of Folio 12382 Co. Longford. It is situated on the main road at the exit of Edgeworthstown in the direction of Longford. The first named defendant is a development company and owned an adjacent site upon which it was proposing to build houses. Part of the planning permission for such houses required the use of a portion of Folio 12382 as an access road, footpaths and green space.

7 Prior to the sales, the subject matter of these proceedings, the first named defendant had sold a small portion at the south eastern corner of Folio 12382 to Mr. Kane who has an adjacent garage business.

8 Folio 12382 is the site of the old mart in Edgesworthtown. The mart buildings remain on the site.

9 The site had been for sale for approximately two years prior to April, 2003. In April, 2003 the second named defendant made enquiries through his solicitor, Ms. Karen Clabby, about the site. Ms. Clabby inspected the site with an architect and with a Mr. Tom Groarke, a director of the first named defendant. At that time there were no physical features to indicate the proposed boundary on the south western/western/north western side of the site (to which I will hereafter refer to as the western boundary or side) between the portion being sold and that being retained for the access road, footpaths and green area. Further there was no physical boundary identifying the small plot sold to Mr. Kane in the south eastern corner. The southern boundary was identified by the main road and the eastern boundary had a fence. Mr. Groarke put yellow markings at certain points on the site to roughly identify the proposed boundary on the western side of the portion to be sold.

10 The second named defendant agreed a price of €480,000 and paid €20,000 through his solicitor Ms. Clabby to the auctioneers then acting for the first named defendant as a booking deposit. Prior to a Contract in writing being furnished Ms. Clabby was informed by the auctioneers for the first named defendant on 16th April, 2003, that the first named defendant was not proceeding with the sale as there was a dispute between the directors of the first named defendant about the sale. Ms. Clabby confirmed via telephone conversation with Mr. Tom Groarke that the sale was not proceeding by reason of a dispute between the directors.

11 The plaintiff is a supermarket owner. He has what he describes as a small supermarket in the centre of Edgesworthtown. On the 14th April, 2003, he received a phone call from a Mr. Pat McGarry to ask if he was interested in purchasing the mart site and if so he was to ring Mr. John Duffy (no relation) who was a director of the first named defendant. He rang Mr. Duffy on Good Friday. There is disagreement as to precisely how the plaintiff and Mr. Duffy reached agreement on a figure of €520,000 but there is agreement that such a figure was agreed on the following Tuesday or Wednesday. I have concluded on balance that the plaintiff was not made aware at this stage of the precise acreage of 2. 05 acres though as a matter of probability he was aware of the approximate size of the site. He stated in evidence that he had a letter from the auctioneers which referred to 2. 3 acres. I have concluded as a matter of probability that the plaintiff was made aware that the vendor was retaining a portion of the mart site for the purposes of an access road, footpaths and green area but was not made aware by Mr. John Duffy of the yellow markings. The plaintiff was made aware that it was to be a direct sale without the intervention of auctioneers and that it had to be completed within three weeks.

12 The plaintiff instructed Mr. Vincent Crowley of Collins Crowley & Co. , Solicitors. Draft contracts were furnished to him by the first named defendant's solicitors, Kilrane O'Callaghan & Co. , by letter of the 23rd April, 2003, with an indication that they were instructed that the plaintiff would be signing the Contract on Friday 25th April, 2003. The particulars in the draft Contract describe the site being transferred as "2. 05 acres or thereabouts". Prior to signing the Contract the plaintiff was aware of the area of the site being sold and I have concluded had seen the yellow markings on the site but was not told they were definitive boundary marks.

13 The plaintiff's solicitor amended special condition No. 6 (which is not at issue) and special condition No. 7, which related to the wall to be built around the portion being sold to Mr. Kane, which is at issue. The Contracts with such amendment, signed by the plaintiff, and a deposit in the sum of €52,000 were returned on the 28th April, 2003. The Contracts were signed on behalf of the first named defendant on the 7th May, 2003, as returned save that initially the closing date was specified to be 3 weeks from the date of the Contract and it was changed by the first named defendant's solicitors to two weeks with an explanation that one week had already passed since the Contracts had been furnished. No objection...