Mespil Ltd v Capaldi

• Jurisdiction: Ireland
• Court: Supreme Court
• Judge: Henchy J.
• Judgment Date: 11 February 1986
• Neutral Citation: 1986 WJSC-SC 1244
• Date: 11 February 1986

1986 WJSC-SC 1244

THE SUPREME COURT

Finlay C.J.

Henchy J.

Griffin J.

No. 10398P/1980

No. 10399P./1980

MESPIL v. CAPALDI

MESPIL LIMITED AND ARAMAIC LIMITED

v.

FRANCIS CAPALDI, PHILIP CAPALDI AND ELIZABETH BOWES

Synopsis:

CONTRACT

Formation

Action - Compromise - Terms of settlement recorded by counsel - Terms ambiguous - Mutual mistake - Counsel not ~ad idem~ - Defendant not bound by settlement - ~See~ Mistake, contract - (74/84 - Supreme Court - 11/2/86) - [1986] ILRM 373

|Mespil Ltd. v. Capaldi|

MISTAKE

Contract

Formation - Action - Compromise - Written settlement of issues between parties - Whether terms of settlement unambiguous - Ejectment for non-payment of rent - Counsel recording terms of settlement - Final settlement of all matters in dispute between the parties "in these proceedings" - Quoted words being added by defendant's counsel at insistence of plaintiff's counsel - Later action by plaintiff against defendant based on alleged breach of covenant relating to user of demised premises - Defendant's counsel believing that settlement covered all causes of action against defendant - Plaintiff's counsel believing that settlement covered only ejectment for non-payment of rent - Held that counsel not ~ad idem~ because of mutual mistake - Held that defendant not bound by settlement - Decision of High Court (10/2/84) reversed - (74/84 - Supreme Court - 11/2/86) [1986] ILRM 373

|Mespil Ltd. v. Capaldi|

ACTION

Compromise

Terms - Ambiguity - Mutual mistake - Parties not ~ad idem~ - Defendant not bound by settlement - ~See~ Mistake, contract - (74/84 - Supreme Court - 11/2/86) - [1986] ILRM 373

|Mespil Ltd. v. Capaldi| [1986] ILRM 373

1 Judgment of Henchy J. delivered the 11th February 1986 [Nem Diss]

2 The plaintiffs in these two consolidated actions are associated companies with common directors and shareholders.

3 In the first action, Mespil Limited claimed against the defendants possession of premises at No. 5 Clare Lane, Dublin. The defendants were tenants from Mespil Limited of those premises under a tenancy agreement which provided that the tenancy could be terminated for non-payment of rent if the rent was in arrear for ten days. It being alleged that the rent had thus fallen into arrear and that a notice terminating the tenancy had been duly served, Mespil Limited claimed possession together with £1,760 arrears of rent and mesne rates up to judgment or possession.

4 In the second action, Aramaic Limited claimed possession of adjacent premises at Nos. 27 and 28 Clare Street. The defendants occupied those premises under a lease which provided that if the rent was in arrear for 21 days the lessor could terminate the lease by service of the prescribed notice. It being alleged that the rent had thus fallen into arrear and that a notice terminating the lease had been duly served, Aramaic Limited claimed, as well as possession, £7,012.50 arrears of rent and mesne rates up to judgment or possession.

5 The two actions were listed for hearing in the High Court on the 15 June 1983. If the hearing had taken place on that day, the two actions would doubtless have been heard together as a consolidated action. On the day before, that is the 14 June, counsel for the defendants approached counsel for the plaintiffs in the Law Library and there was a tentative and inconclusive discussion as to a settlement of the two actions. On the morning of the hearing, that discussion was resumed and, after negotiations which lasted for about an hour and a half, a settlement was agreed between the two counsel (who were not the counsel appearing subsequently in the proceedings). The settlement was reduced to writing by counsel for the defendants and, after three words were interpolated by him in his handwritten draft, at the request of counsel for the plaintiffs, the written settlement was authenticated by the signatures of both counsel. The actions were then adjourned for the implementation of the settlement.

6 The difficulty that has arisen is as to the force and effect that should be given to the purported settlement. In its final form it read:

7 "Full and final settlement of all matters and acts in dispute between the parties:-

8 in these proceedings.

9 1. Payment of £31,000 by Defendants to Plaintiffs payable as to £10,000 on Fri. 17.6.83 balance of £21,000 on 15.7.83.

10 2. Adj. to 15th July 1983 for Mention.

11 If all monies paid - dismissed.

12 If all monies not paid on respective dates:

13 a A. Order for Possession.

14 b B. Balance of monies outstanding - Decree being damages for breach of covenant."

15 The three words I have underlined were inserted as an interlineation at the request of counsel for the...