Sharma & Anor v Simposh Ltd

Sharma & Anor v Simposh Ltd

Where a deposit is paid under a void oral agreement for the purchase of land, and the vendor performs as agreed by keeping the property off the market and holding the offer open, there is no failure of consideration and the deposit is not refundable if the parties agreed it was non-refundable.

Parties
Claimant/respondent: Mr Rajesh Sharma; Claimant/respondent: Mrs P N Kuruppu; Defendant/appellant: Simposh Limited
Jurisdiction
England and Wales
Judgment Date
23 November 2011
Procedural Posture
Civil Appeal / Appeal From County Court Judgment
Outcome
Appeal allowed; judgment for claimants set aside.
Legal Topics
Deposit in Abortive Land Transaction, Failure of Consideration, Section 2 Law of Property (miscellaneous Provisions) Act 1989, Restitution for Void Contracts
Property Law Restitution Deposit in Abortive Land Transaction Failure of Consideration Section 2 Law of Property (miscellaneous Provisions) Act 1989 Restitution for Void Contracts

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 4 Authorities cited 10 Party arguments 2 Amounts and remedies 3
Sign in to unlock

Parties

Mr Rajesh Sharma

Claimant/respondent

Mrs P N Kuruppu

Claimant/respondent

Simposh Limited

Defendant/appellant

Procedural Posture

Civil Appeal / Appeal From County Court Judgment

Legal Issues

  1. 1 Whether a deposit paid under an oral, void agreement for the purchase of land is refundable when the purchaser withdraws and the vendor has performed as agreed
  2. 2 Whether the doctrine of failure of consideration entitles the purchaser to restitution of the deposit
  3. 3 Whether a non-contractual agreement can validly stipulate for a non-refundable deposit

Ratio Decidendi

Where a deposit is paid under a void oral agreement for the purchase of land, and the vendor performs as agreed by keeping the property off the market and holding the offer open, there is no failure of consideration and the deposit is not refundable if the parties agreed it was non-refundable.

Court Disposition

Appeal allowed; judgment for claimants set aside.

Orders

  • Judgment in favour of claimants set aside
  • Defendant entitled to retain the deposit (except for the undisputed £1,600)