Hildron Finance Ltd v Sunley Holdings Ltd [2010] EWHC 1681 (Ch) (06 July 2010)

Hildron Finance Ltd v Sunley Holdings Ltd [2010] EWHC 1681 (Ch) (06 July 2010)

The Porter's Flat Agreement was frustrated by supervening illegality under the Leasehold Reform, Housing and Urban Development Act 1993, which made it impossible for Hildron to perform its obligations to sell a new long lease of the porter's flat. The contract could not be construed to require payment to Sunley based on the statutory sale of the freehold, as this would impermissibly rewrite the parties' bargain. The agreement was discharged without fault on either side.

Citation
[2010] EWHC 1681 (Ch)
Parties
Part 20 Claimant/respondent: Hildron Finance Limited; Part 20 Defendant/appellant: Sunley Holdings Limited
Jurisdiction
England and Wales
Judgment Date
06 July 2010
Procedural Posture
Appeal / High Court (chancery Division) Appeal From Central London County Court
Outcome
Appeal dismissed
Legal Topics
Frustration of Contract, Overage Agreements, Collective Enfranchisement, Statutory Illegality, Leasehold Reform
Contract Law Property Law Frustration of Contract Overage Agreements Collective Enfranchisement Statutory Illegality Leasehold Reform

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Parties

Hildron Finance Limited

Part 20 Claimant/respondent

Sunley Holdings Limited

Part 20 Defendant/appellant

Procedural Posture

Appeal / High Court (chancery Division) Appeal From Central London County Court

Legal Issues

  1. 1 Whether Sunley Holdings Limited is entitled to an overage payment under the Porter's Flat Agreement following collective enfranchisement and statutory illegality under the Leasehold Reform, Housing and Urban Development Act 1993.
  2. 2 Whether the Porter's Flat Agreement was frustrated by supervening illegality.

Ratio Decidendi

The Porter's Flat Agreement was frustrated by supervening illegality under the Leasehold Reform, Housing and Urban Development Act 1993, which made it impossible for Hildron to perform its obligations to sell a new long lease of the porter's flat. The contract could not be construed to require payment to Sunley based on the statutory sale of the freehold, as this would impermissibly rewrite the parties' bargain. The agreement was discharged without fault on either side.

Court Disposition

Appeal dismissed