Peverel Freehold Ltd v Stonyfield Management Ltd

Peverel Freehold Ltd v Stonyfield Management Ltd

The SML indemnity covenant does not cover liabilities imposed by PF1 on itself after it ceased to be owner and after the liability under the section 106 agreement had accrued; only liabilities arising directly as owner or indirectly as part of the transfer transaction are covered.

Parties
Fourth Defendant/appellant: Peverel Freehold Limited; Fifth Defendant/respondent: Stonyfield Management Ltd
Jurisdiction
England and Wales
Judgment Date
08 November 2012
Procedural Posture
Civil Appeal / Appeal From Chancery Division Judgment
Outcome
Appeal dismissed
Legal Topics
Indemnity Covenants, Section 106 Agreements, Successors in Title, Planning Obligations
Property Law Contract Law Indemnity Covenants Section 106 Agreements Successors in Title Planning Obligations

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Parties

Peverel Freehold Limited

Fourth Defendant/appellant

Stonyfield Management Ltd

Fifth Defendant/respondent

Procedural Posture

Civil Appeal / Appeal From Chancery Division Judgment

Legal Issues

  1. 1 Whether PF1 is entitled to indemnity from SML for liability under section 106 agreement incurred by PF2
  2. 2 Construction of indemnity covenants in property transfers

Ratio Decidendi

The SML indemnity covenant does not cover liabilities imposed by PF1 on itself after it ceased to be owner and after the liability under the section 106 agreement had accrued; only liabilities arising directly as owner or indirectly as part of the transfer transaction are covered.

Court Disposition

Appeal dismissed

Orders

  • Appeal dismissed; judgment of HHJ Purle QC affirmed