Burrows Investments Ltd v Ward Homes Ltd

Burrows Investments Ltd v Ward Homes Ltd

The sale of five affordable housing units to AmicusHorizon was not a Permitted Disposal under paragraph (c) of the Sale Agreement, as the clause did not extend to disposals of completed dwellings (Market Units) for social/community purposes. Ward breached the contract by making the disposal without Burrows' consent or a Deed of Covenant. Burrows is entitled to damages on a negotiating (Wrotham Park) basis for the lost opportunity to negotiate a release from the restriction, even though no actual overage was payable.

Parties
Appellant/claimant: Burrows Investments Limited; Respondent/defendant: Ward Homes Limited
Jurisdiction
England and Wales
Judgment Date
20 October 2017
Procedural Posture
Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal
Outcome
Appeal allowed on both grounds.
Legal Topics
Interpretation of Contracts, Overage Agreements, Permitted Disposals, Damages for Breach of Contract, Negotiating Damages (wrotham Park Damages)
Contract Law Property Law Interpretation of Contracts Overage Agreements Permitted Disposals Damages for Breach of Contract Negotiating Damages (wrotham Park Damages)

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Parties

Burrows Investments Limited

Appellant/claimant

Ward Homes Limited

Respondent/defendant

Procedural Posture

Civil Appeal / Appeal From High Court (chancery Division) to Court of Appeal

Legal Issues

  1. 1 Whether the sale of five affordable housing units to AmicusHorizon was a 'Permitted Disposal' under the Sale Agreement, specifically under paragraph (c) of the definition.
  2. 2 Whether Burrows is entitled to damages on a negotiating (Wrotham Park) basis for breach of contract.

Ratio Decidendi

The sale of five affordable housing units to AmicusHorizon was not a Permitted Disposal under paragraph (c) of the Sale Agreement, as the clause did not extend to disposals of completed dwellings (Market Units) for social/community purposes. Ward breached the contract by making the disposal without Burrows' consent or a Deed of Covenant. Burrows is entitled to damages on a negotiating (Wrotham Park) basis for the lost opportunity to negotiate a release from the restriction, even though no actual overage was payable.

Court Disposition

Appeal allowed on both grounds.

Orders

  • Declaration that the disposal to AmicusHorizon was not a Permitted Disposal under the Sale Agreement.
  • Case remitted to the High Court for assessment of damages on a negotiating (Wrotham Park) basis if not agreed by the parties.