Bellway Homes Ltd v Beazer Homes Ltd [2011] EWCA Civ 15 (20 January 2011)

Bellway Homes Ltd v Beazer Homes Ltd [2011] EWCA Civ 15 (20 January 2011)

The risk of refusal of planning permission for allocated land passed to Bellway upon disposal under the September 1999 accord. The Shareholders Agreement did not provide for subsequent adjustment or re-allocation in the event of such refusal. The parties, as market professionals, took the risk of developability, and the doctrine of common mistake does not apply. The appeal is allowed and Bellway is not entitled to a further disposal from Middle Warren.

Citation
[2011] EWCA Civ 15
Parties
Claimant: Bellway Homes Ltd; Appellant: Beazer Homes Ltd
Jurisdiction
England and Wales
Judgment Date
20 January 2011
Procedural Posture
Civil Appeal / Court of Appeal Judgment
Outcome
Appeal allowed
Legal Topics
Shareholders Agreement, Joint Venture, Land Disposal, Common Mistake, Planning Permission
Contract Law Property Law Shareholders Agreement Joint Venture Land Disposal Common Mistake Planning Permission

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Parties

Bellway Homes Ltd

Claimant

Beazer Homes Ltd

Appellant

Procedural Posture

Civil Appeal / Court of Appeal Judgment

Legal Issues

  1. 1 Whether Bellway is entitled to a further disposal of land to rectify an imbalance resulting from refusal of planning permission for allocated land under the Shareholders Agreement
  2. 2 Interpretation of clause 3.1(d) of the Shareholders Agreement regarding equality of value in land disposals
  3. 3 Applicability of common mistake doctrine to the allocation of land parcels

Ratio Decidendi

The risk of refusal of planning permission for allocated land passed to Bellway upon disposal under the September 1999 accord. The Shareholders Agreement did not provide for subsequent adjustment or re-allocation in the event of such refusal. The parties, as market professionals, took the risk of developability, and the doctrine of common mistake does not apply. The appeal is allowed and Bellway is not entitled to a further disposal from Middle Warren.

Court Disposition

Appeal allowed

Orders

  • Declaration in favour of Bellway set aside
  • No further disposal of land from Middle Warren to Bellway