Harcourt Developments Ltd, Esplanade Financial Centre Ltd, Les Jardins Residential Ltd, Les Jardins Developments (Jersey) Ltd and Harcourt Developments (Jersey) Ltd -v- States of Jersey Development Company Ltd and Minister for Treasury and Resources [2014] JRC 092 (09 April 2014)

Harcourt Developments Ltd, Esplanade Financial Centre Ltd, Les Jardins Residential Ltd, Les Jardins Developments (Jersey) Ltd and Harcourt Developments (Jersey) Ltd -v- States of Jersey Development Company Ltd and Minister for Treasury and Resources [2014] JRC 092 (09 April 2014)

Under Jersey law, a mere agreement to negotiate, even in good faith, is not sufficiently certain to constitute an enforceable contract. The Heads of Terms in this case, while detailed, ultimately committed the parties only to negotiate further terms, and did not provide objective criteria or machinery for resolving outstanding issues. Therefore, no enforceable contract existed between the plaintiffs and WEB, and the claim against the Minister for inducing breach of contract cannot succeed.

Citation
[2014] JRC 092
Parties
Plaintiff: Harcourt Developments Limited and subsidiaries; First Defendant: Waterfront Enterprise Board Limited (WEB); Second Defendant: Minister for Treasury & Resources (the Minister)
Jurisdiction
Jersey
Judgment Date
09 April 2014
Procedural Posture
Strike Out Application / Interlocutory
Outcome
Strike out application granted
Legal Topics
Certainty in Contract Formation, Agreements to Negotiate, Heads of Terms, Tort of Inducing Breach of Contract, Good Faith Negotiation
Contract Law Tort Law Certainty in Contract Formation Agreements to Negotiate Heads of Terms Tort of Inducing Breach of Contract Good Faith Negotiation

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Parties

Harcourt Developments Limited and subsidiaries

Plaintiff

Waterfront Enterprise Board Limited (WEB)

First Defendant

Minister for Treasury & Resources (the Minister)

Second Defendant

Procedural Posture

Strike Out Application / Interlocutory

Legal Issues

  1. 1 Whether an agreement to negotiate in good faith constitutes an enforceable contract under Jersey law
  2. 2 Whether the Heads of Terms between the parties were sufficiently certain to be legally binding
  3. 3 Whether the Minister can be liable for inducing breach of contract if no enforceable contract exists

Ratio Decidendi

Under Jersey law, a mere agreement to negotiate, even in good faith, is not sufficiently certain to constitute an enforceable contract. The Heads of Terms in this case, while detailed, ultimately committed the parties only to negotiate further terms, and did not provide objective criteria or machinery for resolving outstanding issues. Therefore, no enforceable contract existed between the plaintiffs and WEB, and the claim against the Minister for inducing breach of contract cannot succeed.

Court Disposition

Strike out application granted

Orders

  • The amended order of justice is struck out insofar as it claims against the Minister.