ROBERT M. GREER & MARGARET R GREER v. HARTLEY HOLIDAY PARKS LTD & ROYAL BANK OF SCOTLAND PLC [2009] ScotSC 97 (21 April 2009)

ROBERT M. GREER & MARGARET R GREER v. HARTLEY HOLIDAY PARKS LTD & ROYAL BANK OF SCOTLAND PLC [2009] ScotSC 97 (21 April 2009)

Strict compliance with the formal requirements of clause 4.3.1 of the share purchase agreement was required. The seller's failure to submit the profit and loss statement to the buyer's accountants, as specified, meant the deemed finality mechanism could not operate. There was no relevant factual dispute that could affect the outcome, and the pleadings did not justify proof before answer. The action was therefore dismissed as irrelevant.

Citation
[2009] ScotSC 97
Parties
Pursuers and Respondents: Robert M Greer & Margaret R Greer; First Defenders and Appellants: Hartley Holiday Parks Ltd; Second Defenders: The Royal Bank of Scotland PLC
Jurisdiction
Scotland
Judgment Date
21 April 2009
Procedural Posture
Civil Appeal / Appeal Against Interlocutor Allowing Proof Before Answer
Outcome
Appeal sustained; action dismissed
Legal Topics
Contractual Interpretation, Notice Provisions, Share Purchase Agreements, Strict Compliance, Commercial Formalities
Contract Law Commercial Law Contractual Interpretation Notice Provisions Share Purchase Agreements Strict Compliance Commercial Formalities

Case Brief

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Parties

Robert M Greer & Margaret R Greer

Pursuers and Respondents

Hartley Holiday Parks Ltd

First Defenders and Appellants

The Royal Bank of Scotland PLC

Second Defenders

Procedural Posture

Civil Appeal / Appeal Against Interlocutor Allowing Proof Before Answer

Legal Issues

  1. 1 Whether strict compliance with contractual notice/formality provisions is required for a profit and loss statement to become final and binding under a share purchase agreement
  2. 2 Whether submission of the profit and loss statement to the buyer directly, rather than to the buyer's accountants as specified, satisfies the contract
  3. 3 Whether there was sufficient material to justify proof before answer or whether the case should be dismissed on relevancy

Ratio Decidendi

Strict compliance with the formal requirements of clause 4.3.1 of the share purchase agreement was required. The seller's failure to submit the profit and loss statement to the buyer's accountants, as specified, meant the deemed finality mechanism could not operate. There was no relevant factual dispute that could affect the outcome, and the pleadings did not justify proof before answer. The action was therefore dismissed as irrelevant.

Court Disposition

Appeal sustained; action dismissed

Orders

  • Sheriff's interlocutor of 1 December 2008 recalled
  • Plea in law 1 for the first defenders and appellants sustained