R & D Construction Group Ltd v. Hallam Land Management Ltd [2010] ScotCS CSIH_96 (10 December 2010)

R & D Construction Group Ltd v. Hallam Land Management Ltd [2010] ScotCS CSIH_96 (10 December 2010)

Clause 4.1.10, properly construed, required the respondent to use all reasonable endeavours to agree a purchase price with the landowner on terms wholly acceptable to itself, but did not require the respondent to facilitate or seek an increased price from the reclaimer or to disclose negotiation details. The clause was sufficiently certain to be enforceable, but on the facts, the respondent was not in breach as it was entitled to require a formal written offer from the reclaimer before agreeing a price with Mrs Kerr, and no such offer was made.

Citation
[2010] ScotCS CSIH_96
Parties
Pursuer and Reclaimer: R & D Construction Group Limited; Defender and Respondent: Hallam Land Management Ltd
Jurisdiction
Scotland
Judgment Date
10 December 2010
Procedural Posture
Civil Appeal (reclaiming Motion) / Inner House, Court of Session (appeal From Lord Ordinary)
Outcome
Reclaiming motion refused; cross-appeal refused.
Legal Topics
Enforceability of Agreements to Agree, Reasonable Endeavours Clauses, Suspensive Conditions, Subjective Satisfaction Clauses
Contract Law Commercial Property Enforceability of Agreements to Agree Reasonable Endeavours Clauses Suspensive Conditions Subjective Satisfaction Clauses

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Parties

R & D Construction Group Limited

Pursuer and Reclaimer

Hallam Land Management Ltd

Defender and Respondent

Procedural Posture

Civil Appeal (reclaiming Motion) / Inner House, Court of Session (appeal From Lord Ordinary)

Legal Issues

  1. 1 Whether clause 4.1.10 of the missives imposed an enforceable obligation on the respondent to use all reasonable endeavours to agree a purchase price with the landowner.
  2. 2 Whether the clause was void for uncertainty or amounted to an unenforceable agreement to agree.
  3. 3 Whether the respondent breached any enforceable obligation under the clause.

Ratio Decidendi

Clause 4.1.10, properly construed, required the respondent to use all reasonable endeavours to agree a purchase price with the landowner on terms wholly acceptable to itself, but did not require the respondent to facilitate or seek an increased price from the reclaimer or to disclose negotiation details. The clause was sufficiently certain to be enforceable, but on the facts, the respondent was not in breach as it was entitled to require a formal written offer from the reclaimer before agreeing a price with Mrs Kerr, and no such offer was made.

Court Disposition

Reclaiming motion refused; cross-appeal refused.

Orders

  • The reclaiming motion by R & D Construction Group Limited is refused.
  • The cross-appeal by Hallam Land Management Ltd is refused.