Zemhunt v Control Securities [1991] ScotCS CSIH_6 (30 October 1991)

Zemhunt v Control Securities [1991] ScotCS CSIH_6 (30 October 1991)

The deposit was a guarantee for performance and not merely an advance part payment; the pursuers were in material breach of contract by failing to pay the purchase price on time; as a result, the deposit is forfeited and not recoverable by the pursuers.

Citation
[1991] ScotCS CSIH_6
Parties
Pursuer: Zemhunt (Holdings) Ltd; Defender: Control Securities plc
Jurisdiction
Scotland
Judgment Date
30 October 1991
Procedural Posture
Civil / Appeal (reclaiming Motion)
Outcome
appeal refused; action dismissed
Legal Topics
Forfeiture of Deposit, Breach of Contract, Restitution, Sale of Heritable Property, Interpretation of Contract Terms
Contract Law Property Law Forfeiture of Deposit Breach of Contract Restitution Sale of Heritable Property Interpretation of Contract Terms

Case Brief

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Parties

Zemhunt (Holdings) Ltd

Pursuer

Control Securities plc

Defender

Procedural Posture

Civil / Appeal (reclaiming Motion)

Legal Issues

  1. 1 Whether the deposit paid by the purchaser is forfeitable upon breach of contract by the purchaser
  2. 2 Whether the purchaser is entitled to restitution of the deposit where the contract is rescinded due to their own breach
  3. 3 Proper construction of the term 'deposit' in the contract

Ratio Decidendi

The deposit was a guarantee for performance and not merely an advance part payment; the pursuers were in material breach of contract by failing to pay the purchase price on time; as a result, the deposit is forfeited and not recoverable by the pursuers.

Court Disposition

appeal refused; action dismissed

Orders

  • Reclaiming motion refused
  • Action dismissed