A case based on a misrepresentation of fact cannot succeed if the alleged implied misrepresentation would have been too vague to have any legal consequences. A statement of opinion may be a misrepresentation if the maker does not in fact hold the opinion stated.
The High Court has dismissed an appeal concerning misrepresentation in auction particulars in Co Mayo Estates Ltd v Hidden Gem Ltd [2024] EWCH 401 (KB).
The case concerned the sale, at an online auction, of three plots of land in Kingswood, Henley on Thames, by the claimant in September 2020. The defendant, the winning bidder, completed the sale of one plot but failed to pay the full deposit for the other two. The claimant claimed the unpaid balance of the deposits.
The defendants sought to rescind the contract for misrepresentation and to recover the sums paid alleging that by referring to “potential” and facilities which future residential occupiers could enjoy together with CGI pictures of possible houses to be built on the plots the claimant represented that the three plots had a real possibility of use for residential development. In fact, all three plots had been wooded continuously since 1600AD, were protected “ancient woodland” and there was no prospect of any permission for development being granted.
The judge found that it had been open to each of the parties to make enquiries as to the planning and development potential and status of the land, that the claimant had not undertaken local searches in relation to the land and was not in a stronger or better position than the defendant to know the facts of the planning position. He was not satisfied that the claimant knew there was no realistic residential development potential.
On the defendant’s appeal the High Court was not persuaded that there was any error in the judge’s findings of fact. The claimant did not have any relevant knowledge about the planning status of the land which was not readily available to the defendant. The judge’s finding that the claimant’s opinion was honestly held was fatal to the defendant’s case in relation to any representation of opinion.
The sales particulars must be read as a whole. References to a plot which “clearly offers a number of opportunities for a purchaser to consider alternative uses or even development, subject to the necessary consents” was too vague or qualified to be a representation of fact and that “buyers are deemed to rely solely on their own enquiries with regard to any development potential“ clearly meant that the vendor was not making any representations about such potential.
Louise Clark is a property law consultant and mediator
