Sale of land — Contract — Construction — Appellant taking assignment of contract to purchase land — Respondent vendor’s obligation to sell conditional upon purchaser making successful planning application — Purchaser named as original contracting party — Whether meaning of “purchaser” to include assignees — Whether planning application by assignee sufficing — Appeal dismissed
T Ltd entered into an agreement with the respondent, F, to purchase from him a piece of land with development potential at Newton Abbot. The agreement was to remain in force for a limited time, and F’s obligation to sell was conditional upon planning permission being obtained for the land within the period of the contract. However, the agreement provided that F could serve notice at any time requiring T Ltd to complete the purchase. F further undertook not to oppose an application for planning permission by the purchaser. The agreement provided, in a clause defining the terms used, that T Ltd was “hereinafter called the purchaser”. It defined “planning permission” as permission obtained “following a planning application… made by or on behalf of the purchaser”.
T Ltd subsequently granted the appellant, CS Ltd, an assignment of the benefit of the contract. CS Ltd applied for, and was granted, planning permission for the land. It did not notify F of the assignment until much later. F then brought proceedings seeking a declaration that he was not obliged to complete the sale to CS Ltd. He contended that there had not been a successful planning application within the contract period by “the purchaser”, since that term referred solely to T Ltd. The judge accepted that argument and allowed the claim. CS Ltd appealed, contending that “purchaser” had to be taken to mean T Ltd or its assignees.
Held: The appeal was dismissed.
Per Schiemann LJ: The agreement meant exactly what it said, and there was no justification for reading “purchaser” as meaning “T Ltd and its assigns”. T Ltd could assign the benefit of the contract, but any planning application had to be by “the purchaser”, a term that was defined as T Ltd alone. The agreement provided no machinery for a planning application by an assignee. It could not be true that F was under an obligation not to oppose a planning application by a purchaser whose identity was unknown, as had been the case with CS Ltd at the time of its application.
Per Chadwick LJ: The word “purchaser” had to be capable of including someone to whom the benefit of the contract had been assigned, unless the contract were held to be unassignable. However, CS Ltd could not claim to be the purchaser until it had notified F of the assignment. It was clear from the agreement that the parties’ intention was that the identity of the person who could at any time claim to be the purchaser should be known to the vendor. That was important in the context of the obligation not to oppose a planning application by the purchaser, and also in relation to F’s right to serve a notice requiring the purchaser to complete, since F had to know upon whom to serve such a notice. Since CS Ltd had not notified F of the assignment at the time when it applied for planning permission, it could not now require F to complete the sale.
Per Sir Christopher Staughton: The fact that the parties to the agreement were named or labelled did not prevent an assignment of the benefit of the contract. Upon assignment, the parties remained the same, and T Ltd continued to be the purchaser as defined in the agreement. CS Ltd simply took over the entitlement to enforce the rights of the purchaser. Those rights were conditional upon a successful planning application by the purchaser, namely T Ltd, and an application by CS Ltd would not suffice. Accordingly, in the circumstances of the case, the purchaser’s right to completion of the sale had not been triggered, and there was nothing for CS Ltd to enforce: Warner Brothers Records Inc v Rollgreen Ltd [1976] QB 430 distinguished.
Amanda Michaels and Paul Dickens (instructed by Over Taylor Biggs, of Exeter) appeared for the appellant; Leslie Blohm (instructed by Hugh James Ford Simey, of Exmouth) appeared for the respondent.
Sally Dobson, barrister
