Defendant contracting to buy site conditionally upon grant of planning consent for superstore – Defendant undertaking not to make similar application for other sites within specified radius – Defendant in breach of undertaking – Plaintiff instituting summary proceedings for specific relief – Plaintiff limited to interlocutory relief
On 9 January 1998 the defendant agreed to buy from the plaintiff a parcel of land (the New Hall site) located at Rawtenstall, Lancashire. The contract was conditional upon the grant of “satisfactory planning permission” for retail development of the site. By clause 23 the defendant undertook “not at any time prior to completion or termination”…[to] make or support any planning application in respect of any other land within a seven mile radius of the Property for the development of any retail store …”. Planning permission for the New Hall site was refused by the relevant authority in September 1998, but the defendant instituted an appeal, which remained in abeyance at all material times thereafter. On or about 15 October the defendant submitted planning applications for a proposed retail development of a site in Burnley. Upon learning of this matter approximately 10 days later, the plaintiff established that, although the distance by road between the sites was 7.5 miles, the distance as the crow flies was 6.5 miles.
On 18 December 1998 the plaintiff was advised by its solicitor that the defendant was in breach of clause 23. By writ issued on 17 February 1999 the plaintiff sought: (i) summary judgment for specific performance of the contract for sale; (ii) summary judgment for a (permanent) order requiring withdrawal of the Burnley application; and (iii) an interlocutory order requiring such withdrawal. The defendant admitted that it had, albeit inadvertently, breached clause 23, but resisted the first two claims on the ground of delay on the plaintiff’s part, contending that the question of whether the plaintiff was deserving of (discretionary) equitable relief, or should be limited to an award of damages, could only be resolved at a full trial of the action. Further objections were taken to the interlocutory application.
Held: The plaintiff could only claim interlocutory relief .
1. Contrary to the plaintiff’s assertion, the relevant period of delay had to be reckoned, not from the date of its solicitor’s advice, but from the date it had become aware of the facts which had aroused its suspicion: see the authorities considered in Spry on Equitable Remedies at p431. Whether there was a reasonable explanation for the delay, or whether (as the defendant had alleged) the plaintiff was using the time in order to pressure the defendant into buying an alternative site in the Rawtenstall area, could only be determined at a full trial.
2. Although mandatory in form, the interlocutory order sought would do no more than restate the express negative undertaking contained in clause 23, and for that reason should issue as of course unless there were strong reasons to the contrary. The defendant’s problem at the Burnley site was of its own making. Moreover, given that a new store at that site might attract custom away from the proposed store on the New Hall site, and having regard to the undertaking in damages to be required from the plaintiff, the court was not satisfied that the threat posed by the injunction to the defendant’s interests would be disproportionately greater than the harm apprehended by the plaintiff should relief be refused. For similar reasons it was far from certain that the court would, at the conclusion of a full trial, exercise its statutory power to make an award of damages in substitution for an injunction: Jaggard v Sawyer [1995] 1 EGLR 146 considered.
Ian Foster (instructed by Widdows Mason, of Bolton) appeared for the plaintiff; John Furber QC (instructed by Dewar Hogan) appeared for the defendant.
Alan Cooklin, barrister