The owners of a property near Heathrow Airport have been awarded only nominal damages in a £450,000 negligence claim against solicitor Iliffes Booth Bennett (IBB).
Clarke, the first claimant, claimed that they had suffered a £448,000 loss on the property, Mentone Farm, in Bedfont Road, Stanwell, owing to incorrect advice given by an IBB employee as to the procedure for removing the land from the green belt.
In 1998, the Clarkes had agreed to sell the land to Land Securities subsidiary Ravenseft Industrial Estates Ltd for £1.2m, on the condition that the land was removed from the green belt.
Although Mrs Clarke believed that the process would take only a few months, the local plan was not amended until April 2001. By this time, Clarke argued, the value of the property had increased to £1.72m.
The High Court has held that Clarke’s conveyancer had been negligent in not informing her as to the correct green-belt procedure.
However, the judge held that only nominal damages would be payable because Clarke had failed to show that she would not have signed the sale contract or sold to Ravenseft at that time if she had been informed of the proper procedure.
Ravenseft was first given the option to purchase the land, subject to its removal from the green belt, for £1m. The land formed part of a 35 acre site upon which the company, in a joint venture with Salmon Developments Ltd, intended to construct a warehouse development to serve Heathrow’s terminal 4.
Clarke mistakenly believed that the property would be removed from the green belt upon publication of a planning inspector’s report recommending its exclusion. The report was published in November 1998, but procedural technicalities meant that the land was not excluded until April 2001, when the local plan was amended.
She tried to renegotiate the purchase price, and eventually accepted £1.272m in March 2001. In August, Ravenseft sold the entire site to Scania for £6.5m.
Lawrence Collins LJ held that IBB solicitor Susan Mawson had been under a “duty to understand the contract and its effect”. He maintained that “simply because Clarke had negotiated the term before Mawson was instructed” did not mean that “Mawson’s retainer was limited to dealing with Ravenseft’s enquiries, and drafting or approving the drafting of the documents”.
The judge added: “Nor do I accept that it was no part of the duty of a commercial conveyancer to know or to advise on the procedure for the removal of land from the green belt. All will depend upon the circumstances, but where release from the green belt is one of the important terms of the contract, the circumstances may require that knowledge or advice.”
However, he said that he was satisfied that Clarke was wrong in her claim that, had she known of the green-belt procedures she would not have signed the contract nor sold to the developer at that time.
The amount of nominal damages has yet to be determined.
Clarke and another v Iliffes Booth Bennett and others Chancery Division (Lawrence Collins J) 21 July 2004.
Paul Morgan QC and Greville Healey (instructed by Osmond & Osmond) appeared for the claimants; David Halpern (instructed by Beachcroft Wansbroughs) appeared for the defendants.
References: EGi Legal News 22/07/04
