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Rowallan Group Ltd v Edgehill Portfolio No 1 Ltd (2007)

Summary

The claimant had no real prospect of establishing its pleaded case claiming rectification of an agreement for the sale of its lease on the ground of unilateral mistake.

Facts

The applicant (E) applied for summary judgment in respect of the claim of the respondent (R) for the rectification of an agreement that the parties had entered into. By the agreement, R had agreed to sell its lease of business premises to E. In March 2006, heads of terms were agreed. They provided, among other things, that E would pay the outstanding instalments of the premium for the lease. The instalments were in the sum of £65,000 and were payable on April 24 each year. The agreement was completed in June 2006. In May, it had been amended to provide that R would, on completion, supply E with a receipt for the instalment due on April 24, 2006. R sought rectification of the agreement on the ground that it had mistakenly believed that the May amendment did not alter the term previously agreed in the heads of terms that E would be liable to pay the instalment due on April 24, 2006. E argued that R's claim had no real prospect of success.

Held

R had no real prospect of establishing its pleaded case claiming rectification on the ground of unilateral mistake. The amendment on its face plainly and unequivocally imposed the obligation on R to pay the instalment due on April 24, 2006. The critical fact was that the matters which had apparently induced R's solicitor to believe that the amendment had no such effect were matters that had not been disclosed to, and had not been known by, E. Absent that knowledge, there was no reason why E should not have proceeded on the basis that R had known and intended exactly what the amendment provided, namely that R should provide the receipt for payment of the instalment. There had been no sharp practice on E's part and no reason why it could or should have known of or even suspected the pleaded mistake on R's part.

Application granted.

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Judgment
19 Jan 2007

Chancery Division
Lightman J

References
‚Äč[2007] EWHC 32 (Ch)

Members
Michael Pryor

Practice areas
Real Estate