Grant v Mchugh

• Jurisdiction: Jamaica
• Court: Court of Appeal (Jamaica)
• Judge: Bingham, J.A.,FORTE, P.,PANTON, J.A.
• Judgment Date: 29 September 2003
• Neutral Citation: JM 2003 CA 38
• Docket Number: Civil Appeal No. 123 of 2000
• Date: 29 September 2003

Court of Appeal

Forte, P.; Bingham, J.A.; Panton, J.A.

Civil Appeal No. 123 of 2000

Grant

and

McHugh

Appearances:

Dr. Lloyd Barnett and Ian G. Wilkinson for the appellant.

Garth McBean instructed by Dunn Cox, for the respondent.

Contract - Agreement for sale of church property — Offer made by vendor to purchase specified property — Terms and conditions of agreement met by this offer — Refusal by respondent to accept offer — Breach of contract — Forfeiture of 59% deposit — Whether there was agreement of sale if the terms were not complied with by the respondent — No conformity with terms of agreement — No concluded contract — Purchaser's conduct not in compliance with contract — Breach of agreement — Judgment for the appellant.

Bingham, J.A.

1 On the aforementioned dates this Court heard submissions in respect of this appeal at the end of which we allowed the appeal and set aside the judgment entered below. We entered judgment for the appellant and ordered costs both here and below to him, such costs to be taxed if not agreed.

2 At the time of handing down our decision we promised to put our reasons in writing. This is a fulfillment of that promise.

3 The matter giving rise to these proceedings arose out of an Agreement for Sale of certain land: situated at 128 Brunswick Avenue, Spanish Town in Saint Catherine. On September 26 1986, the defendant/appellant in his capacity as, and hereinafter described as, the “vendor” of the said property, and, the plaintiff/respondent hereinafter referred to as the “purchaser” executed an Agreement for Sale. The agreement reads as follows:

“AGREEMENT FOR SALE MADE THIS 26TH DAY OF SEPTEMBER 1986 WHEREBY IT IS AGREED AS FOLLOWS:

VENDOR: MR. D.C. GRANT

22 ALEXANDER PLACE, HIGHFIELD

SPANISH TOWN 2.

PURCHASER: MR. D. MCHUGH

22 CLARENCE AVENUE

HAMPTON GREEN, SPANISH TOWN

DESCRIPTION OF

PROPERTY: PORTION OF 128 BRUNSWICK AVE SPANISH TOWN

Further to our many discussions on the subject the conditions of Sale and Agreement are stated hereunder:

It is a vital part of this agreement and should be adhered to, that whatever is the name of your present Assembly “The Church of Jesus - 128 Brunswick Avenue” shall prefix that name.

Further to our talk and subsequent deliberations with my parties concerned the decision was taken to sell the portion of the premises, on which the church building is being constructed, for Two Hundred and Thirty Thousand Dollars ($J230,000.00). A down payment of One Hundred Thousand Dollars (J$100,000.00) is required. However, to conform with your request, we have agreed to accept the down payment in two parts as follows: Eighty Thousand Dollars ($80,000.00) which is to be paid by the 25th instant and Twenty Thousand Dollars ($20,000.00) is to be paid six months from the date of the first down payment. The frontage of this portion of the premises is approximately 83 ft wide, n. side 200 ft and s. side approximately 190 ft. And the church building is 41x105 ft., including office, rest rooms, prayer room, etc.

The portion of the premises on which is the three section shed has a frontage of approximately 60 ft. This portion is not for sale at the present time. But I can assure you that whenever I am ready to dispose of same, if you so desire, you will be given first preference. It will be officially valued and sold to you - “The Church” at a price to be negotiated.

Whenever you have made the first down payment you may start to occupy the premises in accordance with the terms of the Agreement.

After thirty-six months of the final down payment of Twenty Thousand Dollars (J$20,000.00) you should then start paying to the writer, his wife or his daughter Elaine Jones the balance which will be in the form of monthly installments. This payment will cover a period of seven years and conform to the then current mortgage rate of interest, less five percent (5%) given by commercial banks and other similar lending agencies.

If you so desire to close the deal before the prescribed periods a rebate of interest will be given in accordance with that obtained from commercial banks and similar lending agencies. It must also be borne in mind that after the first down payment is made if you failed to pay the final down payment of Twenty Thousand Dollars (420,000.00) within the prescribed six months period, without consultation and agreement, fifty percent (50%) of the first down payment will be regarded as being forfeited, and the whole transaction will become null and void. In such a situation, if you have carried out any improvement on the building, satisfaction would be obtained as stated in the other section of this Agreement.

Please continue to be reminded that the section of the premises on which is the church building was officially valued at Two Hundred and Seventy Thousand Dollars (J$270,000.00) and, it must be remembered that the amount which will be accepted for the portion of the premises represents a very great reduction of that which it is worth, and must be regarded as my extra contribution towards the establishing of the church on site.

It must also be borne in mind that the fees for the government, attorney, et al, must not be part of the, amount which is to be paid to me. You having obtained the premises so cheaply such fees are really infinitesimal indeed. If it is a legal demand that the vendor must pay the fees himself upward adjustment will have to be made to the selling price of the premises to suit the situation.

If at the expiration of the thirty-six months period, plus three months, you fail, without consultation and agreement, to start paying the monthly installment, the amount of One Hundred Thousand Dollars (4100,000.00), which you deposited as down payment will be regarded as being forfeited. Also, the transaction will be considered forfeited if after you have started to pay the monthly installment you, without consultation and agreement, fail to continue to do so for a continuous period of three months or an aggregate of six months.

Upon such eventuality I think that it would be only reasonable to have a valuation carried out on the premises, bearing in mind the improvement that you have made to same over the period, With a view of having it sold to a suitable organism, and reparation made proportionately to all parties concerned, and so bring the matter to satisfaction. Reparation will not be a part of any down payment which will have already been forfeited.

It should be noted that the sale of the church premises does not include any of the material in and outside of the shed, nor any metal, excluding reinforcing steel bars, in and outside of the church building. All material used as decking will be on loan to the purchaser until the slab is casted.

However, the floor tiles - about 1,500 of them, 6” building blocks - about 500 or them and eight sheets of ¹/₂” ply board are included in the sale, also all windows similar to those already installed in the rear section of the church building. It might be necessary for me to inform you that I have title and diagram for the premises; registered at Volume 1143 Folio 80 and it has no encumbrances. The new title will be prepared for you to coincide with the completion of payment.

Signed D.C. Grant

Vendor

Witness

Signed D.L. McHugh

Purchaser

Witness.”

4 The Agreement for Sale was not one drawn up by an attorney-at-law versed and skilled in the art of Conveyancing Law and executed after consultation and negotiation between the parties and their legal advisers. Such a course would have no doubt produced a draft agreement which would then be examined for any changes to be made and arising out of this would have been the final formal contract engrossed drawn up and executed by the parties and their respective attorneys-at-law. The parties for reasons best known to themselves undertook to be their own conveyancers.

5 Following the Agreement for Sale, there was an exchange of letters between the parties. These were concerned at the outset with accusations of a personal nature. Later they related to the subject premises.

6 On September 25, 1987, the purchaser wrote to the appellant making an offer of $50,000.00 to purchase a lot of land referred to as 128A Brunswick Avenue, which was part of the land registered at Volume 1482 Folio 80 but which was not part of the land the subject of the Agreement for Sale (the church land). The vendor had undertaken to give “the right of first preference” to the purchaser if and when he decided to dispose of this portion of the property. This offer of $50,000.00 was rejected by the vendor in a letter dated July 20, 1987. It is of some importance that the Agreement for Sale had provided for an official valuation of this portion of the property carried out by the vendor as a pre-condition of any offer for sale being favourably considered. As the letter stated, the right of first refusal was dependent on the purchaser within two weeks of the receipt of the letter, indicating acceptance of the vendor's offer to purchase the land in question for $70,000.00. If the offer was accepted, the purchaser was required to pay the entire amount within two months of October 7, 1987.

7 The response of the purchaser was to make a counter offer in a letter dated October 30, 1987. He now offered to purchase that portion of the property for $60,000.00.

8 It was following this exchange of correspondence that the purchaser consulted their attorneys-at-law, Milholland Ashenheim & Stone, and by letter dated November 26, 1987 they wrote to the vendor (appellant) a memorandum couched in the following terms:

Mr. D.C. Grant

22 Alexander Place, Highfield

Spanish Town 2

Dear Sir,

Re: 128 & 128A Brunswick Avenue, Spanish Town

We act for Mr. D. L. McHugh and have been instructed to represent our client in connection with the purchase of the abovementioned premises

We would be grateful if you would let us have a copy of the title or titles...